Pure Storage (PSTG) 28 Aug 242025 Q2 Earnings call transcript

Good day, and welcome to the Pure Storage Second Quarter Fiscal 2025 Financial Results Conference Call. Today's conference is being recorded. [Operator Instructions]. At this time, I'd like to turn the call over to Paul Ziots, Vice President of Investor Relations. Please go ahead.

Thank you. welcome Call. Second and XXXX Fiscal everyone, Conference Earnings afternoon, to Quarter Pure's Year Good

call, have Lee, the Chief On we Financial Kevan Executive Officer; Krysler, Officer; and Rob Chief Officer. Charlie Technology Giancarlo, Chief

and Charlie's questions. Kevan's will we Following take remarks, prepared

after was investor.purestorage.com. call posted webcast this of market being can accompany this simultaneously webcast. be Our on issued and website at our press close release that downloaded where is is The slides

undertake risks offerings and and which this obligation them. based uncertainties. product call and will forward-looking we statements subject our facts to statements These and and On we and our new we various economic regarding on trends. make forward-looking include of Any no are competitive industry as operations, to and statements, update our are its make today, financial current outlook assumptions that strategy, and today, advantages, technology

of should our of you Our reported considered public related the as actual these from and in risks business forecasted, results to indication we and SEC, results with performance. to filings. differ uncertainties may our results is be not of the the future contained A filings and materially an refer some discussion

all measures and performance financial our press associated During this measures provided the GAAP revenue, are Reconciliations are obligations release slides. non-GAAP in most earnings and call, to rates other or growth investments. RPO metrics and cash remaining than and directly comparable

is the Pure will the on and Storage. Investor playback is live call website the the An recorded Storage purposes. Pure on of IR be is webcast broadcast being of This for being property Relations available website archive and

October business, XXXX. begins Our at third period XXXX quarter the XX, close of fiscal Friday, quiet

to that, Charlie. over it With turn I'll

revenue 'XX in and in afternoon, up of to everyone, share growth market pick with you, earnings XX% outpace QX our and growth. FY both innovation the welcome Thank We and Pure year-over-year. to were Paul. continues pleased call. QX our Good industry,

our at and we the quarter, customers Annual //Accelerate During partners hosted Conference.

and //Accelerate where events Our of a and our and picked of customers Vegas Asia strategy Pacific, in held June, about off series Europe thousands platform learn vision. Fusion local Las Americas, the across partners

as well Pure's in virtualization and application As modernization. offerings AI,

Specifically, we of soon Pure data automated upgrade cloud that allows global their introduced data customers. storage be an a architecture systems. nondisruptive data to Fusion, existing a businesses generation to enterprise to first-of-its-kind cloud available as into next of silos our Storage the of all storage eliminates the Fusion systems storage transform

the that performance price Storage AI the provides their address. growth. of need Pure's type needs both and for growth a infrastructure We them of industry's GPU AI as their also in AI Evergreen//One cost their workloads and they flexibility revenue and for in clouds to need as consumption are matches flexibility first they will and Service unveiled to clouds. uncertain Growing and GPU future their

It costs, also removes delivery XX Our Evergreen//One Evergreen//One, and Pure a simplifies planning, work, environment has hard a overall resiliency, services, provides risk multiple with of last flexibility, efficiency enhances It improving significantly avoids rigid service and grown of Evergreen//One offering performance. over remains efficiency solid Technology, and energy XXXX company, across small SaaS on years back X customers' subscription Through from strong. globally. technology labor. and their sites and and started guaranteed enterprise with Options X in expense to the organizations. operating the of financial Evergreen//One SLAs. regularly and petabytes operations it terms it IT overprovisioning storage capital in boosts of the storage

deal continue While first activity. to see the large times lengthening the enterprise growth of Evergreen//One deal we in strong impacted half,

interest great to be our continues customers. of intelligence Artificial to

expected as The year. our predicted. has have AI DGX for had their infrastructure. market Pure of consistently NVIDIA our continue use data join well progressed SuperPOD accommodate to storage have for as to AI this as //Accelerate AI end AI were we solutions. both opportunities how certification for to the at sees areas NVIDIA customers study us by to in announce Specifically, pleased X separate potential the We

