PSTG Pure Storage

Sanjot Khurana Vice President of Investor Relations
Charlie Giancarlo Chief Executive Officer
Kevan Krysler Chief Financial Officer
Rob Lee Vice President and Chief Architect
Karl Ackerman Cowen
Sidney Ho Deutsche Bank
Jason Ader William Blair
Rod Hall Goldman Sachs
Wamsi Mohan Bank of America
Amit Daryanani Evercore
Simon Leopold Raymond James
Matt Sheerin Stifel
Shannon Cross Cross Research
Kathryn Huberty Morgan Stanley
Call transcript
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Good day, ladies and gentlemen. Thank you for standing by, and welcome to the Pure Storage First Quarter Fiscal Year 2022 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, there will be a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded. to host like call, today's now Mr. would introduce for your conference I Khurana. Sanjot Please go ahead.

Sanjot Khurana

good to name afternoon. first and Relations you, Thank Welcome Storage. XXXX Vice of conference at Khurana, Pure quarter the earnings call. Sanjot My is President Investor fiscal Storage Pure

are Charlie me our CFO, and Giancarlo; Kevan today Joining President Lee. & our Krysler; Vice Chief our CEO, Architect, Rob

to we call, statements, like related Before remind and product and sales facts are you COVID-XX subject this as industry I which and business during forward-looking some would the them. based of to Any our assumptions strategy undertake we competitive, risks prospects, today, These management update our begin, that current operations. disruptions, to uncertainties. make we that its will offerings, our regarding: and and include no make various and are all and our statements obligation future growth technology and pandemic on and trends, and statements advantages, forward-looking

may the A should refer performance. not to is our Our actual as uncertainties results and of risks future considered to of filings. with we and contained differ forecasted results results public business the indication filings relating an of be SEC, reported some discussion and our the from you in materially these

and property our Charlie be website over the purposes. broadcast webcast being release During turn With to press and Storage archive website comparable playback directly available most provided and of live discuss company's of measures non-GAAP CEO, the the on we measures earnings performance, this to GAAP call that, will Storage. Pure will call, is call and This I'll Relations in on talking Investor reconciliations Pure is the the IR Giancarlo. An in is the the for are slides. about being the recorded

Charlie Giancarlo

in summer I ones forward begins, are view. better days us and healthy you as Hello world hope joining the ahead to the and comes beginning end parts increase, today. and the everyone looking COVID of and thank into of you many restrictions vaccination for rates your loved of

Our recover. in hearts still India strong soon very go scourge suffering that Pure strong will out to friends drove last other We and QX double-digit and to delivered growth our against broad happy countries with we they results from in strong QX. pray with balanced I’m that also this our aspect business. contributions quarter every of a our across comparison based year. report was of

enterprise our teams saw contribution, enterprise segment in In see to our this years. continue where we year-over-year. customer’s validating go-to-market quarter, two over the investment new we past increased acquisition, in expansion, customer strengthen world-class We services also particularly net its and products, commercial our

teams achieved significant again U.S. double-digit growth. Our new and both International annual this year-over-year our saw products and quarter our growth

partners subscription recently and match partner channel year-over-year to remote legacy are to and cannot Pure the subscription marketing fantastic of models leading resonate industry as-a-service selling this customers enhance financing, support. their recreate nicely. through to Our over or bookings to systems capabilities on rest through upgrades, XX% momentum. growth, attempting growing our industry. strongly the partners sales quarter as-a-Service our our doubled but business up to and management continue last unique build API professional our change And, of has number new same operations and year. Pure’s saw the us and from are non-disruptive we and incentives services, differentiate Competitors offerings Pure the announced with Evergreen channel

on and during confidence customers’ our based brand. our increasing continued expectations COVID is overperformance exceeded Our our our was mostly quarter, improvements expense prudent with reflecting operating growth paired this quarter profit this management. operations strong in restrictions in revenue The and achieved

Pure’s started. and pandemic predictions that their our an our in Aegis Sciences, in Modern since culture, how our strongly increase how leading semblance re-iterated have showed Roblox using globally, the the that This strategy as Pure’s management and office a the feel platform organizations vision and and and services, further. released to normal I our business We resonating have accurate for we latest will XX% connected announced Accelerate their some return rates Experience, new Enterprise. reasonably more Portworx than of infrastructure, with Data data markets been and all month, customer, our to confident momentum of annual for //Accelerate conference PureX year. modernize Experience of prospect participation NASA, increase vaccination of business environment We applications. is even modernize indicator our event, higher updates of Digital at record market. modernize and Data significant we attendees, Experience our the We version Modern their partner XX,XXX to increase we Pure’s and kicked our Digital far, like attendance, The so platform than off last in cloud-based is of annual operations our are products business

We also software and Bare as enhancements. provided Purity with a-Service Equinix solution our greater details Metal newest on

are to Modern All that throughout our without by transformation entire, workshops modern of We automated operations three edge, possible that Data excitement of business new modern Accelerate supporting made every disruption. the believe continually featured and in and the of leading Pure’s journey Pure’s capabilities month-long applications. modern Modern these Data infrastructure enables event. is promise Customers shown delivers infrastructure for are Experience. more company’s be Experience fundamental will steps these that continue have in needs improving digital

on-prem to easy-to-deploy, modernize services, developers applications alike, A operate IT a enabling both applications and And, by provide common The infrastructure. and a contract cloud. in services, Pure environment. hybrid as-a-Service, interfaces infrastructure can and across cloud-native across customers business provide next manageable management unified reliable we clouds. generation first critical code. through component and existing cloud We APIs Customers and of with single our Data provides is our modern data their Modern customers Experience

further the growth stuck first FlashArray//C, fastest disk. continues our saw ever. Pure’s new realized is that of FlashArray//C all-QLC quarter the Our growing our to product pushes and founding this where data with FlashArray of tier new to vision double-digit competing a All with Flash be flash competitors center being workloads, are

