By Connor Hart

Shares of Commvault Systems tumbled after the company's second-quarter profit slipped, as lower gross margins weighed on results and expenses increased.

The stock was recently trading 17% lower, at $145.01, midday Tuesday, on track for its largest percent decrease in about four years. Shares have lost 15% of their value over the past four years.

Commvault, which helps clients restore data and operations following cyber incidents, said profit fell in the latest quarter, in part due to an acceleration in its software-as-a-service business, which carries a lower gross margin.

At the same time, total operating expenses jumped 19%, to $208.7 million. Finance Chief Jen DiRico told The Wall Street Journal on Monday that these higher expenses were in line with company expectations.

Slimmer margins and higher expenses offset Commvault's top line, which rose 18%, to $276.2 million, for the three months ended Sept. 30. DiRico said that durable demand for the company's cyber-resilience products continues to drive sales.

For the current quarter, Commvault projected revenue of $298 million to $300 million, roughly in line with analyst estimates. It reaffirmed its full-year revenue outlook of $1.16 billion to $1.17 billion and said it remains confident in its growth trajectory heading into the second half.

Write to Connor Hart at connor.hart@wsj.com

(END) Dow Jones Newswires

October 28, 2025 12:25 ET (16:25 GMT)

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