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Here's How Pure Storage (PSTG) is Placed Ahead of Q1 Earnings

Zacks Equity Research
·3-min read

Pure Storage, Inc PSTG is scheduled to report first-quarter fiscal 2025 results on May 29.

PSTG expects revenues to be $680 million for the quarter, implying an increase of 15.4% from the year-ago figure. The Zacks Consensus Estimate is pegged at $681.4 million, suggesting an improvement of 15.6% from the prior-year level.

The Zacks Consensus Estimate for earnings is pegged at 22 cents per share. The company reported earnings of 8 cents in the prior-year quarter.

PSTG beat estimates in each of the last four quarters, the average surprise being 38.6%.

Pure Storage, Inc. Price and EPS Surprise

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

Increasing customer demand, especially for the FlashBlade portfolio (including FlashBlade//E) and Evergreen//One storage-as–a-service, is likely to have driven the top-line performance for Pure Storage in the fiscal first quarter.

The rapid proliferation of generative AI is expected to boost demand for FlashBlade and Portworx products. Increased customer adoption of Portworx storage software solution for databases, messaging and logging systems is an additional tailwind.

Apart from this, continued momentum in its subscription services is likely to have boosted Pure Storage’s fiscal first-quarter performance. We expect revenues from subscription services to be $346.4 million, up 23.6% year over year.

An expanded customer base (especially large enterprise clients) along with strength in commercial business bode well. In the last reported quarter, the company acquired 349 customers, including six new Fortune 500 customers. It serves more than 60% of the Fortune 500 companies.

Management remains concerned about the volatile macroeconomic backdrop. Price increases on NAND from suppliers might affect margins. Intensified competition in the flash-based storage market poses an additional headwind.

What Our Model Says

Our proven model does not predict an earnings beat for PSTG. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here.

PSTG has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.

Abercrombie & Fitch Co ANF has an Earnings ESP of +4.48% and is set to announce quarterly figures on May 29. ANF currently has a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for ANF’s to-be-reported quarter’s earnings and revenues is pegged at $1.62 per share and $948.8 million, respectively. Shares of ANF have risen 410.8% in the past year.

The Gap, Inc GPS has an Earnings ESP of +15.47% and presently carries a Zacks Rank #1. GPS is slated to release quarterly numbers on May 30.

The Zacks Consensus Estimate for GPS’ to-be-reported quarter’s earnings and revenues is pegged at 14 cents per share and $3.28 billion, respectively. Shares of GPS have gained 181.1% in the past year.

Dell Technologies Inc DELL has an Earnings ESP of +2.30% and currently carries a Zacks Rank #2. DELL is scheduled to report quarterly earnings on May 30.

The Zacks Consensus Estimate for DELL’s to-be-reported quarter’s earnings and revenues is pegged at $1.25 per share and $21.7 billion, respectively. Shares of DELL have surged 219.4% in the past year.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar

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Zacks Investment Research