Pure’s last family week, was Gartner Insights as recognized Choice. Peer a FlashArray Customers' Just

capability copies data technology brought portfolio, protected know the national to don’t SafeMode, know insecurity not consolidated but the online that Ransomware who Pure be data ability as-a-Service update with the extra to and technology Medical a which protection a that ever new Pure PureX Donor organization’s last of restore that disruption of data data layer customer’s Protection of be You view Pure only allowing without In by a Evergreen to to launched data, an they Bone which a protect in is with matter critical we in Marrow data restore FlashBlade of the fleet, quarter, security. with within subscribes this the breach. services, the provides to customer is operated can National Match, cornerstone Pure’s is to modern this SafeMode another they that and peace-of-mind their unique franchise a Data by is within customer’s protected in the need SafeMode of rapid like The our to Be in to with protect a platforms, hours to breach. protection have to arrays few Ransomware nuisance, hours. is need years, a chosen We Center Ransomware capabilities, enterprises from and continually environment. of infrastructure, their a from a entire of industry-leading back Pennsylvania Snapshot a protection. delivering so SafeMode Meadville their FlashArray//X if Customers mission they all in event Program, ability recover Dashboard

only ago in modernized X use, our were in but In have cases deployed most not recent fact, arrays XX% still are our of many that models. to over years been

consistently, systems, most upgraded like and to services, the application. most the technology, are to transparently non-disruptively Our cloud modern

software, and Evergreen a management PureX customers. system model, uniquely to true Purity infrastructure to deliver position modern Pure our experience as-a-Service, Our

DevOps, of and with second processes. you means developers have yesterday’s its block, file, to the be is infrastructure the Modern our the is public offerings Experience is strategy application this data-storage as-a-Service management. a service to capacity to events come deliver private storage clouds true catalog via Ops industry’s for that a of of to a element the delivers as-a-Service Modern is Launched manual Ops. teams, available even our across key of After organization XXXX, science deeply City performance, and service as-a-Service a storage-as-a-service very They Modern and and unifies and modernizing and storage-as-code quarter. it Pure data Data object to they upgrades, use and elections. and experience data making monitor Pure component Customers Pure all, automate continues expect. operations. for subscription hybrid-cloud the all pleased if them we’re of foundation Doing Denver such it operate in experience. tiers and and The as APIs. unified of performance, diminished value seasonal benchmark like standardizing with variable modern into the Pure growth use

With hyper-scaler also differentiated but Store strong PureX, the as-a-Service solution are only in now proactive bare Azure agility their user data with experience. as-a-Service inherent analysis reaping containers. via simplify metal, by has deliver to option and we PureX proven META companies experience the from its while gathered as Cloud telemetry subscription, ecosystem, both Pure’s architecture, support as-a-Service both Pure engine, benefits resolution an the predictive Evergreen Block is fault our and Pure including VMs, the their interest not the and using AI seeing Pure's flexibility of across we private from of and our by of broadened architecture for want who and a AWS clouds.

subscription desire customers computing, of to suggest leverages supports efficient AI-driven which to architectures, add, The expanded of tier the and is they customers needed. work capabilities infrastructure and seamlessly applications The an //Accelerate, new capabilities family, applications, customers These live. run for cloud-native as-a-Service FlashArray utilizes tools decisions. service production or Portworx Pure applications limit, including architectures Our scale purchases. containers enhanced infrastructure, was Portworx PureX hybrid-cloud modernize container-based renew all provisioning streaming. automated, fully SaaS Modern Pure more new workloads Modernizing confidently Data automation suspend, complete announced PureX and can Experience. resiliency deeper Pure and Enterprise, to across support, expanded planner truly and customers’ bare latest like Pure this Storage develop take analytics now to storage across FlashBlade operations we’ve easily workload and experience cloud, Kubernetes-native advantage for quarter, third storage Portworx intelligence right need and enterprise modern investments Kubernetes, proactive made pillar are the The and in delivers to real-time the they the version as can make and for the enable even our arrays, storage to give specifically both for metal programming environments. infrastructure containerized and and so to integration using of resume, on as-a-Service now insight Customers subscriptions upgrade, enabling wherever It together observability models, service gives at catalog the solutions. third-party data systems. Enterprise Pure

we fully since integrated, Pure acquisition, and for. products is Portworx three have simple Just Pure into that the Evergreen and known combined platform quarters

cumulative nearly a number complexity modern storage, preferred At data unstructured data organizations the applications. where reducing applications unified platform increases, $X it of needing remains and customers their the billion range object As and Pure’s the architecture business fast file for with are FlashBlade choice volume modern market in object is of and the their fast the leader. sales, of increases, for

validating leader expanding. Pure FlashBlade new pioneer in the space. our In Object in and object as is Overall, Storage, Radar leadership for is GigaOm’s product the fact, the market fast High-Performance

All We advanced models. Kevan industry’s deeper reliability innovative CFO, for Modern way Experience our with to on delivering continue we turn to greatest a of the to numbers. to our call total most are platforms, at cost over together, Data now complete well the ownership, look deliver customers the worldwide. a the Krysler most and service I’ll

Kevan Krysler

afternoon. good and Charlie, you, Thank

We of on well growth both revenue our the its delivered influence and We pleased as the broad-based strength double-digit continued momentum. with QX are very tough globe. compare, continued results a COVID-XX across markets of uncertainty despite as and

last cancelable reflected compared sales growth, to Our XX%, strength excluding orders, also growing year.

