Commvault Systems Annual Report 2022

FY2022 Annual Report · Commvault Systems

Loading PDF…

Leading the
way with
Intelligent
Data Services

2022 Annual Report

Commvault is a global leader in data management. Our Intelligent Data Services help
customers do amazing things with data by transforming how they protect, store, and use
it. We provide a simple and unified Data Management Platform that spans our customers’
data estate — regardless of where it lives (on-premises, hybrid, or multi-cloud) or how
it’s structured (legacy applications, databases, VMs, or containers). Commvault solutions
are available through any combination of software subscriptions, integrated appliances,
partner-managed, or Software as a Service via our Metallic portfolio. Over 25 years, more
than 100,000 organizations have relied on Commvault to keep their data secure, assessable,
and ready to drive business growth.

To learn more visit commvault.com

Financial Highlights
(In thousands, except headcount)

INCOME STATEMENT

Revenue

2018

2019

2020

2021

2022

$699,393

$710,957 $670,885 $723,472

$769,591

Non-GAAP operating income(1)

$76,001

$111,928

$87,492

$137,464

$161,682

Non-GAAP operating income margin(1)

10.9%

15.7%

13.0%

19.0%

21.0%

BALANCE SHEET

Cash, cash equivalents, and short-term investments

$462,421 $458,330 $339,727 $397,237 $267,507

Total assets

$818,642 $822,453 $845,076 $904,173 $816,080

SELECTED ADDITIONAL INFORMATION

Net cash provided by operating activities

$84,169

$110,180

$88,464 $123,955

$177,180

Recurring Revenue

Headcount at March 31

$425,452 $486,415 $476,958 $555,783

$620,571

2,839

2,559

2,533

2,671

2,848

(1) Non-GAAP operating results exclude certain expenses, including non-cash stock-based compensation. For a detailed

reconciliation of GAAP and non-GAAP results, please refer to our earnings press releases found on our website.

C OM MVAU LT SYSTEM S, IN C. | 202 2 AN NUAL R EP OR T

369481_COMMVA_INSERT – 8.25” × 10.75”

214750

369481_COMMVA_INSERT

06/30/22

page 01

“We never rest and we

couldn’t do it without you —
our customers, partners,
and shareholders.
Thank you for putting
your trust in us.”
Sanjay Mirchandani, President and CEO

To our shareholders,

I couldn’t be prouder. It takes a lot to sustain and grow
a successful and promising business in our industry.
And Commvault has done it — the proof is in our results.

Last year, our employees weathered the uncertain world around them to deliver the

best year in Commvault’s history. We grew total revenue six percent to $770 million,

software revenue nine percent to $356 million, and subscription software revenue 27%

to $245 million. Their hard work and unwavering dedication to customers have enabled

us to achieve these results. Our Vaulters have my utmost respect and appreciation.

Additionally, we increased the annual recurring revenue (ARR) for our subscription and

software-as-a-service (SaaS) business by 46% year-over-year to $346 million, which

represents 59% of our Total ARR. This critical metric speaks directly to our customer

loyalty and predictability and reaffirms the overall health of our business.

C OM MVAU LT SYSTEM S, IN C. | 202 2 AN NUAL R EP OR T

2022 Highlights

I’m particularly pleased to share that Metallic — the SaaS business we funded, incubated,

and launched internally — hit $50 million in ARR in just six quarters of commercial

availability. Not only is it a hypergrowth addition to our portfolio, but it is introducing

new customers globally to our broader platform of cloud data management software

and SaaS solutions. We call this the Power of AND — and we are offering it when

customers need it most.

Today, organizations live in a dynamic world with multiple generations of data and new

and different workloads onsite, in-flight, and in the cloud. It’s complex, conflicted, and

creates more surface area for bad actors to attack. All of which are converging rapidly

and putting even more pressure on the CIOs, CISOs, and the teams entrusted with

keeping data safe, accessible, and actionable.

To avoid this IT collision, organizations need to be agile. They shouldn’t have to choose

between software and SaaS because they need both. Commvault enables customers

to choose a solution that flexes and scales to meet a multitude of data management

capabilities. If customers want SaaS today but decide to add software onsite

tomorrow, we seamlessly enable it. If customers are moving an enterprise data center

to the cloud, we make it happen while supporting all cloud-native workloads.

We help customers steer clear of an IT collision and provide choice, performance,

flexibility, and peace of mind that their data is secure and readily available.

That is the Power of AND.

C OM MVAU LT SYSTEM S, IN C. | 202 2 AN NUAL R EP OR T

$770M
+6% YoY

2022 REVENUE

$583M
+13%

ANNUALIZED RECURRING
REVENUE (“ARR”)

81%

OF REVENUE IS
RECURRING

10 years

CONSECUTIVE LEADER
in the Gartner Magic Quadrant
for Data Center Backup and
Recovery Solutions

>1,100

PATENTS ISSUED
WORLDWIDE

“ We push ourselves to drive
innovation by expanding
our products and services.
In FY 2022, we invested in
the quality of the products
we produce and acquired
new products to help
better protect and securely
manage data.”

C OM MVAU LT SYSTEM S, IN C. | 202 2 AN NUAL R EP OR T

2023 and Beyond

“ Innovation is at the core of everything we do — which is
why we never stop.”

We believe Commvault is poised for growth in FY’23

We have a rich heritage of building elegant solutions for customers’ hard problems,

which has earned us our place as a “leader” and “outperformer” on the GigaOm

Radar for Hybrid Cloud Data Protection for Enterprise and Small and Medium-

sized Businesses, as well as the highest scores for data center, cloud, and edge

environments in the Gartner 2021 Critical Capabilities for Enterprise Backup and

Recovery Software solutions report.

We continue to innovate to address customers’ most critical and complex data

protection challenges, such as the persistent threat of ransomware. In addition to

enhancing our cloud data management solutions and introducing new services to

help mitigate these threats, we acquired TrapX and began integrating its proactive

deception technology into our Metallic SaaS portfolio. We will be introducing this

groundbreaking integrated offering in early FY’23.

We never rest. Our Vaulters work tirelessly to engineer innovative solutions, to support

and exceed our customers’ expectations, strengthen our go-to-market initiatives, and

to bolster our partner ecosystem. We couldn’t do it without them.

And we couldn’t do it without you — our customers, partners, and shareholders. On

behalf of the entire Commvault team, thank you for putting your trust in us.

Sanjay Mirchandani

President and CEO

C OM MVAU LT SYSTEM S, IN C. | 202 2 AN NUAL R EP OR T

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

☑

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2022
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FORM 10-K

Commission File Number: 1-33026

Commvault Systems, Inc.
(Exact name of registrant as specified in its charter)

Delaware

22-3447504

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

1 Commvault Way
Tinton Falls, New Jersey 07724
(Address of principal executive offices, including zip code)

(732) 870-4000
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Common Stock, $0.01 par value

Trading Symbol(s)
CVLT

Name of each exchange on which registered

The Nasdaq Stock Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨

No þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes þ

No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such
files.) Yes þ

No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an
emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” "smaller reporting company" and “emerging growth
company” in rule 12b-2 of the Exchange Act.

Large accelerated filer

þ Accelerated filer

☐ Non-accelerated filer

☐ Smaller reporting company ☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act ¨

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that
prepared or issued its audit report. ☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐

No þ

As of September 30, 2021, the last business day of the registrant’s most recently completed second fiscal quarter; the aggregate market value of voting
and non-voting common stock held by non-affiliates of the registrant (based upon the closing price of the common stock as reported by The Nasdaq
Stock Market) was approximately $3.4 billion.

As of May 3, 2022, there were 44,602,631 shares of the registrant’s common stock ($0.01 par value) outstanding.

Information required by Part III (Items 10, 11, 12, 13 and 14) is incorporated by reference to portions of the registrant’s definitive Proxy
Statement for its 2022 Annual Meeting of Stockholders (the “Proxy Statement”), which is expected to be filed not later than 120 days after the registrant’s
fiscal year ended March 31, 2022. Except as expressly incorporated by reference, the Proxy Statement shall not be deemed to be part of this report on
Form 10-K.

DOCUMENTS INCORPORATED BY REFERENCE

COMMVAULT SYSTEMS, INC.

FORM 10-K

FISCAL YEAR ENDED MARCH 31, 2022

TABLE OF CONTENTS

Page

Business

Item 1.
Item 1A. Risk Factors
Item 1B. Unresolved Staff Comments
Item 2.

Properties

Legal Proceedings

Mine Safety Disclosures

Item 3.

Item 4.

Item 5.

PART I

PART II

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities

Item 6.

[Reserved]

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Item 8.
Financial Statements and Supplementary Data

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Item 9.
Item 9A. Controls and Procedures
Item 9B. Other Information
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

PART III

Item 10. Directors, Executive Officers and Corporate Governance
Item 11.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder

Executive Compensation

Matters

Item 13. Certain Relationships and Related Transactions, and Director Independence
Item 14. Principal Accountant Fees and Services

Item 15. Exhibits and Financial Statement Schedules
Item 16.

Form 10-K Summary

SIGNATURES

PART IV

FORWARD-LOOKING STATEMENTS

The discussion throughout this Annual Report on Form 10-K contains forward-looking statements. In some
cases, you can identify these statements by our use of forward-looking words such as “may,” “will,” “should,”
“anticipate,” “estimate,” “expect,” “plan,” “believe,” “predict,” “potential,” “project,” “intend,” “could,” "feel" or similar
expressions. In particular, statements regarding our plans, strategies, prospects and expectations regarding our
business are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"). You should be aware that these statements and any other forward-looking
statements in this document reflect only our expectations and are not guarantees of performance. These statements
involve risks, uncertainties and assumptions. Many of these risks, uncertainties and assumptions are beyond our
control and may cause actual results and performance to differ materially from our expectations. Important factors
that could cause our actual results to be materially different
from our expectations include the risks and
uncertainties set forth under the heading “Risk Factors.” Accordingly, you should not place undue reliance on the
forward-looking statements contained in this Annual Report on Form 10-K. These forward-looking statements speak
only as of the date on which the statements were made. We undertake no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information, future events or otherwise, except as required
by law.

References in this Annual Report on Form 10-K to "Commvault," the "Company", "we," "our" or "us" refer to

Commvault Systems, Inc., including as the context requires, its direct and indirect subsidiaries.

Item 1.

Business

Company Overview

PART I

Incorporated in Delaware in 1996, Commvault Systems, Inc. is a global data management company offering

customers enterprise level, intelligent data services via a single platform and unified code base.

We believe in solving hard problems for our customers by enabling our customers to accelerate their digital
transformation in today's ever-evolving workforce. Our product portfolio includes intuitive tools and powerful
machine learning technology that drives automation, reduces complexity, reigns in data fragmentation, and
accelerates a customer’s cloud journey. Our product functionality share the same back-end technologies to deliver
the benefits of a holistic approach to protecting, managing, and securing data. Our products address many aspects
of data management, from data protection and security, to data governance, transformation and insights, while
providing scalability. We believe our technology and professional services provide the broadest set of capabilities in
the industry, which enables customers to efficiently and cost-effectively scale their data on premise or in the cloud.

Products

Commvault provides a portfolio of intelligent data management solutions that help organizations securely
manage their data without increasing costs or complexity. We call the seamless integration of our products the
‘Power of AND’, which creates an intuitive data management experience across customer-managed enterprise
software AND SaaS-delivered cloud native solutions that mitigates data sprawl, facilitates cloud adoption, and
meets customers wherever they are on their journey to modernize and transform their enterprise IT environment.
These offerings are organized into three categories - (1) Data Protection, (2) Data Insights and (3) Data Storage.

All of Commvault's products are managed seamlessly through a single pane of glass called the Commvault
Command Center, which is our user interface for managing data protection and disaster recovery by providing
configuration values and streamlined procedures for data protection and recovery tasks. Customers use the
Command Center to establish their data protection environment, identify content to be protected, and initiate and
monitor backups and restores. The main navigation pane provides customers with easy access to various
components including downloads, forms, analytics, and monitoring. The Command Center provides a controlled
foundation for self-service, helping to reduce the load on administrators and IT support staff.

Data Protection

Commvault Backup and Recovery (“CBR”) is designed to meet the needs of any size business covering
workloads across all
locations: hybrid environments including on-premise and multiple cloud providers; physical
servers; virtual machines; applications and databases; endpoint devices; cloud applications and more. CBR
provides backup, verifiable recovery and cost-optimized cloud workload mobility, helping to ensure data availability,
even across multiple clouds. Our simplified backup and recovery solution allows customers to manage all workloads
– cloud, virtual machines ("VMs"), containers, applications, databases and endpoints – from the Command Center
while flexible copy data management allows users to multi-purpose backed-up data for DevOps, replication and
more, across an entire infrastructure.

Commvault Disaster Recovery (“CDR”) provides an easy-to-use replication and disaster recovery solution
from a single extensible platform, all managed through the Command Center. Commvault’s standalone disaster
recovery solution is both easy to implement and cost-effective. It provides orchestration and automated compliance
reporting,
flexible replication, cost-optimized cloud data mobility, and verifiable recoverability via copy data
management.

Commvault Complete Data Protection is a comprehensive, easy-to-use data protection solution that
combines CBR with CDR. It delivers backup, replication, and disaster recovery for all workloads, on-premises, in the
cloud, across multiple clouds, and in hybrid environments. It provides trusted recovery of data and applications,
virtual machines, and containers, along with verifiable recoverability of replicas, cost-optimized cloud data mobility,
security and resilient ransomware protection, and flexible copy data management to leverage protected data for
DevOps, testing, and analytics.

Data Insights

Commvault's Data Insights portfolio is an integrated family of solutions for actionable insights, combining
Commvault Data Governance, Commvault File Storage Optimization, and Commvault eDiscovery and Compliance.
These solutions can operate independent of Commvault Complete Data Protection or as part of a combined solution
to maximize data management capabilities for any business. This means that customers can gain insights to data
that isn’t managed by Commvault to drive analytics and other tasks.

Data Backup

Hyperscale X

Commvault HyperScale X is an intuitive and easy-to-deploy, scale-out solution that is fully integrated with
Commvault’s intelligent data management platform to help enterprises transition from legacy scale-up
infrastructures. It provides scalability, security and resiliency to accelerate an organization’s digital transformation
journey as they move to hybrid cloud, container and virtualized environments. Its flexible architecture allows
customers to get up and run quickly and scale. HyperScale X technology accelerates hybrid cloud adoption with an
integrated solution that delivers comprehensive data management for all workloads, including containers, VMs and
databases, from a single, extensible platform. With HyperScale X, customers can leverage the entire Commvault
portfolio giving them access to all
functions, and industry leading integration with applications,
databases, public cloud environments, hypervisors, operating systems, NAS systems and primary storage arrays,
is available in two form factors giving customers the flexibility to choose an
wherever the data resides.
implementation based on specific needs and preferences:

the features,

• Commvault HyperScale X Appliance: A fully integrated appliance that streamlines operations and
infrastructure and is ideally suited for smaller deployments with capacity requirements less than 150
terabytes that want the simplicity of an all-in-one integrated appliance from a single vendor.

• Commvault HyperScale X Architecture: Our pre-validated designs for popular server platforms provides
greater flexibility and allows customer to leverage existing vendor relationships and is ideally suited for
larger environments that require greater scale.

Commvault Distributed Storage

Commvault Distributed Storage provides software-defined storage built on HyperScale architecture that
uses modern distributed system techniques to meet our customers primary, secondary and cloud data needs. With
the capability to be deployed on any operating system, hypervisor, container or cloud, this unique platform also has
the versatility to deploy in hyperscale or hyperconverged mode. Commvault Distributed Storage stores, protects and
replicates data across any number of private and public cloud data centers and is integrated into our Hyperscale X
technology. The advanced software stack of Commvault Distributed Storage simplifies all aspects of storage with a
full set of enterprise data capabilities that can be provisioned at the application level and automated.

Metallic Cloud Storage Service

Metallic Cloud Storage Service ("MCSS") is the “easy button” to adopt secure and scalable cloud storage in
minutes, right from the Commvault Command Center — delivering against an organization's hybrid cloud strategy,
without the need for additional cloud expertise. It is an integrated cloud storage target that enables IT organizations
to efficiently adopt cloud storage for Commvault Backup & Recovery or HyperScale X – to ease digital
transformation, save costs, reduce risk and scale.

Metallic Software-as-a-Service

Metallic Software-as-a-Service (“Metallic”) delivers data protection technology with simplicity and agility,
getting companies up and running to protect critical business data within minutes. Powered by Commvault’s
intelligent data management platform, Metallic delivers enterprise-grade data protection on a cloud-delivered
platform, with advanced built-in security controls. Application program interfaces manage functions including billing,
metrics, and identity management. Current Metallic offerings include data protection for Office 365, virtual machines
and Kubernetes, databases, files, Dynamics 365, Salesforce and endpoints.

Professional Services

Commvault offers a wide range of professional services to complement its product portfolio. We offer

multiple levels of customer service that can be tailored to our customers’ needs.

Our customer support services consist of:

•

Real-Time Support. Customers have 24/7 access to support with our support staff available by phone
for first responses and to manage resolutions, and our customers have access to an online support
database for help with troubleshooting and operational questions.
Innovative use of web-based
diagnostic tools provides problem analysis and resolution. Our solution design is also an important
element in our comprehensive customer support, including “root cause” problem analysis, intelligent
alerting and troubleshooting assistance. Our solutions are directly linked to our online support database
allowing customers to analyze problems without engaging our technical support personnel.

Broad Expertise. Our support engineers have extensive knowledge of complex applications, servers
and networks. We proactively take ownership of the customer’s problem, regardless of whether the
issue is directly related to our products or to those of another vendor. We have also developed and
maintain a knowledge library of storage systems and software products to further enable our support
organization to quickly and effectively resolve customer problems.

• Global Operations. We offer global customer support options from physical locations in Tinton Falls,
New Jersey; Reading, United Kingdom; Sydney, Australia; and Bangalore,
India which are
complemented by numerous regional support centers. Our cloud-based support system creates a
virtual global support center combining these locations to allow for the fastest possible resolution times
for customer incidents. We have designed our support infrastructure to be able to scale with the
increasing globalization of our customers.

•

Enhanced Support Options. We offer several enhanced customer support services such as Enterprise
Support. Our Enterprise Support service is for customers with critical support needs and builds on our
24/7 real-time support deliverables and includes various levels of enhanced services to ensure
dedicated support and customized reporting. Enterprise Support adds a specialized team of technical
support engineers, an assigned support account manager and innovative tools to achieve our
customers’ mission.

Our technology consultants ensure customers' environments are
Technology Consulting Services.
designed for optimal results and deliver over the long term by installing, configuring, personalizing and
validating those environments. We also offer architecture design; implementation; personalization; data
migration; and health assessment services.
In addition, we offer customers staff-augmentation options
to assist with rapid expert deployment of the Commvault suite.

Our business consultants provide insights that align to how specific
Business Consulting Services.
businesses gather,
recovery readiness and policy
implementation; private cloud services design; data classification and archive policy implementation;
and operational efficiency assessment services.

retain and employ data. We offer disaster

Education Services. We provide global on- and off-site training, and self-paced online alternatives for
our products.

Remote Managed Services. Commvault Remote Managed Services provides remote monitoring and
management of the Commvault's solutions deployed on a customer's environment. Our engineers
configure, maintain and optimize a customer's Commvault software environment remotely via a secure
connection.

Customers

Our current customer base spans thousands of organizations across a variety of sizes, including large
global enterprise companies, and small or mid-sized businesses and government agencies. We support customers
in a range of
insurance and financial services, government, healthcare,
pharmaceuticals and medical services, technology, legal, manufacturing, utilities and energy.

including banking,

industries,

Strategic Relationships

An important element of Commvault’s strategy is to establish partnerships that support development,
marketing, selling and implementation of our technology solutions. We believe that strategic and technology-based
relationships with industry leaders are fundamental to our success. We have forged numerous relationships with
software application, hardware and cloud vendors to enhance our combined capabilities and to create the optimal
combination of data and information management applications. We believe this approach enhances our ability to
expand our product offerings and customer base and to enter new markets. We have established the following
types of strategic relationships:

Alliance and Technology Partners. We maintain strategic product and technology relationships with major
industry leaders to ensure that our products are integrated with, supported by and add value to our partners’
portfolios. Collaboration with these market leaders allows us to provide applications that enable our customers to
improve data and information management efficiency. We also maintain relationships with a broad range of industry
operating system, application and infrastructure vendors to verify and demonstrate the interoperability of our
portfolio with their equipment and technologies.

Distributors, Value-Added Reseller, Systems Integrator, Corporate Reseller and Original Equipment
Manufacturer Relationships. Our corporate resellers bundle or sell our solutions together with their own products,
and our value-added resellers resell our solutions independently.

In order to broaden our market coverage, we work closely with our global original equipment manufacturer
("OEM") partners, investing significant time and resources to deliver unique, joint solutions incorporating Commvault
solutions. These partners team with our technical, engineering, marketing and sales force to enhance integration,
tuning, operational management, implementation and vision for solutions that are designed to meet current and
future data management needs. Our alliance managers work directly with global OEM partners to design, deliver
and support field activities that make it easier for customers to locate, learn about, and purchase these differentiated
solutions.

