The Six Five team discusses Pure Storage Earnings.
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Transcript:
Patrick Moorhead: Pure Storage. How’d they do, Dan? Storage is, well, NetApp was way up. How’d Pure do?
Daniel Newman: Yeah, Pure had a solid result. What are you looking at? Well, their revenue growth slowed. They were 3%. So their growth, at least they’re up year over year. With Pure, there’s a certain subset of numbers I tend to look at based on its business and where it’s seeing growth, and that’s been one, the ARR focus of Pure Storage. Two, has been their continued focus on being the most liked company in the industry, which has been solid for its customer growth. And then, of course, I’ve been watching their cloud product growth. Which is the Evergreen product. Those are the three numbers I came into this really looking at, Pat. ARR 25% growth. They’ve now hit $1.37 billion in subscription revenue, which is just a slight bit higher than Moor Insights advisory contracts. I had to do that. Sorry.
Patrick Moorhead: Dan, don’t undersell me, Dan.
Daniel Newman: Sorry, I didn’t mean to doubt you. Then the Evergreen one business saw $400 million TCV and the contract value of the cloud business. And Pat, here’s the more important thing. They’re 100%. So they’re seeing their new product, their new cloud product, getting strong adoption on a year-over-year basis, and their net promoter score stays at 82. Highest in the industry, Pat. And I don’t know if people fully appreciate how hard it is to have a net promoter score over 80. And so a lot of companies just don’t talk about it. I’ve got 100, but very likable. But in all serious, these are the three critical metrics that I’m paying attention to. What else? I do think that they’ve been very busy talking about performance, Pat. This is something you and I are very interested in. As we pay attention to Signal65 business that we have and the overall testing. The company put a bunch of outcome-related data in their presentation of performance.
I’ve got to say, when we talked to Charlie Giancarlo, next week, I think we’re going to talk to him about these results. I got to ask about this. They put out a two to five time less power in space, 10 x versus existing hard disk systems, 50% lower TCO on a typical configuration, 10 x more reliable, 10 to 30 service visits less, five to 10 times less labor to operate.
Patrick Moorhead: Boy, it sounds like a Signal65 pressure.
Daniel Newman: Hey, Shrout, where you at, man? I know we got to test this stuff, but I love that they put this in their thing. In fact, then they went on to do more. They basically went on and said Pure Flash consumes 80% less power than traditional storage systems. Which again, there’s something to do there. But a lot to test here, Pat. But look, the company’s doing great. In 2024, they’ve seen their percent of the Fortune 500 customers rise. They’re up to 60% now and they added 349 new customers. Their trajectory is very good, strong company. We’ll probably have more after we talk to Charlie, but good week for Pure Storage.
Patrick Moorhead: Yeah, their stock is up 35% in the past five days, which is eerily similar to the advance that Dell got. I think this is all about AI. I like to call it a proof of life, right? Dan, you and I have talked to a ton of CEOs and CFOs lamenting on, hey, my AI is real. Why aren’t we getting credit for it? I’m an industry analyst, not an equities analyst, but I’m smart enough to know that the street is wanting a proof of life. Show me the numbers.
That comes into two forms. That’s one form that says, this is the percentage of my AI business today, and this is going to be my percentage of AI business. We saw big pops from companies like Broadcom and Marvell. What we saw here with Pure Storage was a great explanation of an eight-figure deal with Evergreen and one from a specialized GPU cloud provider. And that’s probably either CoreWeave or Lambda Labs, that was an end to end piece there. And AI was mentioned.
Actually this, let me scratch that, at least 14 times. The AI is picking up things like the AI and container, but if I look at just the AI, I think this was what investors wanted to see, to put this company in the AI category. I’m going to step back. I’m going to end on what I think is a masterclass in growth. I think Pure Storage, right? That they come out in a niche market when they started with a very radical concept of being very software-first and a bladed type of architecture that ended up to be very upgradeable. Where you didn’t have to upgrade the entire storage system. You just had to upgrade Blade or do a software upgrade. And over years, they’re now block, file, and object storage. They’re now on-prem as a service, and then even offering their software capabilities in the public cloud. And that’s Evergreen and Pure Fusion.
And then layering on top of what a lot of people are doing is they’re going after a data management play. Which is really interesting. And that’s from an acquisition that they made from PortWorx. I could very much see, and there’s been a little bit of talk on this, which is, hey, you’ve got the data there. Why don’t we do AI queries right there on the storage software itself?
And I think that’s going to be the next type of thing that you would expect. We’re seeing it from a lot of storage software plays like Rubrik and Cohesity. And here we’ve got Pure that’s operating, going from a different part of the stack into doing even more software. Anyways, I’ll end with really looking forward to our call next week with Charlie Giancarlo, CEO of Pure Storage
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