our both includes billion, which most XX% and performance $X.X from in driven over product grew our obligations, entire what committed and performance non-cancelable XX% about which revenue performance our and existing including our our our were FlashArray//C; the business. our growth remaining or by saw very from across including is year-over-year. with future year-over-year quarter business. our strength Our particular, solution entire pleased was we across new commercial slightly customer growing strength In was channel portfolio, the commercial and partners; growth in key sequentially RPO, part Double sales acquisition, customers, geos; digit business. contribution new We this strong impressive from our also

of as Now revenue consistent the sales of were year. as and expenses sequentially for reflect reflect our total States services last Again, revenue for travel which environment, the last slightly International the our expenditures approximately throughout XX%, as XX.X% quarter XX% million. XX.X% and with million employees. margins solutions, Total were and to XX% a ended the quarter, year-over-year. margins the the gross quarter revenue of included quarter our momentum. long-term in gross our and grew XX slightly Cash accelerated of margins year, COVID XX% Contributing Capital outperformed quarter to slower-than-planned outperformance, X,XXX continues both services less over hiring. approximately the expectations. repurchase sequentially non-GAAP turning higher million during software compared to Pure-as-a-Service slightly sequentially reflect physical saw factors results what shares We be returned the growth our both margins XXX marketing were product high-end Non-GAAP in approximately share and operations FlashArray//C QX part program. was improved while on and services Subscription X.XX and capital customers. expectation. mix positive our infrastructure. year-over-year million improving events, this over expenditures in subscription during XX.X%. XXX to quarter. we $X.XX to to non-GAAP include in flow grew XX.X% XX%, We to of achieved the specific of margins value approximately to financial lower approximately supply with total We well continue differentiated our revenue million required and XX our services million cash of capital represents and last billion repurchase United the including margins revenue subscription Product due were grew improved costs Subscription product chain Product gross from and profit to during in gross invested to of revenue. XX operating secure Non-GAAP continue grew quarter. year. increasing

Now, turning to guidance.

last are with we to steadily As momentum quarters, navigate previously our by two challenges mentioned, the while the continuing increasing very over created pleased various COVID-XX.

will year, momentum We of million, the double-digit XXX expect be to the as continue XX%. throughout challenges approximately recede progress created our representing that will by revenue to and QX COVID-XX continue. expected growth we is

approximately also We million. non-GAAP XX profit operating be will expect

the on operating income. but updating be I provide about for quarter revenue will one As mentioned and thinking view, time our additional impact of quarter, guiding at last both be not will a over-achievement and our annual we we will QX we color are some how

accretive we of over-achievement be annual will that our expect increasing due view. over-achievement be to costs related revenue anticipate, will to half Primarily approximately we quarter income supply chain that to our the that accretive our operating expect We annual during view.

questions. build the We I QX we are excited get to customers. create it services experiences can upon our for will continuing to momentum our your outcomes, by broad-based to to operator over that, and partners best-in-class With and so turn in


Cowen. Instructions] line Your from [Operator Ackerman the you. Thank of first comes Karl question with

Karl Ackerman

the going guess afternoon. increase still you half of flattish on from to recovering deflationary growth], a you. of that you tell outlook, NAND second at have context in seeing into spend what hoping I With as know, well? a I'm bottomed. us [Exabyte year, enterprise the is FlashArray can may? but, if you regarding Good abates, basis, the wondering maybe thank us because as box] per second Yes, regarding you to hardware roughly of whether Two revenue maybe Exabyte’s if clip, anything tell market pricing could all pressures could the we regarding to a was growth component about of I on-prem seems the current the capacity And know, Kevan, your regard from questions ask year. array, growth points is in some [exabyte business? big XX% year-over-year speak per in And the half then think that you growth your I the I

Charlie Giancarlo

Karl, Yeah, me start I Charlie, wall. this is Kevan, think stats some let on pulls together that the that. on of

say product in really pleased been know, know, there's in that in bullish are to our that that growth product for You and our overall, line addition, that continue that would remain that, product were growth have we'll that, I we continue. counting you FlashArray line very overall to seeing, you growth you to strong growth And to and – Portworx, course, say, both of know, FlashArray//C, see overall. of FlashArray//X know, all know, FlashBlade see you which that I I and line, overall

then and on pass count growth because I’ll NAND. which the subscriptions not the and comment side line growth accounting on you in the a seeing on subscription along Yeah, that immediately moment in does overall. if we good just seeing supply with the chain So, particular, are up of the we're for that, in you And top for know, basis. show

calendar see correct, entered First see, will downward It's exactly to correct. is, pricing you're year NAND raw actually year, pricing to forward. the likely is the of some as pressure some not and the the although remainder we go unlikely NAND year deflationary in you're any the initially, probably we on we see upward with that through

a competitive very expect in ASPs and you You plus of affecting. year increase minus sales nature, course, through the hold, industry we And that'll overall. steady overall reasonably be to of or most would ASPs saw know, are in also know, slight our and I because

you're So, We're deflationary of I this to year. pressure lot going see think correct. a not

Kevan Krysler

is Yeah, and just one is broader agree NAND as thing and the think inflationary Charlie, than other would add pressure I I I well.

So, but in terms supply again, we're as how guide. incremental our half of about profit overachievement been I be annual and for seeing about it that incremental, chain, guide, remarks, would that's to our why we're thinking our considered you the in of the across that's know, operating prepared QX commented viewed

Charlie Giancarlo

for definitely finally, last on you we than Exabyte, And you know, sure. will Exabyte’s then this year we more the, year know, did ship

I think know, average know, average, know, data this to, I'm that spending terms for You of increase But for go as tends that storage you spending cautiously and in market up. you we're will the the also a whole. optimistic year expecting will overall

So, some indication. you I hope that provides

Karl Ackerman

That does, I gentlemen. and appreciate that,

you AWS little like follow spoke when prepared bit, and you'll be – business and breaking gun whether Block I'm at the about know, is know, and, so any you're this Thank up, our you primary in but maybe out one this $XXX now a my may of million For annual run thoughts remarks, curious, peers, GA reach Pure Cloud your how you rate? Store jumping on you. Azure,

Kevan Krysler

And block do Azure? and you on with and hit demand combines lot that as-a-Service. that's why Store Block continued to have me really I nicely Block really seeing Cloud we're here's of and let Rob, some share how Cloud Karl, excited a Store unified It'd Yeah, the thoughts cloud we're great with on on of a momentum be And Pure that? first point just with about subscription service. think our on some comments store Azure quite

Rob Lee

Yeah, absolutely.

portfolio, that super the AWS overall now subscription. traditional the know, You Azure, from growth adding the modern component value of and cloud unified to key see applications, app, ton the see just sorry know, as to expanding you excited, we for, in just continued to Block we're Store Cloud a the

was well example, over to a quarter, Store Azure customer and who utilize prem, their as tremendous to an to capacity subscription, gear know, brought on was undergoing Disaster the Cloud a Block Pure as on get You large elasticity on benefits Environment immediate move unified Recovery you FSI performance the and this growth their their as in able up legacy cloud. under struggling in business, with know, keep to

we which deliver And approach subscription, think were overall benefits to cloud the I able so, of subscription through products. and to goes to unified speak last, we deliver the just flexibility, that and software just the the software the

Karl Ackerman

Thank you.


