Abstract
Pure Storage will report fiscal Q4 2026 results on February 25, 2026 Post Market; this preview summarizes consensus revenue, margin, and EPS expectations and highlights where investors should focus amid shifting AI infrastructure demand and subscription mix dynamics.Market Forecast
The market expects Pure Storage’s current quarter to post revenue of $1.03 billion, up 18.72% year over year, EBIT of $225.75 million, and EPS of $0.64, implying a year-over-year increase of 55.19%. Based on the company’s margin trajectory last quarter and its guidance tone, investors are watching for a gross profit margin near the low 70s and a net profit margin consistent with recent mid-single-digit performance; consensus implies margin expansion alongside operating leverage from recurring subscription revenue. Pure Storage’s main businesses are products and support services; for the prior quarter, products generated $534.76 million and support services generated $429.69 million. The support and subscription business remains the most promising segment as its recurring nature underpins higher gross margin and visibility; investors are looking for continued double-digit growth in subscription ARR and an increasing revenue mix that supports sustained operating margin improvement.Last Quarter Review
In the prior quarter, Pure Storage delivered revenue of $964.45 million, with a gross profit margin of 72.31%, GAAP net income attributable to shareholders of $54.81 million, a net profit margin of 5.68%, and adjusted EPS of $0.58, representing a 16.00% year-over-year increase. GAAP net income grew 16.32% quarter over quarter, reflecting disciplined operating expense control and improving operating leverage as subscription revenue scaled. Main business performance showed a balanced mix: product revenue was $534.76 million and support revenue was $429.69 million, with support growing as a share of the mix and providing a margin tailwind.Current Quarter Outlook
Main business: All-flash arrays and Evergreen/managed subscription support
Pure Storage’s revenue base continues to be anchored by hardware product sales complemented by support and subscription services. The hardware cycle is benefiting from ongoing enterprise refresh from hybrid arrays to all-flash, while AI-related workloads and high-performance analytics are sustaining demand for performance storage. The subscription model, notably Evergreen and managed services, increases revenue visibility and reduces cyclicality, but it also shifts some near-term revenue from upfront product sales to ratable support and services. This quarter’s unit growth and deal velocity will hinge on enterprise budget cycles and proof-of-concept conversions, with consensus embedding a healthy close rate into fiscal year-end. Investors will watch whether the company sustains a revenue mix that keeps gross margins near the low 70s. If support and subscription ARR growth outpaces product, the company could report improved operating margin due to higher gross profitability and more efficient go-to-market spend per dollar of recurring revenue.Most promising segment: Support and subscription services
Support and subscription services continue to be a source of structural margin expansion and revenue durability. With the previous quarter’s support revenue at $429.69 million and trending up as a percentage of total revenue, the company’s blended gross margin has remained above 70%, signaling the positive impact of higher-margin recurring revenue. As customers adopt Evergreen/ as-a-Service models for AI and data-intensive workloads, the attach rates and expansion within the installed base can drive sustained double-digit growth for support. Management’s emphasis on ARR growth, pricing discipline, and contract duration is central to this quarter’s earnings narrative; the consensus revenue forecast of $1.03 billion suggests incremental support strength alongside seasonal product demand in the fiscal Q4 period. Should support growth accelerate relative to product, EPS leverage can exceed revenue growth given the lower cost-to-serve and improved renewal economics.Stock-price drivers this quarter: ARR momentum, AI workload pull-through, and margin execution
The primary stock-price catalysts are likely to be the trajectory of ARR, AI-related demand signals, and gross-to-operating margin conversion. ARR momentum demonstrates the stickiness of the platform and provides forward visibility; any beat in net-new ARR or renewal rates may drive multiple expansion, especially if support mix expands. AI workload pull-through—deployments of high-performance flash for training pipelines, inference caching, and data lakes—can accelerate large-deal activity and push product revenue above seasonal norms. Margin execution will be scrutinized: with last quarter’s gross margin at 72.31% and net margin at 5.68%, investors will assess whether operating leverage from scale and subscription mix can lift EPS above the $0.64 estimate if revenue lands near $1.03 billion. Conversely, any indication of discounting to win AI-edge cases, elongated deal approvals in the enterprise, or supply-chain cost creep could cap margin expansion and temper the stock’s reaction.Analyst Opinions
Across recent institutional previews, the balance of opinion is bullish, emphasizing accelerating demand from AI infrastructure projects, robust ARR growth within subscription support, and persistent share gains in all-flash arrays against legacy incumbents. Analysts highlighting the revenue estimate of $1.03 billion and EPS of $0.64 see upside potential if operating margin expands with mix; their constructive stance centers on Pure Storage’s ability to convert high attach rates in Evergreen into predictable renewals and upsell. Commentary also notes that fiscal year-end seasonality typically supports stronger close rates, while the product pipeline aligned to performance workloads could enable revenue to outpace historical patterns. The bullish view argues that with gross margins holding near the low 70s and EBIT implied at $225.75 million, incremental operating efficiency can provide EPS upside if revenue meets or moderately exceeds expectations.On the qualitative side, supportive opinions underscore the company’s consistent execution in subscription transitions and expansion in enterprise accounts that are modernizing data infrastructure for AI and analytics. They also point out that competitive dynamics in flash pricing have remained manageable, with Pure Storage’s software and data services differentiation contributing to stable pricing and renewals. From a risk perspective, the bullish camp monitors elongated procurement cycles and larger deal scrutiny but sees these as manageable within a strong fiscal Q4 backdrop. Overall, the majority of analyst previews expect Pure Storage to at least meet and likely exceed consensus on revenue and EPS, led by support/services mix improvements and healthy AI-driven project momentum.
Comments