Pure Storage Announces First Quarter Fiscal 2026 Financial Results

Q1 total revenue growth of 12% year-over-year Storage as a Service offerings TCV sales growth of 70% , /PRNewswire/ -- Today Pure Storage (NYSE: PSTG), the IT pioneer that delivers the world's most advanced data storage technologies and services, announced financial results for its first quarter fiscal year 2026 ended May 4, 2025. "Pure continues to demonstrate the superiority of our technology and strategy through our steady growth and the expansion of our products and services," said Pure Storage CEO and Chairman, Charles Giancarlo. "Pure's platform enables customers to unify, virtualize and modernize their data footprints, across all workloads, over the entire range of performance, capacity and formats, and all with our single, advanced Purity Operating Environment." First Quarter Financial Highlights Revenue $778.5 million, up 12% year-over-year Subscription services revenue $406.3 million, up 17% year-over-year Subscription annual recurring revenue (ARR) $1.7 billion, up 18% year-over-year Remaining performance obligations (RPO) $2.7 billion, up 17% year-over-year GAAP gross margin 68.9%; non-GAAP gross margin 70.9% GAAP operating loss $(31.2) million; non-GAAP operating income $82.7 million GAAP operating margin (4.0%); non-GAAP operating margin 10.6% Operating cash flow $283.9 million; free cash flow $211.6 million Total cash, cash equivalents, and marketable securities $1.6 billion Returned approximately $120 million to stockholders through share repurchases of 2.5 million shares. "Q1 FY26 was a solid start to the year, with strong revenue growth," said Pure Storage CFO, Kevan Krysler. "Looking ahead, we remain committed to executing on our strategic priorities, driving growth, and maintaining the flexibility to navigate evolving market conditions." Leadership Update Pure also announced that Kevan Krysler has decided to leave the company after more than five years of service. Krysler will remain at Pure Storage until a successor has been named. "I want to thank Kevan for his partnership, dedication and loyal service to Pure. Of his numerous contributions to the company, he helped grow the business to over $3 billion in revenue and led our transition to subscriptions, which are now roughly 50% of our revenue," Giancarlo continued. First Quarter Company Highlights Accelerating Innovation Through Product Advancements Introduced the FlashBlade//EXA platform, the industry's leading data storage platform, designed to meet the rigorous demands of AI and high-performance computing, delivering unmatched performance, scalability, and metadata management. Launched Portworx Enterprise 3.3, an enterprise-grade container data management platform that aims to support VM workloads at an enterprise level. Strengthening Leadership with Deepened Industry Collaborations Announced a partnership with Nutanix to provide a joint, integrated solution to provide customers with a seamless way to deploy and manage virtual workloads on a scalable, modern infrastructure. Integrated the NVIDIA AI Data Platform reference design into its FlashBlade® line, cementing Pure Storage's position as a leader in enterprise data storage. Achieved certifications from NVIDIA, including recognition as a high-performance storage platform for NVIDIA Partner Network Cloud Partners; also secured NVIDIA-Certified Storage Partner approval at both the Foundation and Enterprise levels. Delivering Cyber Resilience and Performance Expanded its partnership with Rubrik to deliver a comprehensive solution to securely manage unstructured data at scale, providing bolstered protection against advanced threats, improved management capabilities, and exponential data efficiency. Industry Recognition and Accolades Amy Fowler, GM, Commercial Line of Business, and Hope Galley, VP, Americas Partner Sales, were recognized as 2025 Women of the Channel by CRN. Recognized as part of CRN's AI 100, Data Center 50, and 50 Coolest Software-Defined Storage Vendors for 2025. Awarded for Storage Excellence as part of ITPro's Excellence Awards. Second Quarter and FY26 Guidance Q2FY26 Revenue $845M Revenue YoY Growth Rate 10.6 % Non-GAAP Operating