for First, and environments learning high-performance for provides farms. private Pure storage GPU and machine storage training where public

behind of for large This services, quarter, with Japanese platform, created SoftBank's to is SoftBank language. the Corporation, develop deal the a we signed services storage cutting-edge big Pure generative providing new AI their in the language including market-leading X model X telecommunication the Japan. of specifically layer many

use commercial most, focuses second own opportunity storage operate systems or tailored The or provide Many, will their with other for use LLM data. small offerings models environments of closely satisfy AI foresee number this Pure will to inference enterprises market. NVIDIA a not on is on insight data in-house. their working we on market GPU environments. AI to if enterprise rag These vertical relatively from proprietary to

their Enterprise's cloud, sit for believe all stores data data generally We and served storage to siloed stacks nor storage AI. the Pure existing and access to data engines preparation continue has of enterprise opened AI AI Current AI access that investigations is opportunity to their behind major the access are easier in eliminating the Customers acknowledge storage silos architectures. our as nature will for by customers to management simplifying directly have data to most deployment. allow and are data and a that enable neither analytics. data to address connectivity Fusion performance barriers largest the function advanced application AI and upgrade that

their large has costs escalating services. also AI their to organizations around dollars. cloud customers planning reevaluate increase begin uncertainty on to software, and invest managing SaaS will from and how on they We're Focus IT focus caused seeing their

and solution infrastructure application services. Pure less generally enterprises Store cloud dramatically by Cloud is storage helping than resilient But public cloud Cloud more a Store enterprise performing costs cloud or deployments simply, large that than contain Azure Block Our storage Microsoft for VMware more cloud provides expensive XX%. native is Block

performance. with thousands case of The a workload Fortune compatible and accelerating fully food Block protection, and recovery limited is data XXX reporting. a Block data data dozens with its is costs storage customer beverage of Store hyperscaler growing in of with visibility discs cloud-managed enterprise protection. By is overall disaster including ransomware equipped advanced Block into services, Cloud to just storage features remediation that face store workload to save footprint point Furthermore, Global leveraging interfaces Store, One bill. and performance volumes, looking Cloud company total Cloud and reducing its XX% and

core technology Our storage hyperscalers their progress to discussions with continues positively. Pure to with replace

remain prospect will hyperscaler secure have detailed months. in design by been from year-end. Our that our our and core advanced we integrated evaluation contractual confident of win solution we lead first to engaged for many has We and extensive testing technology negotiations

are power hyperscalers projected longer-term significant. of a technology, discs alone. reliability The buy similar can flash of opportunity scale, better XX sense ownership. and drives total provide in for is Because of disc hard to Pure hyperscalers all direct over top offer XX% space exabytes at almost the to To a we this unique performance, XXX with and of savings Pure's or year hyperscalers better cost

in expertise standard density property and Pure with match management, outdistance can With nearly the and experience industry with performance. key that efficiency, and to be cannot continue unmatched multiprocess we XX intellectual years and of flash hardware multivendor, replicated flash other SSDs. far energy no holds vendor software

map. the DirectFlash stop next latest industry-leading flash XXX-terabyte road Our is, on shipping our year module but later robust this

centers. advantage significant. requirements space reduced to and power to savings by generated to on of incentive alone direct switch and to from world power in by the X provides XX a Energy a discs of supply, are compelling enterprise We as savings space, greater data compared flash electrical In discs. electricity demands our a both hyperscaler and as factor limited cooling hard hard well

Our products their to E last recognize and grow more they eliminate that strongly. performance centers. Enterprises focused has DirectFlash where the replacing systems on technology higher price with continues family Pure mechanical component from can hard the Pure of data technology efficient level reached disc enterprise increasingly

As the provider the approximately existing of set highlighted British XXXX. multinational service our Pure's ESG a reduce centers constraints emissions power in net to has by Businesses can data to and by sustainability costs zero facing in target while goals. higher operations from higher end achieve carbon XX%. in its storage greater report, committing March are BT, DirectFlash power reduction on power latest total usage energy technology

a to we their support center program. directly storage reduction As energy BT, foundational data provider

has have to grow BT your efficient more enabled storage BT data times be XX We benchmarks. measured to its about legacy usage. storage storage reducing its their energy while than

customers' Looking back past environment change over this buy. a have to in seen intentions overall not significant the our or quarter, macro we

