Everpure (NYSE:PSTG) FY Conference Transcript

Summary of Everpure's Earnings Call Company Overview - Company: Everpure - Industry: Technology, specifically focusing on data storage and hyperscaler solutions Key Points and Arguments Hyperscaler Revenue Expectations - Everpure has increased expectations for hyperscaler shipments in FY27, particularly in the second half of the fiscal year, with most shipments expected in Q3 and Q4 due to hyperscaler build-out schedules [2][3] - Currently, the company is primarily shipping to one lead customer in the hyperscaler space, but is also exploring additional prospects [3][4] Business Model Evolution - The original business model was centered around software royalties for DirectFlash software, which constituted the bulk of revenue in FY26 [7] - The new standardized business model allows hyperscalers to procure components necessary for DirectFlash modules, which simplifies operations and enhances gross margin expectations to a range of 75-85 points [10][11] Demand Drivers - Robust demand across various segments, including enterprise and commercial sectors, is noted, with a significant focus on AI and infrastructure modernization projects [12][15] - KV caching is emerging as a new demand driver, particularly in the context of AI inferencing, although it currently represents a smaller portion of the overall business [16][17] Neocloud Service Providers - Traditional enterprises are the primary focus for demand strengthening, but Neocloud service providers are also being engaged for GPU infrastructure [20][21] - Neoclouds are seen as an opportunity due to their diverse customer needs, which align with Everpure's flexible technology offerings [24] Growth and Profitability Strategy - Everpure aims to drive significant growth while maintaining moderate operating margin improvements, targeting a point of operating margin growth annually [37] - The company is focused on sustainable growth across core and new markets, including hyperscalers and AI [26][29] 1touch Acquisition - The acquisition of 1touch is primarily targeted at enhancing enterprise capabilities, particularly in data discovery and classification, which will integrate into Everpure's existing technology [40][41] - This acquisition is expected to complement the unified control plane strategy, aiding in data consolidation and management [44] Supply Chain and Pricing - Everpure has strong visibility into its supply chain and maintains strategic agreements with suppliers, which have been strengthened over time [55][56] - The company has been shipping more QLC NAND than TLC, with a trend towards increasing QLC usage [59] - Pricing actions have been taken to recover gross margins affected by rapid input cost increases, with expectations for recovery starting in Q2 [60][62] Conclusion - Everpure is positioned for growth with a focus on hyperscalers, AI, and enterprise solutions, while managing supply chain challenges and pricing strategies to maintain profitability [26][29][61]