Nutanix Earnings: Record Q4, Raises 2027 Outlook

Nutanix, Inc. (NASDAQ: NTNX) reported record fourth-quarter revenue in an earnings release on Aug. 26, 2026. The company posted 16% annual recurring revenue (ARR) growth and strong free cash flow, prompting management to raise fiscal 2027 revenue and margin guidance as bookings accelerated.

Record Quarter and Margins

For the quarter ended July 31, Nutanix reported revenue of $757.1 million, exceeding its guidance range and marking a company record. This represented about 16% growth from the prior-year quarter’s $653.3 million.

The company showed margin strength with a non-GAAP gross margin of approximately 87.7% and a non-GAAP operating margin of 26.2%, above its prior target range. Nutanix posted non-GAAP net income of $175 million, or $0.60 diluted earnings per share (EPS), compared with analyst consensus near $0.49. It generated roughly $278 million in free cash flow, implying a free cash flow margin near 37%.

Full-Year Performance and Cash Flow

For fiscal 2026, Nutanix recorded revenue of $2.854 billion, about 12% higher than the previous year. Non-GAAP net income reached $597 million, or $2.04 diluted EPS, with a non-GAAP operating margin of about 23.7%, roughly 260 basis points above the prior year and exceeding the company’s outlook.

The company produced approximately $841 million in free cash flow, yielding an implied margin near 29%. Its Rule of 40 score—a combined measure of growth and profitability—was around 42, marking the third consecutive year above the 40% benchmark.

On a GAAP basis, Nutanix reported net income of $1.507 billion, reflecting a one-time tax valuation allowance release of about $1.2 billion. Excluding this benefit, GAAP net income was roughly $299 million.

CFO Rukmini Sivaraman said the results showed “a good balance of top and bottom line performance with 16% year-over-year ARR growth and strong free cash flow generation.”

Guidance, Bookings, and Demand

Management set fiscal 2027 revenue guidance between $3.18 billion and $3.23 billion, implying about 12% year-over-year growth at the midpoint. The company expects non-GAAP operating margins to expand and free cash flow to grow year over year, driven by accelerating bookings.

Demand was broad across Nutanix’s hybrid multicloud platform, external storage support, and public-cloud offerings. External storage and Nutanix Cloud Clusters materially contributed to the record quarter. The company added more than 3,000 customers in fiscal 2026, including about 650 new logos in the fourth quarter, and ended the quarter with net dollar-based retention of 106%.

Management noted ongoing server supply constraints and elevated hardware prices but said the business delivered solid top-line performance despite these challenges.

Analysts and company officials highlighted accelerating bookings and the lag between bookings and recognized revenue, suggesting continued conversion of bookings will support revenue and cash flow growth in fiscal 2027.