Ho question next of Bank. Deutsche from Your comes Sidney

Sidney Ho

first for range. services subscription think type driving XX% some there is revenue taking of high-end think continue the higher really over what question depends the or Should questions. of than faster guys will be to than Clearly, the at are there about? is you higher stay revenue? My Thanks target margin. gross levels does margins to grow other the to on doing well you on gross to guys we my likely services it inflationary about talk expect growth? these I pressure there Are considerations considering product very

Kevan Krysler

a question. that's think I No, great

progress think as we're out kind chain. both your you I saw with itself lends high-end coming margin expectations. very the in gross margins due margins. around our accounted pressure, of guide on pleased really again, the on pressure our year, remarks to expect we're the side, we what gross of we to in product margins, through again, on that point, see QX we But and some above, the seeing for the would really, product But of know, on more to view. strong gross with we're annual product, the we've supply a prepared product gross and terms seeing of inflationary my what subscription side, throughout to And pressure the the quarter,

Sidney Ho

accelerate you is a just in the Maybe the to say point? why starting in would you strength differently? market companies you semiconductor of kind market of quarter. But a think start higher I you to business been, Can still side And things highlighting your will half, data – business maybe with do it. it's kind your is of enterprise question have improve the on of points some the enterprise seeing the general talk are if would also the just quarter starting been in last enterprise weak, it's say mixed better. guys market Got in follow-up along hasn't does things, get second – the this about overall

Charlie Giancarlo

expansion both in we The such as two large. products with years into and think deployments we're were company. a of early, We market some we've made yes. both answer would go investments made or three we become because commercial well enterprise enterprise our enterprise. is overall seeing ways by major in as just perspective. our And to business is to really at that our Remember, respected good of be The the But a why investments company brand largely reason set, a in expansion a I customer brand a as still team by enterprise. broader many environment really in to the achieved that from we're ago,

that continue. So, not, made to the I investments specific we know, to secular expect which you is that expansion,

in new for companies can and still about growth enterprise us us into a what waiting enterprise the as mature that are see to therefore you're enterprise, was in us the help us, secular in think know, it's market. probably expand And market comparing you growth segment. really, a that So, penetration to only I for not, are perhaps continue to Secular had space. in we

Sidney Ho

Thank great. Okay, you.

Charlie Giancarlo



question Blair. Jason next of William from Your Ader comes

Jason Ader

a Kubernetes this business? technology, it's in Hey, be us XX and guys you. you we've activity is of XX microservices in why can definitely let's just more start was demand to the I give demand been months, for obviously sense thank last, then there's say, guess, material Charlie, inflection saw your how an months that, and to and going when but maybe, I And do pipeline, Portworx? in wondering, you manifesting? heard of point you for for bought that's Yeah, think to terms you Portworx,

Charlie Giancarlo

to therefore, is top Yeah, while you business to products a a to it's takes difference, talking, big of you growth know, and doubling for that, and you larger – pipeline. much you you a well, know, revenue in expansion line, know, of growth, both you a know, it know, even subscription seen the a we've is, have know, based it as I but ratable know, we're ratable say and revenue make around, you

is by aligning, single the able their customers well as bit both applications, going under the you're going applications, the layer everything know, single, be to management of traditional but Kubernetes and native for that on layer, applications, from manage here, their strategy know, as you you modern it's, supported it's very so-called been So, I'm one to cloud out little a well. umbrella know, having, And [limb] and you or, And expanding know, a new you production a of And you Portworx under the arrays, environment, customers. for a that using done FlashArray reliable to that highly we're know, know, startup then powerful either you to a you able development a know, very environment multi-petabyte have or FlashBlade. a small environment, layer. know, original promise full, all storage into you non-disruptively, with it's deliver to amount SDS our

growing, I mentioned, two expanding in we're say, as Portworx. a becomes or on good, a you of interest, that's fast demand. of be it's top very you line we seeing outside before call really even to or last as two, seeing, our noticeable year know, know so so we're going know, probably lot far, know, So, you a truly, it you But

Kevan Krysler

is strong And give And, know little pretty our color the now we're that. a know, I customers wanted you quite to Charlie, the integration Yeah, you are existing just add we're that's going to that on as a about. maybe and right. if there, you that, know, Rob excited Portworx well. on peer on new with we're We've pleased Enterprise seeing quite version that got synergy of don't with

Charlie Giancarlo

it. little talk I'll bit a about

after but in seen know, we've with customers, know, to You the we've eight transaction, our we've close repeating. just bears and more come. now roughly it with, of The the months, customers, you integrated products all of indicated what this,

makes the the for us, the buyers that we've new for the accounts, sometimes and sometimes Pure do of punch about to And acquisition one, are customers already same half one, leverage people in us on I really buyers that are a are two but development side. is compelling half we been buyers to being it's about know, account, think. that area talking know, makes learn what the new customers the other the years. And You a of you able a new

Rob Lee

what punch this a transition particularly I’ll today. how is that and of fast is, modern jump most is are applications being are there. in just built. and and powerful Frankly, applications is one, a secular how built Part makes two significant space. this growing This

we've to get the environments, or a And able spectrum strategy help and production across really taken going just data staging on-prem, of production in or the deploy, you to that's multiple so getting whether build, suite getting customer in investing they’re development in know, management be capabilities, a the global of to the and you full hybrid of deploy cloud, lifecycle, whole scale. to multi-cloud started, cloud know, whether

So, exciting. early but days, really

Jason Ader

Thank you.


