Raises Full Year Net Sales and EPS Outlook
FREMONT, Calif.--(BUSINESS WIRE)--April 01, 2026--
Penguin Solutions, Inc. ("Penguin Solutions," "we," "us," or the "Company") (Nasdaq: PENG) today reported financial results for the second quarter of fiscal 2026.
Second Quarter Fiscal 2026 Highlights
-- Net sales of $343 million, down 6% versus the year-ago quarter
-- GAAP gross margin of 27.3%, down 130 basis points versus the year-ago
quarter
-- Non-GAAP gross margin of 31.2%, up 40 basis points versus the year-ago
quarter
-- GAAP diluted EPS of $0.58 versus $0.09 in the year-ago quarter
-- Non-GAAP diluted EPS of $0.52 for the current and year-ago quarters
"Enterprises, governments, and neocloud providers are racing to build AI factories, as platforms scale to power the next generation of inference workloads," said Kash Shaikh, CEO of Penguin Solutions. "Our AI/HPC pipeline continues to expand, and we added five AI/HPC customers this quarter, including a Tier One financial institution deploying our MemoryAI$(TM)$ CXL-based KV cache server. Memory is a critical scaling factor for AI inference, and that aligns with one of our core strengths. Reflecting strong memory demand and disciplined execution, we are raising our full-year net sales and EPS outlook."
Quarterly Financial Results
GAAP (1) Non-GAAP (2)
---------------------------- ----------------------------
(in thousands,
except per
share amounts) Q2-26 Q1-26 Q2-25 Q2-26 Q1-26 Q2-25
--------------- -------- -------- -------- -------- -------- --------
Net sales:
Advanced
Computing $115,715 $151,452 $200,157 $115,715 $151,452 $200,157
Integrated
Memory 171,629 136,521 105,260 171,629 136,521 105,260
Optimized
LED 55,655 55,098 60,102 55,655 55,098 60,102
------- ------- ------- ------- ------- -------
Total net sales $342,999 $343,071 $365,519 $342,999 $343,071 $365,519
======= ======= ======= ======= ======= =======
Gross profit $ 93,702 $ 96,109 $104,648 $106,916 $102,921 $112,408
Operating
income (loss) 25,689 19,582 18,488 45,254 41,528 49,090
Net income
(loss)
attributable
to Penguin
Solutions 37,452 5,270 8,082 34,107 32,391 33,836
Diluted
earnings
(loss) per
share $ 0.58 $ 0.04 $ 0.09 $ 0.52 $ 0.49 $ 0.52
(1) GAAP represents U.S. Generally Accepted Accounting Principles.
(2) Non-GAAP represents GAAP excluding the impact of certain activities.
Further information regarding the Company's use of non-GAAP measures and
reconciliations between GAAP and non-GAAP measures are included within
this press release.
Business Outlook
As of April 1, 2026, Penguin Solutions is providing the following financial outlook for fiscal year 2026:
Updated GAAP Non-GAAP
Outlook Outlook Adjustments Outlook
------------ -------------- -------------------------------- --------------
12% YoY Growth 12% YoY Growth
Net sales +/-5% -- +/-5%
Gross margin 26% +/- 0.5% 2% $(A)$ 28% +/- 0.5%
$310 million $250 million
Operating +/- $5 ($60) +/- $5
expenses million million (B)$(CUL3)$ million
Diluted
earnings per $1.30 +/- $2.15 +/-
share $0.15 0.85 (B)$(C)$(D)$(E)$(F)$ $0.15
Diluted
shares 53 million -- 53 million
Non-GAAP adjustments (in millions)
------------------------------------------------------------------- -------
(A) Stock-based compensation and amortization of
acquisition-related intangibles included in cost of sales $ 30
(B) Stock-based compensation and amortization of
acquisition-related intangibles included in R&D and SG&A 50
(C) Other operating adjustments 10
(D) Other non-operating adjustments (1) (20)
$(E)$ Estimated income tax effects (18)
(F) Estimated effect of allocation of earnings to participating
securities (7)
---
$ 45
===
(1) Primarily reflects net gains associated with non-marketable equity
investments.
