Summary
Nutanix reported fiscal 2025 first quarter revenue of $590.96 million, up 15.6% from the prior-year quarter. Gross margin was 86.0%, up 2.0 percentage points, and operating margin was 4.6%, up 5.7 percentage points. The company swung to operating income of $27.3 million and net income of $29.9 million. Diluted earnings per share was $0.10. Operating cash flow was $161.8 million, up 11.2%, while capital expenditures fell 24.5% to $9.8 million. Deferred revenue rose 15.1% to $1.89 billion. Those results show a sharp turn from the prior-year period, when the company ran an operating loss and a net loss.
Top-line growth was supported by a larger customer base and longer contract terms. Annual recurring revenue reached $1.97 billion, up 18% from $1.66 billion. Average contract duration was 3.1 years, compared with 2.9 years. Nutanix ended the quarter with over 27,000 end customers, including approximately 1,060 Global 2000 enterprises. Total billings were $591.4 million. Management said the mix of larger deal opportunities has increased, and these deals often take longer to close, require more executive review, and carry greater variability in timing and structure. The company also noted a modest elongation of average sales cycles, tied to the macroeconomic environment and increased scrutiny on spend.
Profitability on a non-GAAP basis remained much higher than GAAP results. Non-GAAP gross margin was 87.5%, and non-GAAP operating income was $118.2 million. Non-GAAP operating margin was 20.0%. Free cash flow was $151.9 million, up $19.4 million from the prior-year quarter. The company generated operating cash flow of $161.8 million, which it used to cover capital expenditures of $9.8 million and other items. Nutanix also continued to invest in its sales force. As of October 31, 2024, about 74% of global sales team members were fully ramped, while about 26% were still ramping. Management expects sales and marketing expense to increase in the near term as new representatives become productive.
Operationally, Nutanix expanded its partnership with Amazon Web Services to offer AWS services for customers migrating to NC2 on AWS. It was named a Leader in the 2024 Gartner Magic Quadrant for Distributed Hybrid Infrastructure and was positioned furthest in Vision in the 2024 Gartner Magic Quadrant for File and Object Storage Platforms. The company also extended its AI infrastructure platform with Nutanix Enterprise AI, which can be deployed on Kubernetes platforms, at the edge, in core data centers, and on public clouds such as AWS EKS, Azure AKS, and Google GKE. Renewal activity stayed solid. Among customers with 18 months or more of tenure, about 76% made a repeat purchase, and their total lifetime orders were more than 8.9 times their initial order on average. That multiple rose to approximately 35.4 times for Global 2000 customers.
For the second quarter of fiscal 2025, management guided revenue to $635 million to $645 million and non-GAAP operating margin to 20% to 21%. For the full fiscal year 2025, the company guided revenue to $2.435 billion to $2.465 billion, non-GAAP operating margin to 16% to 17%, and free cash flow to $560 million to $610 million. The guidance assumes continued demand for the Nutanix Cloud Platform and leverage from channel and OEM partners. Risks include macroeconomic and geopolitical uncertainty, competition from public cloud providers, delays in customer acceptance of new products, and the company's reliance on channel and OEM partners. The MD&A also points to a higher mix of large deals and longer sales cycles, which can make quarterly results more variable. Nutanix carries convertible notes due 2027, and if their conditional conversion feature is triggered, holders could convert before maturity. The company also has commitments with contract manufacturers and operating lease obligations that require future cash.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2025 | Q4 FY2024 | QoQ | Q1 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $591.0M | $548.0M | +7.8% | $511.1M | +15.6% |
| Gross profit | $508.3M | $467.0M | +8.8% | $429.1M | +18.5% |
| Gross margin | 86.0% | 85.2% | +0.8 pp | 84.0% | +2.1 pp |
| Research & development | $174.0M | $167.4M | +3.9% | $152.0M | +14.5% |
| Sales & marketing | $253.4M | $259.4M | -2.3% | $235.3M | +7.7% |
| General & administrative | $53.7M | $52.4M | +2.4% | $47.5M | +13.0% |
| Total operating expenses | $481.0M | $479.2M | +0.4% | $434.8M | +10.6% |
| Operating income (loss) | $27.3M | -$12.2M | +323.6% | -$5.7M | +577.6% |
| Operating margin | 4.6% | -2.2% | +6.8 pp | -1.1% | +5.7 pp |
| Net income (loss) | $29.9M | -$126.1M | +123.7% | -$15.9M | +288.8% |
| Net margin | 5.1% | -23.0% | +28.1 pp | -3.1% | +8.2 pp |
| Diluted EPS | $0.10 | -$0.52 | +$0.62 | -$0.07 | +$0.17 |
Risks
MD&A reports a modest elongation of average sales cycles compared to historical levels, which it attributes to the macroeconomic environment and continued increased scrutiny on spend, alongside a pipeline shifting toward larger deals that take longer to close, involve greater competition, and carry more variability in timing, outcome and deal structure.
As of October 31, 2024, approximately 26% of global sales team members were still ramping, and new representatives typically become fully productive around their fourth quarter of employment; sales and marketing headcount grew 8% from October 31, 2023 to October 31, 2024, so a slower ramp could weigh on revenue growth.
Nutanix sells primarily through channel partners and OEMs and depends on those partners to produce the hardware platforms its software runs on, which exposes it to supply chain delays that could impair its ability to provide services to end customers in a timely manner.
Revenue from subscription term-based licenses is generally recognized upfront upon transfer of control, so any decline in average contract durations would negatively impact top-line results; total average contract duration was approximately 3.1 years for the three months ended October 31, 2024, versus approximately 2.9 years in the prior year period.
SaaS KPIs
All quarters →Free Cash Flow
Annual Recurring Revenue (ARR)
Non-GAAP Gross Margin
Total Billings
Subscription Billings
Non-GAAP Operating Margin
Average Contract Duration
Subscription Revenue
Global 2000 End Customers
Non-GAAP Operating Expenses
Non-GAAP operating income
ARR Growth (YoY)
Summary, forecast, risks and KPIs are extracted from Nutanix, Inc.'s SEC filings for Q1 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.