IT positive We seen however, cloud, storage and software in have, to market resilient be have SaaS. yet believe economy that costs to in customers but we inflection. We a increasing will manage the this see look

and we compete forced Pure in the remain see to we share to well strong our and our have to we that expand now positioned in are share as in all in and We look growing in competition. we legacy maintain our is market. our confident competitors competitors our their and their leadership on segments are the mimic us. gaining will as has the market to We the of strength appreciate which and in our know messaging. and strategies ground clear It efforts focused continue alpha markets gain messaging forward believe intensify competitor our storage. attention ability Overall, We

to Kevan. I'll With turn over it that,

Thank you, Charlie.

and ARR, guidance. to we service during the billion, XX% of first see million be driven business. or and operating double-digit of We QX strong and performance fiscal Revenue to are pleased recurring year-over-year XX% over for higher FlashArray and $XXX which in both for a particular delivered revenue grew to services, continue velocity million in profit Evergreen//One our our our growth half exceeded offerings. by FlashBlade//E $XXX to have annual year, grew continues E revenue offering, both revenue, of our Subscription $X.X sales

service a ARR date subscription effective where noncancelable has the contracts ARR As the service not effective subscription not Including started, services grew services subscription XX%. subscription contracts date noncancelable reminder, has excludes where Evergreen started.

Total grew RPO to and exiting both includes QX, year-over-year services billion. subscription product orders and $X.X XX% which

in XXX 'XX QX and within services from financial include product FY we a order As previous orders shared telco orders quarters, noncancelable QX RPO company 'XX. Fortune have to from relating a FY

RPO At subscription of QX, the associated end by XX%. with our offerings service exclusively grew

million. half sales $XXX reached TCV QX offerings million, during for sales FY Storage total 'XX Service value a Additionally, as first $XXX contract in to the of bringing

'XX growth continued to a time opportunities Last larger the as Service in strong, opportunities. quarter, Evergreen//One Service deals of both of Storage TCV underpin is to sales for in the This million approximately ] a Consistent large QX to year, or Evergreen//One converting success our half less. demonstrating million, which year-over-year extended the we closing now FY This business closed our growth impacts and in valued RPO reflecting offerings, a experience first growth rate we at Service [ year. we half pipeline robust our expect $X with consistent last growth compared a for Evergreen//One of XX%. potential several as $XXX to and forecasted lines Our as first in Storage this be confidence offerings. continues

for QX $XXX $XXX million million. was revenue was international and U.S. revenue

grew subscription supporting now automation healthy Evergreen the and XX% services service delivery Our new of year-over-year. comparable during in Subscription customer margin leverage of acquisition margins XXX. to gross XX.X% by customers we Fortune to serve we our increased gross very and QX XX.X% of of as continues workflows, Total logistics strengthened our services. XXX QX, be

cost-sensitive by gross customers QX driven growth sales FlashArray//C strong of to and increasingly FlashBlade//E, FlashArray//E and margin their our product XX.X% of underscores in all-flash. shifting solutions, the workloads Our

margin As efforts approximately during anticipate expense year. of by decline XX% overachievement, positively transition a the discipline. customers all-flash gross performance we margin impacted fiscal modest revenue Operating to product were help we our second in solutions, strength pursue strategic margins workloads and the our operating and half gross their strong of profit aggressively to

the at of increased Our XXX employees head approximately by sequentially count quarter. X,XXX to nearly the end

$XX million, flow Here's and and capital in quarter very $X.X were including remains balance operations was strong, end liquidity investments of million. expenditures sheet and QX. at $XXX the cash from billion Cash the during

including supporting quarter key engineering capital Our equipment growth significant new initiatives, in expenditures opportunities. our during infrastructure strategic pursuit concentrated for of hyperscaler the most were test

was of our began which we awards As million approximately offsetting equity objective partially million, shares. on QX, by $XX part taxes employee equity X.X withholding dilution awards. of paying taxes dilution, offsets In due withholding on

authorization. million existing We our repurchase remaining $XXX have approximately on

to turning Now guidance.