Previous GAAP Non-GAAP
Outlook Outlook Adjustments Outlook
----------- --------------- ------------------------------- ---------------
6% YoY Growth 6% YoY Growth
Net sales +/-10% -- +/-10%
Gross
margin 27% +/- 1% 2% (A) 29% +/- 1%
$307 million $250 million
Operating +/- $10 ($57) +/- $10
expenses million million (B)(C) million
Diluted
earnings
per share $0.85 +/- $0.25 $1.15 (A)(B)(C)(D)(E)(F) $2.00 +/- $0.25
Diluted
shares 55 million -- 55 million
Non-GAAP adjustments (in millions)
------------------------------------------------------------------- -------
(A) Stock-based compensation and amortization of
acquisition-related intangibles included in cost of sales $ 30
(B) Stock-based compensation and amortization of
acquisition-related intangibles included in R&D and SG&A 49
(C) Other operating adjustments 8
(D) Other non-operating adjustments (1) 3
(E) Estimated income tax effects (20)
(F) Estimated effect of allocation of earnings to participating
securities (7)
---
$ 63
===
(1) Primarily reflects net losses associated with non-marketable equity
investments.
Second Quarter Fiscal 2026 Earnings Conference Call and Webcast Details
Penguin Solutions will hold a conference call and webcast to discuss the second quarter fiscal 2026 results and related matters today, April 1, 2026, at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). Interested parties may access the call by registering online at https://events.q4inc.com/analyst/550562118?pwd=0KlWip4M, at which time registrants will receive dial-in information as well as a conference ID. The live webcast will also be accessible from the Penguin Solutions investor relations website on the Events page, along with the related earnings press release and slide presentation. The webcast replay will be made available on the Quarterly Results page after the call concludes. An archived version of the webcast will be available on the Penguin Solutions investor relations website for approximately one year after the webcast date.
Use of Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995 that are not historical in nature, that are predictive or that depend upon or refer to future events or conditions. These statements may include, but are not limited to, statements concerning or regarding future events and the future financial and operating performance of Penguin Solutions; statements regarding the extent and timing of and expectations regarding Penguin Solutions' future net sales, sales mix and expenses; statements regarding Penguin Solutions' strategic transformation, divestiture of its remaining interest in Zilia Technologies Indústria e Comércio de Componentes Eletrônicos Ltda., a sociedade limitada governed by the laws of Brazil ("Zilia Technologies"), business momentum, and emerging leadership position; statements regarding AI-related demand, customer pipeline, market opportunities and product performance; statements regarding projected demand for the second half of fiscal year 2026; statements regarding long-term effective tax rates; and statements regarding the business and financial outlook for fiscal year 2026 described under "Business Outlook" above.
These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as "anticipate," "target," "expect," "estimate," "intend," "plan," "goal," "believe," "could," and other words of similar meaning. Forward-looking statements provide our current expectations or forecasts of future events, circumstances, results or aspirations and are subject to a number of significant risks, uncertainties and other factors, many of which are outside of our control, including but not limited to: global business and economic conditions, including the impact on the financial condition of our customers, particularly in challenging macroeconomic environments, growth and demand trends in technology industries (including trends and markets related to artificial intelligence), our customer markets and various geographic regions; uncertainties in the geopolitical environment, including those related to global conflicts, such as those in the Middle East and Ukraine, and the global effects thereof on international relations, transport, and trade; our ability to manage our cost structure; disruptions in our operations or supply chain as a result of global pandemics, tariffs or other factors; changes in trade regulations and tariffs or adverse developments in international trade relations and agreements; changes in currency exchange rates; overall information technology spending, including changes in customer spending on our products and services; appropriations for government spending; the success of our strategic initiatives including the U.S. Domestication (as defined below) and our ability to realize the anticipated benefits thereof, our rebranding and related strategy, any existing or potential collaborations and additional investments in new products and additional capacity; acquisitions of companies or technologies and the failure to successfully integrate and operate them or customers' negative reactions to them; issues, delays or complications in integrating the operations of Stratus Technologies; failure to achieve the intended benefits of the sale of Zilia Technologies and its business, including the sale of our remaining 19% interest therein; the impact of and expected timing of winding down the manufacturing and discontinuing the sale of products offered through our Penguin Edge business; limitations on or changes in the availability of supply of materials and components; fluctuations in material costs; the temporary or volatile nature of pricing trends in memory or elsewhere; deterioration in customer relationships; our dependence on a select number of customers, and the timing and volume of customer orders and renewals; the impact of customer churn rates, including discounting and churn of significant customers from whom we derive a significant percentage of our revenue; changes in customer demand and sales mix; production or manufacturing difficulties; competitive factors; technological changes; difficulties with, or delays in, the introduction of new products; slowing or contraction of growth in the memory market, LED market or other markets in which we participate; changes to applicable tax regimes or rates; changes to the valuation allowance for our deferred tax assets, including any potential inability to realize these assets in the future; prices for the end products of our customers; strikes or labor disputes; deterioration in or loss of relations with any of our limited number of key vendors; the inability to maintain or expand government business; potential sales of our common stock by the holder of our issued convertible preferred stock or the anticipation of such sales; and the continuing availability of borrowings under revolving lines of credit or other debt arrangements and our ability to raise capital through debt or equity financings.
