Company: CVLT
Filing Date: 2025-07-02
Form Type: CORRESP
Source: 0001169561-25-000062
Chunk: 2

Company: COMMVAULT SYSTEMS INC
Filing Date: 2025-07-02
Form: CORRESP
Chunk 2
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 strategy and operational focus.

SaaS ARR: SaaS ARR includes only the cloud-hosted portion of Subscription ARR and is calculated using the same methodology. SaaS ARR reflects the annualized value of active SaaS contracts and we

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believe this metric provides insight into customer adoption trends and expansion within our cloud-based offerings. As SaaS continues to represent a growing share of our subscription revenue, we view this metric as a key indicator of our ability to meet the evolving needs of our customer base. Continued adoption and conversion to SaaS arrangements are critical to sustaining our long-term growth and aligning with customer preferences for cloud-delivered solutions.

SaaS Net Dollar Retention (SaaS NRR): SaaS NRR is the percentage of SaaS ARR retained from existing customers at the start of an annual period after accounting for expansion revenue, churn, and downgrades. It is presented on a constant currency basis using exchange rates as of a specified date (e.g., March 31, 2025). We believe our SaaS Net Dollar Retention Rate offers valuable insight into the year-over-year expansion of our existing customer base, reflecting both increased utilization of current products and services as well as the adoption of additional offerings.

These metrics are non-GAAP measures and do not have standardized definitions under GAAP. As such, they may not be comparable to similarly titled measures used by other companies and should be considered as a supplement to, and not as a substitute for, financial information prepared in accordance with GAAP. Management uses these metrics to assess the health of our recurring revenue base and to inform strategic decision-making.

We also note that in a recent investor presentation, we included a metric related to subscription customer growth, which reflects the number of end users benefiting from our recurring solutions. While this metric may offer helpful context regarding customer adoption trends, we do not consider it a key performance indicator, nor do we use the metric in managing the business. Specifically, we do not rely on subscription customer growth to operate or evaluate the business, make investment decisions, or manage day-to-day operations. Instead, we present this metric solely as supplemental information in response to investor interest. We believe it provides additional color on the scale and reach of our subscription offerings, but it is not used internally to assess performance or guide strategic planning. As a result, we do not consider this metric to be material to an understanding of our financial condition or results of operations.

We also confirm that, aside from the metrics discussed above, we do not currently