Additionally, we have a non-exclusive distribution agreement covering our North American commercial
markets and our U.S. Federal Government markets with Arrow Enterprise Computing Solutions, Inc. ("Arrow"), a
subsidiary of Arrow Electronics, Inc. Arrow's primary role is to enable a more efficient and effective distribution
channel
for our products and services by managing our reseller partners and leveraging their own industry
experience. Sales generated through our distribution agreement with Arrow accounted for 37% of our total revenue
in fiscal 2022 and 36% of our total revenue in fiscal 2021.

Service Provider Partners. Our solutions are the data protection platform for many service providers, which
provide cloud-based solutions to customers worldwide. As companies of all sizes and markets rapidly adopt cloud
infrastructures for cost efficiencies, speed and agility, we remain committed to these strategic relationships to
address this growing trend. Customers looking to move IT operations to the cloud depend on service providers to
migrate, manage and protect their data and cloud infrastructures. We partner with a broad ecosystem of managed
service providers and cloud partners to effectively deliver data management-as-a-service solutions based on
Commvault solutions across geographies, vertical markets and offerings.

Competition

The data storage management market is intensely competitive, highly fragmented and characterized by
either legacy technology or rapidly changing technology and evolving standards. The principal competitive factors in
our industry include product functionality, performance, integration, platform coverage, scalability, price, global sales
infrastructure, technical support, branding and reputation. The ability of major system vendors to bundle solutions is
also a significant competitive factor in our industry.

Our primary competitors in the data and information management software applications market, each of
which has one or more products that compete with a part of or our entire product suite, are Dell-EMC, IBM, Veritas,
Veeam, Rubrik, Cohesity, Druva, Avepoint and Datto.

Some of our competitors have greater financial resources and may have the ability to offer their products at
lower prices than ours. In addition, some have greater name recognition, longer operating histories, substantially
larger technical, sales, marketing and other global resources, and larger installed customer base with broader
product offerings. As a result, these competitors can devote greater resources to the development, promotion, sale
and support of their products than we can. Refer to our "Risk Factors" below.

Sales and Marketing

We sell our data management solutions to businesses of all sizes, and government agencies. We sell

through our global direct sales force and partner channels.

We have a variety of marketing programs designed to create brand awareness and market recognition for
our product offerings and sales lead generation. Our marketing efforts include sales campaigns, webinars, active
participation at trade shows, technical conferences and seminars; advertising; content development and distribution;
public relations; social media; industry analyst relations; publication of technical and educational articles in industry
journals; sales training; and preparation of competitive analyses. In addition, our strategic partners augment our
marketing and sales campaigns through seminars, trade shows, joint public relations and advertising campaigns.
Our customers and strategic partners provide references and recommendations that we often feature in external
marketing activities.

Research and Development

Our research and development organization is responsible for the design, development,

testing and
certification of our data management solutions. Our engineering efforts support product development across all
major operating systems, databases, applications and network storage devices. A substantial amount of our
development effort goes into certification, integration and support of our solutions to ensure interoperability with our
strategic partners’ solutions. We have also made substantial investments in the automation of our product test and
quality assurance laboratories.

Technology, Intellectual Property and Proprietary Rights

We believe our solutions are a major differentiator versus our competitors’ portfolios. Our solutions’ unique
indexing, cataloging, data movement, media management and policy technologies are the source of
the
performance, scale, management, cost of ownership benefits and seamless interoperability inherent in all of our
data management solutions. Additional options enable content search, data encryption and auditing features to
support data discovery and compliance. Our success and ability to compete depend on our continued development
and protection of our solutions. We rely primarily on a combination of trade secret, patent, copyright and trademark
laws, as well as contractual provisions, to establish and protect our intellectual property rights.

We patent our technical

infrastructure and key usability and design concepts. Our software’s unique
capabilities are covered by a robust portfolio of over 1,000 patents worldwide. Areas such as data protection,
security, transformation, insights, and compliance and governance, including our Metallic SaaS and HyperScale X
solutions, are core to our competitive advantage. During fiscal year 2022, we were awarded over 120 patents. As of
March 31, 2022, we had 968 issued patents and 381 pending patent applications in the United States, as well as
135 issued patents in foreign countries and 12 pending foreign patent applications. We also have established
proprietary trademark rights in markets across the globe, and Commvault owns hundreds of U.S. and foreign
trademark registrations and pending registration applications. Refer to our “Risk Factors” below.

Government Regulations

The legal environment of technology businesses, both in the United States and internationally, is evolving
rapidly and is often unclear. These topics include data privacy and security, pricing, advertising, taxation, content
regulation and intellectual property ownership and infringement.

We are subject to several local, state, federal and foreign laws and regulations regarding privacy and data
protection. Regulators around the world have adopted or proposed limitations on, or requirements regarding, the
collection, distribution, use, security and storage of personal
information, payment card information or other
confidential information of individuals, and the FTC and many state attorneys general are applying federal and state
consumer protection laws to impose standards on the online collection, use and dissemination of data. In the event
of a security breach, these laws may subject us to incident response, notice and remediation costs. Failure to
safeguard data adequately or to destroy data securely could subject us to regulatory investigations or enforcement
actions under applicable data security, unfair practices or consumer protection laws. The scope and interpretation of
these laws could change and the associated burdens and our compliance costs could increase in the future.

We are also subject to U.S. and foreign laws and regulations that govern or restrict our business and
activities in certain countries and with certain persons,
including the U.S. Commerce Department’s Export
Administration Regulations and economic and trade sanctions regulations maintained by OFAC, as well as anti-
bribery and anti-corruption laws and regulations, including the FCPA and the U.K. Bribery Act.

People

Commvault aims to unlock potential

in data, customers and our employees. To accomplish that, our
employees are empowered to drive innovation and help our customers—by inspiring one another and working to
make what’s already great, even greater—whether that’s product, process or team. As of March 31, 2022, we had
2,848 employees worldwide, including 1,041 in sales and marketing, 763 in research and development, 669 in
customer services and support and 375 in general and administration. Approximately 45% were in the United States
and 55% were located internationally.

Inclusion and Diversity

At Commvault, we believe that diversity is a business imperative at

the heart of our human capital
management strategy. In partnership with our leadership team, we not only drive the ability to be a best-in-class
data management organization but also uphold our value in the marketplace by leading as an employer of choice.
Our commitment is driven and executed by a three-pronged approach to Inclusion and Diversity ("I&D"): Workplace
Inclusion, Workforce Diversity and Personal Accountability.

We continue to elevate our employee engagement efforts – which is the foundation of our approach. We
have implemented an Employee Resource Group (“ERG”) operating model and have established four ERGs for
cross-cultural learning, mentoring and relationship building across employees:

1. CV WIT (Women in Technology),
2. Multi-Culture,
3. LGBTQ+ & Allies, and
4. VALOR (Veterans)

In addition to our continued employee engagement initiatives, we launched a Courageous Conversations
platform. Courageous Conversations was designed as a forum where difficult conversations can be broached in an
open, safe and respectful manner. This platform has become the hub for all I&D related conversations, where
employees and senior leaders share courageous life experiences related to bias and social
injustice. Since its
inception, we have hosted several powerful sessions, each virtually, reaching our workforce around the globe.

We continue to be committed to securing the very best talent, with a concerted effort to expound on and
build an inclusive and diverse pipeline of candidates. We are committed to providing a clear vision to career
progression while investing in the development, creativity and aspirational needs of all employees.

Safety and Well-being

Commvault values its people. We are focused on driving business globally while honoring and caring for the
health and safety of our employees, customers, and partners. Since 2020, the vast majority of our employees
shifted to a remote working environment and have been delivering successful and proactive results ever since. We
continue to monitor the COVID-19 pandemic and are adhering to guidelines set
forth by the World Health
Organization and Centers for Disease Control as we begin to reopen offices. We are committed to creating an
environment that supports our employees’ health and overall well-being, focusing on physical, emotional, financial,
and personal wellness.

Information about our Executive Officers

The following table presents information with respect to our executive officers as of May 3, 2022:

Name
Sanjay Mirchandani

Brian Carolan

Riccardo Di Blasio

Age
57

Position
President and Chief Executive Officer

Chief Financial Officer

Chief Revenue Officer

Sanjay Mirchandani, has served as our President and Chief Executive Officer since February 2019. Prior to
joining Commvault, Mr. Mirchandani served from September 2016 to January 2019 as the Chief Executive Officer of
Puppet, Inc. (“Puppet”), an Oregon-based IT automation company. Mr. Mirchandani joined Puppet in May 2016 as
President and Chief Operating Officer. Mr. Mirchandani brings a wealth of international business experience
through his diverse well-rounded career in technology. Before joining Puppet, from October 2013 to April 2016, Mr.

Mirchandani served as Corporate Senior Vice President and General Manager of Asia Pacific and Japan at
VMware, Inc. and, from June 2006 to October 2013, Mr. Mirchandani held various senior leadership positions at
EMC Corporation, including Chief Information Officer and leader of the Global Centers of Excellence. Prior to that,
Mr. Mirchandani held various positions at Microsoft Corporation and Arthur Andersen LLP. Mr. Mirchandani has a
Master of Business Administration degree from the University of Pittsburgh and a bachelor’s degree in mathematics
from Drew University.

Brian Carolan has served as our Chief Financial Officer since October 2012. Prior to his current role,
Mr. Carolan served as our Vice President, Finance and Chief Accounting Officer from July 2006 until September
2012. He also held the position of Controller from February 2001 until June 2006. Prior to joining Commvault,
Mr. Carolan was with Ernst & Young LLP in its Technology, Communications and Entertainment audit practice from
1993 until January 2001. Mr. Carolan obtained his bachelor’s degree in accounting from Villanova University, his
master’s degree in business administration from New York University and is a certified public accountant in the
State of New Jersey.

Riccardo Di Blasio has served as our Chief Revenue Officer since May 2019. Prior to joining Commvault,
Mr. Di Blasio led DXC Technology as Global Head of Sales for VMware Cloud Platform Services. Prior to that role,
he was Chief Executive Officer at Globetouch, Inc., leading the company growth in the IoT and connected cars
industry from January 2017 until April 2018. He also served as Chief Operating Officer at Cohesity from October
2015 until November 2016, where he significantly grew the sales and support organizations while expanding global
operations and achieving double digit growth in sales. Previous to those positions, he served in various leadership
roles for more than a decade across US and Europe, as Senior Vice President of Sales and Marketing at VMware
and EMC Corporation.

Available Information

Our internet address is www.commvault.com. On the investor relations section of this website, we post
filings as soon as reasonably practicable after they are electronically filed with or furnished to the U.S. Securities
and Exchange Commission ("SEC"), including: our Annual Reports on Form 10-K, our quarterly reports on Form 10-
Q, our current reports on Form 8-K, our proxy statements related to our annual stockholders’ meetings and any
amendment to those reports or statements filed or furnished pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended. All such filings are available on the Investors Relations portion of our web site
free of charge. The contents of our web site are not incorporated by reference into this Form 10-K or in any other
report, statement or document we file with the SEC.

Item 1A.

Risk Factors

You should consider each of the following factors as well as the other information in this Annual Report in
evaluating our business and our prospects. The risks and uncertainties described below are not the only ones we
face. Additional risks and uncertainties not presently known to us or that we currently consider immaterial may also
impair our business operations. If any of the following risks actually occur, our business and financial results could
be harmed. In that case, the trading price of our common stock could decline. You should also refer to the other
information set forth in this Annual Report, including our financial statements and the related notes.

Risks Related to Our Business

We have engaged, and may continue to engage, in strategic acquisitions or transactions, which could have
a material adverse effect on our business, results of operations, financial condition and cash flows.

Acquisitions involve a number of risks, including diversion of management’s attention, ability to finance the
acquisition on attractive terms, failure to retain key personnel or valuable customers, legal liabilities, the need to
amortize acquired intangible assets, and intellectual property ownership and infringement risks, any of which could
have a material adverse effect on our business, results of operations, financial condition and cash flows. Any
additional future acquisitions may also result in the incurrence of indebtedness or the issuance of additional equity
securities.

We could also experience financial or other setbacks if transactions encounter unanticipated problems,
including problems related to execution, integration or underperformance relative to prior expectations. Acquisitions
may not result in long-term benefits to us or we may not be able to further develop the acquired business in the
manner we anticipated.

Following the completion of acquisitions, we may have to rely on the seller to provide administrative and
other support, including financial reporting and internal controls, and other transition services to the acquired
business for a period of time. There can be no assurance that the seller will do so in a manner that is acceptable to
us.

Our industry is intensely competitive, and many of our competitors have greater financial, technical and
sales and marketing resources and larger installed customer bases, which could enable them to compete
more effectively than we do.

The data and information management software market is intensely competitive, highly fragmented and
characterized by rapidly changing technology and evolving standards, changing customer requirements and
frequent new product introductions. Competitors vary in size and in the scope and breadth of the products and
services offered.

The principal competitive factors in our industry include product functionality and integration, platform
coverage, ability to scale, price, worldwide sales infrastructure, global technical support, name recognition and
reputation.
If we are unable to address these factors, our competitive position could weaken and we could
experience a decline in revenues that could adversely affect our business.

It is also costly and time-consuming to change data and information management systems. Most of our new
customers have installed data and information management systems, which gives an incumbent competitor an
advantage in retaining a customer because it already understands the network infrastructure, user demands and
information technology needs of the customer, and also because some customers are reluctant to invest the time
and money necessary to change vendors.

New competitors entering our markets can have a negative impact on our competitive positioning. In
addition, we expect to encounter new competitors as we enter new markets. Furthermore, many of our existing
competitors are broadening their operating systems platform coverage. We also expect increased competition from
OEMs, including those we partner with, and from systems and network management companies, especially those
that have historically focused on the mainframe computer market and have been making acquisitions and
broadening their efforts to include data management and products. We expect that competition will increase as a
result of future industry consolidation. Increased competition could harm our business by causing, among other
things, price reductions of our products, reduced profitability and loss of market share.

We rely on indirect sales channels, such as value-added resellers, systems integrators, corporate resellers,
distributors, and OEMs, for the distribution of our solutions, and the failure of these channels to effectively
sell our solutions could have a material adverse effect on our revenues and results of operations.

We rely significantly on our value-added resellers, systems integrators and corporate resellers, which we
collectively refer to as resellers, for the marketing and distribution of our software applications and services.
Resellers are our most significant distribution channel. However, our agreements with resellers are generally not
exclusive, are generally renewable annually, typically do not contain minimum sales requirements and in many
cases may be terminated by either party without cause. Many of our resellers carry data management solutions that
compete with ours. These resellers may give a higher priority to other software applications, including those of our
competitors, or may not continue to carry data management solutions. If a number of resellers were to discontinue
or reduce the sales of our products, or were to promote our competitors’ products in lieu of our own, it could have a
material adverse effect on our future revenues. Events or occurrences of this nature could seriously harm our sales
and results of operations. If we fail to manage our resellers successfully, there may be conflicts between resellers or
they could fail to perform as we anticipate, including required compliance with the terms and obligations of our
agreement, either of which could reduce our sales or impact our reputation in the market. In addition, we expect that
a portion of our sales growth will depend upon our ability to identify and attract new resellers. Our competitors also
use reseller arrangements and may be more successful in attracting reseller partners and could enter into exclusive
relationships with resellers that make it difficult to expand our reseller network. Any failure on our part to maintain
and/or expand our network of resellers could impair our ability to grow revenues in the future.

Some of our resellers may, either independently or jointly with our competitors, develop and market
solutions that compete with our offerings. If this were to occur, these resellers might discontinue marketing and
distributing our solutions. In addition, these resellers would have an advantage over us when marketing their
competing products and related services because of their existing customer relationships. The occurrence of any of
these events could have a material adverse effect on our revenues and results of operations.

In addition, we have a distribution agreement covering our North American commercial markets and our
U.S. Federal Government market with Arrow. Pursuant to this distribution agreement, Arrow’s primary role is to
enable a more efficient and effective distribution channel for our products and services by managing our resellers
and leveraging their industry experience. Arrow accounted for approximately 37% of our total revenues for fiscal
2022 and 36% of our total revenues for fiscal 2021.
If Arrow was to discontinue or reduce the sales of our solutions
or if our agreement with Arrow was terminated, and if we were unable to take back the management of our reseller
channel or find another North American distributor to replace Arrow, then it could have a material adverse effect on
our future revenues.

Our OEMs sell and integrate our solutions which represents a material portion of our revenues. We have no
control over the shipping dates or volumes of systems these OEMs sell and they have no obligation to sell systems
incorporating our solutions. They also have no obligation to recommend or offer our solutions exclusively or at all.
They have no minimum sales requirements and can terminate our relationship at any time. These OEMs also could
choose to develop their own data management solutions. Our OEM partners compete with one another. If one of
our OEM partners views our arrangement with another OEM as competing, it may decide to stop doing business
with us. Any material decrease in the volume of sales generated by OEMs could have a material adverse effect on
our revenues and results of operations in future periods.

If the cost for maintenance and support agreements, or our term-based subscription licenses, with our
customers is not competitive in the market or if our customers do not renew their agreements either at all,
or on terms that are less favorable to us, our business and financial performance might be adversely
impacted.

Most of our support and maintenance agreements are for a one-year term and thereafter, we pursue
renewal thereof. Historically, such renewals have represented a significant portion of our total revenue. If our
customers do not renew their annual maintenance and support agreements or transition to other products or
services, either at all, or on terms that are less favorable to us, our business and financial performance might be
adversely impacted.

Additionally, a significant amount of our

revenues are from term-based, or subscription license
arrangements. The arrangements are typically one to three years in duration.
If at the end of the initial term,
customers elect to not renew, or they renew terms that are less favorable to us, our business and financial
performance might be adversely impacted.

In periods of volatile economic conditions, our exposure to credit risk and payment delinquencies on our
accounts receivable significantly increases.

Our outstanding accounts receivables are generally not secured. Our standard terms and conditions permit
payment within a specified number of days following the receipt of our solution. Volatile economic conditions,
including those related to the COVID-19 pandemic and its variants, or the war in Ukraine and the global response,
could result in our customers and resellers facing liquidity concerns leading to them not being able to satisfy their
payment obligations to us, which would have a material adverse effect on our financial condition, operating results
and cash flows.

In addition, we have transitioned a more significant percentage of our revenue to subscription, or term
In these arrangements, our customers may pay for solutions over a period of several years.

based, arrangements.
Due to the potential for extended period of collection, we may be exposed to more significant credit risk.

Actual or threatened public health crises could adversely affect our business in a material way.

As a global company, with employees and customers located around the world in a variety of industries, our
performance may be impacted by public health crises, including the COVID-19 pandemic, which has caused global
economic uncertainty. The emergence of a public health threat could pose the risk that our employees, partners,
and clients may be prevented from conducting business activities at full capacity for an indefinite period, due to the
spread of the disease or suggested or mandated by governmental authorities. Moreover, these conditions can affect
the rate of information technology spending and may adversely affect our clients’ willingness to purchase our
solutions, delay prospective clients’ purchasing decisions, reduce the value or duration of their contracts, cause our
clients to request concessions including extended payment terms or better pricing, or affect attrition rates, all of
which could adversely affect our future sales and operating results. The global spread of COVID-19 has created
significant uncertainty, and economic disruption. We have undertaken measures to protect our employees, partners,
and clients, including allowing our employees to work remotely; however, there can be no assurance that these
measures will be sufficient or that we can implement them without adversely affecting our business operations.

We develop solutions that interoperate with certain products, operating systems and hardware developed
by others, and if the developers of those operating systems and hardware do not cooperate with us or we
are unable to devote the necessary resources so that our solutions interoperate with those systems, our
development efforts may be delayed or foreclosed and our business and results of operations may be
adversely affected.

Our solutions operate primarily on the Windows, UNIX, Linux and Novell Netware operating systems; used
in conjunction with Microsoft SQL; and on hardware devices of numerous manufacturers. When new or updated
versions of
is often
these operating systems, solution applications, and hardware devices are introduced,
necessary for us to develop updated versions of our solution applications so that they interoperate properly with
these systems and devices. We may not accomplish these development efforts quickly or cost-effectively, and it is
not clear what the relative growth rates of these operating systems and hardware will be.

If we fail to accurately predict
We sell a backup appliance which integrates our solution with hardware.
manufacturing requirements and manage our supply chain we could incur additional costs or experience
manufacturing delays that could harm our business.

We generally provide forecasts of our requirements to our supply chain partners on a rolling basis. If our
forecast exceeds our actual requirements, a supply chain partner may assess additional charges or we may incur
costs for excess inventory they hold, each of which could negatively affect our gross margins. If our forecast is less
than our actual requirements, the applicable supply chain partner may have insufficient time or components to
produce or fulfill our solutions' requirements, which could delay or interrupt manufacturing of our products or
fulfillment of orders for our solutions, and result in delays in shipments, customer dissatisfaction, and deferral or loss
of revenue. If we fail to accurately predict our requirements, we may be unable to fulfill those orders or we may be
required to record charges for excess inventory. Any of the foregoing could adversely affect our business, financial
condition or results of operations.

We encounter long sales and implementation cycles, particularly for our larger customers, which could
have an adverse effect on the size, timing and predictability of our revenues.

Potential or existing customers, particularly larger enterprise customers, generally commit significant
resources to an evaluation of available solutions and require us to expend substantial time, effort and money
educating them as to the value of our solutions. Sales often require an extensive education and marketing effort.