These and other risks, uncertainties and factors are described in greater detail under the sections titled "Risk Factors," "Critical Accounting Estimates," "Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk" and "Liquidity and Capital Resources" contained in the Annual Report on Form 10-K for the fiscal year ended August 29, 2025, as updated by the risk factors, if any, contained in our Quarterly Reports on Form 10-Q and in our other filings with the U.S. Securities and Exchange Commission (the "SEC"). Such risks, uncertainties and factors as outlined above and in such filings could cause our actual results to be materially different from such forward-looking statements. Accordingly, investors are cautioned not to place undue reliance on any forward-looking statements. Any forward-looking statements that we make in this press release speak only as of the date of this press release. Except as required by law, we do not undertake to update the forward-looking statements contained in this press release to reflect the impact of circumstances or events that may arise after the date that the forward-looking statements were made.
Statement Regarding Use of Non-GAAP Financial Measures
This press release and the accompanying tables contain the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP operating margin, non-GAAP effective tax rate, non-GAAP net income, non-GAAP weighted-average shares outstanding, non-GAAP diluted earnings per share and adjusted EBITDA. Penguin Solutions' management uses these non-GAAP measures to supplement Penguin Solutions' financial results under GAAP. Management uses these measures to analyze its operations and make decisions as to future operational plans and believes that this supplemental non-GAAP information is useful to investors in analyzing and assessing the Company's past and future operating performance. These non-GAAP measures exclude certain items, such as stock-based compensation expense; amortization of acquisition-related intangible assets (consisting of amortization of developed technology, customer relationships and trademarks/trade names and backlog acquired in connection with business combinations); acquisition-related inventory adjustments; inventory write-off, stolen in-transit shipment; cost of sales-related restructuring; diligence, acquisition and integration expense; redomiciliation costs; restructuring charges; (gain) loss on disposition of equity investments; (gain) loss on non-marketable equity investments; impairment of goodwill; changes in the fair value of contingent consideration; (gains) losses from changes in foreign currency exchange rates; amortization of debt issuance costs; (gain) loss on extinguishment or prepayment of debt; gain on disposition of equity investment; other infrequent or unusual items and related tax effects and other tax adjustments. While amortization of acquisition-related intangible assets is excluded, the revenues from acquired companies are reflected in the Company's non-GAAP measures and these intangible assets contribute to revenue generation. Management believes the presentation of operating results that exclude certain items provides useful supplemental information to investors and facilitates the analysis of the Company's core operating results and comparison of operating results across reporting periods. Management also uses adjusted EBITDA, which represents GAAP net income (loss), adjusted for net interest expense; income tax provision (benefit); depreciation expense and amortization of intangible assets; stock-based compensation expense; cost of sales-related restructuring; diligence, acquisition and integration expense; redomiciliation costs; (gain) loss on dispositions of equity investments; (gain) loss on non-marketable equity investments; impairment of goodwill; restructuring charges; loss on extinguishment of debt and other infrequent or unusual items.