workloads. takes profit we operating anticipate $XXX resulting XX.X%. with in of an solutions, year, of modest revenue of which gross QX, during successfully cost-sensitive our are profit For in of decline million, in the half family margin that product operating we expected margins $XXX of targeting the expect second of continued driven fiscal operating E by our an sales account million expectations growth Projected into sequential

product FY $X.X 'XX, for our of of been 'XX billion, operating all-flash The annual of reaffirming an growth contemplated revenue successful million Turning of XX.X% anticipated during modest of workloads with annual the decline XX%. $XXX fiscal of our our to year margin the representing we operating guidance gross validates strategy and half cost-sensitive in target second expanding solutions guidance with profit our are our in margins and guidance. our has FY into

we to In performance, closing, effectiveness which initiatives. of are financial our strong pleased reaffirms strategic deliver the

data Our underscores innovation industry. focus solutions our be in on a storage and the customer-centric to commitment leader

we demand high-performance, broader confident are macroeconomic the remain of to data on mindful solutions. in the storage growing we While capitalize ability environment, our for sustainable

to it will I turn that, back Paul Q&A. for With

Kevan. Thanks,

many part please can as to X so limit Before as session, possible. question we of begin the we to ask you to consisting yourselves people get X Q&A I'll

questions, the additional Operator, queue, If we'll happy please you those you questions allows. have that be rejoin started. ask take as let's additional time get we and to kindly

[Operator Instructions].

will question ISI. first from Amit Our Daryanani come from Evercore

away year happen here downtick you're I for the would really that guess to based it $XXX your my getting have Evergreen//One I would $XXX CapEx is is, year guide. TCV fiscal I and help perhaps that your to are lower square of is revenue would on a such not million the million. think think have fiscal better meant from that actually things thought seeing Clearly, one profile. the growth I folks trying trends target question customers,

the the TCV that on you driving see to really? And guide what's unpack revenue downtick expectations? your just do you hoping how So flowing

expected to Absolutely in on a the staying switching had opportunity seen longer raised We've What supposition would deal based very CapEx what other really was I correct the a looking A that's be whether large we've or Evergreen//One whether bit. on increases customers whether your based Well, subscription Evergreen//One closely But based and expenses on now bit indicated SaaS out. is customers, software stretching that's large deal deal. we or expenses fully we're a over large same therefore, opportunities is were customer to instead are an size diagnose the think customer by yet that. -- than if Evergreen//One from caution that's opportunities. at lengthening that seeing little their that year. given and we opportunities of

to would worked deals Charlie's view close. to being Evergreen//One sale annual product upward point, for an and larger to out see And million. I'll they're revenue. increase saw just when or as add guidance that's quarter this larger an that why still was longer we're will CapEx, point I of looking greater X than those question guide. on aren't are taking at are actively we flip on traditional really to the If that. and opportunities defining And larger And to seeing these closed We were our that focused revenue we did our opportunities $X we just a just be to reiterate, annual

Aaron comes Rakers question from Wells Fargo. from next Our

kind you to then for way, biggest you're And changed opportunities has on on another to Aaron. opportunity This curious of more continuing to ask sounds the just behalf of customer, wanted year. see maybe if of deal expect guys of I hurdle can done? of kind I'm discussions pursuing, kind what's by anything any you the end Senoff the there color any the like the get if is just overcome like to with other get it It just you mentioned. anything I hyperscale note progress? there's if or you're need separately, the on Michael

You bet.

lots hurdle. aligning for is There's lot own chains. just that this there's lot logistical wouldn't data So the A just you're into hyperscalers models, I to -- say as little especially a of hurdles. And complex large of when there's complex economics and go with the to their elements horse, them large pricing centers supply speaking improvements business us. well, largest with and orders economic that of lead and large

a little I well, would of has testing hurdles going worked lots So to be Conversations detail going but just say well. of is lot are out. now, right that

