Why a $99 Million Exit From This Cybersecurity Stock Down 40% Might Signal a Shift

On February 17, 2026, Greenvale Capital disclosed in a U.S. Securities and Exchange Commission filing that it sold out its entire position in Varonis Systems (NASDAQ:VRNS), an estimated $99.14 million trade based on previously disclosed position values.

What happened

According to a February 17, 2026 SEC filing, Greenvale Capital reported the sale of its entire position in Varonis Systems, a reduction of 1,725,000 shares. The stake’s value at quarter-end dropped to zero, down $99.14 million from the prior period.

What else to know

• Greenvale fully liquidated its Varonis holding, which was previously 7.8% of AUM.
• Top holdings after the filing:
  • NASDAQ:RUN: $197.23 million (18.5% of AUM)
  • NYSE:ZETA: $142.91 million (13.4% of AUM)
  • NYSE:SN: $116.57 million (10.9% of AUM)
  • NASDAQ:OKTA: $81.71 million (7.7% of AUM)
  • NASDAQ:ENPH: $75.32 million (7.1% of AUM)
• As of February 13, 2026, Varonis shares were priced at $25.36, down 40% over the past year and well underperforming the S&P 500’s roughly 20% gain in the same period.

Company overview

Company snapshot

• Varonis Systems offers software solutions for data security, analytics, classification, and access management, including DatAdvantage, DatAlert, Data Classification Engine, DataPrivilege, Data Transport Engine, and DatAnswers.
• The firm generates revenue through licensing and subscription sales of its proprietary software products, as well as related maintenance and support services.
• It serves enterprise IT, security, and business teams across North America, EMEA, and international markets, focusing on organizations managing sensitive and regulated data.

Varonis Systems, Inc. is a technology company specializing in software that enables enterprises to manage, secure, and analyze data both on-premises and in the cloud. The company leverages advanced analytics and automation to help organizations protect sensitive information and ensure compliance. Varonis differentiates itself through a comprehensive platform that addresses complex data security and governance challenges for large, data-driven organizations.

What this transaction means for investors

Sharp drawdowns like the one Varonis faced last quarter can certainly be jarring. The firm’s stock took a hit when management revealed that its transition toward a subscription and SaaS model would take longer than previously expected. The update triggered a nearly 50% single day plunge in October, wiping out two years of stock gains almost overnight and leaving shares still down roughly 40% over the past year even months later.

The cybersecurity sector has generally rewarded patience in recent years, but the market’s reaction to Varonis shows how quickly sentiment can turn when growth expectations shift. More recently, the firm reported a 16% increase in annual recurring revenues alongside full-year revenue up to $623.5 million from $551 million in 2024. But that might not be enough for investors hoping for booming growth.

Against that backdrop, the portfolio repositioning becomes easier to understand. The fund’s largest holdings skew toward other high growth software and energy transition names such as Zeta Global, Okta, and Sunrun, all of which are either up for the year or in Okta’s case, down much less than 40%.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Okta, SharkNinja, and Varonis Systems. The Motley Fool recommends Enphase Energy. The Motley Fool has a disclosure policy.