Our GAAP effective tax rate can vary significantly from quarter to quarter based on a variety of factors, including, but not limited to, discrete items which are recorded in the period they occur, the tax effects of certain items of income or expense, significant changes in our geographic earnings mix or changes to our strategy or business operations. We are unable to predict the timing and amounts of these items, which could significantly impact our GAAP effective tax rate, and therefore we are unable to reconcile our forward-looking non-GAAP effective tax rate measure to our GAAP effective tax rate.
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP, as they exclude important information about Penguin Solutions' financial results, as noted above. The presentation of these adjusted amounts varies from amounts presented in accordance with GAAP and therefore may not be comparable to amounts reported by other companies. In addition, adjusted EBITDA does not purport to represent cash flow provided by, or used for, operating activities in accordance with GAAP and should not be used as a measure of liquidity. Investors are encouraged to review the "Reconciliation of GAAP to Non-GAAP Measures" tables below.
Explanatory Note
On June 30, 2025, we completed the redomiciliation of the parent company of our corporate group, Penguin Solutions (Cayman), Inc. (formerly known as Penguin Solutions, Inc.), a Cayman Islands exempted company ("Penguin Solutions Cayman"), from the Cayman Islands to the State of Delaware in the United States, resulting in Penguin Solutions, Inc., a Delaware corporation ("Penguin Solutions Delaware"), becoming our publicly traded parent company (the "U.S. Domestication"). Penguin Solutions Delaware is the successor issuer to Penguin Solutions Cayman. The U.S. Domestication was approved by the shareholders of Penguin Solutions Cayman and effected via a court-sanctioned scheme of arrangement under Cayman Islands law, pursuant to which each ordinary share of Penguin Solutions Cayman was exchanged for one share of common stock of Penguin Solutions Delaware, and each convertible preferred share of Penguin Solutions Cayman was exchanged for one share of convertible preferred stock of Penguin Solutions Delaware. Additional information about the U.S. Domestication was included in Penguin Solutions Cayman's definitive proxy statement on Schedule 14A, filed with the SEC on May 2, 2025.
As used in this press release, unless stated otherwise or the context requires otherwise, the terms "Penguin Solutions," "Company," "we," "our, " "us" or similar terms (i) for periods prior to the consummation of the U.S. Domestication, refer to Penguin Solutions Cayman and its consolidated subsidiaries and (ii) for periods at or after the consummation of the U.S. Domestication, refer to Penguin Solutions Delaware and its consolidated subsidiaries. Throughout this press release, we refer to our equity securities (i) for periods prior to the consummation of the U.S. Domestication, as ordinary shares and/or convertible preferred shares and (ii) for periods at or after the consummation of the U.S. Domestication, as shares of common stock and/or shares of convertible preferred stock.
About Penguin Solutions
The most transformative technological advancements are often the hardest to deploy and optimize. Penguin Solutions, the AI factory platform company, has the innovative technologies, skills, experience, and partnerships needed to turn your AI ambitions into reality.
In addition to our AI capabilities, Penguin Solutions offers memory and LED solutions serving a wide range of high-performance and specialized applications.
For more information, visit www.penguinsolutions.com.