Rob. is this Yes,

Just you'd Charlie accompanied detailed on of now say, it as the that, lead imagine, done very as our moved is initial as core months the we've concept extensive and IP our a to to well, think of I many remarks. over overall, of solution. co-engineered so with testing involves to forth. -- engagements our that. performance, well, around mentioned testing mentioned this an as detailed What would forward add contractual with to progressing his in commercial with last package. really are operational prepared in And really on from so phases prospects of proof as testing, Charlie integrated And a discussions testing that

and engagement well one to And big would say the lots I things goes it's so as original overall, question, to little of hurdle. opposed

Our next Guggenheim Howard question from Securities. from comes Ma

joking. Great. good us you Thank is, my My your tell who lead question afternoon, is That's you, not horses. and I'm everyone. can question.

you of a were sales. but because is TCV contribution more asked question opting sales total keeping the The getting variation product it's as-a-service lower from by less as-a-service it question not means change, is obviously you're your customers said that Charlie, lowering sales that just revenue that by But instead. estimate, outlook CapEx the Amit and

that line? increased that if mean, we set? look drivers certain line, at that point you appropriately can is does risk does give product guidance in that confidence to So more you that, the the product mean Or there's demand

Yes.

out. sales we've velocity been seen cetera, pipeline, expected. as not an just expected base, closed. seeing changed specifically deals we've As a continue call lengthening what along, all expected. not have But not you they those in that haven't we haven't intention CapEx the as the those to tracking seeing opportunities, we coming look at our switched also We're of sales when words, if the deals Evergreen//One They length sales large but progress we we're CapEx accounts, had intention, character. and we from -- same In in et and will, for other Evergreen//One switched Evergreen//One, same they've

So that's what specifically we're seeing.

velocity seeing we're So the good business. growth in

And longer that is it's of there the Evergreen One that deals great And to view larger just the continues taking so close. activity interest. is to be the good,

Yes.

the Kevan deals look, really which that it's significant longer from time think that our any our larger we're asking as of which, we're overall to seeing you're This seeing, important. is in and what guide, period think, we're not seeing decouple I change with what the demand annual informs Evergreen//One is, Howard. I well, demand

Our Bora from Pinjalim next question comes JPMorgan. from

the it This has is their do to imprinting? at space How interest see prepare Jason for they storage Fusion been AI for customers on new on as offering? looking the And customer Pinjalim. you unify

is This has Look, take I Rob. been Yes. great. I'll early that mean, interest one.

we -- As been conference seen the know, partners and think off ability what have the of the really for existing been what we're fusion installed to customers year. year, base you have looking vision the the of demand. we've for and talking user that coming technology //Accelerate I really to Fusion go forward out customers, advantage in we alike last And this our existing to is think about later with take arrays I

later their capabilities and you to of able year, is operational arrays will fully of Fusion storage this we'll customers existing policy all these all as steps release management the able resources, of step designed to their latest declaration through to customers take multiple as storage pool be of individual capabilities our this on that and Storage data automate states. Pure estate of really environments that be back Fusion X later X will, cloud, to being to these able coming all With if for advantage manage opposed year, deliver and unify allow

great. So been early interest has

those to this think easier it advantage as will year, the take of later make into I roll later the capabilities. -- we that for coming release out much customers it

this by see small. also fact by involved and both that Yes. in very very beta been interest say have we a I'll and we've been users strong and large that have that the the pleased, customers infusion utility been pleased

customers to at So labor amount being their further policy relatively of reduce that and even takes in it small to even a are great almost operate benefit fleets the every seeing able manage level. smaller through

comes question from Mike from Our next Cikos Needham.

in get up which choose more I of maybe into just environment it in a of thinking these to the the this type on help some preference. as just macro. to to given are ballooning tie Gen production to seems environments repatriation little purchase, to a the on-prem behind way customer it handle their because And bit better to costs understanding a about want customers circle move customers potentially CapEx environments? is data Does AI I'm workloads they like any counterintuitive continuing trying

seeing and have this, seeing Charlie our we're start demand Evergreen//One Look, strong. actually we're velocity Kevan. I'll in it's with quite is And come our that Yes. then what really off, opportunity.

these are are year. So tracking that $X And set with beginning we at our the less the of tracking and million. strongly they expectations opportunities are that than

