Everpure NYSE: P reported a stronger-than-expected first quarter of fiscal 2027, with management citing broad demand across core businesses and geographies, higher pricing tied to component shortages and continued momentum in subscription offerings.
Chief Executive Officer Charlie Giancarlo called the quarter “outstanding” and “truly remarkable,” saying revenue rose 35% year over year and operating profit nearly doubled to $159 million. Chief Financial Officer Tarek Robbiati said both revenue and operating profit exceeded the high end of the company’s guidance range.
Robbiati said total revenue growth was helped by higher pricing and some customer purchase acceleration as buyers moved to secure product availability and avoid future price increases amid supply constraints. He estimated those two effects represented nearly one-third of Everpure’s first-quarter year-over-year revenue growth.
Revenue Growth and Guidance Raised
Product revenue grew 55% year over year to $577 million, Robbiati said. Subscription services revenue increased 17% to $476 million and represented 45% of total revenue. Annual recurring revenue rose 19% to more than $2 billion, while remaining performance obligations increased 41% to $3.8 billion.
Everpure ended the quarter with more than $1.5 billion in cash and investments. Cash flow from operations was $180 million, capital investments were $68 million and free cash flow was $112 million. The company repurchased 1.3 million shares for approximately $84 million and said it had about $245 million remaining under its existing $400 million repurchase authorization.
For the second quarter, Everpure guided for revenue of $1.095 billion to $1.105 billion, representing about 28% year-over-year growth at the midpoint. It expects operating profit of $195 million to $205 million, up about 54% year over year at the midpoint.
For fiscal 2027, the company raised its revenue outlook to a range of $4.41 billion to $4.51 billion, or 22% year-over-year growth at the midpoint. That compares with prior guidance for 19% growth. Everpure also raised its operating profit forecast to $820 million to $860 million, representing about 32% year-over-year growth at the midpoint.
Supply Chain Crisis Drives Pricing Volatility
Management spent much of the call discussing what Giancarlo described as an unprecedented supply chain environment driven by heavy AI-related demand. “In my over 40 years in technology, I have never seen another supply chain situation remotely like this,” he said.
Giancarlo said component shortages and cost increases have “entirely eclipsed” the tariff issues the company faced last year. He said costs and component availability now change rapidly and are difficult to predict.
Everpure has raised prices, but management emphasized that it has moved later and by less than competitors. Giancarlo said the company published a letter to customers in April explaining that it would “share the cost pain” and would not seek to “profiteer” from the crisis.
During the question-and-answer session, Giancarlo said spot market prices for some components had risen “anywhere from 5x-10x,” adding that he had seen prices “doubling every 18 days.” He also said Everpure has shortened customer quote validity to 30 days from its prior 90-day standard, while noting that some other vendors will not provide final pricing until shipment.
Robbiati said product gross margin was 65.5%, within the company’s long-term range of 65% to 70%, up 150 basis points year over year but down 180 basis points sequentially. He attributed the sequential decline mainly to higher commodity costs, partly offset by price increases and product mix. Total gross margin was 70.1%, and subscription services gross margin was 75.6%.
Evergreen//One and Subscription Demand
Everpure highlighted strong demand for Evergreen//One, its storage-as-a-service offering. Giancarlo said the current pricing environment has increased the appeal of the model because longer contracts, lower upfront costs and longer asset lives allow costs to be spread over multiple years.
Evergreen//One sales rose 73% year over year in the quarter, according to Giancarlo. Robbiati said total contract value sales for storage-as-a-service offerings were $165 million, also up 73% year over year.
In response to an analyst question, Giancarlo said Evergreen//One orders grew faster than overall company revenue and somewhat faster than capital expenditure-based sales. He said he expected the model to grow further relative to traditional purchases, given the economic benefits in a high-price environment.
AI, Hyperscalers and Data Management
Giancarlo said FlashBlade//EXA continued to win customers in AI, machine learning and GPU-accelerated financial services trading applications. He cited a fintech customer using GPU-based AI modeling for algorithmic trading that selected FlashBlade//EXA for high-performance AI infrastructure.
Management said hyperscale product revenue was minimal in the first quarter, as expected, but should rise significantly in the third and fourth quarters based on customer order commitments. Robbiati said Everpure expects the “significant majority” of hyperscaler revenue in the second half of fiscal 2027 and reiterated that the company expects a multiple of fiscal 2026 hyperscaler revenue in fiscal 2027.
Giancarlo said Everpure’s hyperscale solution is progressing with hyperscale, cloud and large technology customers, and that the company is investing heavily in system qualification. He said hyperscalers are seeking storage capacity broadly, with hard disk supply sold out through 2028.
The company also closed its acquisition of OneTouch earlier in May. Giancarlo said OneTouch will help customers manage enterprise data across Everpure products, competing products, cloud environments and SaaS platforms. He said the technology can support data catalogs, semantics, ontologies and knowledge graphs, which Everpure believes will be useful for AI and analytics workloads.
Management Cites Share Gains but Limited Visibility
Everpure said it added 275 new customers during the quarter, including 223 new logos in its commercial business. Robbiati said the company’s Fortune 500 penetration reached 64%. Giancarlo said new customer logos were up 20% year over year and large deals above $5 million rose by high double digits.
Management said competitive win rates have improved and that Everpure is gaining share. Giancarlo attributed this to the company’s ability to support block, file and object storage across performance tiers, along with reliability, simplicity and total cost of ownership advantages.
Despite the strong start to the year, management was cautious about the second half. Giancarlo said visibility is limited because of rapid changes in supply availability and pricing, and said the company wants to see whether historically high prices lead to demand destruction. Robbiati said Everpure is not assuming additional customer pull-forward in its second-half forecast, though further price increases are expected.
“Demand continues to be robust across all business segments, enterprise and commercial alike,” Robbiati said. Still, he added that it remains unclear when customers may stop buying in anticipation of eventual price declines.
About Everpure NYSE: P
Pure Storage, Inc provides data storage technologies, products, and services in the United States and internationally. The company's Purity software is shared across its products and provides enterprise-class data services, such as data reduction, data protection, and encryption, as well as storage protocols, including block, file, and object. Its products portfolio includes FlashArray for block-oriented storage, addressing databases, applications, virtual machines, and other traditional workloads; FlashArray//XL; and FlashArray//C, an all-QLC flash array.
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