Everpure, Inc. Q1 FY2026 earnings call

• Fusion 2.0 received an outstanding reception with almost 100 customers using or testing it.
• Launched FlashBlade//EXA, the industry's highest performing storage platform for AI and HPC, to be delivered later this quarter.
• Strong AI wins across customers and segments, with Pure's unified platform handling full range of AI workloads.
• Partnership with Nutanix to integrate Nutanix Cloud Platform with Pure Storage platform, solution expected to be generally available later this year.
• Pure Portworx supports modern virtualization solutions like Red Hat OpenShift and KubeVirt.
• Expanding Cloud Block Store integration with Azure VMware service into a fully managed service in public beta.
• Kevan Krysler will leave Pure to pursue new opportunity, remaining until new CFO is in place.

In Q1, Pure Storage delivered solid performance with revenue growing 12% to $83 million. Operating profit was $82.7 million with an operating margin of 10.6%. Subscription services revenue reached $406 million, up 17% and representing over half of total revenue. ARR grew 18% to $1.7 billion, and total remaining performance obligations (RPO) grew 17% to $2.7 billion. U.S. revenue was $531 million, growing 9%, while international revenue was $248 million, growing 21% year-over-year. Total gross margin improved to 70.9% in Q1, with subscription services margin at 77.2% and product margin rising 1.1 points sequentially to 64%. The company added 235 new customers, bringing penetration to 62% of the Fortune 500.

• Reiterated FY’26 revenue and operating margin guidance.
• Anticipates Q2 revenue of $845 million, representing a 10.6% year-over-year increase.
• Expects operating profit of $125 million and operating margin of 14.8% for Q2.
• Fundamental growth drivers of the business are confident, but macroeconomic uncertainties persist in the second half.

Q: About the hyperscale opportunity with Meta, how is the progress and rev rec?

A: Meta's evaluation and testing runs along their data center design process. There will be de minimis revenue contribution contemplated in the annual guide, with a licensing fee model.

Q: On the newly announced XL offering, size relative to traditional enterprise market and financial model implications?

A: The opportunity is in niche markets like government sovereign clouds, etc. Margins expected to be at or above company margins long-term, with disaggregated infrastructure where metadata node is charged fully and software on data nodes is charged.

Q: Changes in buyer behavior during macro uncertainty?

A: Q1 results didn't show significant pull-ins. For the first half, no substantial change in customer sentiment or pull-ins observed.

Q: Revenue contribution from Meta's 1 to 2 exabytes in second half?

A: There is de minimis revenue contribution already contemplated in the annual guide, with a licensing fee model.

Q: Update on larger Evergreen//One deals from last year?

A: Two quarters don't represent a trend, but strength seen in Q4 and Q1 with larger deals tracking as expected and higher velocity traction solid.

Q: Compare and contrast of Meta project with other projects?

A: It's due to Meta's data center design cycle which is long, involving co-engineering, and has progressed from proofs of concept to production validation testing.