Rubrik Prices IPO Above Expected Range at $32 Per Share, Raising $752 Million

Rubrik, a data security and management company, priced its initial public offering (IPO) at $32 per share on Tuesday, exceeding the expected range of $28 to $31 per share. The Palo Alto, California-based company sold 23.5 million shares in the offering, raising a total of $752 million and implying a valuation of approximately $5.6 billion.

The shares are expected to begin trading on the New York Stock Exchange on April 25, 2024, under the ticker symbol "RBRK". Goldman Sachs & Co. LLC, Barclays, Citigroup, and Wells Fargo Securities are acting as lead book-running managers for the offering, which is expected to close on April 29, 2024, subject to customary closing conditions.

Founded in 2014 by venture capitalist Bipul Sinha, Rubrik provides cloud-based ransomware protection and data-backup software to over 6,000 business customers, including major corporations like Nvidia and Home Depot. The company reported a subscription annual recurring revenue growth of 47% year-over-year as of January 2024, but also disclosed a net loss of $354 million on revenue of $628 million for the 12 months ended January 31, 2024.

Why this matters: Rubrik's successful IPO pricing above the expected range is seen as a bullish sign for the company's stock market debut and a potential indicator of a rebound in the U.S. IPO market, which had been slow in 2022 and 2023 amid global macroeconomic uncertainty. The strong investor demand for Rubrik's shares, with the offering being oversubscribed by about 20 times, suggests a growing appetite for fast-growing technology companies, even if they are currently unprofitable.

Rubrik's IPO comes at a time when the company is shifting its focus from perpetual licenses and hardware maintenance contracts to cloud-based cybersecurity software subscriptions, which now account for 91% of its revenue, up from 59% two years ago. However, the company's widening losses remain a concern as it enters the public market, with a net loss of $354 million in the latest fiscal year, compared to a loss of $278 million the previous year.

Key Takeaways

• Rubrik priced its IPO at $32/share, above the expected range of $28-$31.
• Rubrik raised $752M, implying a $5.6B valuation, and will trade on NYSE as "RBRK".
• Rubrik provides cloud-based ransomware protection and data-backup software to over 6,000 businesses.
• Rubrik's IPO is seen as a bullish sign for the U.S. IPO market, which was slow in 2022-23.
• Microsoft, Lightspeed, Bain, and Khosla are among Rubrik's prominent backers.