Pure Storage (PSTG) stock is surging in Wednesday's session after the advanced data storage company beat top- and bottom-line expectations for its fiscal 2025 third quarter and announced it had been awarded a design win from a "top-four hyperscaler."
In the quarter ended November 3, Pure Storage's revenue increased 8.9% year over year to $831.1 million. Its earnings per share (EPS) remained unchanged from the year-ago period at 50 cents.
The results beat analysts' expectations. Wall Street was anticipating revenue of $815 million and earnings of 41 cents per share, according to Investor's Business Daily.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"Pure Storage has achieved another industry first in our journey of data storage innovation with a transformational design win for our DirectFlash technology in a top-four hyperscaler," said Pure Storage CEO Charles Giancarlo in a statement. "This win is the vanguard for Pure Flash technology to become the standard for all hyperscaler online storage, providing unparalleled performance and scalability while also reducing operating costs and power consumption."
The company anticipates test runs for the major tech firm to start in early 2025 and is targeting "large full production deployments, on the order of double-digit Exabytes" by calendar year 2026, Giancarlo said on the company's earnings call in regard to the design win. This corresponds to Pure Storage's fiscal 2027.
As a result of its strong financial performance in the first nine months of its current fiscal year, Pure Storage raised its full-year outlook. The company now anticipates revenue of approximately $3.15 billion and operating income of roughly $540 million.
This is up from its previous forecast for revenue of approximately $3.1 billion and operating income of about $532 million.
Is Pure Storage stock a buy, sell or hold?
Pure Storage was already doing well on the price charts heading into Wednesday's trading. Indeed, the tech stock was up 50% through the year to date through the December 3 close vs the S&P 500's 28.5% total return (price change plus dividends).
Unsurprisingly, Wall Street is bullish on the large-cap stock. According to S&P Global Market Intelligence, the average analyst target price for PSTG is $70.62, representing implied upside of nearly 7% to current levels. Additionally, the consensus recommendation is a Buy.
Financial services firm Needham is one of those with a Buy rating and a fresh $75 price target on PSTG stock, up from its previous target of $62.
"We expect Pure Storage to gain share from competing storage vendors on the strength of its expanding product portfolio and innovative product roadmap – both of which are underpinned by Pure Storage's Purity software," says Needham analyst Mike Cikos.
The analyst thinks PSTG'S Evergreen subscriptions are "a direct reflection of its software-based offering and its disruptive approach to the Storage market. Furthermore, growing Evergreen subscriptions are expected to benefit the economic model through improved customer lifetime value."
Related Content
-
4 Career Moves to Make Now if You're Worried About a RecessionWorried about a recession? These steps to protect your job prospects will help you professionally whether a downturn develops or not.
-
How StoryCorps Works and How You Can Tell Your StoryStoryCorps has recorded conversations between thousands of people, and anyone can participate. National facilitator Alan Jinich explains how to share your story.
-
I'm a Retirement Psychologist: Here's Why Doing What You 'Ought' in Retirement Beats Doing Whatever You WantTrue retirement freedom isn't about simply doing whatever you want, but about finding purpose and direction through commitments that align with your deepest values and allow you to contribute meaningfully.
-
Tactical Roth Conversions: Why 2025-2028 Is a Critical Window for RetireesThe One Big Beautiful Bill (OBBB) extended today's low tax brackets, but they may not last. Here's how smart planning now can prevent costly tax surprises later.
-
Ready to Retire? It's Not Too Late to Convert to a Roth IRAMillions of Americans are turning 65 this year. If you're retiring soon, don't dismiss the idea of a Roth conversion — it could still be a smart move even now.
-
9 Warren Buffett Quotes for Investors to Live ByWarren Buffett transformed Berkshire Hathaway from a struggling textile firm to a sprawling conglomerate and investment vehicle. Here's how he did it.
-
I'm a Financial Adviser: Three Things You Will Wish You Did Before the Fed Cuts Interest RatesWith potential interest rate cuts on the horizon, you might want to lock in today's higher yields and consider adjusting your asset allocation.
-
Simple Ways to Save on Back-to-School Shopping This YearSet a budget and stick to it, scour the house for what you already have, decorate backpacks and lunch boxes with your kids and consider buying some items during holiday sales.
-
Stocks End Strong Month on a Down Note: Stock Market TodayThere was likely a bit of profit-taking ahead of a historically weak September.
-
If You'd Put $1,000 Into UnitedHealth Group Stock 20 Years Ago, Here's What You'd Have TodayUNH stock was a massive market beater for ages – until it wasn't.