We could expend significant funds and resources during a sales cycle and ultimately fail to win the
customer. Our sales cycle for all of our products and services is subject to significant risks and delays over which
we have little or no control, including:

•

our customers’ budgetary constraints;

the timing of our customers’ budget cycles and approval processes;

our customers’ willingness to replace their current software solutions;

our need to educate potential customers about the uses and benefits of our solutions; and

the timing of the expiration of our customers’ current agreements for similar solutions.

If our sales cycles lengthen unexpectedly, they could adversely affect the timing of our revenues or increase
costs, which may cause fluctuations in our quarterly revenues and results of operations. Finally,
if we are
in closing sales of our solutions after spending significant funds and management resources, our
unsuccessful
operating margins and results of operations could be adversely impacted, and the price of our common stock could
decline.

We depend on growth in the data management solutions market, and lack of growth or contraction in this
market could have a material adverse effect on our sales and financial condition.

Demand for data management solutions is linked to growth in the amount of data generated and stored,
demand for data retention and management (whether as a result of regulatory requirements or otherwise) and
demand for and adoption of new backup devices and networking technologies. Because our solutions are
concentrated within the data management market, if the demand for backup and data management solutions
devices declines, our sales, profitability and financial condition would be materially adversely affected.

Furthermore,

the data management solutions market

is dynamic and evolving. Our future financial
performance will depend in large part on continued growth in the number of organizations adopting data
management solutions for their environments. The market for data management solutions may not continue to grow
at historic rates, or at all. If this market fails to grow or grows more slowly than we currently anticipate, our sales and
profitability could be adversely affected.

Our complex solutions may contain undetected errors, which could adversely affect not only their
performance but also our reputation and the acceptance of our solutions in the market.

Our complex solutions may contain undetected errors or failures, especially when they are made generally
available or new versions are released. Despite extensive testing by us and customers, we have discovered errors
in our solutions in the past and will do so in the future. As a result of past discovered errors, we experienced delays
and lost revenues while we corrected those solutions. In addition, customers in the past have brought to our
attention “bugs” in our software created by the customers’ unique operating environments, which are often
characterized by a wide variety of both standard and non-standard configurations that make pre-release testing very
difficult and time consuming. Although we have been able to fix these bugs in the past, we may not always be able
to do so. Our solutions may also be subject to intentional attacks by viruses that seek to take advantage of these
bugs, errors or other weaknesses. Any of these events may result in the loss of, or delay in, market acceptance of
our solutions or damage to our reputation, which would seriously harm our sales, results of operations and financial
condition.

We may not receive significant revenues from our current research and development efforts for several
years, if at all.

Developing software is expensive, and the investment in product development may involve a long payback
cycle. Our research and development expenses were $153.6 million, or 20% of our total revenues in fiscal 2022,
$133.4 million, or 18% of our total revenues in fiscal 2021 and $110.0 million, or 16% of our total revenues in fiscal
2020. We believe that we must continue to dedicate a significant amount of resources to our research and
development efforts to maintain our competitive position. However, we may not recognize significant revenues from
these investments for several years, if at all.

Our ability to sell our solutions is highly dependent on the quality of our customer support and professional
services, and failure to offer high quality customer support and professional services would have a material
adverse effect on our sales and results of operations.

Our services include the assessment and design of solutions to meet our customers’ storage management
requirements and the efficient installation and deployment of our software applications based on specified business
objectives. Further, once our software applications are deployed, our customers depend on us to resolve issues
relating to our software applications. A high level of service is critical for the successful marketing and sale of our
software. If we or our partners do not effectively install or deploy our applications, or succeed in helping our
customers quickly resolve post-deployment issues, it would adversely affect our ability to sell software products to
existing customers and could harm our reputation with prospective customers. As a result, our failure to maintain
high quality support and professional services would have a material adverse effect on our sales of software
applications and results of operations.

A portion of our revenue is generated by sales to government entities, which are subject to a number of
challenges and risks.

Sales to U.S. and foreign federal, state, and local governmental agencies account for a portion of our
revenue, and we may in the future increase sales to government entities. This customer base experiences
budgetary constraints or shifts in spending priorities regularly which may adversely affect sales of our solutions to
government entities.

Selling to government entities can be highly competitive, expensive and time consuming, often requiring
significant upfront time and expense without any assurance that we will successfully sell our solutions. Government
entities may require contract terms that differ from our standard terms and conditions including termination rights
favorable for the customer, audit rights, and maintenance of certain security clearances for facilities and employees
which can entail administrative time and effort resulting in costs and delays. Government demand for our solutions
may be more volatile as they are affected by public sector budgetary cycles, funding authorizations, and the
potential for funding reductions or delays, making the time to close such transactions more difficult to predict.

We are subject to several local, state, federal and foreign laws and regulations regarding privacy and data
protection.

In the event of a security breach, these laws may subject us to incident response, notice and remediation
costs. Failure to safeguard data adequately or to destroy data securely could subject us to regulatory investigations
or enforcement actions under applicable data security, unfair practices or consumer protection laws which could
have an adverse effect on our business, financial condition or operating results. The scope and interpretation of
these laws could change and the associated burdens and our compliance costs could increase in the future.

Change in senior management or key personnel could cause disruption in the Company and have a
material effect on our business.

We have had, and could have, changes in senior management which could be disruptive to management
and operations of the Company and could have a material effect on our business, operating results and financial
conditions. Turnover at the senior management level may create instability within the Company, which could impede
the Company’s day-to-day operations. Such instability could impede our ability to fully implement our business plan
and growth strategy, which would harm our business and prospects.

We rely on our key personnel to execute our existing business operations and identify and pursue new
growth opportunities. The loss of key employees could result in significant disruptions to our business, and the

integration and training of replacement personnel could be costly, time consuming, cause additional disruptions to
our business and be unsuccessful.

Borrowing against our revolving credit facility could adversely affect our operations and financial results.

We have a $100 million revolving credit facility. If we were to borrow substantially against this facility the

indebtedness could have adverse consequences, including:

• requiring us to devote a portion of our cash flow from operations to payments of indebtedness, which would
reduce the availability of cash flow to fund working capital requirements, capital expenditures and other
general purposes;

• limiting our flexibility in planning for, or reacting to, general adverse economic conditions or changes in our

business and the industry in which we operate in;

• placing us at a competitive disadvantage compared to our competitors that have less debt; and

• limiting our ability to fund potential acquisitions.

Risks Related to our International Operations

Volatility in the global economy could adversely impact our continued growth, results of operations and our
ability to forecast future business.

As a global company, we have become increasingly subject to the risks arising from adverse changes in
domestic and global economic and political conditions. Uncertainty in the macroeconomic environment and
associated global economic conditions have resulted in volatility in credit, equity, debt and foreign currency markets.

These global economic conditions can result in slower economic activity, decreased consumer confidence,
reduced corporate profits and capital spending, inflation, adverse business conditions and liquidity concerns. There
has also been increased volatility in foreign exchange markets. These factors make it difficult for our customers, our
vendors and us to accurately forecast and plan future business activities. These factors could cause customers to
slow or defer spending on our solutions, which would delay and lengthen sales cycles and negatively affect our
results of operations. If such conditions deteriorate or if the pace of economic recovery is slower or more uneven,
our results of operations could be adversely affected, we may not be able to sustain the growth rates we have
experienced recently, and we could fail to meet the expectations of stock analysts and investors, which could cause
the price of our common stock to decline.

We continue to invest in our business internationally where there may be significant risks with overseas
investments and growth prospects. Increased volatility or declines in the credit, equity, debt and foreign currency
markets in these regions could cause delays in or cancellations of orders. Deterioration of economic conditions in
the countries in which we do business could also cause slower or impaired collections on accounts receivable.

Our international sales and operations are subject to factors that could have an adverse effect on our
results of operations.

We have significant sales and services operations outside the United States and derive a substantial portion
of our revenues from these operations. We also plan to continue to expand our international operations. We
generated approximately 48% of our revenues from outside the United States in both fiscal 2022 and fiscal 2021.
International revenue increased 8% in fiscal 2022 compared to fiscal 2021. Expansion of our international
operations will require a significant amount of attention from our management and substantial financial resources
and might require us to add qualified management in these markets.

In addition to facing risks similar to the risks faced by our domestic operations, our international operations
are also subject to risks related to the differing legal, political, social and regulatory requirements and economic
conditions of many countries, including:

•

adverse effects in economic conditions in the countries in which we operate related specifically to the
COVID-19 pandemic and the governmental regulations put in place as a result of the virus, and the war
in Ukraine;

difficulties in staffing and managing our international operations;

•

foreign countries may impose additional withholding taxes or otherwise tax our foreign income, impose
tariffs or adopt other restrictions on foreign trade or investment, including currency exchange controls;

difficulties in coordinating the activities of our geographically dispersed and culturally diverse
operations;

general economic conditions in the countries in which we operate, including seasonal reductions in
business activity in the summer months in Europe and in other periods in other countries, could have an
adverse effect on our earnings from operations in those countries;

imposition of, or unexpected adverse changes in, foreign laws or regulatory requirements may occur,
including those pertaining to sanctions, export restrictions, privacy and data protection, trade and
employment restrictions and intellectual property protections;

longer payment cycles for sales in foreign countries and difficulties in collecting accounts receivable;

competition from local suppliers;

greater risk of a failure of our employees and partners to comply with both U.S. and foreign laws,
including antitrust regulations, the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act of 2010, and
any trade regulations ensuring fair trade practices;

costs and delays associated with developing solutions in multiple languages; and

political unrest, war or acts of terrorism.

Our business in emerging markets requires us to respond to rapid changes in market conditions in those
markets. Our overall success in international markets depends, in part, upon our ability to succeed in differing legal,
regulatory, economic, social and political conditions. We may not continue to succeed in developing and
implementing policies and strategies that will be effective in each location where we do business. The occurrence of
any of the foregoing factors may have a material adverse effect on our business and results of operations.

We may experience fluctuations in foreign currency exchange rates that could adversely impact our results
of operations.

Our international sales are generally denominated in foreign currencies, and this revenue could be
materially affected by currency fluctuations. Our primary exposure is to fluctuations in exchange rates for the
U.S. dollar versus the Euro and, to a lesser extent, the Australian dollar, British pound sterling, Canadian dollar,
Chinese yuan,
Indian rupee, Korean won and Singapore dollar. Changes in currency exchange rates could
adversely affect our reported revenues and could require us to reduce our prices to remain competitive in foreign
markets, which could also have a material adverse effect on our results of operations. An unfavorable change in the
exchange rate of foreign currencies against the U.S. dollar would result in lower revenues when translated into U.S.
dollars, although operating expenditures would be lower as well.

In recent fiscal years, we have selectively hedged our exposure to changes in foreign currency exchange
rates on the balance sheet. In the future, we may enter into additional foreign currency-based hedging contracts to
reduce our exposure to significant fluctuations in currency exchange rates on the balance sheet, although there can
be no assurances that we will do so. However, as our international operations grow, or if dramatic fluctuations in
foreign currency exchange rates continue or increase or if our hedging strategies become ineffective, the effect of
changes in the foreign currency exchange rates could become material to revenue, operating expenses, and
income.

Risks Related to Information Technology and Security

We may be subject to IT system failures, network disruptions and breaches in data security.

IT system failures, network disruptions and breaches of data security could disrupt our operations by
causing delays or cancellation of customer orders, impeding the delivery of our solutions, negatively affecting
customer support or professional services, preventing the processing of transactions and reporting of financial
results, and disturbing our enterprise resource planning system.
IT system failures, network disruptions and
breaches of data security could also result in the unintentional disclosure of customer or our information as well as
damage our reputation. There can be no assurance that a system failure, network disruption or data security breach
will not have a material adverse effect on our financial condition and operating results.

Bad actors regularly attempt to gain unauthorized access to our IT systems, and many such attempts are
increasingly sophisticated. The perception that the COVID-19 pandemic has made companies’ IT systems more
vulnerable has increased the already significant volume of such attempts. These attempts, which might be related to
industrial, corporate or other espionage, criminal hackers or state-sponsored intrusions, include trying to covertly
introduce malware or ransomware to our environments and impersonating authorized users.

Third-party service providers that we may rely on to back up and process our confidential information may
also be subject to similar threats. Such threats could result in the misappropriation, theft, misuse, disclosure, loss or
destruction of the technology, intellectual property, or the proprietary, confidential or personal information, of us or
our employees, customers, licensees, suppliers or partners, as well as damage to or disruptions in our IT systems.
These threats are constantly evolving,
them or
implementing adequate preventative measures. We seek to detect and investigate all security incidents and to
prevent their recurrence, but attempts to gain unauthorized access to our IT systems or other attacks may be
successful, and in some cases, we might be unaware of an incident or its magnitude and effects.

increasing the difficulty of successfully defending against

Risks Related to Legal Matters

We have been, and may in the future become, involved in litigation that may have a material adverse effect
on our business.

From time to time, we may become involved in various other legal proceedings relating to matters incidental
to the ordinary course of our business, including intellectual property, commercial, product liability, employment,
class action, whistleblower and other litigation and claims, and governmental and other regulatory investigations
and proceedings. Such matters can be time-consuming, divert management’s attention and resources and cause us
to incur significant expenses. Furthermore, because litigation is inherently uncertain, there can be no assurance that
the results of any of these actions will not have a material adverse effect on our business, results of operations or
financial condition.

Risks Related to Tax and Accounting

Our effective tax rate is difficult to project, and changes in such tax rate or adverse results of tax
examinations could adversely affect our operating results.

We are a U.S.-based multinational company subject to tax in multiple U.S. and foreign tax jurisdictions. Our
results of operations would be adversely affected to the extent that our geographical mix of income becomes more
weighted toward jurisdictions with higher tax rates and would be favorably affected to the extent the relative
geographic mix shifts to lower tax jurisdictions. Any change in our mix of earnings is dependent upon many factors
and is therefore difficult to predict.

The process of determining our anticipated tax liabilities involves many calculations and estimates that are
inherently complex and make the ultimate tax obligation determination uncertain. As part of the process of preparing
our consolidated financial statements, we are required to estimate our income taxes in each of the jurisdictions in
which we operate prior to the completion and filing of tax returns for such periods. These estimates involve complex
issues, require extended periods of time to resolve, and require us to make judgments, such as anticipating the
outcomes of audits with tax authorities and the positions that we will take on tax returns prior to our actually
preparing the returns.

Furthermore, our overall effective income tax rate and tax expenses may be affected by various factors in
our business, including changes in our entity structure, geographic mix of income and expenses, tax laws, and
variations in the estimated and actual level of annual profits before income tax.

Our reported financial results may be adversely affected by changes in accounting principles generally
accepted in the United States.

Generally accepted accounting principles in the United States are subject to interpretation by the Financial
Accounting Standards Board,
the SEC, and various bodies formed to promulgate and interpret appropriate
accounting principles. A change in these principles or interpretations could have a significant effect on our reported
financial results, and may even affect
transactions completed before the announcement or
effectiveness of a change.

the reporting of

Risks Related to our Common Stock

Certain provisions of our certificate of formation and our amended and restated bylaws or Delaware law
could prevent or delay a potential acquisition of control of our Company, which could decrease the trading
price of our common stock.

Our certificate of formation, amended and restated bylaws and the laws in the State of Delaware contain
provisions that are intended to deter coercive takeover practices and inadequate takeover bids by making such
practices or bids unacceptably expensive to the prospective acquirer and to encourage prospective acquirers to
negotiate with our Board of Directors rather than to attempt a hostile takeover. Delaware law also imposes
restrictions on mergers and other business combinations between us and any holder of 15% or more of our
outstanding common stock.

We believe that these provisions protect our shareholders from coercive or otherwise unfair takeover tactics
by effectively requiring those who seek to obtain control of the Company to negotiate with our Board of Directors
and by providing our Board of Directors with more time to assess any acquisition of control. However, these
provisions could apply even if an acquisition of control of the Company may be considered beneficial by some
shareholders and could delay or prevent an acquisition of control that our Board of Directors determines is not in the
best interests of our Company and our shareholders.

Although we believe we currently have adequate internal control over financial reporting, we are required to
assess our internal control over financial reporting on an annual basis, and any future adverse results from
such assessment could result in a loss of investor confidence in our financial reports and have an adverse
effect on our stock price.

Management has assessed that our internal control over financial reporting is effective and lacks any
material weaknesses. Such assessment is made through subjective judgment of our management that may be open
to interpretation. The effectiveness of our internal control in the future is subject to the risk that such internal controls
may become inadequate. In the future, if we fail to timely complete this assessment, or if our independent auditors
are unable to express an opinion on the effectiveness of our internal controls, there may be a loss of public
confidence financial reporting, the market price of our stock could decline and we could be subject to regulatory
sanctions or investigations by the Nasdaq Stock Market, the SEC or other regulatory authorities, which would
require additional financial and management resources. Any failure to implement required new or improved controls,
or difficulties encountered in their implementation, could harm our operating results or cause us to fail to timely meet
our regulatory reporting obligations.

We may experience a decline in revenues or volatility in our quarterly operating results, which may
adversely affect the market price of our common stock.

We cannot predict our future quarterly revenues or operating results with certainty because of many factors
outside of our control. A significant revenue or profit decline, lowered forecasts or volatility in our operating results
could cause the market price of our common stock to decline substantially. Factors that could affect our revenues
and operating results include the following:

•

the unpredictability of the timing and magnitude of orders for our solutions, particularly transactions
greater than $100,000 in recent fiscal years, a majority of our quarterly revenues were earned and
recorded near the end of each quarter;

the possibility that our customers may cancel, defer or limit purchases as a result of reduced
information technology budgets;

the possibility that our customers may defer purchases of our solutions in anticipation of new solutions
or updates from us or our competitors;

the ability of our OEMs and resellers to meet their sales objectives;

• market acceptance of our new solutions and enhancements;

•

our ability to control expenses;

changes in our pricing, packaging and distribution terms or those of our competitors; and

•

the demands on our management, sales force and customer services infrastructure as a result of the
introduction of new solutions or updates.

Our expense levels are relatively fixed and are based, in part, on our expectations of future revenues. If
revenue levels fall below our expectations and we are profitable at the time, our net income would decrease
because only a small portion of our expenses varies with our revenues. Therefore, any significant decline in
revenues for any period could have an immediate adverse impact on our results of operations for that period. We
believe that period-to-period comparisons of our results of operations should not be relied upon as an indication of
future performance. Our results of operations could be below expectations of public market analysts and investors
in future periods which would likely cause the market price of our common stock to decline.

The price of our common stock may be highly volatile and may decline regardless of our operating
performance.

The market price of our common stock could be subject to significant fluctuations in response to:

•

variations in our quarterly or annual operating results;

changes in financial estimates, treatment of our tax assets or liabilities or investment recommendations
by securities analysts following our business or our competitors;

the public’s response to our press releases, rumors, our other public announcements and our filings
with the SEC;

changes in accounting standards, policies, guidance or interpretations or principles;

sales of common stock by our directors, officers and significant stockholders;

announcements of technological innovations or enhanced or new products by us or our competitors;

our failure to achieve operating results consistent with securities analysts’ projections;

the operating and stock price performance of other companies that investors may deem comparable to
us;

broad market and industry factors; and

other events or factors, including those resulting from war, incidents of terrorism or responses to such
events.

The market prices of data management solutions companies have been extremely volatile. Stock prices of
many of those companies have often fluctuated in a manner unrelated or disproportionate to their operating
performance. In the past, following periods of market volatility, stockholders have often instituted securities class
action litigation. Securities litigation could have a substantial cost and divert resources and the attention of
management from our business.

General Risks

Our business could be materially and adversely affected as a result of natural disasters, terrorism or other
catastrophic events.

Any economic failure or other material disruption caused by war or natural disasters, including fires, floods,
hurricanes, earthquakes, and tornadoes; power loss or shortages; environmental disasters; telecommunications or
business information systems failures or similar events could also adversely affect our ability to conduct business. If
such disruptions result in cancellations of customer orders or contribute to a general decrease in economic activity
or corporate spending on IT, or impair our ability to meet our customer demands, our operating results and financial
condition could be materially adversely affected.

Our business may be adversely affected by the impact of the war in Ukraine and a widespread outbreak of
contagious diseases, including the COVID-19 pandemic and its variants. These events may cause us or our
customers to temporarily suspend operations and could adversely affect the economies and financial markets of
many countries, resulting in an economic downturn that could affect demand for our solutions, our ability to collect
against existing trade receivables and our operating results.

Item 1B.

Unresolved Staff Comments

None.

Item 2.

Properties

Our principal administrative, sales, marketing, customer support and research and development facility is

located at our owned corporate headquarters in Tinton Falls, New Jersey.

In addition, we have offices in the United States in California and Texas; and outside the United States in
Australia, Austria, Belgium, Brazil, Canada, China, Denmark, France, Germany, Hong Kong, India, Israel, Italy,
Japan, Netherlands, Poland, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Spain, Sweden,
Switzerland, Taiwan, United Arab Emirates, and United Kingdom.

Item 3.

Legal Proceedings

From time to time, we may become involved in legal proceedings arising in the ordinary course of business.
We do not believe that we are currently party to any pending legal action that could reasonably be expected to have
a material adverse effect on our business or operating results.

Item 4.

Mine Safety Disclosures

Not Applicable.