Penguin Solutions, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
------------------------------- ----------------------
February November February February February
27, 2026 28, 2025 28, 2025 27, 2026 28, 2025
-------------------- --------- --------- --------- --------- -----------
Net sales:
Advanced
Computing $115,715 $ 151,452 $200,157 $267,167 $ 377,583
Integrated Memory 171,629 136,521 105,260 308,150 201,966
Optimized LED 55,655 55,098 60,102 110,753 127,072
------- -------- ------- ------- ----------
Total net
sales 342,999 343,071 365,519 686,070 706,621
Cost of sales 249,297 246,962 260,871 496,259 504,161
------- -------- ------- ------- ----------
Gross profit 93,702 96,109 104,648 189,811 202,460
------- -------- ------- ------- ----------
Operating expenses:
Research and
development 18,976 18,693 19,907 37,669 39,718
Selling, general
and
administrative 47,989 53,092 59,315 101,081 119,851
Impairment of
goodwill -- -- 6,079 -- 6,079
Other operating
expense 1,048 4,742 859 5,790 968
------- -------- ------- ------- ----------
Total
operating
expenses 68,013 76,527 86,160 144,540 166,616
------- -------- ------- ------- ----------
Operating income 25,689 19,582 18,488 45,271 35,844
------- -------- ------- ------- ----------
Non-operating
(income) expense:
Interest expense,
net 721 47 2,183 768 6,579
Other
non-operating
(income)
expense (27,983) 11,675 (209) (16,308) 427
------- -------- ------- ------- ----------
Total
non-operating
(income)
expense (27,262) 11,722 1,974 (15,540) 7,006
------- -------- ------- ------- ----------
Income (loss) before
taxes 52,951 7,860 16,514 60,811 28,838
Income tax provision
(benefit) 14,410 1,805 7,643 16,215 14,003
------- -------- ------- ------- ----------
Net income (loss) 38,541 6,055 8,871 44,596 14,835
Net income
attributable to
noncontrolling
interest 1,089 785 789 1,874 1,536
------- -------- ------- ------- ----------
Net income (loss)
attributable to
Penguin Solutions 37,452 5,270 8,082 42,722 13,299
------- -------- ------- ------- ----------
Preferred stock
dividends 3,033 3,033 2,600 6,066 2,600
------- -------- ------- ------- ----------
Income available for
distribution 34,419 2,237 5,482 36,656 10,699
Income allocated to
participating
securities 3,594 231 482 3,808 492
------- -------- ------- ------- ----------
Net income available
to common
stockholders $ 30,825 $ 2,006 $ 5,000 $ 32,848 $ 10,207
======= ======== ======= ======= ==========
Earnings (loss) per
share:
Basic $ 0.59 $ 0.04 $ 0.09 $ 0.62 $ 0.19
Diluted $ 0.58 $ 0.04 $ 0.09 $ 0.61 $ 0.19
Common stock used in
per share
calculations:
Basic 52,283 52,900 53,454 52,592 53,468
Diluted 53,186 54,991 54,384 54,031 54,484
Penguin Solutions, Inc.
Reconciliation of GAAP to Non-GAAP Measures
(In thousands, except percentages)
(Unaudited)
Three Months Ended Six Months Ended
---------------------------------------- --------------------------
February 27, November 28, February 28, February 27, February 28,
2026 2025 2025 2026 2025
----------------------- ------------ ------------ ------------ ------------ ------------
GAAP gross profit $ 93,702 $ 96,109 $104,648 $189,811 $202,460
Stock-based
compensation
expense 1,522 1,386 1,776 2,908 3,419
Amortization of
acquisition-related
intangibles 5,909 5,909 5,907 11,818 11,816
Inventory write-off,
stolen in-transit
shipment 5,783 -- -- 5,783 --
Cost of
sales-related
restructuring -- (483) 77 (483) 35
Other -- -- -- -- (200)
------- ------- ------- ------- -------
Non-GAAP gross profit $106,916 $102,921 $112,408 $209,837 $217,530
======= ======= ======= ======= =======
GAAP gross margin 27.3% 28.0% 28.6% 27.7% 28.7%
Effect of
adjustments 3.9% 2.0% 2.2% 2.9% 2.1%
------- ------- ------- ------- -------
Non-GAAP gross margin 31.2% 30.0% 30.8% 30.6% 30.8%
======= ======= ======= ======= =======
GAAP operating expenses $ 68,013 $ 76,527 $ 86,160 $144,540 $166,616
Stock-based
compensation
expense (3,597) (8,694) (9,804) (12,291) (19,692)
Amortization of
acquisition-related
intangibles (1,600) (1,599) (2,932) (3,199) (6,778)
Diligence,
acquisition and
integration
expense -- -- (567) -- (1,400)
Redomiciliation
costs -- -- (2,359) -- (3,602)
Impairment of
goodwill -- -- (6,079) -- (6,079)
Restructuring
charges (1,048) (4,742) (859) (5,790) (968)
Other (106) (99) (242) (205) (575)
------- ------- ------- ------- -------
Non-GAAP operating
expenses $ 61,662 $ 61,393 $ 63,318 $123,055 $127,522
======= ======= ======= ======= =======
GAAP operating income $ 25,689 $ 19,582 $ 18,488 $ 45,271 $ 35,844
Stock-based
compensation
expense 5,119 10,080 11,580 15,199 23,111
Amortization of
acquisition-related
intangibles 7,509 7,508 8,839 15,017 18,594
Inventory write-off,
stolen in-transit
shipment 5,783 -- -- 5,783 --
Cost of
sales-related
restructuring -- (483) 77 (483) 35
Diligence,
acquisition and
integration
expense -- -- 567 -- 1,400
Redomiciliation
costs -- -- 2,359 -- 3,602
Impairment of
goodwill -- -- 6,079 -- 6,079
Restructuring
charges 1,048 4,742 859 5,790 968
Other 106 99 242 205 375
------- ------- ------- ------- -------
Non-GAAP operating
income $ 45,254 $ 41,528 $ 49,090 $ 86,782 $ 90,008
======= ======= ======= ======= =======
GAAP operating margin 7.5% 5.7% 5.1% 6.6% 5.1%
Effect of
adjustments 5.7% 6.4% 8.3% 6.0% 7.6%
------- ------- ------- ------- -------
Non-GAAP operating
margin 13.2% 12.1% 13.4% 12.6% 12.7%
======= ======= ======= ======= =======
Penguin Solutions, Inc.