the comes question Rod next line of of Sachs. Hall Your Goldman from

Rod Hall

Yeah, you that, power were think you board? then, kind you to people their add a different the we I'm guys. think like fairly lines, to talking to the cost so things that's into what and you question, – to upward cost about of I Charlie, like know, come like hear lot back as predictable, of your seeing see on cost freight guess cost, the pricing wondering, various for on that question I of seems wanted on, a pressure know, I is? you not If much continue thanks to other pressure on, are in do but because upward relatively it's NAND, Thanks. guys what businesses. across And

Charlie Giancarlo

supply some question. components. the Yeah. on it's you but across pressure Look, some, all more is you say the NAND I'd we're different you seeing board, know, there side, of true know, seeing, Great on the on pricing area, is of the component acute it's know,

can't that's nature. been tremendous at look I'm in probably it's, are going us, guidance, bit, but know, and the you take it, the our At most our, costs competitive you You going know, same to I lot your sales that driver know, as know, for of you I'll are a freight, say but of a Rod, time, up. a

competitive particular is it environment pricing determined our a the much so, And by in more costs. is than deal our by

confident, will but guess we be as I'm with you balancing be, Kevan know, Exactly you our best that we've the XXX% is, mentioned, guide. there so, incorporated how some can't sure. much into know, And ASPs,

have, feel it be fairly on about be may margins. I may there effect severe. it. expect don't good our It we So, some to

because know, in a generally competitive operate the XXX% time again, of we a You environment.

Kevan Krysler

little that. Rod, on then add more just bit I'll to And a maybe

saw specific ASPs, front, we in see I actually know, some two on that really did on the ASP to factors. improvement to what we So QX, you and, attribute

doing job supply general that. is we're But nice inflationary really the continuing the think a into the I value of issues I seeing chain solutions. we're to sell also around our playing think

when strong suppliers. that the the we've how for And got just the think I very our look, get have you issues, relationships of so, year. see broader remainder as supply with we to plays But well, out know, we'll back to chain

us than a making meet team And in suppliers so, different I what we're with our tremendous very cautious terms our terms working very through and environment. the confident doing no needs. navigating sure know, of in just actively, very job we is our COVID did chain And, you of they can this, supply in monitoring customer’s we're think being

pleased see So, the I are componentry. general of with some yet how concerns inflationary then but, improvement in did especially we're themes think we some you things across And the quite know, ASPs. smaller are progressing, board, the with

Charlie Giancarlo

Yeah, to with. I our have just that. suppliers underline Really, to want been do work wonderful

They're lot them. good have that that really the we I they've You know, a a, we b, of But And environment suppliers pressure, tough with couldn't be – a under relationships worked with been us pleased well. it's with. but they've out with more work there.

Rod Hall

know Okay. Do … mind if was I it one guys I but answer, another a long in? you sneak

Kevan Krysler

at all, please. Not

Rod Hall


negatively you benefited to leisure, said are, reopening exposure Thanks. some about travel, one just have stuff? what you got of assuming you what know, that. don't of product kind your that of exposure all COVID. exposures these you've You that affected you just remember industries know, think were through is I'm sort was to you impacted curious, the other know, think that to on, industries you reopening? clearly, exactly I'm industrial that your what revenue The I

Kevan Krysler

Thanks, Rod.

we that's products, know, on to new and new products. the more or customers the their to whether was growth, willingness lesser as and able when focused be vendor, talked being new not in the fact COVID new one it for concern office, to that know, the existing in about, a was relatively You cases things, exposure, try do vendors, it past, you new that had with used

you as including, return way new be we things, you our And to to, different. a the or so, maybe just is willing that it this much that competitors existing may one and or entirely. currently they to of try products new look customers are do products know, case we one maybe a more in at used environment vendor, where know, be an of willing use products case something but new going to more new They're where new used a it's our

looking what about us exposed activities new less our forward It about so and in And we're to. reluctance segments engage much being to that's highly exposed more by customers. was to

Rod Hall

Charlie. lot, right. All Appreciate Great. Thanks a it.


America. call comes of Wamsi Mohan from next the line of Your of Bank

Wamsi Mohan

Thank you. Yes.

all? on much be Sorry specific is on potentially do inflationary from a like, half, that in And see pricing of cost at of you topic. upside sounded of impacting the flowing I about revenue? to suppliers? logistics increased whether all what impact versus this back you guys sort the how you the that And revenue know, to back more through your get procurement follow-up. But alluded can have not but It versus you

Charlie Giancarlo

That think really you Also that suddenly performed of there confident and we QX. unavailable. day, been, thought a those our context you Wamsi. become from, supply QX week. of team look, reasonably our reasonably you up very you good available, who then with every a, every with know, know, QX you, degree for both in feel from throughout being were being know, confidence, day with one this a there COVID. we where that elsewhere. know, one work of components Well, have we about you suppliers being Wamsi, And a the levels looking high QX. about said, it's the customer to is own very of you It's feel situations it chain. closely. standpoint, Thank are And where, flawlessly, high changes confidence component about lot uncertainty availability, components have operations in know you We in until but talk know, We and know, difficult

supply as supply a a issue we costs both well as it's identified cost side. largely So, on issue, as are the going up

quarter QX. us. to world, reasonably feel affect on on so to that QX, would side, put being there, And reasonably every less feel uncertain at keep, won't we going this. to just said, for said, QX it how I an that just think confident And want you it's we on the I we'll of and And caveat about know, that confident. I as least and revenue but a bit you, as logistic we're QX, update

Kevan Krysler

And can terms Yeah. in of a more what saw, we QX. I bit detail maybe in go specifically into little

So, we previously. mentioned actually did in see ASPs, I improvement as

think despite had pressure you margin the which, you and that's very expectations, And in You on of that's traction, for know, product with you favorable. And know, profile supply job on I that with obviously, this on and the FlashArray//C. seeing really our saw what again, more product the had the saw is as selling the we very of is doing total our know, I of doing what us. – some we both nice that field also as margin we're mentioned a chain then for at navigating gross as frankly, of gross with terms Again, gross I through we was quarter, with were we viewed chain, what positive look high-end a products. our side, then great FlashArray//C what And we favorable supply margin when newer some we discounting. well, think kind value really us, but given the

that is helpful hopefully you. for So,

Wamsi Mohan

through opening necessarily Thank that some it comments, you you offerings was you no, how your Thank know, been you think, of the if characterize, financing I you. landscape that. proliferation [indiscernible] And for we're in with to is. lens as-a-service follow-up, around of not offerings Charlie, seeing competitor I an Yeah, you the in increased would enhancements, these competitive know, technology I as-a-service, offerings? competitive wondering referred could largely on-prem are [HB],

