Rubrik, Backed by Microsoft, Targets $713M IPO: Report

April 15, 2024 : Cloud security software company Rubrik, which boasts prominent backing from Microsoft, is reportedly aiming to raise up to $713 million through an initial public offering (IPO), according to a source familiar with the matter. This development signifies Rubrik’s intention to join the ranks of publicly traded companies.

The details of the IPO were disclosed anonymously due to the confidential nature of the ongoing discussions. The source indicated that Rubrik intends to sell 23 million shares at a price range of $28 to $31 per share. At the upper end of this spectrum, the company’s valuation would reach approximately $5.4 billion.

Rubrik’s decision to pursue an IPO comes amidst a period of tentative recovery for the U.S. IPO market. Following a prolonged stretch of sluggishness in 2022 and 2023, characterized by a reluctance of companies to go public due to unfavorable market conditions, recent successful stock market debuts by social media platform Reddit and semiconductor connectivity firm Astera Labs appear to be paving the way for renewed activity. Emboldened by these positive developments, Rubrik seems poised to capitalize on this improving market climate.

The reasons behind Rubrik’s decision to go public at this time were not disclosed. However, an IPO can provide companies access to a wider pool of capital, potentially fueling future growth initiatives. Additionally, becoming a publicly traded company can enhance brand recognition and potentially attract a broader range of talent.

Rubrik specializes in cloud-based data security solutions, catering to the growing need for robust protection against ransomware attacks and efficient data backup procedures within cloud environments. The company boasts a clientele exceeding 5,000 businesses, including prominent names like Nvidia Corp and Home Depot.

According to its IPO filing, Rubrik’s subscription annual recurring revenue (ARR) increased 47% year over year at the end of January 2024. However, the company remains unprofitable, reporting a loss of $354 million on revenue of $628 million for the 12 months ended January 31st, 2024. The prior year saw a loss of $278 million on revenue of $600 million.

While Rubrik demonstrates impressive revenue growth, its path to profitability remains unclear. Potential investors should carefully consider the company’s financial health and future growth prospects before making investment decisions.

In conclusion, Rubrik’s planned IPO signifies its aspirations for significant growth and broader market recognition. The success of the offering will depend on investor confidence in the company’s ability to navigate the competitive cloud security landscape and achieve sustained profitability.

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