Income $125M Non-GAAP Operating Margin 14.8 % FY26 Revenue $3.515B Revenue YoY Growth Rate 11 % Non-GAAP Operating Income $595M Non-GAAP Operating Margin 17.0 % These statements are forward-looking and actual results may differ materially. Refer to the Forward Looking Statements section below for information on the factors that could cause our actual results to differ materially from these statements. Pure has not reconciled its guidance for non-GAAP operating income and non-GAAP operating margin to their most directly comparable GAAP measures because certain items that impact these measures are not within Pure's control and/or cannot be reasonably predicted. Accordingly, reconciliations of these non-GAAP financial measures guidance to the corresponding GAAP measures are not available without unreasonable effort. Conference Call Information Pure will host a teleconference to discuss the first quarter fiscal 2026 results at 2:00 pm PT today, May 28, 2025. A live audio broadcast of the conference call will be available on the Pure Storage Investor Relations website. Pure will also post its earnings presentation and prepared remarks to this website concurrent with this release. A replay will be available following the call on the Pure Storage Investor Relations website or for two weeks at 1-800-770-2030 (or 1-647-362-9199 for international callers) with passcode 5667482. Additionally, Pure is scheduled to participate at the following investor conferences: William Blair's 45th Annual Growth Stock ConferenceDate: Tuesday, June 3, 2025Time: 6:00 a.m. PT / 9:00 a.m. ETChief Technology Officer Rob Lee Bank of America 2025 Global Tech ConferenceDate: Tuesday, June 3, 2025Time: 11:00 a.m. PT / 2:00 p.m. ETChairman and CEO Charles GiancarloChief Financial Officer Kevan Krysler The presentations will be webcast live and archived on Pure's Investor Relations website at investor.purestorage.com. Updated Date and Location for Product & Technology-Focused Meeting for Financial Analysts at Pure//Accelerate 2025 in New York Date: Thursday, September 25, 2025 Join us at Pure//Accelerate® 2025 in New York on September 25, 2025, as we make history, changing the future of storage and the industry. Pure Storage executives - including Pure Storage CEO, Charles Giancarlo - and partners will share insights, strategies, and their vision for the future. The financial analyst meeting presentation will be webcast live and archived on the Pure Storage Investor Relations website at investor.purestorage.com. About Pure Storage Pure Storage (NYSE: PSTG) delivers the industry's most advanced data storage platform to store, manage, and protect the world's data at any scale. With Pure Storage, organizations have ultimate simplicity and flexibility, saving time, money, and energy. From AI to archive, Pure Storage delivers a cloud experience with one unified Storage as-a-Service platform across on premises, cloud, and hosted environments. Our platform is built on our Evergreen architecture that evolves with your business – always getting newer and better with zero planned downtime, guaranteed. Our customers are actively increasing their capacity and processing power while significantly reducing their carbon and energy footprint. It's easy to fall in love with Pure Storage, as evidenced by the highest Net Promoter Score in the industry. For more information, visit www.purestorage.com. Connect with Pure BlogLinkedInTwitterFacebook Pure Storage, the Pure P Logo, Portworx, and the marks on the Pure Storage Trademark List are trademarks or registered trademarks of Pure Storage Inc. in the U.S. and/or other countries. The Trademark List can be found at purestorage.com/trademarks. Other names may be trademarks of their respective owners. Forward Looking Statements This press release contains forward-looking statements regarding our products, business and operations, including but not limited to our views relating to our opportunity relating to hyperscale and AI environments, our ability to meet hyperscalers' performance and price requirements, our ability to meet the needs of hyperscalers for the entire spectrum of their online storage use cases, the timing and magnitude of large