PART II

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities

Market for our Common Stock

Our common stock is listed and traded on The Nasdaq Global Market under the symbol “CVLT”.

Stockholders

As of May 3, 2022, there were approximately 45 holders of our common stock. The number of record
holders does not represent the actual number of beneficial owners of shares of our common stock because shares
are frequently held in street name by securities dealers and others for the benefit of individual owners who have the
right to vote their shares.

Dividend Policy

We have never paid cash dividends on our common stock, and we intend to retain our future earnings, if
any, to fund the growth of our business. We therefore do not anticipate paying any cash dividends on our common
stock in the foreseeable future. Our future decisions concerning the payment of dividends on our common stock will
depend upon our results of operations, financial condition and capital expenditure plans, as well as any other factors
that the Board of Directors, in its sole discretion, may consider relevant.

Stock Performance Graph

The graph set forth below compares the cumulative total stockholder return on our common stock between
March 31, 2017 and March 31, 2022, with the cumulative total return of (i) The Nasdaq Computer Index and (ii) The
Nasdaq Composite Index, over the same period. This graph assumes the investment of $100,000 on March 31,
2017 in our common stock, The Nasdaq Composite Index and The Nasdaq Computer Index, and assumes the
reinvestment of dividends, if any. The graph assumes the initial value of our common stock on March 31, 2017 was
the closing sales price of $50.80 per share.

The comparisons shown in the graph below are based upon historical data. The stock price performance
shown in the graph below is not necessarily indicative of, nor is it intended to forecast, the future performance of our
common stock. Information used in the graph was obtained from Nasdaq, a source we believe to be reliable, but we
are not responsible for any errors or omissions in such information.

The performance graph shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or
otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into
any filing of Commvault under the Securities Act or the Exchange Act.

Commvault

Nasdaq Composite Index

Nasdaq Computer Index

)
s
d
n
a
s
u
o
h
T
n
I
(
$

400

350

300

250

200

150

100

03/31/17

03/31/18

03/31/19

03/31/20

03/31/21

03/31/22

Commvault

Nasdaq Composite Index

Nasdaq Computer Index

3/31/2017

3/31/2018

3/31/2019

3/31/2020

3/31/2021

3/31/2022

100.0

112.6

119.5

126.0

127.4

130.7

140.5

79.7

130.3

157.6

127.0

224.1

276.4

130.6

240.5

332.1

Issuer Purchases of Equity Securities

During the three months ended March 31, 2022, we repurchased $39.8 million of common stock, or
approximately 0.6 million shares, under our repurchase program. During the year ended March 31, 2022, we
repurchased $305.2 million of common stock, or approximately 4.3 million shares, under our repurchase program.

Period

Total number of
shares purchased

Average price
paid per share

Total number of
shares purchased
as part of publicly
announced
programs

Approximate dollar
value of shares that
may yet be purchased
under the program

January 1-31, 2022

February 1-28, 2022

March 1-31, 2022

Three months ended March 31, 2022

277,900

144,900

178,000

600,800

68.15

65.16

64.29

66.29

277,900

144,900

178,000

600,800

*During the fourth quarter of fiscal 2022 we completed a share repurchase program that was commenced in
January 2021. On April 21, 2022 the Board of Directors approved a new share repurchase program of $250.0
million. The Board's authorization has no expiration date.

Item 6.

[Reserved]

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis along with our consolidated financial statements and
the related notes included elsewhere in this Annual Report on Form 10-K. The statements in this discussion
regarding our expectations of our future performance, liquidity and capital resources, and other non-historical
statements are forward-looking statements. These forward-looking statements are subject to numerous risks and
uncertainties, including, but not limited to, the risks and uncertainties described under “Risk Factors” and elsewhere
in this Annual Report on Form 10-K. Our actual results may differ materially from those contained in or implied by
any forward-looking statements.

Overview

Incorporated in Delaware in 1996, Commvault Systems, Inc. is a global data management company offering

customers enterprise level, intelligent data services via a single platform and unified code base.

We believe in solving hard problems for our customers by enabling our customers to accelerate their digital
transformation in today's ever-evolving workforce. Our product portfolio includes intuitive tools and powerful
machine learning technology that drives automation, reduces complexity, reigns in data fragmentation, and
accelerates a customer’s cloud journey. Our product functionality share the same back-end technologies to deliver
the benefits of a holistic approach to protecting, managing, and securing data. Our products address many aspects
of data management from data protection and security, to data governance, transformation and insights, while
providing scalability. We believe our technology and professional services provide the broadest set of capabilities in
the industry, which enables customers to efficiently and cost-effectively scale their data on premise or in the cloud.

Industry

The industry in which we currently operate continues to go through accelerating changes as the result of
compounding data growth and the introduction of new technologies. We are continuing to pursue an aggressive
product development program in both data and information management solutions. Our data management solutions
include not only traditional backup, but also new innovations in de-duplication, data movement, virtualization, snap-
based backups and enterprise reporting. Our information management innovations are primarily in the areas of
archiving, eDiscovery, records management, governance, operational reporting and compliance. We remain
focused on both the data and information management trends in the marketplace and, in fact, a material portion of
our existing research and development expenses are utilized toward the development of such new technologies
discussed above. While we feel confident
these changing industry demands with our
in our ability to meet
Commvault suite and potential future releases, the development, release and timing of any features or functionality
remain at our sole discretion and our solutions or other technologies may not be widely adopted.

Given the nature of the industry in which we operate, our software applications are subject to obsolescence.
We continually develop and introduce updates to our existing software applications in order to keep pace with
evolving industry technologies. In addition, we must address evolving industry standards, changing customer
requirements and competitive software applications that may render our existing software applications obsolete.

For each of our software applications, we provide full support for the current generally available release and
one prior release. When we declare a product release obsolete, a customer notice is delivered twelve months prior
to the effective date of obsolescence announcing continuation of full product support for the first six months. We
provide an additional six months of extended assistance support in which we only provide existing workarounds or
fixes that do not require additional development activity. We do not have existing plans to make any of our software
products permanently obsolete.

Sources of Revenues

We derive a significant portion of our total revenues from sales of licenses of our software applications and
related appliance products. We do not customize our software or products for a specific end-user customer. We sell
our software applications and products to end-user customers both directly through our sales force and indirectly
through our global network of value-added reseller partners, systems integrators, corporate resellers and original
equipment manufacturers. Our software and products revenue was 46% of our total revenues for fiscal 2022, 45%
in fiscal 2021 and 41% in fiscal 2020.

During fiscal 2022, we continued to focus on subscription and other recurring revenue arrangements and
began generating revenue from the renewals of subscription licenses sold in prior years. Any of our licensing
models (capacity, instance based, etc.) can be sold via a subscription arrangement.
In these arrangements the
customer has the right to use the software over a designated period of time. The capacity of the license is fixed and
the customer has made an unconditional commitment to pay. Software revenue in these arrangements is generally
recognized when the software is delivered. During the fiscal year ended March 31, 2022, approximately 69% of
software license revenue was sold under a subscription model. Software license revenue sold under a subscription
model was 59% and 41% in the fiscal years ended March 31, 2021 and 2020, respectively. We also sell to some
customers, primarily managed service providers, via utility, or pay-as-you-go models.
In these arrangements actual
usage is regularly measured and billed. Revenue in these utility arrangements is recognized as the software is
used.

In recent fiscal years, including the periods presented, we generated an average of 80% of our software
and products revenue from our existing customer base and approximately 20% of our software and products
revenue from new customers. In addition, our total software and products revenue in any particular period is, to a
certain extent, dependent upon our ability to generate revenues from large customer software and products deals,
which we refer to as larger deal transactions. Larger deal transactions (transactions greater than $0.1 million of
software and product revenue) represented approximately 72% of our software and products revenue in fiscal 2022,
69% in fiscal 2021 and 65% in fiscal 2020.

Software and products revenue generated through indirect distribution channels accounted for
approximately 90% of total software and products revenue in recent fiscal years. Software and products revenue
generated through direct distribution channels accounted for approximately 10% of total software and products
revenue in recent fiscal years. Deals initiated by our direct sales force are sometimes transacted through indirect
channels based on end-user customer requirements, which are not always in our control and can cause this overall
percentage split to vary from fiscal year to fiscal year. As such, there may be fluctuations in the dollars and
percentage of software and products revenue generated through our direct distribution channels from time to
time. We believe that the growth of our software and products revenue, derived from both our indirect channel
partners and direct sales force, are key attributes to our long-term growth strategy. We intend to continue to invest in
both our channel relationships and direct sales force in the future, but we continue to expect more revenue to be
generated through indirect distribution channels over the long term. The failure of our indirect distribution channels
or our direct sales force to effectively sell our software applications could have a material adverse effect on our
revenues and results of operations.

We have a non-exclusive distribution agreement covering our North American commercial markets and our
U.S. Federal Government market with Arrow Enterprise Computing Solutions, Inc. ("Arrow"), a subsidiary of Arrow
Electronics, Inc. Pursuant to this distribution agreement, Arrow's primary role is to enable a more efficient and
effective distribution channel for our products and services by managing our reseller partners and leveraging their
own industry experience. We generated approximately 37% of our total revenues through Arrow in fiscal 2022,
approximately 36% of our total revenues in fiscal 2021 and approximately 37% of our total revenues in fiscal 2020.
If Arrow was to discontinue or reduce the sales of our products or if our agreement with Arrow was terminated, and if
we were unable to take back the management of our reseller channel or find another North American distributor to
replace Arrow, then it could have a material adverse effect on our future business.

Our services revenue was 54% of our total revenues for fiscal 2022, 55% in fiscal 2021 and 59% in fiscal
2020. Our services revenue is made up of fees from the delivery of customer support and other professional
services, which are typically sold in connection with the sale of our software applications. Customer support
agreements provide technical support and unspecified software updates on a when-and-if-available basis for an
annual fee based on licenses purchased and the level of service subscribed. Other professional services include
consulting, assessment and design services, implementation and post-deployment services and training, all of
which to date have predominantly been sold in connection with the sale of software applications. Metallic, our
software-as-a-service solution, allows customers to use hosted software over the contract period without taking
possession of the software. Revenue related to Metallic is generally recognized ratably over the contract term as
services revenue.

the annual period approaches, we pursue the renewal of

Most of our customer support agreements related to perpetual licenses are for a one-year term. As the end
of
the agreement with the customer. Historically,
maintenance renewals have represented a significant portion of our total revenue. Because of this characteristic of
our business, if our customers choose not to renew their maintenance and support agreements with us on beneficial
terms, or at all, our business, operating results and financial condition could be harmed.

The gross margin of our services revenue was 76% for fiscal 2022, 79% for fiscal 2021 and 78% for fiscal
2020. Overall, our services revenue has lower gross margins than our software and products revenue. The gross
margin of our software and products revenue was 96% for fiscal 2022, 92% for fiscal 2021 and 90% for fiscal 2020.
The increase in gross margin percentage of software and products is a result of reduced sales of hardware
associated with our appliance as well as reduced software royalties associated with sales of HyperScale appliances
and software. With the launch of HyperScale X in the second half of fiscal 2021, we typically sell software to a third
party that sells an integrated appliance to end user customers. As a result, our hardware revenues and cost of sales
have been decreasing.

Description of Costs and Expenses

Our cost of revenues is as follows:

• Cost of Software and Products Revenue, consists primarily of the cost of third-party royalties and other
costs such as media, manuals, translation and distribution costs, and hardware associated with our
appliances; and

• Cost of Services Revenue, consists primarily of salary and employee benefit costs in providing

customer support and other professional services as well as third-party hosting fees.

Our operating expenses are as follows:

• Sales and Marketing, consists primarily of salaries, commissions, employee benefits, stock-based
compensation and other direct and indirect business expenses, including travel and related expenses,
sales promotion expenses, public relations expenses and costs for marketing materials and other
marketing events (such as trade shows and advertising);

• Research and Development, which is primarily the expense of developing new software applications
and modifying existing software applications, consists principally of salaries, stock-based compensation
and benefits for research and development personnel and related expenses; contract labor expense
and consulting fees as well as other expenses associated with the design, certification and testing of
our software applications; and legal costs associated with the patent registration of such software
applications;

• General and Administrative, consists primarily of salaries, stock-based compensation and benefits for
our executive, accounting, human resources,
information systems and other administrative
legal,
personnel. Also included in this category are other general corporate expenses, such as outside legal
and accounting services, compliance costs and insurance; and

• Depreciation and Amortization, consists of depreciation expense primarily for our owned corporate
campus headquarters location, computer equipment we use for information services and in our
development and test labs and amortization of intangible assets.

Foreign Currency Exchange Rates’ Impact on Results of Operations

Sales outside the United States were approximately 48% of our total revenue for both fiscal 2022 and fiscal
2021 and 49% for fiscal 2020. The income statements of our non-U.S. operations are translated into U.S. dollars at
the average exchange rates for each applicable month in a period. To the extent the U.S. dollar weakens against
foreign currencies, the translation of these foreign currency denominated transactions generally results in increased
revenue, operating expenses and income from operations for our non-U.S. operations. Similarly, our revenue,
the U.S. dollar
operating expenses and net
strengthens against foreign currencies.

income will generally decrease for our non-U.S. operations if

Using the average foreign currency exchange rates from fiscal 2021, our software and products revenue
would have been lower by $0.1 million, our services revenue would have been lower by $2.5 million, our cost of
sales would have been lower by $0.3 million and our operating expenses would have been lower by $1.6 million
from non-U.S. operations for fiscal 2022.

In addition, we are exposed to risks of foreign currency fluctuation primarily from cash balances, accounts
to the resulting
receivables and intercompany accounts denominated in foreign currencies and are subject
transaction gains and losses, which are recorded as a component of general and administrative expenses. Net
foreign currency transaction losses in fiscal 2022 were not significant. We recognized net
foreign currency
transaction losses of $1.9 million in fiscal 2021 and gains of $0.4 million in fiscal 2020.

Critical Accounting Policies

In presenting our consolidated financial statements in conformity with U.S. generally accepted accounting
principles, we are required to make estimates and judgments that affect the amounts reported therein. Some of the
estimates and assumptions we are required to make relate to matters that are inherently uncertain as they pertain to
future events. We base these estimates on historical experience and on various other assumptions that we believe
to be reasonable and appropriate. Actual results may differ significantly from these estimates. The following is a
description of our accounting policies that we believe require subjective and complex judgments, which could
potentially have a material effect on our reported financial condition or results of operations.

Revenue Recognition

We account for revenue in accordance with ASC 606, Revenue from Contracts with Customers. Our
revenue recognition policies require us to make significant judgments and estimates. In applying our revenue
recognition policy, we must determine which portions of our revenue are recognized currently (generally software
and products revenue) and which portions must be deferred and recognized in future periods (generally services
revenue). We analyze various factors including, but not limited to, the selling price of undelivered services when
sold on a stand-alone basis, our pricing policies, the credit-worthiness of our customers, and contractual terms and
conditions in helping us to make such judgments about revenue recognition. Changes in judgment on any of these
factors could materially impact the timing and amount of revenue recognized in a given period.

We derive revenue from two primary sources: software and products, and services. Software and products
revenue includes our software and integrated appliances that combine our software with hardware. Services include
customer support
(software updates and technical support), consulting, assessment and design services,
installation services, customer education and Commvault software-as-a-service, which is branded as Metallic.

We sell both perpetual and term-based licenses of our software. We refer to our term-based software
licenses as subscription arrangements. We do not customize our software and installation services are not required.
The software is delivered before related services are provided and is functional without professional services,
updates and technical support. We have concluded that our software licenses (both perpetual and subscription) are
functional intellectual property that is distinct as the user can benefit from the software on its own. Software revenue
for both perpetual and subscription licenses is typically recognized when the software is delivered and/or made
available for download as this is the point the user of the software can direct the use of, and obtain substantially all
of the remaining benefits from the functional intellectual property. We do not recognize software revenue related to
the renewal of subscription software licenses earlier than the beginning of the new subscription period.

Services revenue includes revenue from customer support and other professional services. Customer
support includes software updates on a when-and-if-available basis, telephone support, integrated web-based
support and bug fixes or patches. Commvault sells its customer support contracts as a percentage of net software
purchases the support is related to. Customer support revenue is recognized ratably over the term of the customer
support agreement, which is typically one year. The term of our subscription arrangements is typically three years.

Our other professional services include consulting, assessment and design services, installation services
and customer education. Customer education services include courses taught by our instructors or third-party
contractors. Revenue related to other professional services and customer education services is typically recognized
as the services are performed.

Commvault software-as-a-service, which is branded as Metallic, allows customers to use hosted software
the software. Revenue related to Metallic is generally

over the contract period without
recognized ratably over the contract term as services revenue.

taking possession of

Most of our contracts with customers contain multiple performance obligations. For these contracts, we
account for individual performance obligations separately if they are distinct. The transaction price is allocated to the
separate performance obligations on a relative standalone selling price basis. Standalone selling prices of software
and appliances are typically estimated using the residual approach. Standalone selling prices of services are
typically estimated based on observable transactions when these services are sold on a standalone basis.

Our typical performance obligations include the following:

Performance Obligation

When Performance Obligation
is Typically Satisfied

When Payment is
Typically Due

How Standalone Selling Price is
Typically Estimated

Software and Products Revenue

Software Licenses

Upon shipment or made available for
download (point in time)

Within 90 days of shipment
except for certain
subscription licenses which
are paid for over time

Residual approach

Customer Support Revenue

Software Updates

Ratably over the course of the support
contract (over time)

At the beginning of the
contract period

Observable in renewal
transactions

Customer Support

Ratably over the course of the support
contract (over time)

At the beginning of the
contract period

Observable in renewal
transactions

Other Services Revenue

Other Professional
Services (except for
education services)

As work is performed (over time)

Education Services When the class is taught (point in time)

Within 90 days of services
being performed

Software-as-a-
service (Metallic)

Ratably over the course of the contract
(over time)

Annual or monthly
payments

Observable in transactions
without multiple performance
obligations

Accounting for Income Taxes

Under ASC 740, deferred income taxes arise from temporary differences between the tax basis of assets
and liabilities and their reported amounts. Valuation allowances are established when, in our judgment, it is more
likely than not that deferred tax assets will not be realized. In assessing the need for a valuation allowance, we
legislative
weigh the available positive and negative evidence,
developments, expectations and risks associated with estimates of future pre-tax income, and prudent and feasible
tax planning strategies. We believe that it is more likely than not that we will not realize the benefits of our gross
deferred tax assets and therefore have recorded a valuation allowance to reduce the carrying value of these gross
deferred tax assets, net of the impact of the reversal of taxable temporary differences, to zero. The valuation
allowance is material to our financial statements.
In the future, changes to our estimates regarding the realizability
of our gross deferred tax assets could materially impact our results of operations.

levels of pre-tax income,

including historical

We conduct business globally and as a result, file income tax returns in the United States and in various
state and foreign jurisdictions. In the normal course of business, we are subject to examination by taxing authorities
throughout
including such major jurisdictions as the United States, Australia, Canada, Germany,
the world,
Netherlands and United Kingdom.

Goodwill

We test goodwill for impairment at least annually, on January 1, by performing a quantitative assessment of
whether the fair value of each reporting unit or asset exceeds its carrying amount. We have one reporting unit.
Goodwill is tested at this reporting unit level. This requires us to assess and make judgments regarding a variety of
factors which impact the fair value of the reporting unit or asset being tested, including business plans, anticipated
future cash flows, economic projections and other market data. Because there are inherent uncertainties involved in
these factors, significant differences between these estimates and actual results could result in future impairment
charges and could materially impact our future financial results. During the fourth quarter of 2022, we completed the
annual
the test date,
January 1, 2022.

for goodwill and determined that

it had not been impaired as of

impairment

test

Results of Operations

Fiscal year ended March 31, 2022 compared to fiscal year ended March 31, 2021

Revenues (in millions)

Total Revenues

Software and Products
Revenue

$769.6

$723.5

$356.5

$326.8

Services Revenue

$413.1

$396.6

2022

2021

2022

2021

2022

2021

- Total revenues increased $46.1 million, or 6%

- Software and products revenue represented 46% of our total revenues in fiscal 2022 and 45% of our total
revenues in fiscal 2021. Software and products revenue increased $29.6 million, or 9%, primarily due to the
following:

•

Increase of $30.0 million, or 13%, in larger deal transactions (deals greater than $0.1 million in
software and products revenue);
Increase of 19% in the number of larger deal transactions partially offset by a decrease of 4% in the
average dollar amount of such transactions;
The average dollar amount of larger deal transactions was approximately $320 thousand in fiscal
2022 and approximately $335 thousand in fiscal 2021;
Larger deal transactions represented approximately 72% of our software and products revenue in
fiscal 2022 and 69% of our software and products revenue in fiscal 2021; and
The increase in larger deal transaction revenue was partially offset by a decrease of $0.3 million in
transactions less than $0.1 million.

- Services revenue represented 54% of our total revenues in fiscal 2022 and 55% of our total revenues in
fiscal 2021. Services revenue increased $16.5 million, primarily due to an increase in professional services
and software-as-a-service revenue, partially offset by a decline in customer support revenue.

