Post Earnings Coverage as Pure Storage’s Revenue Soared 52%

Upcoming AWS Coverage on Nimble Storage Post-Earnings Results

LONDON, UK / ACCESSWIRE / March 17, 2017 / Active Wall St. announces its post-earnings coverage on Pure Storage, Inc. (NYSE: PSTG). The Company posted its fourth quarter and fiscal 2017 results on March 01, 2017. The data storage Company surpassed top- and bottom-line expectations. Register with us now for your free membership at:

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One of Pure Storage’s competitors within the Data Storage Devices space, Nimble Storage, Inc. (NYSE: NIML), reported on March 07th, 2017, its financial results for the Q4 FY17 and FY17. AWS will be initiating a research report on Nimble Storage in the coming days.

Today, AWS is promoting its earnings coverage on PSTG; touching on NIML. Get our free coverage by signing up to:

http://www.activewallst.com/register/

Earnings Reviewed

For the quarter ended January 31, 2017, Pure Storage’s revenues were a record $227.9 million, up 52% y-o-y and 16% q-o-q, which is 2% above the mid-point of the Company’s guidance. Pure Storage’s revenue numbers topped analysts’ consensus of $223.9 million. For the full year 2017, Pure Storage’s revenues were $728 million, up 65% from the prior year and 3.3% above the Company’s guidance range. Pure Storage has grown revenues 2.7 times in the six quarters it has reported since the Company’s IPO.

During Q4 FY17, Pure Storage added 450 new customers, bringing its total for the year up to 1,400 customers added; increasing the Company’s customer count to over 3,000 totals, including well over 100 from the Fortune 500 and roughly 70% of the net new logos in the quarter were driven by the channel. Pure Storage noted that Cloud companies account for more than 25% of its total sales. The Company serves over 500 software as a service, infrastructure as a service, and consumer Internet cloud customers. And since inception, 8 of the top 10 telecommunications providers have collectively spent over $100 million with Pure Storage.

For Q4 FY17, non-GAAP operating losses were negative $4.4 million, or negative 1.9% of revenue, compared to non-GAAP operating losses of negative $20.9 million, or negative 13.9% of revenue, in the year-ago corresponding quarter. This represents a 12% improvement in operating margin year-on-year and a 7.9% improvement sequentially. The Company’s operating loss for FY17 was negative $96.3 million, or negative 13.2% of revenue, 31% lower than the operating loss for the last fiscal year and 32% ahead of its operating loss guidance.

Pure Storage reported net loss of $42.9 million, or $0.21 per share, compared to net loss of $44.3 million, or $0.24 per share. Losses, adjusted for stock option expense, were $0.02 per share. The results surpassed Wall Street’s expectations for a loss of $0.07 per share.

Segment Results

Pure Storage’s Product revenue in Q4 grew 47% y-o-y to $186.8 million, driven in part by a record 450 new customers and excellent demand from the existing customers. Pure Storage stated that during the reported quarter, across its entire customer base, for every $1 that the customers spent initially they spent an average of an additional $2 within the next 24 months.

Pure Storage’s Support revenue in Q4 FY17 grew 79% y-o-y and 13% quarter on quarter to $41.1 million, driven by revenue recognition on ongoing support contracts. The Company continues to drive loyalty among its customers, demonstrated by a strong customer retention rate in the mid-90% range.

From a geographic perspective, 77% of Pure Storage’s revenue came from the US and 23% internationally for Q4 FY17 and FY17, compared to an 80/20 split in the prior fiscal year.

Product gross margins of 66.6% improved 0.6% sequentially and declined 1.7% year-on-year. Support gross margins of 63.6% improved 10.2% year-on-year and 0.4% sequentially.

Total headcount at the end of Q4 was over 1,700, up from 1,650 at the end of Q3 and up from 1,300 a year ago.

Balance Sheet & Cash Flow

Pure Storage finished FY17 with cash and investments of $546.7 million. The Company’s free cash flow was positive $25.3 million, or 11% of revenue, in Q4 FY17 compared to $32.1 million, or 21% of revenue in the year ago same quarter. The Company noted that this included $8.1 million of cash impact related to its employee stock purchase plans. Excluding this amount, free cash flow would have been $17.2 million, or 8% of revenue, compared to $21 million, or 15% of revenue, for the year-ago comparable quarter.

For the full fiscal year ending on January 31, 2018, Pure Storage expects revenues to be between $975 million and $1.025 billion. The Company expects gross margins between 63.5% and 66.5% and operating margins between negative 9% and negative 5%.

For Q1 FY18, Pure Storage expects revenues of between $171 million and $179 million. Turning to gross margins, it expects Q1 FY18 non-GAAP gross margins in the range of 63.5% and 66.5%.

Stock Performance

At the close of trading session on Thursday, March 16, 2017, Pure Storage’s stock price climbed 1.07% to end the day at $10.39. A total volume of 574.73 thousand shares were exchanged during the session. The stock currently has a market cap of $2.01 billion.

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