orders, including sales to hyperscalers, the timing and amount of revenue from hyperscaler licensing and support services, future period financial and business results, demand for our products and subscription services, including Evergreen//One, the relative sales mix between our subscription and consumption offerings and traditional capital expenditure sales, our technology and product strategy, specifically customer adoption of FlashBlade//EXA, Pure Fusion™ and priorities around sustainability and energy saving benefits to our customers of using our products, our ability to perform during current macro conditions and expand market share, our sustainability goals and benefits, the impact of inflation, tariffs, economic or supply chain disruptions, our expectations regarding our product and technology differentiation, new technology investments and partnerships, and other statements regarding our products, business, operations and results. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption "Risk Factors" and elsewhere in our filings and reports with the U.S. Securities and Exchange Commission, which are available on our Investor Relations website at investor.purestorage.com and on the SEC website at www.sec.gov. Additional information is also set forth in our Annual Report on Form 10-K for the fiscal year ended February 2, 2025. All information provided in this release and in the attachments is as of May 28, 2025, and Pure undertakes no duty to update this information unless required by law. Key Performance Metrics Subscription ARR is a key business metric that refers to total annualized contract value of all active subscription agreements on the last day of the quarter, plus on-demand revenue for the quarter multiplied by four. Total Contract Value (TCV) Sales, or bookings, of Pure's Evergreen//One and similar consumption- and subscription-based offerings is an operating metric, representing the value of orders received during the period. Non-GAAP Financial Measures To supplement our unaudited condensed consolidated financial statements, which are prepared and presented in accordance with GAAP, Pure uses the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, and free cash flow. We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses such as stock-based compensation expense, payroll tax expense related to stock-based activities, amortization of debt issuance costs related to debt, amortization of intangible assets acquired from acquisitions, restructuring costs related to severance and termination benefits, costs associated with the impairment and early exit of certain leased facilities, and unrealized gains and losses from mark-to-market adjustments on strategic investments that may not be indicative of our ongoing core business operating results. Pure believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when analyzing historical performance and liquidity and planning, forecasting, and analyzing future periods. The presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP, and our non-GAAP measures may be different from non-GAAP measures used by other companies. For a reconciliation of these non-GAAP financial measures to GAAP measures, please see the tables captioned "Reconciliations of non-GAAP results of operations to the nearest comparable GAAP measures" and "Reconciliation from net cash provided by operating activities to free cash flow," included at the end of this release. PURE STORAGE, INC.Condensed Consolidated Balance Sheets(in thousands, unaudited) At the End of First Quarter of Fiscal 2026 Fiscal 2025 Assets Current assets: Cash and cash equivalents $ 739,336 $ 723,583 Marketable securities 839,748 798,237 Accounts receivable, net of allowance of $959 and $940 411,319 680,862 Inventory 37,548 42,810 Deferred commissions, current 101,288 99,286 Prepaid expenses and other current assets 270,988 222,501 Total current assets 2,400,227 2,567,279 Property and equipment, net 503,527 461,731 Operating lease right-of-use-assets 138,423 146,655 Deferred commissions, non-current 230,989 229,334 Intangible assets, net 15,108 19,074 Goodwill 361,427 361,427 Restricted cash 19,046 12,553 Other assets, non-current 141,618 