Reconciliation of GAAP to Non-GAAP Measures, Continued
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
----------------------------- ----------------------
November February
February 28, 28, February February
27, 2026 2025 2025 27, 2026 28, 2025
----------------------- --------- -------- -------- --------- -----------
GAAP net income (loss)
attributable to
Penguin Solutions $ 37,452 $ 5,270 $ 8,082 $ 42,722 $ 13,299
Stock-based
compensation
expense 5,119 10,080 11,580 15,199 23,111
Amortization of
acquisition-related
intangibles 7,509 7,508 8,839 15,017 18,594
Inventory write-off,
stolen in-transit
shipment 5,783 -- -- 5,783 --
Cost of
sales-related
restructuring -- (483) 77 (483) 35
Diligence,
acquisition and
integration
expense -- -- 567 -- 1,400
Redomiciliation
costs -- -- 2,359 -- 3,602
Loss on
non-marketable
equity investment -- 10,000 -- 10,000 --
Impairment of
goodwill -- -- 6,079 -- 6,079
Gain on disposition
of equity
investment (27,036) -- -- (27,036) --
Restructuring
charges 1,048 4,742 859 5,790 968
Amortization of debt
issuance costs 658 658 950 1,316 1,903
Foreign currency
(gains) losses (1,015) 1,212 24 197 1,052
Other 106 956 242 1,062 375
Income tax effects 4,483 (7,552) (5,822) (3,069) (10,064)
------- ------ ------ ------- -------
Non-GAAP net income
attributable to
Penguin Solutions 34,107 32,391 33,836 66,498 60,354
------- ------ ------ ------- -------
Preferred stock
dividends 3,033 3,033 2,600 6,066 2,600
------- ------ ------ ------- -------
Non-GAAP income
available for
distribution 31,074 29,358 31,236 60,432 57,754
Income allocated to
participating
securities 3,195 2,990 2,706 6,154 2,610
------- ------ ------ ------- -------
Non-GAAP net income
available to common
stockholders $ 27,879 $26,368 $28,530 $ 54,278 $ 55,144
======= ====== ====== ======= =======
Weighted-average shares
outstanding - Diluted:
GAAP
weighted-average
shares outstanding 53,186 54,991 54,384 54,031 54,484
Adjustment for
dilutive securities
and capped calls -- (1,228) -- (128) --
------- ------ ------ ------- -------
Non-GAAP
weighted-average
shares outstanding 53,186 53,763 54,384 53,903 54,484
======= ====== ====== ======= =======
Penguin Solutions, Inc.
