Pure Storage (PSTG) Rolls Out New FlashArray//XL Solution

Pure Storage PSTG unveiled a new FlashArray//XL solution, which is primarily designed for mission-critical enterprise applications like huge databases, cloud-native and containerized applications.

Pure Storage added that the solution can speed up enterprise workloads with maximum performance and provides 100% more host connectivity and twice increased volume support on a single array. Per the company estimates, FlashArray//XL offers nearly 80% improvement in input/output operations per second or IOPS.

The new FlashArray solution safeguards the stored data and enables easy recovery following any adverse situation. FlashArray//XL solution helps in workload consolidation on lesser arrays and streamlines operations along with lowering rack-space requirements. It also helps to slash power consumption and cooling expenses.

Pure Storage’s latest FlashArray offering, when combined with Pure Fusion, offers business enterprises a “cloud-like model” that simplifies and accelerates deployment of apps, added the company.

Pure Storage, Inc. Price and Consensus

Pure Storage, Inc. price-consensus-chart | Pure Storage, Inc. Quote

In September 2021, Pure Storage rolled out Pure Fusion, which is a self-service and autonomous storage platform. Pure Fusion boasts a strong combination of nimble enterprise storage and the cloud’s scalability feature.

Talking about specs, FlashArray//XL can deliver up to 5.78 PB effective capacity and offers up to 36GB/s throughput, with 5:1 data reduction average along with 99.9999% availability in a 5U platform, per company estimates.

Opportunities Aplenty for Pure Storage

Pure Storage’s top-line performance is being driven by continued strength in its subscription services, namely Pure as-a-Service subscription (includes Cloud Block Store), Portworx and Evergreen Storage.

In the last reported quarter, the company’s Subscription services revenues (33.4% of total revenues) of $187.8 million surged 38% on a year-over-year basis.
Higher gains from the strong uptake of FlashArray and FlashBlade — particularly second-generation FlashArray//C (an all-QLC flash array) — solutions are other catalysts.

FlashArray//C is a cost-effective storage array solution that offers clients enhanced performance capabilities and helps them run complex cloud workloads on a single platform.

Increasing customer acquisitions (especially large enterprises clients) along with strength in commercial business augurs well. In the last reported quarter, Pure Storage reported 12% increase (or 345 new customers) in new customer acquisition in the reported quarter. The company’s customer count stands at 9,500, including 50% of the Fortune 500 companies, noted Pure Storage.

Driven by these factors, Pure Storage expects fourth-quarter fiscal 2022 revenues to be $630 million, indicating year-over-year growth of 25%.

Pandemic-induced supply chain disruptions, higher expenses on product development amid stiff competition from other storage peers Like NetApp NTAP is a concern.

NetApp recently reported numbers for its second-quarter fiscal 2022 performance. Revenues of $1.566 billion increased 11% year over year, topping the Zacks Consensus Estimate by 1.2%. The company had projected revenues in the range of $1.49-$1.59 billion. The upside was driven by strong demand in the Hybrid Cloud and Public Cloud divisions.

NetApp’s All-Flash Array Business annualized net revenue run rate came in at $3.1 billion, up 22% year over year in the last reported quarter.

Zacks Rank & Stocks to Consider

At present, Pure Storage currently carries a Zacks Rank #2 (Buy).

Some better-ranked stocks in the broader technology sector include Arrow Electronics ARW and Alphabet GOOGL. The stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

For Arrow Electronics, the Zacks Consensus Estimate for 2021 earnings is pegged at $14.60 per share, up 8.1% in the past 60 days. The long-term earnings growth rate of the company is pegged at 27.4%.

Arrow Electronics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 18.6%. Shares of the company have rallied 29.4% year to date.

For Alphabet, the Zacks Consensus Estimate for 2021 earnings is pegged at $108.29 per share, up 6.3% in the past 60 days. The long-term earnings growth rate of the company is pegged at 25.8%.

Alphabet’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 41.5%. Shares of the company have rallied 69.1% year to date.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.