Pure Storage Stock Slips Despite Positive Q3 Results
Pure Storage Inc (NYSE:PSTG) shares are trading lower Wednesday despite reporting third-quarter financial results that met earnings expectations and beat revenue estimates, while also raising its full-year guidance.
What Happened: Pure Storage reported quarterly earnings of 58 cents per share, which met the analyst consensus estimate, representing a 16% increase from 50 cents per share in the same period last year.
The company reported quarterly sales of $964.45 million, which beat the analyst consensus estimate of $956.13 million.
Revenue of $964.5 million increased 16% year-over-year, with subscription services revenue of $429.7 million up 14% year-over-year. Subscription annual recurring revenue reached $1.8 billion, up 17% year-over-year, while remaining performance obligations totaled $2.9 billion, up 24% year-over-year.
“Pure Storage delivered another strong quarter as global customers increasingly choose Pure to solve their toughest data management challenges,” said Charles Giancarlo, Pure Storage CEO and chairman. “Competitive advantage in the AI era demands data accessibility. Pure’s Enterprise Data Cloud breaks data free from application silos, allowing enterprises to harness the power of AI, automation, and analytics.”
For the fourth-quarter, Pure Storage expects sales of $1.02 billion to $1.04 billion versus the $1.023 billion analyst estimate, a 16.5% to 17.6% year-over-year growth.
Pure Storage raised its fiscal 2026 sales outlook from $3.6 billion to $3.63 billion to a new range of $3.63 billion to $3.64 billion versus the $3.619 billion estimate.
PSTG Analyst Ratings
Pure Storage has seen a range of recent analyst actions with several maintaining positive ratings, though the target prices vary. Following its earnings report, Citigroup maintained its Buy rating for the company, setting a target of $105.00 on Dec. 3, down from a previous $110.00. Lake Street also maintained a Buy rating but set a lower target at $92.00, up from a previous $80.00.
Barclays and Wedbush have also taken noteworthy actions. Barclays maintained an Equal-Weight rating, setting a target at $77.00, an increase from a previous target of $70.00. Wedbush maintained an Outperform rating, raising its target from $90.00 to $100.00. JP Morgan also maintained an Overweight rating but reduced the target from $110.00 to $105.00.
PSTG Price Action: Pure Storage shares were down 27.22% at $68.93 at the time of publication on Wednesday, according to Benzinga Pro.
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