Pure Storage revenue tops $1 billion, says ‘hello’ to profit

Pure Storage has joined the billion-dollar club. On Thursday, the all-flash provider completed two long-sought goals by posting fiscal-year revenue of $1.023 billion, up 41%, en route to achieving non-GAAP profit.

Pure Storage revenue last quarter shot up 48% year over year to $338.3 million, topping the $332 billion consensus. Product sales ($277.4 million) and support revenue ($61 million) each was up 48%. Earnings per share of 13 cents beat Wall Street expectations of 7 cents.

It marked the second straight quarter that actual Pure Storage revenue exceeded high point guidance, and it came in two points above the midpoint range.

Aiding the vendor’s surge last quarter was the addition of 500 customers. The list includes Advance Financial Corp, Jenny Craig, Mid America Pet Food, Portland Trailblazers, Suzuki Motor of America and the Texas Rangers.

Pure claims it now serves more than 4,500 customers, up nearly 50% from a year ago.

“It’s been nearly two decades since an independent company in our industry has reached this revenue scale (this rapidly). We achieved the $1 billion milestone in just over eight years since our founding,” Pure Storage CEO Charles Giancarlo said.

Sales of all-flash FlashArray accounted for 20% of Pure Storage revenue last year, including demand for the NVME-based FlashArray//X unstructured data array. Another highlight, Giancarlo said, was Pure producing a full year of operating cash flow ($72.8 million) and free cash flow ($7.7 million).

Although best known for storage hardware, Pure Storage last year added synchronous multisite replication and active-active clustering to boost remote backup. Pure Meta1 analytics also was added for storage for emerging uses in advanced analytics, AI, machine learning.

Pure will try to build on that software-defined product emphasis in 2018, Giancarlo said.

Getting cash-strapped IT customers to move upstream is always a challenge for vendors, but Pure highlighted gains there as well. About 70% of Pure Storage revenue last year stemmed from repurchases by existing customers, President David Hatfield said.

“Our increasing focus (to move customers) up market is working. The number of customers that spent more than $1 million with Pure doubled versus last year,” Hatfield said.

For its 2019 fiscal year, Pure Storage issued non-GAAP revenue guidance in the range of $1.31 billion to $1.36 billion.