Charlie Giancarlo

Yeah. Thanks. Thanks, Wamsi.

largely, behind you detail So, as that. I'll additional describe put it, some

delivering as from know, conferences tell is that it, some technology offering. API. perspective. you the been us you SaaS of the perhaps it fact You that code The customers they're interact well. to continually from you both a similar is remarks, without and experience see know, type very attending that I it, way could are you our a have true through What prepared with accelerate of any disruption, know improving way manipulate to The that able as-a-service

a from view Whereas are make financial most competitors are qualities. of my service on these know, [big of point it You tale], very in focused service. look all much of like view, constructs to my our an to point it a we has product them Pure a the that an are to agreement our that not name, provide is when we as-a-Service doesn't SLA, And it's selling level agreement]. have [teeth a actually providing actually array, service we're customer,

we the are to to financial service we deliver penalties have otherwise us. You that level know, there

provide in objective named and are it whatsoever, to there teeth with it. tend products competitors an Our no in

a is really financing that construct together. it they So, put

that subscription, a all we're the its fact basically, know, is fact what us, service. that the You for is offering

and a CBS. customer data. The it is doesn't they where And I'll last the their subscription. management – so with puts mention the naturally it the subscription thing exists manage Cloud it that across The through matter system. all on-prem And becomes same both it

true So, financial and really the is different of a a course, than pan construct. technical service, just therefore very subscription Cloud unified

Wamsi Mohan

Thanks Charlie.


Daryanani with comes Amit Evercore. question next from Your

Amit Daryanani

just guess what you would the my your as And year, acceleration, to we suggest growth simpler should love would the be we as that we would back if the easier an to going the taking back off, in accelerates do, should half factors for versus as would you compared take. first first what think tendency growth I fairly know, back compares first because Thanks take in guide, back with half. say, understand the the the half we are or compare afternoon. I about half. to questions. – helpful? the the have And half be in such see should half factors simplistically, to I consider go of so I July into we're very easy Good give quarter two well. XX.X% my get

Kevan Krysler

what well, parlay Charlie, some in in it are we we know expecting in. plays highlight second for out sales, start terms of that's acceleration to And QX, half, think with know, know, for more looking our I'll tactically. obviously, you that our where FlashArray//C, you ramp and Yeah, you And throughout just QX to in at as on you know, I second jump which year. to And – to that. some guide free our then for obviously, itself feel signs on is QX going the of that seasonally half, get But, quarter early beneficial. generally we highest landed is

everything strength you You driving the know, with for exciting we that's saw across from is and saw we coming I we still quarter, pleased board kind first see through to what very know, environment. enterprise, that, despite you this in was seeing to what were is commercial, in strength, think highlight mean, on being we COVID the I based this particular, were strength I really a us time think of perspective. commercial. And really important broad a know, whether it's some that

seeing we're great what across Portworx. board and was see, to as-a-Service that So obviously Pure with the

year. that So, this really will in that? that that to we to the continue really add QX throughout started balanced do else we've you'd really which seen QX momentum, think in But strength it's anything want Charlie

Charlie Giancarlo

as to phenomenon, we believe mostly weeks little that pickup hard know, a that but in speculate seeing the being shoots the know, we've while three like, your you green been people promise year, just yet you to of what we’re quarter date know, have QX, rest rules, you that still to real you year. office, in year we we've under quarter’s you the back XXX% that, had, under earnings to all still, where Yeah, come kind see say the just into around any know, would we'll year, say rules. better look we know, getting next was might second be have I some to able given we've you be We're it due maybe this look QX at a the once to see had we position, might the up, the of – to bit and we COVID XXX% of half know, the experience as then COVID a our may of QX, the of

Amit Daryanani

the Fair commercial a segment, folks. [indiscernible] with the the seeing momentum there, sustains] here, is what sales can set on something engagement If customers done? commercial the what's I [exploration you just are is enough. customers different or Hopefully with better a it just talked channel a we have don't bit now the have over And the engaging you traditional different? wave better enterprise your versus driving then with product PR know for third could and momentum follow-up I about you

Charlie Giancarlo

are of we're number there work. question. at say phenomenon’s no I'd There's a that seeing

have increased prepared that might – and part we're we the mentioned commercial. that in seeing this a sourced call partner we remarks what large of deals, think I is

is only that pickup We're going by partners we seeing good So, that we the believe really to overall. will, continue.

is that, was market part our a enterprise, you I but think the a phenomena, FlashArray//C, gotten beginning, resurgence but bit feet not just you of a big it. of environment, I of commercial a and know, of that, large in just the Second, on fact well. that's a this COVID back market. think don't will, I in selling that's commercial you know, way. have the as if there's we think know, you do are them into think number think And do into their them, underneath the by We that

so And that. of a up I that bit think also opens

think think I a little of three it's to the bit So, things, come. those more of but a lot I

Kevan Krysler

had as-a-Service Yeah. just Pure And I too Charlie.