We track software and products revenue on a geographic basis. The geographic regions that are tracked
are the Americas (United States, Canada, Latin America), EMEA (Europe, Middle East, Africa) and APJ (Australia,
Japan, Southeast Asia, China). Americas, EMEA and APJ represented 59%, 30% and 11% of total software and
products revenue, respectively, for the fiscal year ended March 31, 2022. The year over year increase of software
and products revenue was 15% and 2% in the Americas and in EMEA, respectively, and declined 2% in APJ.

▪

The increase in Americas software and products revenue was primarily due to a 15% increase from larger
deal transactions. This was the result of an increase in the number of transactions compared to the prior
year partially offset by a decrease in average deal size.

EMEA software and products revenue increased primarily as a result of a 13% increase in larger deal
revenue driven by an increase in average deal size.

APJ revenue from deals less than $0.1 million decreased 5% compared to the prior year partially offset by a
1% increase in larger deal transactions.

Our software and products revenue in EMEA and APJ is subject to changes in foreign exchange rates as

more fully discussed above in the “Foreign Currency Exchange Rates’ Impact on Results of Operations” section.

Cost of Revenues and Gross Margin ($ in millions)

Total
Cost of Revenues

Software and Products
Cost of Revenue

$113.9

$109.4

)
s
n
o

i
l
l
i

M
n
I
(
$

)
s
n
o

i
l
l
i

M
n
I
(
$

$14.1

$27.2

Services
Cost of Revenue

$99.8

$82.2

)
s
n
o

i
l
l
i

M
n
I
(
$

2022

2021

2022

2021

2022

2021

Total
Gross Margin

85%

Software and Products
Gross Margin

96%

92%

Services
Gross Margin

76%

79%

2022

2021

2022

2021

2022

2021

- Total cost of revenues increased $4.5 million and represented 15% of our total revenues in both fiscal 2022

and fiscal 2021.

- Cost of software and products revenue decreased $13.2 million and represented 4% of software and
products revenue in fiscal 2022 compared to 8% in fiscal 2021. The decrease was the result of reduced
sales of hardware associated with our appliances as well as reduced software royalties associated with
sales of HyperScale appliances and software. Our appliances are now typically sold by third parties that
integrate our software with hardware.

- Cost of services revenue increased $17.6 million and represented 24% of our services revenue in fiscal
2022 compared to 21% in fiscal 2021. The increase in cost of services revenue related to an increase in the
cost of infrastructure related to our software-as-a-service offerings, as well as an increase in employee
compensation and related expenses compared to the prior year due to temporary pay cuts enacted in 2021.

Operating Expenses ($ in millions)

Sales and Marketing

Research and
Development

General and
Administrative

$341.6

$331.9

)
s
n
o

i
l
l
i

M
n
I
(
$

$153.6

$133.4

)
s
n
o

i
l
l
i

M
n
I
(
$

$103.0

$92.2

)
s
n
o

i
l
l
i

M
n
I
(
$

2022

2021

2022

2021

2022

2021

Sales and Marketing
(as % of Revenues)

Research and
Development
(as % of Revenues)

General and
Administrative
(as % of Revenues)

44%

46%

20%

18%

2022

2021

2022

2021

13%

2022

13%

2021

- Sales and marketing expenses: increased $9.7 million, or 3%, primarily due to an increase in employee

compensation and sales commissions associated with increased revenue.

- Research and development expenses: increased $20.2 million, or 15%, as a result of an increase in

employee compensation and related expenses attributable to the expansion of our engineering group.

•

Increase in employee compensation, including an increase in stock-based compensation of $9.0
million compared to prior year.
Investing in research and development has been a priority for Commvault, and we anticipate
continued spending related to the development of our data management software applications.

- General and administrative expenses: increased $10.8 million, or 12%, primarily due to the following:

•

Increase in employee compensation and related expenses compared to prior year. Stock-based
compensation increased $9.3 million compared to the prior year.
Increase in legal expenses for costs related to intellectual property matters partially offset by $7.9
million of settlement gains netted against related legal expenses.

- Restructuring: Our restructuring plan is intended to increase efficiency in our sales, marketing and
distribution functions as well as reduce costs across all functional areas. Restructuring expenses were $6.2
million and $23.5 million for the years ended March 31, 2022 and 2021, respectively. These restructuring
charges relate primarily to severance and related costs associated with headcount reductions. These
charges include $1.7 million in fiscal 2022 and $2.7 million in fiscal 2021 of stock-based compensation
related to modifications of existing awards granted to certain employees included in the restructuring. We
cannot guarantee the restructuring program will achieve its intended result. Risks associated with this
restructuring program also include additional unexpected costs, adverse effects on employee morale and
the failure to meet operational and growth targets due to the loss of key employees, any of which may
impair our ability to achieve anticipated results of operations or otherwise harm our business.

- Depreciation and amortization expense: decreased $5.0 million, from $14.6 million in fiscal 2021 to $9.7
million in fiscal 2022, driven by the elimination of amortization of intangible assets related to Hedvig due to

their impairment in the second quarter of fiscal 2021. Current year amortization of intangible assets related
to TrapX is $0.2 million.

Interest Income

Interest income decreased $0.3 million, from $1.0 million in fiscal 2021 to $0.7 million in fiscal 2022

primarily as a result of declines in market interest rates and the amount of invested funds.

Interest Expense

Interest expense increased $0.1 million as a result of entering into a revolving credit facility in fiscal 2022.

Income Tax Expense

Income tax expense was $9.8 million in fiscal 2022 compared to expense of $9.7 million in fiscal 2021. The

income tax expense for the year ended March 31, 2022 relates primarily to current foreign taxes.

Liquidity and Capital Resources

As of March 31, 2022, our cash balance was $267.5 million. In recent fiscal years, our principal source of
liquidity has been cash provided by operations. The amount of cash and cash equivalents held outside of the United
States by our foreign legal entities was approximately $184.0 million. These balances are dispersed across many
international locations around the world. We believe that such dispersion meets the current and anticipated future
liquidity needs of our foreign legal entities. If we need to repatriate funds from outside of the United States, such
repatriation would likely be subject
laws and/or tax consequences including foreign
withholding taxes.

to restrictions by local

On December 13, 2021, we entered into a five-year $100 million senior secured revolving credit facility (the
“Credit Facility”) with J.P. Morgan. The Credit Facility is available for share repurchases, general corporate
purposes, and letters of credit. The Credit Facility contains financial maintenance covenants including a leverage
ratio and interest coverage ratio. The Credit Facility also contains certain customary events of default which would
permit the lender to, among other things, declare all loans then outstanding to be immediately due and payable if
such default is not cured within applicable grace periods. The Credit Facility also limits our ability to incur certain
additional indebtedness, create or permit liens on assets, make acquisitions, make investments, loans or advances,
sell or transfer assets, pay dividends or distributions, and engage in certain transactions with foreign affiliates.
Outstanding borrowings under the Credit Facility accrue interest at an annual rate equal to Secured Overnight
Financing Rate plus 1.25% subject to increases based on our actual leverage. The unused balance on the Credit
Facility is also subject to a 0.25% annual interest charge subject to increases based on our actual leverage. As of
March 31, 2022, there were no borrowings under the Credit Facility and we were in compliance with all covenants.

During the year ended March 31, 2022, we repurchased $305.2 million of common stock, or approximately
4.3 million shares, under our share repurchase program. This program commenced in January of 2021 and was
completed on March 31, 2022. On April 21, 2022 the Board of Directors approved a new share repurchase program
of $250.0 million. The Board's authorization has no expiration date. Our stock repurchase program has been funded
by our existing cash and cash equivalent balances as well as cash flows provided by our operations.

The following chart summarizes the cash used to repurchase shares of our common stock:

)
s
n
o

i
l
l
i

(
$

$305.2

$95.3

$77.2

$132.7

$112.2

2022

2021

2020

2019

2018

A summary of the cash used for the stock repurchase program consists of the following:

Cash used for repurchases (in
thousands)

Shares repurchased (in thousands)

Average price per share

2022

2021

2020

2019

2018

Year Ended March 31,

305,239

95,259

77,198

132,697

112,218

4,307

1,643

1,701

2,115

70.87

57.97

45.37

62.74

2,098

53.49

Our summarized annual cash flow information is as follows (in thousands):

Net cash provided by operating activities

Net cash provided by (used in) investing activities

Net cash used in financing activities

Effects of exchange rate — changes in cash

Year Ended March 31,

2022

2021

2020

177,180

123,955

88,464

(24,444)

(276,088)

(6,378)

35,469

(74,738)

16,469

(74,005)

(39,403)

(6,966)

Net increase (decrease) in cash and cash equivalents

(
(129,730) $

)

101,155

)
(31,910)
(

Net Cash Provided by
Operating Activities

$177.2

$124.0

$88.5

Net Cash Provided by
(Used in) Investing
Activities

$35.5

$(24.4)

)
s
n
o

i
l
l
i

M
n
I
(
$

)
s
n
o

i
l
l
i

M
n
I
(
$

)
s
n
o

i
l
l
i

M
n
I
(
$

Net Cash Used in
Financing Activities

$(39.4)

$(74.7)

2022

2021

2020

2022

2021

2020

2022

2021

2020

$(74.0)

$(276.1)

- Net cash provided by operating activities was impacted by:

•

Fiscal 2022: net income adjusted for the impact of non-cash charges, increases in deferred
revenue and accrued expenses, partially offset by increases in accounts receivable and deferred
commissions.
Fiscal 2021: net loss adjusted for the impact of non-cash charges, including the impairment of
intangible assets, and increases in deferred revenue and accrued expenses, partially offset by
increases in accounts receivable and deferred commissions.
Fiscal 2020: net loss adjusted for the impact of non-cash charges and decreases in accounts
receivable.

- Net cash provided by or used in investing activities was impacted by:

•

Fiscal 2022: $16.9 million used for the acquisition of TrapX, $3.9 million of capital expenditures and
$4.1 million for the purchase of equity securities partially offset by proceeds of $0.5 million related
to the sale of an equity investment.
Fiscal 2021: $43.6 million of proceeds of short-term investments of U.S. Treasury bills, partially
offset by $8.1 million of capital expenditures.

•

Fiscal 2020: $157.5 million used for
the acquisition of Hedvig and $3.2 million of capital
expenditures, partially offset by $86.7 million of net proceeds of short-term investments of U.S.
Treasury Bills.

- Net cash used in financing activities was impacted by:

•

Fiscal 2022: $305.2 million used to repurchase shares of our common stock under our repurchase
program, $0.6 million of debt issuance costs paid partially offset by $29.7 million of proceeds from
the exercise of stock options and the employee stock purchase plan.
Fiscal 2021: $95.3 million used to repurchase shares of our common stock under our repurchase
program, partially offset by $20.5 million of proceeds from the exercise of stock options and the
employee stock purchase plan.
Fiscal 2020: $77.2 million used to repurchase shares of our common stock under our repurchase
program, partially offset by $37.8 million of proceeds from the exercise of stock options and the
employee stock purchase plan.

Working capital decreased $144.4 million from $234.4 million as of March 31, 2021 to $90.0 million as of
March 31, 2022. The decrease in working capital is primarily due to cash used for share repurchases during the
fiscal year.

We believe that our existing cash, cash equivalents and our cash from operations will be sufficient to meet
our anticipated cash needs for working capital, capital expenditures and potential stock repurchases for at least the
next 12 months. We may seek additional funding through public or private financings or other arrangements during
this period. Adequate funds may not be available when needed or may not be available on terms favorable to us, or
at all. If additional funds are raised by issuing equity securities, dilution to existing stockholders will result. If we raise
additional funds by obtaining loans from third parties, the terms of those financing arrangements may include
negative covenants or other restrictions on our business that could impair our operational flexibility, and would also
require us to fund additional interest expense. If funding is insufficient at any time in the future, we may be unable to
develop or enhance our products or services, take advantage of business opportunities or respond to competitive
pressures, any of which could have a material adverse effect on our business, financial condition and results of
operations.

Summary Disclosures about Contractual Obligations and Commercial Commitments

Our material capital commitments consist of obligations under facilities and operating leases. Some of these
leases have free or escalating rent payment provisions. Refer to Notes 2 and 15 of the notes to the consolidated
financial statements for further discussion on operating leases.

We have certain software royalty commitments associated with the shipment and licensing of certain
products. Royalty expense is generally based on a fixed cost per unit shipped or a fixed fee for unlimited units
shipped over a designated period. Royalty expense, included in cost of software and products revenues, was $11.2
million in fiscal 2022 and $16.3 million in fiscal 2021.

We offer a 90-day limited product warranty for our software. To date, costs relating to this product warranty

have not been material.

Off-Balance Sheet Arrangements

As of March 31, 2022, we did not have off-balance sheet

including any
relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured
finance or special purpose entities.

financing arrangements,

Indemnifications

Certain of our software licensing agreements contain certain provisions that indemnify our customers from
intellectual property infringement. These provisions
any claim, suit or proceeding arising from alleged or actual
continue in perpetuity along with our software licensing agreements. We have never incurred a liability relating to
one of these indemnification provisions in the past and we believe that the likelihood of any future payout relating to
these provisions is remote. Therefore, we have not recorded a liability during any period related to these
indemnification provisions.

Impact of Recently Issued Accounting Standards

See Note 2 of the notes to the consolidated financial statements for a discussion of the impact of recently

issued accounting standards.

Item 7A.

Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

None.

Foreign Currency Risk

Economic Exposure

As a global company, we face exposure to adverse movements in foreign currency exchange rates. Our
international sales are generally denominated in foreign currencies and this revenue could be materially affected by
currency fluctuations. Approximately 48% of our sales were outside the United States in both fiscal 2022 and fiscal
2021. Our primary exposures are to fluctuations in exchange rates for the U.S. dollar versus the Euro, and to a
lesser extent, the Australian dollar, British pound sterling, Canadian dollar, Chinese yuan, Indian rupee, Korean won
and Singapore dollar. Changes in currency exchange rates could adversely affect our reported revenues and
require us to reduce our prices to remain competitive in foreign markets, which could also have a material adverse
effect on our results of operations. Historically, we have periodically reviewed and revised the pricing of our products
available to our customers in foreign countries and we have not maintained excess cash balances in foreign
accounts.

We estimate that a 10% change in all foreign exchange rates would impact our reported operating profit by
approximately $11.8 million annually. This sensitivity analysis disregards the possibilities that rates can move in
opposite directions and that losses from one geographic area may be offset by gains from another geographic area.

Transaction Exposure

Our exposure to foreign currency transaction gains and losses is primarily the result of certain net
receivables due from our foreign subsidiaries and customers being denominated in currencies other than the
functional currency of the subsidiary. Our foreign subsidiaries conduct their businesses in local currency and we
generally do not maintain excess U.S. dollar cash balances in foreign accounts.

Foreign currency transaction gains and losses are recorded in General and administrative expenses in the
Consolidated Statements of Operation. Net foreign currency transaction activity in fiscal 2022 was not significant.
We recognized net foreign currency transaction losses of $1.9 million and gains of $0.4 million in fiscal 2021 and
fiscal 2020, respectively.

Item 8.

Financial Statements and Supplementary Data

Commvault Systems, Inc.

Consolidated Financial Statements

Fiscal Years Ended March 31, 2022, 2021 and 2020

Index to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm (PCAOB ID 42)

Consolidated Balance Sheets as of March 31, 2022 and 2021

Consolidated Statements of Operations for the years ended March 31, 2022, 2021 and 2020

Consolidated Statements of Comprehensive Income (Loss) for the years ended March 31, 2022, 2021 and 2020

Consolidated Statements of Stockholders’ Equity for the years ended March 31, 2022, 2021 and 2020

Consolidated Statements of Cash Flows for the years ended March 31, 2022, 2021 and 2020

Notes to Consolidated Financial Statements

Page

38
40
41
42
43
44
45

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Commvault Systems, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Commvault Systems, Inc. (the Company) as of March 31,
2022 and 2021, the related consolidated statements of operations, comprehensive income (loss), stockholders' equity and cash
flows for each of the three years in the period ended March 31, 2022, and the related notes (collectively referred to as the
“consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects,
the financial position of the Company at March 31, 2022 and 2021, and the results of its operations and its cash flows for each
of the three years in the period ended March 31, 2022, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting as of March 31, 2022, based on criteria established in
Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
(2013 framework) and our report dated May 6, 2022 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on
the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to
error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial
statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that
was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that
are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The
communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken
as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit
matter or on the account or disclosure to which it relates.

Description of the
Matter

Accounting for Revenue Recognition
As described in Note 3 to the consolidated financial statements, the Company derives
revenues from two primary sources: software and services. Most of the Company’s
contracts with customers contain multiple performance obligations which are
accounted for separately if they are distinct. The transaction price is allocated to
separate performance obligations on a relative standalone selling price basis.

Auditing the identification of performance obligations in a software contract requires
significant judgment as it relates to the evaluation of the contractual terms of the
arrangement.

How We Addressed the
Matter in Our Audit

We obtained an understanding, evaluated the design and tested the operating
effectiveness of controls over the Company’s revenue recognition process, including
the evaluation of the contractual terms of the revenue arrangements.

To test
the amount of revenue recognized, we performed audit procedures that
included, among others, testing a sample of revenue transactions during the year and
evaluating the identification of performance obligations based on analysis of the
contractual terms and independent confirmations of the terms and conditions of the
contract directly with customers.

We have served as the Company’s auditor since 1998.

/s/ Ernst & Young LLP

Iselin, New Jersey
May 6, 2022

Commvault Systems, Inc.

Consolidated Balance Sheets
(In thousands, except per share data)

ASSETS

March 31,

2022

2021

Current assets:

Cash and cash equivalents

Trade accounts receivable, net

Other current assets

Total current assets

Property and equipment, net

Operating lease assets

Deferred commissions cost

Intangible assets, net

Goodwill

Other assets

Total assets

Current liabilities:

Accounts payable

Accrued liabilities

267,507

194,238

22,336

484,081

106,513

14,921

52,974

3,542

127,780

26,269

LIABILITIES AND STOCKHOLDERS’ EQUITY

816,080

432

Current portion of operating lease liabilities

Deferred revenue

Total current liabilities

Deferred revenue, less current portion

Deferred tax liabilities, net

Long-term operating lease liabilities

Other liabilities

Commitments and contingencies (Note 8)

Stockholders’ equity:

Preferred stock, $0.01 par value: 50,000 shares authorized, no shares issued and
outstanding

Common stock, $0.01 par value, 250,000 shares authorized, 44,511 shares and
46,482 shares issued and outstanding at March 31, 2022 and 2021, respectively

Additional paid-in capital

Accumulated deficit

Accumulated other comprehensive loss

Total stockholders’ equity

Total liabilities and stockholders’ equity

121,837

4,778

267,017

394,064

150,180

808

11,270

3,929

—

443

397,237

188,126

22,237

607,600

112,779

20,778

38,444

—

112,435

12,137

904,173

374

112,148

7,469

253,211

373,202

119,231

761

15,419

1,526

—

463

1,165,948

1,069,695

(898,699)

(11,863)

255,829

816,080

(665,774)

(10,350)

394,034

904,173

See accompanying notes to consolidated financial statements

Commvault Systems, Inc.

Consolidated Statements of Operations
(In thousands, except per share data)

2022

Year Ended March 31,
2021

2020

Revenues:

Software and products

Services

Total revenues

Cost of revenues:

Software and products

Services

Total cost of revenues

Gross margin

Operating expenses:

Sales and marketing

Research and development

General and administrative

Restructuring

Depreciation and amortization

Impairment of intangible assets

Net change in contingent consideration

Total operating expenses

Income (loss) from operations

Interest income

Interest expense

Other income, net

Income (loss) before income taxes

Income tax expense (benefit)

Net income (loss)

Net income (loss) per common share:

Basic

Diluted

Weighted average common shares outstanding:

Basic

Diluted

356,487

326,843

413,104

769,591

14,057

99,802

113,859

655,732

341,644

153,615

103,049

6,192

9,666

—

614,166

41,566

656

(109)

1,301

43,414

9,790

396,629

723,472

27,218

82,155

109,373

614,099

331,948

133,401

92,214

23,471

14,628

40,700

—

636,362

(22,263)

1,028

—

(21,235)

9,719

33,624

(
(30,954) $

)

0.74

0.71

)
(0.66) $
(

45,443

47,220

46,652

275,308

395,577

670,885

28,082

88,996

117,078

553,807

335,785

110,020

92,130

21,348

15,815

—

(3,783)

571,315

(17,508)

4,962

—

(12,546)

(6,901)

)
(5,645)
(

)
(0.12)
(

45,793

See accompanying notes to consolidated financial statements

Commvault Systems, Inc.

Consolidated Statements of Comprehensive Income (Loss)
(In thousands)

Net income (loss)

Other comprehensive income (loss):

Foreign currency translation adjustment

Comprehensive income (loss)

2022

Year Ended March 31,
2021

2020

33,624

(30,954) $

(5,645)

(1,513)

3,073

32,111

)
(27,881)
(

(1,855)

)
(7,500)
(

See accompanying notes to consolidated financial statements

Commvault Systems, Inc.