So back or there probably few I Evergreen//One think that a about signals there's a preference probably an versus less play it's to traditional dynamic dynamics of CapEx. to arrangements. as-a-service are really the larger these but a offering offering demand comes And

taking in of cloud, Charlie, we're other offerings, think And could seeing the I why the larger place. to time taken evaluation are is well that any that? customers consideration and and And evaluating part be evaluate on their as as-a-service thoughts when more SaaS. look, as software cost that managing continuing certainly are customers being

answered well. Yes. I think Kevan, it No, you

from Our next Ader Blair. question comes William from Jason

impacted has environment wanted not the NAND now, also, I you ask of the an been has some we've arrays deals comment competitors. And opportunities? competitive to and on rising. of from which know or just environment. your comment then you seen know the QLC-based in how right just on increase about Can I pricing some of some I the can that

Yes.

been. in as Let QLC ever me start lead has on our as that. that remains it say I strong would

by that I I of say our successful. targeting been fact end low very, So family very -- really E the identified the is think, products has that's, wouldn't and that

say wouldn't ever QLC that would I So say much tough it's competition I changed as all. at environment has the that been. as competitive very is

think and don't -- sites think the QLC right a we activity all. competing top at clearly, this appropriately. do in market. I are we are are on it's squarely really that's feel We I that everybody's now competitor But us

I think with a size effectiveness to it's and and scale respect situation us.

I mean you in look our at We're the I progress And think and flash if #X of only feeling systems points everybody area. spot it enterprise, now into our firmly and moment. that -- a all few at in now. the vendor the that #X think that behind I is the

tough, is in competition So but remains. lead our QLC

pricing And our And our the environment. that the an we the again, we're that our having will highlighting workflows success consistent current volatility then which is workloads And pricing, margins as DirectFlash of family would is C. have is our NAND line. Purity gross software lot and and for technology, becomes price-sensitive a affecting I'll commentary. just be in see flash when volatility as E well differentiated as customers, our NAND we're advantages evident touch with such in as top well. really pricing, And more look, And across previous our on the impact with winning lens seeing that on from the and

Citigroup. Asiya from comes from question Merchant next Our

that you recognizing other are have question. the longer and close, the these given Evergreen for deals into can that confidence you Thank dynamics that Great. maybe back you you talked just second ramp begin to macro half, expected in some about. taking dive The

we So $XXX here the year? first what ramp the $XXX to half gives in that million you full for the million confidence from

certainly growing and Yes, considers larger as-a-service of the achievable sales forecast I adjusted This TCV at the appreciate that $XXX is offerings million with dynamic seeing the we're question. for Kevan. our we believe is that XX% Look, deals.

strongly Our also throughout seen track less higher of larger current year the business from contribution does the but assumes the to similar deals, velocity in we've TCV continuing half. continued sales first what forecast assume to

typically what slightly of our or implied sales only we've with is than And so traditional ramp half the seen TCV traditional second our from sales. CapEx higher seasonality sales

forecast. need to to do, to this the we look, achieve So obviously expect absolutely there's we but in half, work and back execute

Our next Sandler. question comes from from Piper Jim Fish

apples last Jim XXX is Quinton Fish. the on book in it's point and pretty of for what understand This flash a it's to bit transform this cycle order we're in at here, And the performance, terabit I kind your think that sell backlog kind early, time? you're are concern or upgrade here? or compared this the you but as that's I budgets is oranges about QX. were customers' of to list ability but facing move concern like in your it not module? for you impact seeing any seems focused would there really on transformational seeing module know that Is that, willingness scrutiny still to of new and Or how little kind in people from

Thanks Yes. question.

similar points an think XXX at reduce very at much our opportunity points transaction. cost to price existing list would for question. E new our us and don't concern it the following reason. for does series for in I cost, really is Pure's open the it's interesting reduce up think to price I be What lower

another that put today we price same. a even less way, also to could we're XXXs. it point with satisfying So the the XX us performance The is satisfy particular will cost with if to be

as as to enhancement well a hard us even then So allowing I us less think for environments. expensive into it's disc margin get

hurt in if any don't way. customers we and to not And going is for. would positive, It's us it so a wait we I that it's think ship something as something not see