Charlie Giancarlo

right. that's know, You

think know, the set very may many enterprise for Pure doing that to it's thought appeals specifically we and the you customers, of think large programs in well as-a-Service but market I there. have, a largely commercial as-a-Service Pure

Amit Daryanani

much. very you Perfect. Thank

Charlie Giancarlo

Thank you.


question Simon Raymond from Your of next James. comes Leopold

Simon Leopold

reading of you. thinking sounded a be recollection too much want I maybe product sounded was But little more two it. that of FlashArray//C on trends? on more whether Is the to the the of upbeat about, but new FlashBlade, call something your my of separate do sort and question. Charlie, and upbeat and you maybe guess Thanks going kind that, on call, bit think into for sense or we here? perception intentional, how you to I'm these ask a one, in how I is my this the cycles get was I on Thank shifted taking could you an prior odd that

Charlie Giancarlo

like just we to no, the wealth. share yeah, Yeah,

other. a And time on one than bit more sometimes we'll spend the little

hearing getting you and get I to So, take any, started – of talk. shouldn't I was myself tired

capable more. workloads for So, No, a know, all to fill you product, supporting niches. we’re you you AI, time. about. bore FlashArray//C, didn't a platform file. both for you at know, to the out of environments all-in-one know learning, with I products, now, analytics, know, really rapid very know, simultaneous out you with, different at same They scale and multiple, product, all want adding unbelievable both speed, know, product, I, good machine excited you you on The even scale recovery very highly FlashBlade death scalable

you now from You hybrid up know, level, with, a with pricing know, called that platform a for what's competitive tier. disk great scale secondary

different you rather, platforms, products, FlashArray//X. you with you you bit a spend from proud us hear time very more We're may Portworx know, including no. both on, and of know, So, quarter-to-quarter, little know,

color amounts So, product. just each you spend may time, for hear on of each us different quarter

Kevan Krysler

choose I'll Simon, of across of a what we in had plethora terms our where that you And, options we we emphasize. business. was know, a had from just add to quarter And this strength wanted to

is, then, saw you know, going rate we on also a flash much scale you know, And we're what's And unstructured this player, know, C. the first in at you that strength previous just quarter. across customers is thing so that, faster had with year-over-year what acquired, board. say the up And data obviously, with see, very impressed new we quarter, the

So, around good the to in stuff anyone ignore meaning all particular. in happening way not

Simon Leopold

when you pre-COVID own of but internal And the it. own on think sense organization, pretty levels expense Right. and activity? hopefully about No, of follow you're maybe your your easy, are to, of planning items reintroducing those for appreciate in returning I that? travel like thinking should kinds where sort Thanks. ups, How then we

Charlie Giancarlo

on work lot discussed are that, adding line we this plan bottom you a the of and we've Yeah, we year putting years you that and imagine can ahead. of know, on last quarter, focus as to

modest as we do other commentary expenses. bottom to this expenses, to and on quarter, to of grow other start reintroduce you to So, know, that guide you that know, you we’ll for the We expect know, some those slow Kevan's line us path. provided into we down addition I down should expect But obviously call, you last continue this. growth, annual think

to will we so bottom So, more expenses of we expect to your add the total down percentage overall that come that the line.

Simon Leopold

Thanks for the taking questions.

Charlie Giancarlo

Simon. Thanks


Tim of Barclays. Your question comes from Long

Tim Long

you. Thank could as Tow if I well.

bit enterprise the to in those there's of And metrics? more, that's, little kind or highlighting? looking some kind if win little and double-digit, view the dig rates, know, any commercial the wanted a good deal worth at, sounded it you double-digits. talk quarter, you pretty about, can we're sizes a in And metrics when side know, you I and overall First, of bit anything just kind of of and larger those second, FlashArray//C into was trends but then different

when next penetrate of got base we're such used Is year, year as we there? rate to what's go thinking you it to know, this, a the your new through as cases accelerate customer growth the huge TAM, about given further. pieces and or, So into going that you

it kind that larger So, that take product really that what is to on of you. allows TAM? Thank much

Charlie Giancarlo

Win all rates have is roughly we thanks. have you steady. know, the this stayed, Sure, stayed time, rates win something analyze

very it's in-line. You much know,

worry, quarter of win this our bit held rates big number too we're did high, get of whenever that vis-a-vis not and in we the one rates in have our steady pretty we a competitors. know, win fights and changes, expand and You no fights, any we’re

have rate have any Kevan, know, much offhand. deal ones remains, I pretty that don't you size? do comment at on the rates. win historical So,

it's think I have any. same, but don't the roughly I

Kevan Krysler

overall in on were with size, for where terms of of to size working deal we on on last get we addressing their folks were part large work critical year, QX pleased that front deal due deals, very saw home. mission fortunate now. Obviously, some Yeah, we and what needs to really in

that I we would a less know, significant but the was a saw, this pleased million with deals say deals dollars. bit larger little multitude I So, of you were really quarter, the balance over

other So, lesser And in in saw. nothing terms highlight, based significance, of deals board. we larger the in you than it that terms of know, broad to we across saw what was

Charlie Giancarlo

C but was, from double-digits you’re fastest very range, a also right, to a and is been C has wide new that growth you be commentary a wide, gave product we growth our perspective. continues

does on file on somewhat overall a think So, than tier market than side, higher our you – opportunity both is us but higher that can open average file add assume significantly we more for and the up a side. it's also block more that even It as side. number on as And features, the for our add us, number second market to growth the we going more company.

side, it's know, mature while block So, it's the still, product. on you

side, days. On the early it's file still

we're going our And going think of we're so, opportunity to know, there. you continued expansion see to I see,

Simon Leopold

you. Thank

Charlie Giancarlo

Thank you.


Your next Sheerin question from Matt of Stifel. comes

Matt Sheerin

contribution support market. given the ask some you. in strong just years, very expanding put as about that particularly the channel last the for new there’s the know to commentary behind do I what in accounts couple that new And your place roster Thank customers, you to the wanted of Yes. the see in regarding commercial What's of the rollout you where further, channel? channel growth in some well programs that in partners as that? that but base traction? Azure I

Charlie Giancarlo

do. We Matt. Thanks, Yeah.

there's reasons don't partner you for that model, a is, know, go it. think One several I we're direct. we meaning XXX%

environment, they one that of it you work not just really tough, is and partners and gets going things like with competitive take we'll us a know when know, the them. that we're So, away from about you fair that them that in to know, we're that the going

the partners So, that themselves. by loyalty is reciprocated

sell it for the partners and easier to I think we've to product. our easier make continued

for and itself from more same be the customer all, Of and customer of to know, relatively, And which, know, highly, little highly the gets it's straightforward, experience, care partner, reliable. product you able up customer. customer, set to a First that that better very work business very operate partners by the you makes able service the to requires to simple that's course, about what busy also because is to partners experience, the be

customers. them will to growth better especially in programs, expertise, you specialized know, aggressive you high on gets we you programs, that you programs So know, evolve I a with of values don't to, direct know, think, the to continue the company you're we NPS, worked to companies provide tough. that a the high fact as to reliability, know, our partner and our lot model work the represent our and partners right, when going enable enable a them we've itself overall And stray experience for