Consolidated Statements of Stockholders’ Equity
(In thousands)

Balance at March 31, 2019

Stock-based compensation

Share issuances related to
business combinations

Share issuance related to stock-
based compensation

Repurchase of common stock

Net loss

Other comprehensive loss

Balance at March 31, 2020

Cumulative effect of adoption of
ASU 2016-13

Stock-based compensation

Share issuance related to stock-
based compensation

Repurchase of common stock

Net loss

Other comprehensive income

Balance at March 31, 2021

Stock-based compensation

Share issuance related to stock-
based compensation

Repurchase of common stock

Net income

Other comprehensive loss

Common Stock

Amount

Additional
Paid-In
Capital

Accumulated
Deficit

Accumulated
Other
Comprehensive
Loss

Total

45,582

454

887,907

(485,490) $

(11,568) $

391,303

65,888

1,616

37,774

(14,526)

2,131

(1,702)

(17)

65,888

1,616

37,795

(77,198)

(5,645)

(1,855)

(62,655)

(5,645)

(1,855)

46,011

458

978,659

(553,790)

(13,423)

411,904

2,115

(1,644)

(16)

84,833

20,500

(14,297)

(84)

(80,946)

(30,954)

46,482

463

1,069,695

(665,774)

2,336

(4,307)

(43)

105,163

29,737

(38,647)

(266,549)

33,624

(84)

84,833

20,521

(95,259)

(30,954)

3,073

394,034

105,163

29,760

(305,239)

33,624

(1,513)

3,073

(10,350)

(1,513)

Balance at March 31, 2022

44,511

443

$ 1,165,948

(898,699) $

(11,863) $

255,829

See accompanying notes to consolidated financial statements

Commvault Systems, Inc.

Consolidated Statements of Cash Flows
(In thousands)

Year Ended March 31,
2021

2020

2022

Cash flows from operating activities

Net income (loss)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

$ 33,624

$ (30,954) $

(5,645)

Depreciation and amortization

Noncash stock-based compensation

Noncash change in fair value of equity securities

Noncash change in contingent consideration

Impairment of intangible assets

Deferred income taxes

Amortization of deferred commissions cost

Impairment of operating lease assets

Changes in operating assets and liabilities:

Trade accounts receivable

Operating lease assets and liabilities, net

Other current assets and Other assets

Deferred commissions cost

Accounts payable

Accrued liabilities

Deferred revenue

Other liabilities

Net cash provided by operating activities

Cash flows from investing activities

Purchase of short-term investments

Proceeds from maturity of short-term investments

Purchase of property and equipment

Purchase of equity securities

Business combination, net of cash acquired

Other

Net cash provided by (used in) investing activities

Cash flows from financing activities

Repurchase of common stock

Proceeds from stock-based compensation plans

Debt issuance costs

Net cash used in financing activities

Effects of exchange rate — changes in cash

Net increase (decrease) in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of year

Cash, cash equivalents and restricted cash at end of year

Supplemental disclosures of cash flow information

Interest paid

Income taxes paid

10,950

105,163

(301)

—

15,878

84,833

—

40,700

17,065

65,888

—

(3,783)

—

(92)

(1,783)

18,339

—

18,318

1,684

17,717

2,761

(20,371)

(34,622)

26,096

(925)

(1,157)

3,732

11,887

(1,226)

(1,246)

(33,512)

(24,095)

(16,063)

10,400

48,295

1,677

10,660

31,740

(874)

(2,474)

(1,997)

(6,230)

(616)

177,180

123,955

88,464

—

(3,911)

(4,139)

(16,894)

500

—

(43,645)

43,645

130,338

(8,176)

(3,203)

—

— (157,495)

—

(24,444)

35,469

(74,005)

(305,239)

(95,259)

(77,198)

29,760

20,521

37,795

(609)

—

(276,088)

(74,738)

(39,403)

(6,378)

16,469

(6,966)

(129,730)

101,155

(31,910)

397,237

296,082

327,992

$ 267,507

$ 397,237

$ 296,082

— $

—

(1,493) $

2,959

6,002

See accompanying notes to consolidated financial statements

Commvault Systems, Inc.

Notes to Consolidated Financial Statements
(In thousands, except per share data)

Nature of Business

Commvault Systems, Inc. and its subsidiaries ("Commvault," "we," "us," or "our") is a provider of data
protection and information management software applications and products. We develop, market and sell a suite of
software applications and services, globally, that provides our customers with data protection solutions. We also
including data
provide our customers with a broad range of professional and customer support services,
management-as-a-service, branded as Metallic.

Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of Commvault. All intercompany transactions

and balances have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements and related disclosures in conformity with U.S. generally accepted
the
accounting principles ("U.S. GAAP") requires management
amounts reported in our consolidated financial statements and the accompanying notes. We base our estimates
and judgments on historical experience and on various other assumptions that we believe are reasonable under the
circumstances. The amounts of assets and liabilities reported in our balance sheets and the amounts of revenues
and expenses reported for each of the periods presented are affected by estimates and assumptions, which are
used for, but not limited to, the accounting for revenue recognition, income taxes and related reserves, deferred
commissions, purchased intangible assets and goodwill. Actual results could differ from those estimates.

to make judgments and estimates that affect

Revenue

We account for revenue in accordance with Accounting Standards Codification ("ASC") Topic 606, Revenue
from Contracts with Customers ("ASC 606"). For a further discussion of our accounting policies related to revenue,
see Note 3 of the consolidated financial statements.

Shipping and Handling Costs

Shipping and handling costs are included in cost of revenues for all periods presented.

Sales Tax

We record revenue net of sales tax.

Accounting for Stock-Based Compensation

Restricted stock units without a market condition are measured based on the fair market values of the
underlying stock on the date of grant. We recognize stock-based compensation expense using the straight-line
method for all stock awards that do not include a market or performance condition. Awards that include a market or
performance condition are expensed using the accelerated method.

Software Development Costs

The costs for the development of new products and substantial enhancements to existing products are
expensed as incurred until technological feasibility has been established, at which time any additional costs would
be capitalized in accordance with the accounting guidance for software. Because our current process for developing
software is essentially completed concurrently with the establishment of technological feasibility, which occurs upon
the completion of a working model, no costs have been capitalized for any of the periods presented.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Advertising Costs

We expense advertising costs as incurred. Advertising expenses were $9,572, $9,560, and $5,579 for the

years ended March 31, 2022, 2021 and 2020, respectively.

Accounting for Income Taxes

We account for income taxes in accordance with ASC Topic 740, Income Taxes ("ASC 740"). The provision
for income taxes and effective tax rates are calculated by legal entity and jurisdiction and are based on a number of
factors, including the level of pre-tax earnings, income tax planning strategies, differences between tax laws and
accounting rules, statutory tax rates and credits, uncertain tax positions and valuation allowances. We use
significant judgment and estimates in evaluating tax positions. The effective tax rate in a given financial statement
period may be materially impacted by changes in the mix and level of earnings by taxing jurisdiction.

levels of pre-tax income,

including historical

Foreign Currency Translation

The functional currencies of our foreign operations are deemed to be the local country’s currency. Assets
and liabilities of our international subsidiaries are translated at their respective period-end exchange rates, and
revenues and expenses are translated at average currency exchange rates for the period. The resulting balance
sheet translation adjustments are included in Other comprehensive income (loss) and are reflected as a separate
component of Stockholders’ equity.

Foreign currency transaction gains and losses are recorded in General and administrative expenses in the
Consolidated Statements of Operations. These gains and losses relate primarily to receivables and payables that
are not denominated in the functional currency of the subsidiary they relate to. Net foreign currency transaction
losses were not significant for the year ended March 31, 2022. We recognized net foreign currency transaction
losses of $1,918 and gains of $355 in the years ended March 31, 2021 and 2020, respectively.

Net Income (Loss) per Common Share

Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted
average number of common shares during the period. Diluted net income (loss) per share is computed using the
weighted average number of common shares and, if dilutive, potential common shares outstanding during the
period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock
options, vesting of restricted stock units and shares to be purchased under the Employee Stock Purchase Plan. The
dilutive effect of such potential common shares is reflected in diluted earnings per share by application of the
treasury stock method.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

The following table sets forth the reconciliation of basic and diluted common share:

Net income (loss)

Basic net income (loss) per common share:

Basic weighted average shares outstanding

Basic net income per common share

Diluted net income (loss) per common share:

Basic weighted-average shares outstanding

Dilutive effect of stock options, restricted stock units, and
employee stock purchase plan (1)

Diluted weighted-average shares outstanding

Year Ended March 31,

2022

2021

2020

33,624

(
(30,954) $

)

)
(5,645)
(

45,443

46,652

0.74

(0.66) $

45,443

1,777

47,220

46,652

—

46,652

45,793

(0.12)

45,793

—

45,793

(1) The fiscal 2021 and 2020 shares have been excluded from the diluted weighted-average shares
outstanding calculation as we were in a net loss position; therefore, these shares would have been anti-
dilutive.

The following table summarizes our potential outstanding common stock equivalents at the end of each
period, which have been excluded from the computation of diluted net income (loss) per common share, as their
effect is anti-dilutive.

Stock options, restricted stock units, and shares under the employee
stock purchase plan

Year Ended March 31,

2022

2021

2020

505

5,024

4,933

Cash, Cash Equivalents and Restricted Cash

We consider all highly liquid investments purchased with maturities of three months or less at the date of

purchase to be cash equivalents, primarily in the form of money market funds.

Trade and Other Receivables

Trade and other receivables are primarily comprised of trade receivables that are recorded at the invoice
amount, net of an allowance for doubtful accounts, which is not material. Unbilled receivables represent amounts
for which revenue has been recognized but which have not yet been invoiced to the customer. The current portion
of unbilled receivables is included in Trade accounts receivable on the Consolidated Balance Sheets. Long-term
unbilled receivables are included in Other assets. The allowance for doubtful accounts was $705 as of March 31,
2022 and $483 as of March 31, 2021. For the years ended March 31, 2022, 2021 and 2020, bad debt expense was
immaterial.

Historically, we have not experienced material losses related to the inability to collect receivables from our
customers. While there is presently no indication that we will not collect material amounts of accounts receivable as
of March 31, 2022, we continue to closely monitor the impact of COVID-19 and the war in Ukraine on our
In these current economic conditions, payment from our customers may be delayed or receivables may
customers.
become uncollectible. The inability to collect receivables could have a material impact on our results of operations.

Concentration of Credit Risk

We grant credit to customers in a wide variety of industries worldwide and generally do not require

collateral. Credit losses relating to these customers have been minimal.

Sales through our distribution agreement with Arrow Enterprise Computing Solutions, Inc. ("Arrow") totaled
approximately 37%, 36% and 37% of total revenues for the years ended March 31, 2022, 2021 and 2020,

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

respectively. Arrow accounted for approximately 30% and 33% of total accounts receivable as of March 31, 2022
and 2021, respectively.

Fair Value of Financial Instruments

The carrying amounts of our cash, cash equivalents, accounts receivable, accounts payable and accrued

expenses approximate their fair values due to the short-term maturity of these instruments.

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability
(an exit price) in the principal or most advantageous market for such asset or liability in an orderly transaction
between market participants on the measurement date. Valuation techniques used to measure fair value should
maximize the use of observable inputs and minimize the use of unobservable inputs. To measure fair value, we use
the following fair value hierarchy based on three levels of inputs, of which the first two are considered observable
and the last unobservable:

Level 1 — Observable inputs such as quoted prices in active markets for identical assets or liabilities;

Level 2 — Inputs other than Level 1, that are observable for the asset or liability, either directly or indirectly;
and

Level 3 — Unobservable inputs that are supported by little or no market activity and that require the
reporting entity to develop its own assumptions.

There were no financial assets or liabilities measured at fair value on a recurring basis for the years ended

March 31, 2022 or 2021.

Equity Securities Accounted for at Net Asset Value

We held equity interests in private equity funds of $4,237 as of March 31, 2022, which are accounted for
under the net asset value practical expedient as permitted under ASC 820, Fair Value Measurement. These
investments are included in Other assets in the accompanying Consolidated Balance Sheets. The net asset values
of these investments are determined using quarterly capital statements from the funds, which are based on our
contributions to the funds, allocation of profit and loss and changes in fair value of the underlying fund investments.
Changes in fair value as reported on the capital statements are recorded through profit and loss as non-operating
income or expense. These private equity funds focus on making investments in key technology sectors, principally
by investing in companies at expansion capital and growth equity stages. We have total unfunded commitments in
private equity funds of $6,889 as of March 31, 2022. We did not own interests in any of these funds prior to fiscal
year 2022.

Leases

We account for leases in accordance with ASC 842, Leases. For a further discussion of our accounting

policies related to leases, see Note 15 of the consolidated financial statements.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation and amortization. Land is not
depreciated. We provide for depreciation on a straight-line basis over the estimated useful lives of the assets. The
depreciable assets that comprise our owned headquarters are classified as Buildings and are being depreciated
over lives ranging from ten to sixty years. Computer and related equipment is generally depreciated over eighteen
months to three years and furniture and fixtures are generally depreciated over three to twelve years. Leasehold
improvements are amortized over the shorter of the useful life of the improvement or the term of the related lease.
Expenditures for
replacements,
improvements and additions are capitalized.

routine maintenance and repairs are charged against operations. Major

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Goodwill and Intangible Assets

Goodwill is recorded when the consideration paid for an acquisition exceeds the fair value of net tangible
and intangible assets acquired. The carrying value of goodwill
is tested for impairment on an annual basis on
January 1, or more often if an event occurs or circumstances change that would more likely than not reduce the fair
value of its carrying amount. For the purpose of impairment testing, we have a single reporting unit. The impairment
test consists of comparing the fair value of the reporting unit with its carrying amount that includes goodwill. If the
carrying amount of the reporting unit exceeds the fair value of the reporting unit, an impairment loss would be
recognized to reduce the carrying amount to its fair value.

Our finite lived purchased intangible asset, developed technology, was valued using the replacement cost
method and is being amortized on a straight-line basis over its economic life of three years as we believed this
method most closely reflects the pattern in which the economic benefits of the assets will be consumed. Impairment
losses are recognized if the carrying amount of an intangible asset is both not recoverable and exceeds its fair
value.

Long-Lived Assets

We review our long-lived assets for impairment whenever events or changes in circumstances indicate that
the carrying amount of the assets may not be fully recoverable. To determine the recoverability of our long-lived
assets, we evaluate the estimated future undiscounted cash flows that are directly associated with, and that are
expected to arise as a direct result of, the use and eventual disposition of the long-lived asset. If the estimated
future undiscounted cash flows demonstrate that recoverability is not probable, an impairment loss would be
recognized. An impairment loss would be calculated based on the excess carrying amount of the long-lived asset
over the long-lived asset’s fair value. The fair value would be determined based on valuation techniques such as a
comparison to fair values of similar assets.

Deferred Commissions Cost

Sales commissions, bonuses, and related payroll

taxes earned by our employees are considered
incremental and recoverable costs of obtaining a contract with a customer. Our
typical contracts include
performance obligations related to software licenses, software updates, customer support and other services,
including software-as-a-service offerings. In these contracts, incremental costs of obtaining a contract are allocated
to the performance obligations based on the relative estimated standalone selling prices and then recognized on a
systematic basis that is consistent with the transfer of the goods or services to which the asset relates. We do not
for perpetual
pay commissions on annual renewals of contracts for software updates and customer support
licenses. The costs allocated to software and products are expensed at the time of sale, when revenue for the
functional software license or appliance is recognized. The costs allocated to software updates and customer
support for perpetual licenses are amortized ratably over a period of approximately five years, the expected period
five years is appropriate based on
of benefit of
consideration of historical average customer life and the estimated useful life of the underlying software or appliance
sold as part of the transaction.

the asset capitalized. We currently estimate a period of

Beginning in fiscal 2022, we modified the terms of our commission plans, and as a result, the commission paid
on the renewal of a term-based, or subscription software license, was not commensurate with the commission paid
on the initial purchase. As a result, the cost of commissions allocated to software updates and customer support on
the initial transaction are now amortized over a period of approximately five years, consistent with the accounting for
these costs associated with perpetual
licenses. The costs of commissions allocated to software updates and
support for the renewal of term-based software licenses is limited to the contractual period of the arrangement, as
we pay a commensurate renewal commission upon the next renewal of the subscription license and related updates
and support. This change in commission plans also resulted in a change in the estimate of the amortization period
of our existing Deferred commissions cost associated with term licenses. This change in amortization period
resulted in an approximate $3,575 reduction in Sales and marketing expense, than if the change in estimate did not
occur, for the year ended March 31, 2022.

The costs related to professional services are amortized over the period the related professional services are
provided and revenue is recognized. Amortization expense related to these costs is included in Sales and marketing
expenses in the accompanying Consolidated Statements of Operations.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Deferred Revenue

Deferred revenues represent amounts collected from, or invoiced to, customers in excess of revenues
recognized. This results primarily from the billing of annual customer support agreements, and billings for other
professional services fees that have not yet been performed by us. The value of deferred revenues will increase or
decrease based on the timing of invoices and recognition of revenue.

Share Repurchases

We consider all shares repurchased as canceled shares restored to the status of authorized but unissued
shares on the trade date. The aggregate purchase price of the shares of our common stock repurchased is reflected
as a reduction to Stockholders’ equity. We account for shares repurchased as an adjustment to common stock (at
par value) with the excess repurchase price allocated between Additional paid-in capital and Accumulated deficit.

Comprehensive Income (Loss)

Comprehensive income (loss) is defined to include all changes in equity, except those resulting from

investments by stockholders and distribution to stockholders.

Recently Adopted Accounting Standards

Standard

Description

Effective Date

Effect on the Consolidated
Financial Statements (or Other
Significant Matters)

We adopted this
standard as of April 1,
2021.

The standard did not have a
significant impact on our
financial statements.

We elected to early
adopt effective January
1, 2022.

The standard did not have a
significant impact in our
consolidated financial
statements, including
accounting policies,
processes and systems.

ASU No. 2019-12
(Topic 740), Income
Taxes

ASU No. 2021-08
(Topic 805), Business
Combinations

In December 2019, the Financial
Accounting Standards Board
("FASB") issued a new standard to
simplify the accounting for income
taxes. The guidance eliminates
certain exceptions related to the
approach for intraperiod tax
allocation, the methodology for
calculating income taxes in an
interim period, and the recognition of
deferred tax liabilities for outside
basis differences related to changes
in ownership of equity method
investments and foreign
subsidiaries. The guidance also
simplifies aspects of accounting for
franchise taxes and enacted
changes in tax laws or rates, and
clarifies the accounting for
transactions that result in a step-up
in the tax basis of goodwill.

In October 2021, the FASB issued a
new standard to improve the
accounting for acquired revenue
contracts with customers in a
business combination. The new
guidance requires companies to
apply revenue guidance under ASC
Topic 606 to recognize and measure
contract assets and contract
liabilities acquired in a business
combination on the acquisition date.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Revenue

We derive revenues from two primary sources: software and products, and services. Software and
products revenue includes our software and integrated appliances that combine our software with hardware.
Services include customer support (software updates and technical support), consulting, assessment and design
services, installation services, customer education and Commvault software-as-a-service, which is branded as
Metallic.

We also sell appliances that integrate our software with hardware and address a wide-range of business
needs and use cases, ranging from support for remote or branch offices with limited IT staff up to large corporate
data centers. Revenue related to appliances is recognized when control of the appliances passes to the customer;
typically upon delivery. In the second half of fiscal 2021 we began transitioning to a software only model in which we
typically sell software to a third party, which assembles an integrated appliance that is sold to end user customers.
As a result, the revenue and costs associated with hardware have declined from recent fiscal years.

Services revenue includes revenue from customer support and other professional services. Customer
support includes software updates on a when-and-if-available basis, telephone support, integrated web-based
support and bug fixes or patches. We sell our customer support contracts as a percentage of net software
purchases the support is related to. Customer support revenue is recognized ratably over the term of the customer
support agreement, which is typically one year on our perpetual
licenses. The term of our subscription
arrangements is typically three years, but can range between one and five years.

Commvault software-as-a-service, which is branded as Metallic, allows customers to use hosted software
the software. Revenue related to Metallic is generally

over the contract period without
recognized ratably over the contract term as services revenue.

taking possession of

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Our typical performance obligations include the following:

Performance Obligation

When Performance Obligation
is Typically Satisfied

When Payment is
Typically Due

How Standalone Selling Price is
Typically Estimated

Software and Products Revenue

Software Licenses

Upon shipment or made available for
download (point in time)

Within 90 days of shipment
except for certain
subscription licenses which
are paid for over time

Residual approach

Customer Support Revenue

Software Updates

Ratably over the course of the support
contract (over time)

At the beginning of the
contract period

Observable in renewal
transactions

Customer Support

Ratably over the course of the support
contract (over time)

At the beginning of the
contract period

Observable in renewal
transactions

Other Services Revenue

Other Professional
Services (except for
education services)

As work is performed (over time)

Education Services When the class is taught (point in time)

Within 90 days of services
being performed

Software-as-a-
service (Metallic)

Ratably over the course of the contract
(over time)

Annual or monthly
payments

Observable in transactions
without multiple performance
obligations

Disaggregation of Revenue

We disaggregate revenue from contracts with customers into the nature of the products and services and
geographical regions. The geographic regions that are tracked are the Americas (United States, Canada, Latin
America), EMEA (Europe, Middle East, Africa) and APJ (Australia, New Zealand, Southeast Asia, China). We
operate in one segment.

