Strong sales pushed all-flash storage array vendor Pure Storage into record revenue territory and left the Mountain View, Calif.-based company with plenty of cash to take it through to profitability.
Pure Storage got plenty of help from its indirect channel partners, which brought in about 80 percent of new customers during its second fiscal quarter of 2017, with the top five partners all driving triple-digit growth over last year, said CEO Scott Dietzen.
Investors loved the news, taking what had been lackluster stock prices all day and helping them soar from less than $12 per share to more than $13.50 per share in after-hours trading. However, Pure Storage's share prices, which debuted in early October 2015 at $16.01 per share, are still down significantly from its mid-October 2015 high of $19.74 per share.
For its second fiscal quarter of 2017, which ended July 31, Pure Storage reported revenue of $163.2 million, up 92.8 percent since its second fiscal quarter of 2016. That was ahead of company revenue guidance of $153 million to $157 million.
However, that revenue growth was not yet enough to bring the company to profitability. On a GAAP basis, Pure Storage lost $63.8 million, or $1.89 per share, in the second fiscal quarter of 2017, down from last year's loss of $59.6 million, or 31 cents per share.
On a non-GAAP basis, Pure Storage this quarter lost $52.0 million, or 33 cents per share, compared to last year's $31.5 million, or 16 cents per share.
Dietzen, speaking at the company's quarterly financial analyst presentation, said Pure Storage's fourth quarter as a public company turned out to be a good one.
"At a time when many of our competitors are shrinking, our growth shows customers are looking to reduce complexity," he said.
Dietzen said that Pure Storage has about $570 million in cash and zero debt, giving the company a good base on which to grow to profitability.
Pure Storage has three key differentiators, Dietzen said. The first is effortless deployment, as evidenced by one large unnamed customer who has a single administrator handling more than 50 TB of capacity compared to 15 people before Pure Storage was implemented.