165,889 Total assets $ 3,810,365 $ 3,963,942 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 83,858 $ 112,385 Accrued compensation and benefits 142,333 230,040 Accrued expenses and other liabilities 157,733 156,791 Operating lease liabilities, current 41,266 43,489 Deferred revenue, current 969,321 953,836 Debt, current 100,000 100,000 Total current liabilities 1,494,511 1,596,541 Operating lease liabilities, non-current 129,735 137,277 Deferred revenue, non-current 858,224 841,467 Other liabilities, non-current 83,840 82,182 Total liabilities 2,566,310 2,657,467 Stockholders' equity: Common stock and additional paid-in capital 2,625,231 2,674,533 Accumulated other comprehensive income 1,831 954 Accumulated deficit (1,383,007) (1,369,012) Total stockholders' equity 1,244,055 1,306,475 Total liabilities and stockholders' equity $ 3,810,365 $ 3,963,942 PURE STORAGE, INC.Condensed Consolidated Statements of Operations(in thousands, except per share data, unaudited) First Quarter of Fiscal 2026 2025 Revenue: Product $ 372,144 $ 347,384 Subscription services 406,341 346,095 Total revenue 778,485 693,479 Cost of revenue: Product (1) 141,050 100,753 Subscription services (1) 101,282 97,020 Total cost of revenue 242,332 197,773 Gross profit 536,153 495,706 Operating expenses: Research and development (1) 221,740 193,820 Sales and marketing (1) 278,512 250,972 General and administrative (1) 67,072 76,787 Restructuring and impairment (2) — 15,901 Total operating expenses 567,324 537,480 Loss from operations (31,171) (41,774) Other income (expense), net 31,655 14,091 Income (loss) before provision for income taxes 484 (27,683) Income tax provision 14,479 7,326 Net loss $ (13,995) $ (35,009) Net loss per share attributable to common stockholders, basic and diluted $ (0.04) $ (0.11) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 326,539 322,589 (1) Includes stock-based compensation expense as follows: Cost of revenue -- product $ 3,266 $ 2,782 Cost of revenue -- subscription services 7,162 8,871 Research and development 49,242 50,294 Sales and marketing 22,084 23,519 General and administrative 14,521 27,528 Total stock-based compensation expense $ 96,275 $ 112,994 (2) Includes expenses for severance and termination benefits related to workforce realignment and lease impairment and abandonment charges associated with cease-use of our former corporate headquarters. PURE STORAGE, INC.Condensed Consolidated Statements of Cash Flows(in thousands, unaudited) First Quarter of Fiscal 2026 2025 Cash flows from operating activities Net loss $ (13,995) $ (35,009) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 33,770 33,943 Stock-based compensation expense 96,275 112,994 Noncash portion of lease impairment and abandonment — 3,270 Other 705 1,606 Changes in operating assets and liabilities: Accounts receivable, net 269,542 238,768 Inventory 2,669 (1,705) Deferred commissions (3,657) 7,707 Prepaid expenses and other assets (19,440) (9,219) Operating lease right-of-use assets 8,397 8,122 Accounts payable (26,991) (26,581) Accrued compensation and other liabilities (84,343) (109,124) Operating lease liabilities (11,238) (10,226) Deferred revenue 32,242 6,954 Net cash provided by operating activities 283,936 221,500 Cash flows from investing activities Purchases of property and equipment (1) (72,346) (48,818) Purchase of strategic investment — (5,000) Purchases of marketable securities (114,896) (160,123) Sales of marketable securities 18,207 37,689 Maturities of marketable securities 57,253 127,857 Net cash used in investing activities (111,782) (48,395) Cash flows from financing activities Proceeds from exercise of stock options 5,359 13,223 Proceeds from issuance of common stock under employee stock purchase plan 27,240 25,328 Principal payments on borrowings and finance lease obligations (1,125) (1,099) Tax withholding on vesting of equity awards (61,300) (12,478) Repurchases of common stock (119,936) — Net cash provided by (used in) financing activities (149,762) 24,974 Net increase in cash, cash equivalents and restricted cash 22,392 198,079 Cash, cash equivalents and restricted cash, beginning of period 737,750 712,131 Cash, cash equivalents and