Americas

EMEA

APJ

Total

Year Ended March 31, 2022

Software and Products Revenue

215,264 $

103,749 $

37,474 $

Customer Support Revenue

Other Services Revenue

202,867

39,764

104,524

19,068

39,724

7,157

Total Revenue

457,895 $

227,341 $

84,355 $

356,487

347,115

65,989

769,591

Americas

EMEA

APJ

Total

Year Ended March 31, 2021

Software and Products Revenue

187,027 $

101,673 $

38,143 $

Customer Support Revenue

Other Services Revenue

215,831

21,264

100,620

12,138

41,330

5,446

Total Revenue

424,122 $

214,431 $

84,919 $

326,843

357,781

38,848

723,472

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Americas

EMEA

APJ

Total

Year Ended March 31, 2020

Software and Products Revenue

141,856 $

95,356 $

38,096 $

Customer Support Revenue

Other Services Revenue

230,226

18,778

88,965

10,459

40,939

6,210

Total Revenue

390,860 $

194,780 $

85,245 $

275,308

360,130

35,447

670,885

Information about Contract Balances

Amounts collected in advance of services being provided are accounted for as deferred revenue. Nearly all
of our deferred revenue balance is related to services revenue, primarily customer support contracts and software-
as-a-service contracts.

In some arrangements we allow customers to pay for term-based software licenses and products over the
term of the software license. Amounts recognized as revenue in excess of amounts billed are recorded as unbilled
receivables. Unbilled receivables, which are anticipated to be invoiced in the next twelve months, are included in
Accounts Receivable on the Consolidated Balance Sheets. Long-term unbilled receivables are included in Other
assets. The opening and closing balances of our Accounts receivable, Unbilled receivables and Deferred revenues
are as follows:

Accounts
Receivable

Unbilled
Receivable
(current)

Unbilled
Receivable
(long-term)

Deferred
Revenue
(current)

Deferred
Revenue
(long-term)

Opening Balance as of March 31, 2021

Increase/(decrease), net

Ending Balance as of March 31, 2022

168,985 $

19,141 $

7,463 $

253,211 $

119,231

8,197

(2,085)

6,833

13,806

30,949

177,182 $

17,056 $

14,296 $

267,017 $

150,180

The net increase in accounts receivable (inclusive of unbilled receivables) is a result of an increase in
software and products revenue relative to the prior year. The increase in deferred revenue is primarily the result of
an increase in deferred revenue associated with software-as-a-service contracts that are billed upfront and
recognized ratably over the contract period.

The amount of revenue recognized in the period that was included in the opening deferred revenue balance
was approximately $254,100 for the year ended March 31, 2022. The vast majority of this revenue consists of
customer support arrangements. The amount of revenue recognized from performance obligations satisfied in prior
periods was not material.

Remaining Performance Obligations

In addition to the amounts included in deferred revenue as of March 31, 2022, approximately $83,500 of
revenue may be recognized from remaining performance obligations, of which approximately $21,250 was related
to software and products. We expect most of the software and products revenue to be recognized in the first half of
fiscal 2022. The majority of the services revenue is related to other professional services which may be recognized
over the next twelve months but is contingent upon a number of factors, including customers’ needs and schedules.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Business Combination

On January 31, 2022, we completed the acquisition of TrapX Security ("TrapX"), an Israeli-based cyber
deception technology company, acquiring 100% of the equity interest for a purchase price of $18,653, paid in cash.
The primary reason for the business combination is to expand the security features of our software-as-a-service
offerings. The technology was valued using the replacement method. The following table summarizes the purchase
price allocation as of the date of acquisition:

Assets acquired and liabilities assumed:

Cash

Trade accounts receivable

Developed technology

Pre-acquisition tax contingencies

Accrued expenses

Deferred revenue

Total identifiable net assets acquired and liabilities assumed

Goodwill

Total purchase price

1,759

700

3,750

(736)

(523)

(1,642)

3,308

15,345

18,653

Actual and Unaudited Pro Forma Information

We completed the acquisition for TrapX on January 31, 2022, and accordingly, TrapX's operations for the
period from January 31, 2022 to March 31, 2022 are included in our Consolidated Statements of Operations. TrapX
contributed revenues of approximately $535 and estimated net loss of $948 for the period from the completion of
acquisition through March 31, 2022.

The following unaudited pro forma results of operations have been prepared using the acquisition method of
accounting to give effect to the TrapX acquisition as though it occurred on April 1, 2020. The pro forma amounts
reflect certain adjustments, such as expenses related to the noncash amortization of intangible assets. The fiscal
2022 supplemental pro forma net income was adjusted to exclude $1,379 of acquisition-related costs incurred in
fiscal 2022. The fiscal 2021 supplemental pro forma net loss was adjusted to include these charges. In addition to
estimated operating expenses, both periods include noncash amortization expenses related to intangible assets as
if the acquisition had taken place on April 1, 2020.

The unaudited pro forma financial

information is presented for illustrative purposes only, is based on a
purchase price allocation, and is not necessarily indicative of the results of operations that would have actually been
reported had the acquisition occurred on April 1, 2020, nor is it necessarily indicative of the future results of
operations of the combined company.

Revenue

Net income (loss)

Unaudited

Year Ended March 31,

2022

2021

774,161

33,104

729,120

(37,601)

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Goodwill and Intangible Assets, Net

Goodwill

Goodwill represents the residual purchase price paid in a business combination after the fair value of all
identified assets and liabilities have been recorded. It includes the estimated value of potential expansion with new
customers, the opportunity to further develop sales relationships with new customers and intangible assets that do
not qualify for separate recognition. Goodwill is not amortized. None of the goodwill recorded is expected to be
deductible for income tax purposes.

There were no impairments to the carrying amount of goodwill during either fiscal year ended March 31,

2022 or 2021.

Goodwill balances are as follows:

Opening balance

Additions

Ending balance

2022

2021

112,435

15,345

127,780

112,435

—

112,435

Intangible assets, net

Intangible assets are recorded at cost and amortized over their estimated useful lives.

Gross Carrying
Amount

Accumulated
Amortization

Net Carrying Value

Remaining Useful
Life (in months)

March 31, 2022

Developed technology

3,750

(208) $

3,542

Gross Carrying
Amount

Accumulated
Amortization

Impairment
Charge

Net Carrying Value

March 31, 2021

Developed technology

Customer relationships

Total intangible assets

49,000

(9,800) $

(39,200) $

3,000

(1,500)

52,000

(
(11,300) $

)

(
(40,700) $

)

—

Amortization expense from acquired intangible assets was $208 for the fiscal year ended March 31, 2022
and $5,650 for the fiscal year ended 2021. During the second quarter of fiscal year 2021 we identified an indicator
of impairment and concluded that the carrying values of the developed technology and customer relationships
acquired in connection with the Hedvig transaction were not recoverable on an undiscounted basis. As a result, we
remeasured the fair value of these assets and concluded their value was de minimis. We recorded a $40,700
impairment charge in the accompanying Consolidated Statements of Operations for the year ended March 31,
2021. These non-recurring fair value measurements were categorized as Level 3, as significant unobservable inputs
were used in the valuation analysis. Key assumptions used in the valuation include forecasts of revenue and
expenses over an extended period, the useful life of the asset, tax rates, and estimated costs of debt and equity
capital to discount the projected cash flows. Certain of these assumptions involve significant judgment and are
based on management’s estimate of current and forecasted market conditions.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Estimated future amortization expense of intangible assets with finite lives as of March 31, 2022 is as

follows:

Year ending March 31,

2023

2024

2025

Total

1,250

1,042

3,542

Property and Equipment

Property and equipment consist of the following:

Land

Buildings

Computers, servers and other equipment

Furniture and fixtures

Leasehold improvements

Purchased software

Construction in process

Less: Accumulated depreciation and amortization

March 31,

2022

2021

9,445

103,244

45,557

15,031

9,349

2,016

2,119

186,761

(80,248)

106,513

9,445

103,244

42,117

14,689

8,089

1,955

4,304

183,843

(71,064)

112,779

We recorded depreciation and amortization expense of $10,708, $10,228, and $11,415 for the years ended
2022, 2021 and 2020, respectively. Approximately $1,250 of depreciation expense is allocated to our cost of goods
sold for the years ended 2022, 2021 and 2020.

Accrued Liabilities

Accrued liabilities consist of the following:

Compensation and related payroll taxes

Other

Commitments and Contingencies

Purchase Commitments

March 31,

2022

2021

73,409

48,428

121,837

69,890

42,258

112,148

We, in the normal course of business, enter into various purchase commitments for goods or services. Total
non-cancellable purchase commitments as of March 31, 2022, which relate primarily to marketing and IT services
are as follows:

Purchase commitments

19,693

4,969

7,976

215

32,853

2023

2024

2025

2025 and beyond

Total

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

We have certain software royalty commitments associated with the shipment and licensing of certain
products. Royalty expense is generally based on a fixed cost per unit shipped or a fixed fee for unlimited units
shipped over a designated period. Royalty expense, included in Cost of software and products revenues, was as
follows:

Royalty expense

11,188

16,256

12,545

Year Ended March 31,

2022

2021

2020

Warranties and Indemnifications

We typically offer a 90-day limited product warranty for our software. To date, costs related to this product

warranty have not been significant.

We provide certain provisions within our software licensing agreements to indemnify our customers from
intellectual property infringement. These provisions
any claim, suit or proceeding arising from alleged or actual
continue in perpetuity, along with our software licensing agreements. We have never incurred a liability relating to
one of these indemnification provisions, and management believes that the likelihood of any future payout relating
to these provisions is remote. Therefore, we have not recorded a liability during any period for these indemnification
provisions.

Legal Proceedings

During fiscal 2022, we entered into settlement agreements resulting in a $7,900 gain which resolved certain
legal matters. The settlement amounts are recorded in General and administrative expenses net against related
legal expenses.

We do not believe that we are currently party to any pending legal action that could reasonably be expected to

have a material adverse effect on our business or operating results.

Capitalization

Common Stock

We have 44,511 and 46,482 shares of common stock, par value $0.01, outstanding at March 31, 2022 and

March 31, 2021, respectively.

During fiscal 2022, we repurchased $305,239 of common stock, or approximately 4,307 shares, under our
share repurchase program. This program commenced in January 2021 and ended on March 31, 2022. Our share
repurchase program has been funded by our existing cash and cash equivalent balances as well as cash flows
provided by our operations.

Subsequent Event

On April 21, 2022 the Board of Directors approved a new share repurchase program of $250,000. The

Board's authorization has no expiration date.

Shares Reserved for Issuance

At March 31, 2022, we have reserved 5,354 shares in connection with our Stock Plans discussed in Note

10 of the notes to the consolidated financial statements.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

10.

Stock Plans

We maintain the Omnibus Incentive Plan (the “2016 Incentive Plan”) for granting awards to employees. On
August 19, 2021, our shareholders approved an amendment to the 2016 Incentive Plan to increase the maximum
number of shares of common stock that may be delivered under plan to 10,050, an increase of 2,000 shares. The
2016 Incentive Plan authorizes a broad range of awards including stock options, stock appreciation rights, full value
awards (including restricted stock, restricted stock units, performance shares or units and other stock-based
awards) and cash-based awards. As of March 31, 2022, approximately 2,090 shares were available for future
issuance under the 2016 Incentive Plan.

As of March 31, 2022, we have granted non-qualified stock options, restricted stock units and performance
stock awards under our stock incentive plans. Historically, most equity awards granted by us under our stock
incentive plans generally vest quarterly over a three-year period, except that the shares that would otherwise vest
quarterly over the first twelve months do not vest until the first anniversary of the grant. We anticipate that future
grants under our stock incentive plans will be restricted stock units and performance stock awards and do not
anticipate that we will grant stock options.

As of March 31, 2022, there was approximately $146,077 of unrecognized stock-based compensation
expense related to all of our employee stock plans that is expected to be recognized over a weighted-average
period of 1.74 years. To the extent the actual forfeiture rate is different from what we have anticipated, stock-based
compensation related to these awards will be different from our expectations.

Restricted stock unit activity is as follows:

Non-Vested Restricted Stock Units
Non-vested as of March 31, 2021

Granted

Vested

Forfeited

Non-vested as of March 31, 2022

Number
of
Awards

Weighted-
Average
Grant Date
Fair Value

3,451

1,958

(1,743)

(356)

3,310

44.90

69.77

45.90

52.93

58.16

The total fair value of the restricted stock units that vested during the years ended March 31, 2022, 2021

and 2020 was $122,259, $72,544 and $48,221, respectively.

The following summarizes the activity for our stock incentive plans from March 31, 2021 to March 31, 2022:

Options
Outstanding at March 31, 2021

Options granted

Options exercised

Options forfeited

Options expired

Outstanding at March 31, 2022

Exercisable at March 31, 2022

Number of
Options

Weighted-
Average
Exercise Price

Weighted-
Average
Remaining
Contractual
Term (Years)

Aggregate
Intrinsic
Value

62.06

—

46.56

—

86.25

68.03

1,357

—

(406)

—

(34)

917

1.46 $

7,070

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

The total

intrinsic value of options exercised was $12,704, $4,306, and $13,428 in the years ended
March 31, 2022, 2021 and 2020, respectively. Our policy is to issue new shares upon exercise of options as we do
not hold shares in treasury.

The following table presents the stock-based compensation expense included in Cost of services revenue,
Sales and marketing, Research and development, General and administrative and Restructuring expenses for the
years ended March 31, 2022, 2021 and 2020.

Year Ended March 31,

2022

2021

2020

Cost of services revenue

Sales and marketing

Research and development

General and administrative

Restructuring

4,474

3,317

37,431

33,870

27,679

1,709

35,577

24,823

18,369

2,747

Stock-based compensation expense

105,163

84,833

2,604

31,779

14,594

15,158

1,753

65,888

Performance Based Awards

In May 2021, we granted 105 performance stock units ("PSUs") to certain executives and in June 2021, we
granted an additional 14 PSUs to certain executives for a total of 119 PSUs for fiscal 2022. Vesting of these awards
is contingent upon i) us meeting certain revenue and non-GAAP performance goals (performance-based) in fiscal
2022 and ii) our customary service periods. The awards vest over three years. These awards generally have
potential to vest at 200% based on actual fiscal 2022 performance. The related stock-based compensation expense
is determined based on the value of the underlying shares on the date of grant and is recognized over the vesting
term using the accelerated method. During each financial period, management estimates the probable number of
PSUs that would vest until the ultimate achievement of the performance goals is known. Based on our results, the
PSUs granted in May 2021, will be eligible to vest at approximately 150% and the PSUs granted in June 2021 will
be eligible to vest at 200%. The awards are included in the restricted stock unit table.

There were no performance based stock units granted during fiscal 2021.

Awards with a Market Condition

In fiscal 2022, we granted 105 market performance stock units to certain executives. The vesting of these
awards is contingent upon us meeting certain total shareholder return ("TSR") levels as compared to the Russell
3000 market index over the three years subsequent to grant date. The awards vest in three annual tranches and
have a maximum potential to vest at 200% and a minimum of 0% based on TSR performance. The related stock-
based compensation expense is determined based on the estimated fair value of the underlying shares on the date
of grant and is recognized using the accelerated method over the vesting term. The estimated fair value was
calculated using a Monte Carlo simulation model. The fair value of the awards granted during the year was $87.74
per share, which approximated the market value of a share of stock at the time of grant. The awards are included in
the restricted stock unit table above.

In fiscal 2021, we granted 299 market performance stock units to certain executives. The vesting of these
awards is contingent upon us meeting certain total shareholder return ("TSR") levels as compared to the Russell
3000 market index over the three years subsequent to grant date. The awards vest in three annual tranches and
have a maximum potential to vest at 200% and a minimum of 0% based on TSR performance. The related stock-
based compensation expense is determined based on the estimated fair value of the underlying shares on the date
of grant and is recognized using the accelerated method over the vesting term. The estimated fair value was
calculated using a Monte Carlo simulation model. The fair value of the awards granted during the year was $36.76
per share, which approximated the market value of a share of stock at the time of grant. The awards are included in
the restricted stock unit table above.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Employee Stock Purchase Plan

The Employee Stock Purchase Plan (the “Purchase Plan”) is a shareholder approved plan under which
substantially all employees may purchase our common stock through payroll deductions at a price equal to 85% of
the lower of the fair market values of the stock as of the beginning or the end of six-month offering periods. An
employee’s payroll deductions under the Purchase Plan are limited to 10% of the employee’s salary and employees
may not purchase more than $25 of stock during any calendar year. Employees purchased 187 shares in exchange
for $10,816 of proceeds in fiscal 2022 and 272 shares in exchange for $9,812 of proceeds in fiscal 2021. The
Purchase Plan is considered compensatory and the fair value of the discount and look back provision are estimated
using the Black-Scholes formula and recognized over the six-month withholding period prior to purchase. The total
expense associated with the Purchase Plan for fiscal 2022, 2021 and 2020 was $3,341, $3,417 and $2,939,
respectively. As of March 31, 2022, there was approximately $1,448 of unrecognized cost related to the current
purchase period of our Purchase Plan.

11.

Income Taxes

Global Intangible Low-Tax Income ("GILTI")

The Tax Cuts and Jobs Act (the "Act") was enacted on December 22, 2017. The Act subjects a U.S.
shareholder to tax on Global Intangible Low-Taxed Income ("GILTI") earned by certain foreign subsidiaries. The
FASB Staff Q&A, Topic 740, No. 5, Accounting for GILTI, states that an entity can make an accounting policy
election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future
years or to provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. The
Company has elected to account for GILTI in the year the tax is incurred, and has recorded an estimate of GILTI as
a component of the tax provision for the fiscal years ending March 31, 2022, 2021 and 2020.

The components of income (loss) before income taxes were as follows:

Domestic

Foreign

Year Ended March 31,

2022

2021

2020

25,905

(28,628) $

17,509

7,393

43,414

(
(21,235) $

)

(16,670)

4,124

)
(12,546)
(

The components of income tax expense (benefit) were as follows:

Year Ended March 31,

2022

2021

2020

Current:

Federal

State

Foreign

Deferred:

Federal

State

Foreign

284

361

9,096

—

3,399

(10,071)

196

6,215

(113)

—

(613)

5,566

284

—

(2,067)

)
(6,901)
(

9,790

9,719

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

A reconciliation of the statutory tax rates and the effective tax rates for the years ended March 31, 2022,

2021 and 2020 are as follows:

Year Ended March 31,

2022

2021

2020

Statutory federal income tax expense (benefit) rate

21.0 %

(21.0)%

State and local income tax expense, net of federal income tax effect

Foreign earnings taxed at different rates

U.S. tax on Global Intangible Low-Taxed Income

Domestic permanent differences including acquisition items

Foreign tax credits

Research credits

Tax reserves

Valuation allowance

Enacted tax law changes

Stock-based compensation

CARES Act Impact

Reduction of NOL for carryback

Other differences, net

Effective income tax expense (benefit)

0.8 %

6.2 %

0.5 %

3.6 %

(5.3)%

(28.3)%

2.6 %

18.3 %

0.3 %

(1.6)%

— %

4.5 %

22.6 %

0.9 %

10.0 %

1.8 %

1.7 %

(7.8)%

(68.6)%

(0.1)%

74.4 %

— %

36.3 %

15.0 %

— %

3.2 %

45.8 %

(21.0)%

(4.9)%

12.3 %

14.5 %

7.7 %

(19.3)%

(32.9)%

(0.6)%

64.0 %

10.6 %

(43.1)%

(82.1)%

59.2 %

(19.4)%

(
(55.0)%

)

The significant components of our deferred tax assets and liabilities are as follows:

March 31,

2022

2021

12,937

948

15,726

19,125

50,587

2,148

493

115

(90,242)

11,837

(3,945)

(8,700)

(12,645) $

)
(808) $
(

12,586

1,193

16,280

14,879

39,062

3,568

801

—

(78,339)

10,030

(4,553)

(6,238)

(10,791)

)
(761)
(

Deferred tax assets:

Net operating losses

Equity investment

Stock-based compensation

Deferred revenue

Tax credits

Accrued expenses

Allowance for doubtful accounts and other reserves

Other

Less: valuation allowance

Total deferred tax assets

Deferred tax liabilities:

Depreciation and amortization

Deferred commissions and other

Total deferred tax liabilities

Net deferred tax liability

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Net deferred tax assets arise due to the recognition of income and expense items for tax purposes, which
differ from those used for financial statement purposes. ASC 740, Income Taxes, provides for the recognition of
deferred tax assets if realization of such assets is more likely than not. In assessing the need for a valuation
allowance, we considered all available objective and verifiable evidence both positive and negative, including
historical
levels of pre-tax income (loss) both on a consolidated basis and tax reporting entity basis, legislative
developments, expectations and risks associated with estimates of future pre-tax income, and prudent and feasible
tax planning strategies. As a result of this analysis, we determined that it is more likely than not that we will not
realize the benefits of our gross deferred tax assets and therefore have recorded a valuation allowance to reduce
the carrying value of these gross deferred tax assets, net of the impact of the reversal of taxable temporary
differences. At March 31, 2022 and 2021, we recorded valuation allowances of $90,242 and $78,339, respectively,
representing an increase in the valuation allowance of $11,903 in 2022, due to the uncertainty regarding the
realization of such deferred tax assets. Included in the March 31, 2022 valuation allowance of $90,242 was $3,894
related to purchase accounting.

During fiscal 2019, the Company could no longer assert that it had the intent to indefinitely reinvest the
earnings and profits of the foreign subsidiaries, with the exception of India. Accordingly, the Company was required
to adjust its deferred tax liability for the effects of this change in assertion. This effect was not significant. Our
position during fiscal 2022 remains unchanged.