So I don't see it as, if you will, opportunity. endangering any revenue

Rob. Yes. And this is

add to Just that. to

prepared Charlie at with us and each the of that remember, back we end as do density But for each the on those flash disc-based the cost road map power step it the have the to way, compete requirements drive to acquisition XXX mentioned costs portfolio. step obviously, reduces -- next make improvement the also step important and and is X more and is it's allows think aggressively the flash a associated things. look terabyte the space on basis. remarks, lower-cost customers. One an I robust in we just, that operating on our for systems his

The require support, that with less are associated drivers quite structure modules equipment removing it. The with denser reduces that common to the common that, we space also power for this associated but obviously simple. reduces ship the and cost equipment

so aggressively the most discussing enterprise. and so And opens disc-based after course, been date is map, us set to has environments. allowed cost-sensitive hyperscaler this you as infrastructure the on in opportunity we executing up efficiency what the go really look as systems to of road to it the we've And aggressively density all, -- with

question Marshall next Morgan Stanley. Meta from comes from Our

these Maybe Evergreen//One these Great. kind of wanted that X a into Or kind we're of diving quantum couple about? I just of of sense, really deals. really Tier up? just a is some deals talking or get And are customers hung are that of enterprise a customers the those is with to kind handful? just this

is handful Yes, to Meta. about because large be quarter. does tend enterprise just customers It a talking And we're deals. per it

when they're more predictable handful forecast. it's challenging to a per quarter does because in not terms easily transact. It to exactly always and So it of make

Susquehanna. Our Hosseini comes Mehdi from next question from

enterprise the of and you're rate, subscription model, that to that Evergreen//One up be data be product in captured million your able pick centers, engaging large small it run data data right your which that's that Could not Evergreen//Two to conference penetrating are to product on the you but products really And with hit centers, capturing earnings until traction these small you thinking and past to calls, have focused and centers, and and revenue? going revenue. in current talked including be XX about In large scale up hyperscalers. about Is were dynamics? way more selling you're $XXX to

both is say Yes. environments. Evergreen//One Evergreen//One, speaking I being we're would and Thanks, Mehdi. small about sold into large

As in put well deals even the small Kevan is of as the into deals rate -- and very quite and well. large selling I'd MSPs very market, It's small cloud into clouds and few very what and We're as a of call commercial strong large in other good. good it, Actually, Evergreen//One run environments. deals. environments

$XXX the they Evergreen//One, that into as million, your All hope those for Evergreen//One. example, answers that our question. well. So regardless into classify that's identified are we going all goes of sell when I who

Our next Jeff James. question Koche comes Raymond from from

on Jeff importantly, Maybe this give you the starting is given Leopold. is And Simon us like at Koche is related? AI? an become point percentage how -- to tailwinds, what more maybe AI book of does how update the This can all in like revenue AI the order like book, for percentage order of what

a out we've a AI, give on split flavor little but bit Well, you not of AI. let's

really revenue players we one first environment. training for just my a some identified well. major I the I other remarks, for at it's really us, just out As foresee that prepared in this X real, the is as there say, And segments. would real time, become but in And has do point that not

environments probably training into years selling X closer for been we've Now years, over right now. to X

technologies for training as Of course, large became the trading. right? it been That's self-driving drug are what parameter-based been for well known typically environments various training medical environment as LLMs, there's But models. hit different once all really discovery models, high-speed cars as training for news the

that been the More of AI lot a models are recently, generative getting have news. obviously, there

a Our storage view share total is are. market models, the billion than or that $X type that we're fair less large we total, considering our would say I getting that of training models, language year in currently. for where

of specifically. broken haven't we sort of an out you magnitude, gives that but it order So

other inside starting The the or be rag and areas model just investigated. X are of enterprises. discussed inference to That's

of X/X organizations space. expect you but available has in we more of been of lot but as the And revenue, for been that. not list that's we working it's when in to of of then might to terms terms revenue order that's of And currently on imagine, for much the make we've organizations the use I enterprise will inside is of inference. enable what advantage the storage think environments data And existing really up-leveling general data silos sitting a overall in in to area yet in soon. largest preparation on hear believe third think a take started we

