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Factors to Note Ahead of Pure Storage's (PSTG) Q1 Earnings

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Pure Storage, Inc. (PSTG - Free Report) is scheduled to report first-quarter fiscal 2022 results on May 26.

For the first quarter of fiscal 2022, management anticipates total revenues to be $405 million. The Zacks Consensus Estimate for fiscal first-quarter revenues stands at $406.3 million, suggesting increase of 10.7% on a year-over-year basis.

Meanwhile, the Zacks Consensus Estimate for fiscal first-quarter earnings is unchanged in the past 30 days at a loss per share of 7 cents.

Pure Storage, Inc. Price and EPS Surprise

 

Pure Storage, Inc. Price and EPS Surprise

Pure Storage, Inc. price-eps-surprise | Pure Storage, Inc. Quote

 

Factors to Note

Pure Storage’s fiscal first-quarter results are likely to gain from healthy adoption of its subscription services namely Pure as-a-Service subscription (includes Cloud Block Store) and Evergreen Storage.  

During the fiscal fourth quarter of 2021, Pure Storage announced the availability of Pure as-a-Service on Amazon’s (AMZN - Free Report) Amazon Web Services Marketplace to help enterprises simplify storage deployment.

Further, synergies from the Portworx acquisition, in a bid to expand its cloud-services solutions for Kubernetes technology, might have contributed to fiscal first-quarter performance.

Continued momentum in uptake of FlashArray and FlashBlade might have contributed to the company’s performance in to-be-reported quarter. The company is also likely to gain from uptick in its Pure FlashRecover offering, which provides all-flash data backup and recovery in case of a ransomware attack.

Incremental adoption of its second generation FlashArray//C is likely to have acted as a tailwind in the soon-to-be-reported quarter. FlashArray//C is a cost-effective storage array solution to provide customers with higher performance capabilities and enable them to run complex cloud workloads onto a single platform.

The continuation of work-from-home, online learning and tele-healthcare set up due to the ongoing pandemic is likely to have driven adoption of Pure Storage’s hybrid multi-cloud offerings and cloud data services. It is expected to have favored the fiscal first-quarter performance.

Improvements made to Pure Storage’s VMWare’s cloud portfolio for offerings, which includes vSphere Virtual Volumes with VMware Cloud Foundation, VMware Site Recovery Manager, Cloud Native Storage for Kubernetes on VMware and NVMe over Fabric, are expected to have accelerated the deployment of the company’s hybrid cloud offerings.

Pure Storage currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Nonetheless, higher expenses on product development amid stiff competition from storage peers including NetApp (NTAP - Free Report) might have limited margin expansion in the to-be-reported quarter.

Sluggish IT spending, owing to coronavirus-induced broader macroeconomic weakness, might have affected Pure Storage’s fiscal first-quarter performance.

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