At March 31, 2022, we had federal NOL carry forwards of $33,978. There are $8,062 NOLs that will expire
by 2036 and $25,915 NOLs that will not expire. As of March 31, 2022, we had deferred tax assets related to state
NOL carry forwards of $1,793 which expire over various years beginning in 2031 depending on the jurisdiction. As of
March 31, 2022, we had foreign NOL carry forwards of $38,391 that will not expire.

We also had federal and state research tax credits ("R&D credit") carryforwards of approximately $35,140
and $18,873, respectively. The federal R&D credit carryforwards expire from 2033 through 2042, and the state R&D
credit carryforwards expire from 2023 through 2037.

We conduct business globally and as a result, file income tax returns in the United States and in various
state and foreign jurisdictions. In the normal course of business, we are subject to examination by taxing authorities
throughout the world. The following table summarizes the tax years subject to income tax examinations by tax
authorities as of March 31, 2022. The years subject to income tax examination in our foreign jurisdictions cover the
maximum time period with respect to these jurisdictions. Due to NOLs, in some cases the tax years continue to
remain subject to examination with respect to such NOLs.

Tax Jurisdiction
U.S. Federal

Foreign jurisdictions

Years Subject to Income
Tax Examination

2018 - Present

2012 - Present

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

The calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax
regulations in each of our tax jurisdictions. The number of years with open tax audits varies depending on the tax
jurisdiction. A number of years may lapse before a particular matter is audited and finally resolved. A reconciliation
of the amounts of unrecognized tax benefits is as follows:

Balance at March 31, 2019

Additions for tax positions related to fiscal 2020

Additions for tax positions related to prior years

Settlements and effective settlements with tax authorities and remeasurements

Reductions related to the expiration of statutes of limitations

Foreign currency translation adjustment

Balance at March 31, 2020

Additions for tax positions related to fiscal 2021

Additions for tax positions related to prior years

Settlements and effective settlements with tax authorities and remeasurements

Reductions related to the expiration of statutes of limitations

Foreign currency translation adjustment

Balance at March 31, 2021

Additions for tax positions related to fiscal 2022

Additions for tax positions related to prior years

Settlements and effective settlements with tax authorities and remeasurements

Reductions related to the expiration of statutes of limitations

Additions for tax positions related to purchase accounting

Foreign currency translation adjustment

Balance at March 31, 2022

1,592

170

—

(100)

—

1,662

614

—

(65)

—

2,211

2,808

—

(117)

4,232

—

9,224

We estimate that no significant remaining unrecognized tax benefits will be realized during the fiscal year
ending March 31, 2023. Interest income, expense and penalties related to unrecognized tax benefits are recorded in
In the year ended March 31, 2022, we
Income tax expense in the Consolidated Statements of Operations.
recognized interest income of $8 related to the release of reserves. In the years ended March 31, 2021 and 2020,
we recognized expense of $9 and $6, respectively, related to interest and penalties.

12.

Employee Benefit Plan

We have a defined contribution plan, as allowed under Section 401(k) of the Internal Revenue Code,
covering substantially all employees. Effective January 1, 2012, we make contributions equal to a discretionary
percentage of the employee’s contributions determined by us. During the years ended March 31, 2022, 2021 and
2020, we made contributions of $2,923, $2,445, and $2,487, respectively.

13.

Segment Information

We operate in one segment. Our products and services are sold throughout the world, through direct and
indirect sales channels. Our chief operating decision maker (the “CODM”) is the Chief Executive Officer. The CODM
makes operating performance assessment and resource allocation decisions on a global basis. The CODM does
not receive discrete financial
information about asset allocation, expense allocation or profitability by product or
geography.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Revenues by geography are based upon the billing address of

transfers between
geographic regions have been eliminated from consolidated revenues. The following table sets forth revenue and
long-lived assets by geographic area:

the customer. All

Revenue:

United States

Other

2022

Year Ended March 31,
2021

2020

398,632

379,106

370,959

344,366

769,591

723,472

342,660

328,225

670,885

No individual country other than the United States accounts for 10% or more of revenues in the years
ended March 31, 2022, 2021 and 2020. Revenue included in the “Other” caption above primarily relates to our
operations in Europe, Australia, Canada and Asia.

Long-lived assets:

United States

Other

March 31,

2022

2021

275,546

56,453

331,999

248,386

48,187

296,573

At March 31, 2022 and 2021 no individual country, other than the United States, accounts for 10% or more

of long-lived assets.

14.

Restructuring

Our restructuring plans are aimed to increase efficiency in our sales, marketing and distribution functions as
well as reduce costs across all functional areas. In the fourth quarter of fiscal 2022, we initiated a restructuring plan
to combine the management of our EMEA and APJ field organizations. Restructuring charges relate primarily to
severance and related costs associated with headcount
reductions, stock-based compensation related to
modifications of existing unvested awards granted to certain employees impacted by the restructuring plan and
lease abandonment charges.

For the years ended March 31, 2022, 2021 and 2020, restructuring charges were comprised of the

following:

Employee severance and related costs

Lease impairments related costs (1)

Stock-based compensation

Total restructuring charges

Year Ended March 31,

2022

2021

2020

4,483

19,040

16,834

—

1,709

1,684

2,747

2,761

1,753

6,192

23,471

21,348

(1) There were no lease impairment charges for the year ended March 31, 2022. Lease impairment charges
relate to seven and six offices for the years ended March 31, 2021 and 2020, respectively.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Restructuring accrual

The activity in our restructuring accrual for the years ended March 31, 2022 and 2021 is as follows:

Beginning balance

Employee severance and related costs

Payments

Ending balance

Year Ended March 31,

2022

2021

3,095

4,483

(5,317)

2,261

2,531

19,040

(18,476)

3,095

15.

Leases

We determine if an arrangement contains a lease at inception. We generally lease our facilities under
operating leases. Operating lease right-of-use ("ROU") assets are included in Operating lease assets on our
Consolidated Balance Sheets. Current portion of operating lease liabilities and Long-term operating lease liabilities
are included on our Consolidated Balance Sheets.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent
our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are
recognized at the commencement date based on the present value of lease payments over the lease term. As most
of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the
the
estimated rate of
commencement date.

for collateralized borrowing over a similar

the lease payments at

term of

interest

We recognize operating lease costs over the estimated term of the lease, which includes options to extend
lease terms that are reasonably certain of being exercised, starting when possession of the property is taken from
the landlord. When a lease contains a predetermined fixed escalation of the minimum rent, we recognize the related
operating lease cost on a straight-line basis over the lease term.
In addition, certain of our lease agreements
include variable lease payments, such as estimated tax and maintenance charges. These variable lease payments
are excluded from minimum lease payments and are included in the determination of lease cost when it is probable
that the expense has been incurred and the amount can be reasonably estimated.

Our lease liabilities relate primarily to operating leases for our global office infrastructure. These operating
leases expire at various dates through fiscal 2031. We did not have any material finance leases for either the years
ended March 31, 2022 or 2021.

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

Net lease cost recognized in our Consolidated Statements of Operations is summarized as follows:

Operating lease cost

Short-term lease cost

Variable lease cost

Net lease cost

Cash flow information

Cash paid for operating lease liabilities

Additions of operating lease assets (non-cash)

Year Ended March 31,

2022

2021

2020

7,129

9,048

123

1,608

232

1,938

8,795

410

2,088

8,860

11,218

11,293

Year Ended March 31,

2022

2021

2020

8,277

1,827

10,370

17,603

9,476

8,448

As of March 31, 2022, the minimum lease commitment amount for operating leases signed but not yet

commenced was immaterial.

As of March 31, 2022, the maturities of lease liabilities based on the total minimum lease commitment

amount including options to extend lease terms that are reasonably certain of being exercised are as follows:

2023

2024

2025

2026

2027

Thereafter

Total minimum lease payments

Less: Imputed interest

Present value of operating lease liabilities

Less: Current portion of operating lease liabilities

Long-term operating lease liabilities

Lease term and Discount rate

4,745

4,226

3,904

2,080

568

1,846

17,369

1,321

16,048

4,778

11,270

Weighted-average remaining term (in years)

Weighted-average discount rate

Year Ended March 31,

2022

2021

4.18

4 %

4.43

4 %

Commvault Systems, Inc.
Notes to Consolidated Financial Statements — (Continued)
(In thousands, except per share data)

16.

Revolving Credit Facility

On December 13, 2021, we entered into a five-year $100,000 senior secured revolving credit facility (the
“Credit Facility”) with J.P. Morgan. The Credit Facility is available for share repurchases, general corporate
purposes, and letters of credit. The Credit Facility contains financial maintenance covenants including a leverage
ratio and interest coverage ratio. The Credit Facility also contains certain customary events of default which would
permit the lender to, among other things, declare all loans then outstanding to be immediately due and payable if
such default is not cured within applicable grace periods. The Credit Facility also limits our ability to incur certain
additional indebtedness, create or permit liens on assets, make acquisitions, make investments, loans or advances,
sell or transfer assets, pay dividends or distributions, and engage in certain transactions with foreign affiliates.
Outstanding borrowings under the Credit Facility accrue interest at an annual rate equal to Secured Overnight
Financing Rate plus 1.25% subject to increases based on our actual leverage. The unused balance on the Credit
Facility is also subject to a 0.25% annual interest charge subject to increases based on our actual leverage. As of
March 31, 2022, there were no borrowings under the Credit Facility and we were in compliance with all covenants.

We have deferred the expense related to debt issuance costs, which are classified as Other assets, and will
amortize the costs into interest expense over the term of the Credit Facility. Unamortized amounts at March 31,
2022 were $543. The amortization of debt issuance costs and interest expense incurred for the year ended
March 31, 2022 was $109. There was no amortization or expense incurred for the year ended March 31, 2021.

Item 9.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

None.

Item 9A.

Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, has
evaluated the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
of the Securities Exchange Act of 1934, as of March 31, 2022. Based on that evaluation, the Chief Executive Officer
and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31,
2022.

(b) Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over our financial
reporting as defined in Rules 13a-15(f) of the Exchange Act. There are inherent limitations in the effectiveness of
any internal control, including the possibility of human error and the circumvention or overriding of controls.
Accordingly, even an effective internal control can provide only reasonable assurance with respect to financial
statement preparation. Further, because of changes in conditions, the effectiveness of any internal control may vary
over time.

Our management, with the participation of our principal executive officer and principal financial officer, has
evaluated the effectiveness of our internal control over financial reporting as of March 31, 2022. In making this
assessment, management used the framework set forth by the Committee of Sponsoring Organizations of the
Treadway Commission ("COSO") in the 2013 Internal Control—Integrated Framework.

Based on our assessment, using those criteria, our management concluded that, as of March 31, 2022, our
internal control over financial reporting was effective. The effectiveness of our internal control over financial
reporting as of March 31, 2022 has been audited by Ernst & Young LLP, our independent registered public
accounting firm, as stated in their report, which is included below in this Annual Report on Form 10-K.

There was no change in our internal control over financial reporting that occurred during the fourth quarter
of fiscal 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Commvault Systems, Inc.

Opinion on Internal Control over Financial Reporting
We have audited Commvault Systems, Inc.’s internal control over financial reporting as of March 31, 2022, based on criteria
established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (2013 framework) (the COSO criteria). In our opinion, Commvault Systems, Inc. (the Company) maintained, in all
material respects, effective internal control over financial reporting as of March 31, 2022, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of the Company as of March 31, 2022 and 2021, the related consolidated statements
of operations, comprehensive income (loss), stockholders' equity and cash flows for each of the three years in the period ended
March 31, 2022, and the related notes and our report dated May 6, 2022 expressed an unqualified opinion thereon.

Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report
on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control
over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be
independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all
material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material
weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

Iselin, New Jersey
May 6, 2022

Item 9B.

Other Information

None.

Item 9C.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

PART III

Item 10.

Directors, Executive Officers and Corporate Governance

We will furnish to the SEC a definitive Proxy Statement not later than 120 days after the close of the fiscal
year ended March 31, 2022. Information with respect to this Item is incorporated herein by reference from the
sections of our 2022 Proxy Statement captioned, “Our Board of Directors” and “Corporate Governance”.

Our Board of Directors has adopted a code of business ethics and conduct, which applies to all of our
employees. The code of business ethics and conduct is in addition to our code of ethics for senior financial officers.
The full texts of our code of business ethics and conduct and our code of ethics for senior financial officers can be
found on our website, www.commvault.com.

Item 11.

Executive Compensation

Information with respect to this Item is incorporated herein by reference from the sections of our 2022 Proxy

Statement captioned “Executive Compensation” and "Compensation Committee Report".

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters

Information with respect to this Item is incorporated herein by reference from the section of our 2022 Proxy

Statement captioned “Security Ownership of Certain Beneficial Ownership and Management”.

Securities Authorized for Issuance under Equity Compensation Plans

The following table provides information as of March 31, 2022 with respect to the shares of our common
stock that may be issuable upon the exercise of options, warrants and rights under or existing equity compensation
plans. The following information is as of March 31, 2022:

Number of Securities
to be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
(a)

Weighted-Average
Exercise Price of
Outstanding
Options, Warrants
and Rights
(b)

Number of Securities
Remaining Available for
Future Issuance Under Equity
Compensation Plans
(Excluding
Securities Reflected in
Column (a))
(c)

4,227,157

—

4,227,157

60.30

—

60.30

2,089,949

—

2,089,949

Equity compensation plans approved by security
holders (1)

Equity compensation plans not approved by
security holder

Totals

(1)

Consists of shares of common stock to be issued upon exercise of outstanding options and vesting of
restricted stock awards under our Omnibus Incentive Plan. These amounts do not include potentially
issuable shares under the Employee Stock Purchase Plan. We have reserved 3,264 thousand shares for
the future issuance of shares under the Employee Stock Purchase Plan.

Item 13.

Certain Relationships and Related Transactions, and Director Independence

Information with respect to this Item is incorporated herein by reference from the sections of our 2022 Proxy
Independence and
Statement captioned “Transactions with Related Persons”,
Composition of our Board of Directors" and "Corporate Governance - The Board of Directors and Its Committees-
General".

"Corporate Governance -

Item 14.

Principal Accountant Fees and Services

Information with respect to this Item is incorporated herein by reference from the section of our 2022 Proxy
Statement captioned “Ratification of the Appointment of Independent Auditors - Audit, Audit-related, Tax and All
Other Fees”.

Item 15.

Exhibits and Financial Statement Schedules

Financial Statements

PART IV

See “Index to Consolidated Financial Statements” set forth in Item 8 for a list of financial statements filed as

part of this report.

Financial Statement Schedules

All schedules are omitted because they are not required or because the required information is included in

the Consolidated Financial Statements or notes thereto.

The following exhibits are incorporated by reference or filed herewith.

Exhibits

Exhibit No.
3.1

3.2

3.3

3.4

4.1

4.2

9.1

10.1*

10.2*

10.3*

10.4*

10.5*

10.6*

10.7*

10.8

10.9*

21.1

23.1

31.1

31.2

32.1**

32.2**

Description

Amended and Restated Certificate of Incorporation of Commvault Systems, Inc., as amended (Incorporated by
reference to Exhibit 3.1 to the Registrant’s Form 10-Q for the quarter ended September 30, 2019).

Certificate of Amendment of Amended and Restated Certificate of Incorporation of Commvault Systems, Inc.
(Incorporated by reference to Exhibit 3.1 to the Registrant's Form 8-K dated August 28, 2020).

Amended and Restated Bylaws of Commvault Systems, Inc.

Certification of Designation of Series A Junior Participating Preferred Stock of Commvault Systems, Inc.
(Incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K dated November 14, 2008).

Form of Common Stock Certificate (Incorporated by reference to Exhibit 4.1 to the Registrant’s Registration
Statement on Form S-1, Commission File No. 333-132550).

Description of Securities.

Form of Voting Trust Agreement (Incorporated by reference to Exhibit 9.1 to the Registrant’s Registration Statement
on Form S-1, Commission File No. 333-132550).

Form of Non-Qualified Stock Option Agreement (Incorporated by reference to Exhibit 10.4 to the Registrant’s
Registration Statement on Form S-1, Commission File No. 333-132550).

Form of Restricted Stock Unit Agreement (Incorporated by reference to Exhibit 10.5 to the Registrant’s Annual
Report on Form 10-K for the year ended March 31, 2007).

Form of Indemnity Agreement between Commvault Systems, Inc. and each of its current officers and directors.

Commvault Systems, Inc. Employee Stock Purchase Plan dated December 9, 2013 (Incorporated by reference to
Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K for the year ended March 31, 2014).

Employment Agreement, dated January 8, 2019, between the Company and Sanjay Mirchandani. (Incorporated by
reference to Exhibit 10.1 to the Registrant’s Form 8-K dated February 5, 2019).

Executive Retention and Severance Agreement, dated April 1, 2019, between Commvault Systems, Inc. and Jay
Whalen (Incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K dated March 31, 2019).

Commvault Systems, Inc. Omnibus Incentive Plan (as amended by the Fifth Amendment thereof) (Incorporated by
reference to Exhibit 10.1 to the Registrant's Form 10-Q for the quarter ended September 30, 2021).

Credit Agreement, dated December 13, 2021, by and among Commvault Systems, Inc., the Lenders from time to
time party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent (Incorporated by reference to Exhibit
10.1 to the Registrant's Form 10-Q for the quarter ended December 31, 2021).

Offer Letter, dated April 28, 2022, between the Company and Gary Merrill. (Incorporated by reference to
Exhibit 10.1 to the Registrant’s Form 8-K dated May 3, 2022).

List of Subsidiaries of Commvault Systems, Inc.

Consent of Ernst & Young LLP

Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS

XBRL Instance Document

101.SCH XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE XBRL Taxonomy Extension Presentation Linkbase Document

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Management contract or compensatory plan or arrangement.

Furnished herewith.

Item 16.

Form 10-K Summary

None.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of
Tinton Falls, State of New Jersey, on May 6, 2022.

SIGNATURES

COMMVAULT SYSTEMS, INC.

By:

/s/ SANJAY MIRCHANDANI

Sanjay Mirchandani

Director, President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by

the following persons on behalf of the registrant and in the capacities indicated on May 6, 2022.

Signature

Title

/s/ SANJAY MIRCHANDANI

Director, President and Chief Executive Officer (Principal
Executive Officer)

Sanjay Mirchandani

/s/ BRIAN CAROLAN

Brian Carolan

/s/

JAMES WHALEN

James Whalen

/s/ NICHOLAS ADAMO

Nicholas Adamo

/s/ MARTHA H. BEJAR

Martha H. Bejar

/s/ R. TODD BRADLEY

R. Todd Bradley

/s/ KEITH GEESLIN

Keith Geeslin

/s/ VIVIE LEE

Vivie Lee

/s/ CHARLES E. MORAN

Charles E. Moran

/s/ ALLISON PICKENS

Allison Pickens

/s/ ARLEN SHENKMAN

Arlen Shenkman

/s/ DAVID F. WALKER

David F. Walker

Chief Financial Officer (Principal Financial Officer)

Chief Accounting Officer (Principal Accounting Officer)

Chairman of the Board

Director

[THIS PAGE INTENTIONALLY LEFT BLANK]

Investor Information

Officers and Directors

Sanjay Mirchandani
President, Chief Executive
Officer, and Director

Gary Merrill
Chief Financial Officer

Riccardo Di Blasio
Chief Revenue Officer

Martha Delehanty
Chief People Officer

Tom Broderick
Chief Strategy Officer

Danielle Sheer
Chief Legal and Compliance
Officer, Corporate Secretary

Rajiv Kottomtharayil
Chief Product Officer

Isabelle Guis
Chief Marketing Officer

James Whalen
Chief Accounting Officer

Nicholas Adamo
Chairman of the Board

David F. Walker
Chairman of Audit Committee

Martha H. Bejar
Chairwoman of Nominations
and Governance Committee

Keith Geeslin
Chairman of Talent and
Management Committee

Arlen Shenkman
Chairman of Operating
Committee

Vivie ‘YY’ Lee
Director

Chuck Moran
Director

Allison Pickens
Director

R. Todd Bradley
Director

Annual Meeting
The annual meeting of stockholders will
be held on Wednesday, August 24, 2022,
at 9:00 a.m. (EDT) virtually at:
http://ir.commvault.com/annual-meeting

Stock Exchange Listing
Commvault’s common stock is traded
on the NASDAQ Global Selection Market
under the symbol “CVLT”.

Investor Relations
Investor inquiries may be directed to:
Michael Melnyk, CFA
Head of Investor Relations
mmelnyk@commvault.com
Phone 1 .732.870.4581

Annual Report on Form 10-K and
Other Investor Information
A copy of our Form 10-K, filed with the
Securities and Exchange Commission, is
included in this report. Additional copies
of other financial information can be
accessed at commvault.com.

Transfer Agent
Computershare Investor Services
PO BOX 505000
Louisville, KY 40233-5000
computershare.com/investor
800.368.5948

Independent Auditors
Ernst & Young LLP
99 Wood Avenue South
Iselin, NJ 08830
732.516.4200

m
o
c
n
o
s
d
d
a
y
b
n
g
s
e
D

commvault.com | 888.746.3849 | get-info@commvault.com