restricted cash, end of period $ 760,142 $ 910,210 (1) Includes capitalized internal-use software costs of $6.9 million and $4.5 million for the first quarter of fiscal 2026 and 2025. Reconciliations of non-GAAP results of operations to the nearest comparable GAAP measures The following table presents non-GAAP gross margins by revenue source before certain items (in thousands except percentages, unaudited): First Quarter of Fiscal 2026 First Quarter of Fiscal 2025 GAAP results GAAP gross margin (a) Adjustment Non- GAAP results Non- GAAP gross margin (b) GAAP results GAAP gross margin (a) Adjustment Non- GAAP results Non- GAAP gross margin (b) $ 3,266 (c) $ 2,782 (c) 240 (d) 296 (d) 208 (e) 20 (e) 3,306 (f) 3,306 (f) Gross profit --product $ 231,094 62.1 % $ 7,020 $ 238,114 64.0 % $ 246,631 71.0 % $ 6,404 $ 253,035 72.8 % $ 7,162 (c) $ 8,871 (c) 743 (d) 867 (d) 632 (e) 309 (e) Gross profit -- subscription services $ 305,059 75.1 % $ 8,537 $ 313,596 77.2 % $ 249,075 72.0 % $ 10,047 $ 259,122 74.9 % $ 10,428 (c) $ 11,653 (c) 983 (d) 1,163 (d) 840 (e) 329 (e) 3,306 (f) 3,306 (f) Total gross profit $ 536,153 68.9 % $ 15,557 $ 551,710 70.9 % $ 495,706 71.5 % $ 16,451 $ 512,157 73.9 % (a) GAAP gross margin is defined as GAAP gross profit divided by revenue. (b) Non-GAAP gross margin is defined as non-GAAP gross profit divided by revenue. (c) To eliminate stock-based compensation expense. (d) To eliminate payroll tax expense related to stock-based activities. (e) To eliminate expenses for severance and termination benefits related to workforce realignment. (f) To eliminate amortization expense of acquired intangible assets. The following table presents certain non-GAAP consolidated results before certain items (in thousands, except per share amounts and percentages, unaudited): First Quarter of Fiscal 2026 First Quarter of Fiscal 2025 GAAP results GAAP operating margin (a) Adjustment Non- GAAP results Non- GAAP operating margin (b) GAAP results GAAP operating margin (a) Adjustment Non- GAAP results Non- GAAP operating margin (b) $ 96,275 (c) $ 112,994 (c) 8,615 (d) 9,400 (d) 3,536 (e) 3,536 (e) 5,489 (f) 9,855 (f) — 6,375 (g) Operating income (loss) $ (31,171) (4.0 %) $ 113,915 $ 82,744 10.6 % $ (41,774) (6.0 %) $ 142,160 $ 100,386 14.5 % $ 96,275 (c) $ 112,994 (c) 8,615 (d) 9,400 (d) 3,536 (e) 3,536 (e) 5,489 (f) 9,855 (f) — 6,375 (g) 153 (h) 153 (h) (2,435) (i) — Net income (loss) $ (13,995) $ 111,633 $ 97,638 $ (35,009) $ 142,313 $ 107,304 Net income (loss) per share -- diluted $ (0.04) $ 0.29 $ (0.11) $ 0.32 Weighted-average shares used in per share calculation -- diluted 326,539 9,470 (j) 336,009 322,589 15,959 (j) 338,548 (a) GAAP operating margin is defined as GAAP operating loss divided by revenue. (b) Non-GAAP operating margin is defined as non-GAAP operating income divided by revenue. (c) To eliminate stock-based compensation expense. (d) To eliminate payroll tax expense related to stock-based activities. (e) To eliminate amortization expense of acquired intangible assets. (f) To eliminate expenses for severance and termination benefits related to workforce realignment. (g) To eliminate lease impairment and abandonment charges associated with cease-use of our former corporate headquarters. (h) To eliminate amortization expense of debt issuance costs related to our debt. (i) To eliminate unrealized gain from mark-to-market adjustment on strategic investment. (j) To include effect of dilutive securities (employee stock options, restricted stock, and shares from employee stock purchase plan). Reconciliation from net cash provided by operating activities to free cash flow (in thousands except percentages, unaudited): First Quarter of Fiscal 2026 2025 Net cash provided by operating activities $ 283,936 $ 221,500 Less: purchases of property and equipment (1) (72,346) (48,818) Free cash flow (non-GAAP) $ 211,590 $ 172,682 (1) Includes capitalized internal-use software costs of $6.9 million and $4.5 million for the first quarter of fiscal 2026 and 2025. SOURCE Pure Storage WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

Pure Storage Announces First Quarter Fiscal 2026 Financial Results

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