Reconciliation of GAAP to Non-GAAP Measures, Continued
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
------------------------------- ----------------------
November
February 28, February February February
27, 2026 2025 28, 2025 27, 2026 28, 2025
--------- -------- ---------- --------- -----------
Diluted earnings
(loss) per share:
GAAP diluted
earnings (loss)
per share $ 0.58 $ 0.04 $ 0.09 $ 0.61 $ 0.19
Effect of
adjustments (0.06) 0.45 0.43 0.40 0.82
------- ------ ------ ------- ----------
Non-GAAP diluted
earnings per
share $ 0.52 $ 0.49 $ 0.52 $ 1.01 $ 1.01
======= ====== ====== ======= ==========
Net income (loss)
attributable to
Penguin Solutions $ 37,452 $ 5,270 $ 8,082 $ 42,722 $ 13,299
Interest
expense, net 721 47 2,183 768 6,579
Income tax
provision
(benefit) 14,410 1,805 7,643 16,215 14,003
Depreciation
expense and
amortization of
intangible
assets 12,751 12,819 14,037 25,570 28,998
Stock-based
compensation
expense 5,119 10,080 11,580 15,199 23,111
Inventory
write-off,
stolen
in-transit
shipment 5,783 -- -- 5,783 --
Cost of
sales-related
restructuring -- (483) 77 (483) 35
Diligence,
acquisition and
integration
expense -- -- 567 -- 1,400
Redomiciliation
costs -- -- 2,359 -- 3,602
Impairment of
goodwill -- -- 6,079 -- 6,079
Gain on
disposition of
equity
investment (27,036) -- -- (27,036) --
Restructuring
charges 1,048 4,742 859 5,790 968
Loss on
non-marketable
equity
investment -- 10,000 -- 10,000 --
Other 106 956 242 1,062 375
------- ------ ------ ------- ----------
Adjusted EBITDA $ 50,354 $45,236 $ 53,708 $ 95,590 $ 98,449
======= ====== ====== ======= ==========
Penguin Solutions, Inc.
Consolidated Balance Sheets
(In thousands)
(Unaudited)
February 27, August 29,
As of 2026 2025
---------------------------------------- --------------- -------------
Assets
Cash and cash equivalents $ 489,172 $ 453,754
Accounts receivable, net 369,935 307,904
Accounts receivable, net - related party 674 --
Inventories 322,360 255,182
Other current assets 56,301 47,387
---------- ---------
Total current assets 1,238,442 1,064,227
Property and equipment, net 86,890 92,603
Operating lease right-of-use assets 56,630 58,847
Intangible assets, net 73,474 87,754
Goodwill 145,895 145,895
Deferred tax assets 99,078 99,107
Other noncurrent assets 49,348 68,767
---------- ---------
Total assets $ 1,749,757 $1,617,200
========== =========
Liabilities, Temporary Equity and
Stockholders' Equity
Accounts payable and accrued expenses $ 454,503 $ 318,761
Current debt -- 19,945
Deferred revenue 81,623 73,893
Other current liabilities 54,568 61,300
---------- ---------
Total current liabilities 590,694 473,899
Long-term debt 442,777 441,893
Noncurrent operating lease liabilities 60,751 62,736
Other noncurrent liabilities 44,866 30,445
---------- ---------
Total liabilities 1,139,088 1,008,973
---------- ---------
Commitments and contingencies
Temporary equity
Preferred stock, $0.03 par value;
authorized 30,000 shares; 200 shares
of convertible preferred stock
issued and outstanding as of
February 27, 2026 and August 29,
2025. Redemption amount of $200,366
and $200,500 as of February 27, 2026
and August 29, 2025, respectively. 202,710 202,710
Penguin Solutions stockholders' equity:
Common stock, $0.03 par value;
authorized 200,000 shares; 64,199
shares issued and 51,213 outstanding
as of February 27, 2026; 62,756
shares issued and 52,738 outstanding
as of August 29, 2025. 1,926 1,883
Additional paid-in capital 572,719 551,712
Retained earnings 83,365 46,709
Treasury stock, 12,986 and 10,018
shares held as of February 27, 2026
and August 29, 2025, respectively (263,210) (206,076)
Accumulated other comprehensive
income 14 18
---------- ---------
Total Penguin Solutions
stockholders' equity 394,814 394,246
Noncontrolling interest in subsidiary 13,145 11,271
---------- ---------
Total stockholders' equity 407,959 405,517
---------- ---------