Shankar Chris question Our TD next from from Securities. comes

for Mertens Robert is This on Chris.

is reiterated some October the Could just imply assuming year-on-year. towards of full to the outlook, quarter speak you growth to of decelerates a mid-single to that seasonality quarter with the puts the in any growth, fans and headwinds bit January digits guide, the Just midpoint new would year the mid- high quarter? inflection And if industry sort is expect takes in there January of the and guide single-digit the norm?

been what it's Kevan. the seasonality. year. of factor the terms which in Yes, year, the is is double second primary a and But This first as to question. exception for in expectations I appreciate of we to tracking many maybe primary following that year our again The first largely saw in well for growth driver total is it. digits, our with terms would that's and half for of in due And look tracking of the COVID. you the half half consistent X historically years see what glad and got revenue terms with the see you That be is

year. offerings, half of velocity the as consideration annual our we are that's been expected the our as revenue well our headwind of expecting in total well to some with guide create total another growth, revenue. is that especially considered business a higher as But this as-a-service second well for in And ramp sales and would our

Markets. from from Street Martinuzzi question Next Lake comes Capital Eric

margin. if the wanted to I I commentary that a on was point the back or then the you but finer think the margin year-on-year. just Yes. it comment if for down I put half, Kevan, Would the, on And care modest for recall, could gross see in that? decline you full said to product gross was year strategic a the product. can we XX.X%

talking taken XXs. thanks, really about sweet Look, high the gross long spot time for achieve it's in time margins product And that. And our been we've a us to Eric. some being for Sure.

positive I XXs. quite actually in a And is of for high think we're seeing this what so us terms the in

seeing really the whether cost product this profit their in back as transition. well, the demand the at to as sequential workloads we'll of that or looking our E-Solutions in momentum aggressively shifting modest sensitive gross and decline And has our what's a well. and And look, from been margins FlashArray//C. I in remarks, talked my that's family customers are and solutions, our from coming strong we that's about prepared Now to our all-flash seeing annual a year. this that's our in And driving half really reduction modest of of expectation continue operating guide pursue for considered

you, Eric. Thank

have We question. X more

question. be will last this the So

last David from will from UBS. Our question come Vogt

What application, thinking of we think by can thematic could kind We kind what viewing mean their of product about your what of hyperscalers is the have had with dovetail your about but you maybe kind as that cases about Just the color, what are I existing sort a use how would of are talk hyperscaler they're discussions, that the the appreciate question all extensive to you solution. workload, so these architecture? opportunity. how

Yes.

implemented, shift workloads, we and they're down only replace, very them. even color Let think higher architectural hyperscalers. at I disc. the Rob replace in fundamental SSDs. And more. add conversation path it's them, performance one it their for reason to not shift for with of go further not it use different a their But lower some looking an me any will And it's to example, including to And with for whereby different workloads, make performance the this. in but start, stages once broad the no would the -- infrastructure, we're Honestly, a it obviously, architectural of

broad. fairly So

those nothing they hyperscaler, the discuss cases -- the conditions are structures, we been terms further the in and us, on the the knock yet, more broader we haven't Now the with more and in test has in use longer are wood, but discussions. we conversations signed

and is this David, Yes, Rob.

hyperscalers at on architectural after this which want going by scale is various special different one. broad each standardizing workloads. infrastructure as generally this build a add of purpose simplicity of replacement points. workloads, set performance Charlie mean workload what serve all many They for emphasize economies I to get many workloads operate And to is the of at so by that. a really targeted really and largely by so that operations I Just infrastructure don't environments. one point made, They those and and these out that and looking to

got being higher lower under umbrella, within think We have served performance and being And performance by by typically in the workloads, workloads, that way long the certainly, disc. to initial replacement board the infrastructure. term, as we've served today, across technology. go disc flash so value would all opportunity focusing an of to in the with step, our provide be But got base certainly, DirectFlash the environments that on largely

David. for helpful that's hopefully, So you,

on. question final comments. Great to end some Charlie has

again, you always, thank to for all call. as us want joining today's today earnings I on Yes.

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Conference 'XX That Fiscal Thank Financial participation. Quarter Call. the your Second concludes you Results Storage for Pure

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