Matt Sheerin

much. very thanks Okay,


Cross of Cross line of Your question Research. comes the next from Shannon

Shannon Cross

Thank you very much.

model a Just at one curious, mix bit of curious is do which going now of out I'm or entire on, shift revenue, where topping or, just recurring customers about there? something XX% about to growing certain for know, big think that's shifts revenue, we how you you the the is see you. you actually, given and I'm CapEx little this you I obviously and it's kind see me, when believe the do know, think do you picture. that get eventually where you of would Thank if rather, migration continuing? more a model a where point

Kevan Krysler

next at And looking milestone and start the day, still prefer, we're of big I'll great would XX% Shannon flexibility. It of the be a the at us. our first Look, question, they what with end our big customer look, revenue. though, that for milestone first terms of off. It's is in it's

I them have revenue, we what with for we're in do drive outcomes. So, want won't of the on good us think a and and their particular force recurring is terms especially to model seeing terms will in with subscription our momentum then XX% that of with is technology around our But how target longer-term a to Azure following really and they Block consume you'd well, our complement AWS talked apps. Store, to Portworx, as-a-Service board, about, modern unified Pure on and that, we've about I and talked as around as else add, coming solutions both with Anything which Cloud we've that, and want Charlie? evergreen

Charlie Giancarlo


that think covers I it.

Kevan Krysler


Shannon Cross

out couple Curious what mean, refers you to? Thank talking of I a to for…? years of sort are you. long-term or

Kevan Krysler

in couple the some September. month that. Definitely. Yeah, of be that'd in out we'll Day, Analyst contemplating details on looking give which years that and we're how a at more our we're And

Shannon Cross

you. thank Great,

Kevan Krysler

you, Thank Shannon.


comes the Morgan Your line next from question Huberty Stanley. with Kathryn of

Kathryn Huberty

what versus You normal the Charlie, seasonality? have some confidence in follow some confidence? then was that sort Where metrics Did for up? the metrics you drive I that pipeline quarter? What did can a of growth of in about second indicators did see And your talk linearity you. those underscore and the quarter? instance, know, like? backlog look of Thank the you leading

Charlie Giancarlo

you, Great to to Katie. Thank you. Sure. speak

said, change look kind linearity, improvement, of of you saw know, you definitely dramatic signs, we of know, done supports, on, kind you and based that we on, the know, you think the frankly, guide pipeline, the wishes, shoots seeing, to hopes, know, but, we've green on that the you improvement, you know, it of, or and pipeline basing hope any provided, through have balanced lot fairly in situation you QX is, tremendously know, number know, good know, I improving, from a we've analysis as a you don't you in we hard that. in metrics at not you or One know, that for know, details the as whole positive. the the know, know, QX. know, you quarter, specific it's quarter, past, standpoint We of you We're not a you So, the things. give but, went know, and so know, you through COVID you

we So, and of you a, think sort guide. it's a a balanced prudent know,

that things You pipeline. know, near are, you term good near term know, deals, know, from, you support

I So, not guide. in know, magic, nothing say would the you

get business we've last quarters. as what there we of know, with couple can over You believe we the seen

Kathryn Huberty

And Great, up, follow Kevan. that's just helpful. a then

As I neutral dollars, just and in upside is on differently to some the a some past know, conservative to think want a pieces through about function out started, play you year? in of percentage, particular costs, by would you fairly within but NAND you typically of and this the margin such different been you gross getting somewhat so Is profit assume just higher the that is the saw it's the gets be industry buckets, Or price to as first that it reason neutral. time? pass Pure to it has inflation, moving expect able there and through maybe pressure you quarter lot move this it cost there's and this that dynamic is that the in a offset

Kevan Krysler

would that articulated. were a Katie, of the just be I it's really looking able follow how look, pass was really, in to that about issues much think concerns terms we inflation And you the pricing do we chain with general NAND you you that the NAND more latter level. of at, know, perfectly at we And But think this that know, if off. I think thesis there's mean, work. component a are broader, a we've we broader. inflationary I supply our we're lot team, chain the have are talked components smallest And supply driving, about there. of really, much seeing around that

supply thing Now, part I do we in and maintain can that we're the increasing that be The around with question we chain in seeing. due to that generally remains interesting that's the the were seeing, think constraints is, QX seen. that ASPs. And to broader is were successful, we inflation our

but of in profit outlook, about over achievement QX talking our our terms know, the operating of annual we're only, view. obviously, know, for for you taking confident the reason why You half were that is we

Charlie Giancarlo

And in aware a a know, so I and higher one competition. their And, you confusion be how all our want become you quarter, next costs it's deals higher bit float I is, but contracts why competing vendors quarter every to cautious terms it's happen if are competitive, tend supply little for costs ASPs to against that's ours, we've Katie, you're people's role. don't know, long place we're I of of know, along, because you But as are their know, forth like plays there this might know, discounting. cost, are But insert, not the when prices. pass the never this. is raised if we just because does timing, And and what you know more versus you for with in a quite one never day

So, a of because of bit timing. movement there's little always

Kathryn Huberty

you. Thank sense. perfect makes That

Kevan Krysler

you, Thank Katie.


session. closing At over for call to time, Giancarlo will this question-and-answer I remarks. turn the the concludes This back Charlie

Charlie Giancarlo

want and over We're summer. past the back to of quarters the operator. our want the many to throughout I thanks employees care. they've our innovation out on to summer. customers period. call you, to suppliers Thank hard for all for you our getting put and and many, the trust the And Take to a happy of collaboration again. everyone thank for I our very this their call the be excited ourselves their all that put all company of support. we prospects work to really and and And partners wish to work the on later strong in also COVID to


call. conference today's concludes This

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