Total liabilities, temporary
equity and stockholders' equity $ 1,749,757 $1,617,200
========== =========
Penguin Solutions, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended Six Months Ended
-------------------------------- ----------------------
February November February February February
27, 2026 28, 2025 28, 2025 27, 2026 28, 2025
------------------ ---------- --------- --------- --------- -----------
Cash flows from
operating
activities
Net income (loss) $ 38,541 $ 6,055 $ 8,871 $ 44,596 $ 14,835
Adjustments to
reconcile net
income (loss) from
continuing
operations to cash
provided by (used
for) operating
activities
Depreciation
expense and
amortization
of intangible
assets 12,751 12,819 14,037 25,570 28,998
Amortization of
debt issuance
costs 658 658 950 1,316 1,903
Stock-based
compensation
expense 5,119 10,080 11,580 15,199 23,111
Loss on
impairment of
non-marketable
equity
investment -- 10,000 -- 10,000 --
Impairment of
goodwill -- -- 6,079 -- 6,079
Gain on
disposition of
equity
investment (27,036) -- -- (27,036) --
Deferred income
taxes, net (55) 85 (48) 30 163
Other (1,226) 2,129 (716) 903 (1,428)
Changes in
operating
assets and
liabilities:
Accounts
receivable (28,641) (34,064) (54,755) (62,705) (78,640)
Inventories (109,155) 41,977 47,215 (67,178) (46,165)
Other assets (1,933) (876) 15,015 (2,809) 15,720
Accounts
payable and
accrued
expenses
and other
liabilities 165,929 (17,805) 24,649 148,124 122,120
-------- ------- ------- ------- -------
Net cash provided
by (used for)
operating
activities 54,952 31,058 72,877 86,010 86,696
-------- ------- ------- ------- -------
Cash flows from
investing
activities
Capital
expenditures and
deposits on
equipment (1,603) (2,853) (2,335) (4,456) (4,171)
Proceeds from
sales and
maturities of
investment
securities -- -- 11,055 -- 14,835
Proceeds from
disposition of
equity
investments 32,186 -- -- 32,186 --
Purchases of
held-to-maturity
investment
securities -- -- (12,671) -- (33,394)
Other (319) (521) (398) (840) (541)
-------- ------- ------- ------- -------
Net cash provided
by (used for)
investing
activities 30,264 (3,374) (4,349) 26,890 (23,271)
-------- ------- ------- ------- -------
Penguin Solutions, Inc.
Consolidated Statements of Cash Flows, Continued
(In thousands)
(Unaudited)
Three Months Ended Six Months Ended
------------------------------- ----------------------
February November February February February
27, 2026 28, 2025 28, 2025 27, 2026 28, 2025
--------- --------- --------- --------- -----------
Cash flows
from
financing
activities
Proceeds
from
issuance of
convertible
preferred
stock, net
of issuance
costs -- -- 191,182 -- 191,182
Repayments
of debt (20,000) -- -- (20,000) --
Payments to
acquire
common
stock (36,941) (20,193) (6,472) (57,134) (17,595)
Payment of
preferred
stock cash
dividends (3,067) (3,133) (2,233) (6,200) (2,233)
Proceeds
from
issuance of
common
stock 2,513 3,339 382 5,852 3,742
------- ------- ------- ------- -------
Net cash
used for
financing
activities (57,495) (19,987) 182,859 (77,482) 175,096
------- ------- ------- ------- -------
Net increase
(decrease)
in cash,
cash
equivalents
and
restricted
cash 27,721 7,697 251,387 35,418 238,521
Cash, cash
equivalents
and
restricted
cash at
beginning
of period 461,767 454,070 370,611 454,070 383,477
------- ------- ------- ------- -------
Cash, cash
equivalents
and
restricted
cash at end
of period $489,488 $461,767 $621,998 $489,488 $621,998
======= ======= ======= ======= =======
View source version on businesswire.com: https://www.businesswire.com/news/home/20260401352541/en/
CONTACT: Investor Contact
Suzanne Schmidt
Investor Relations
+1-510-360-8596
ir@penguinsolutions.com
PR Contact
Maureen O'Leary
Corporate Communications
1-602-330-6846
pr@penguinsolutions.com
(END) Dow Jones Newswires
April 01, 2026 16:05 ET (20:05 GMT)
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