Pure Storage Inc. joined a group of hardware companies that thwarted hopes of a rebound in the second half of the year, attributed its harsh pricing environment and economic slowdown to its third-quarter revenue shortfall and weaker fourth-quarter outlook. On Thursday, after the organization’s disappointing results, Pure Storage PSTG shares fell by -1.05% in after-hours trading, a drop of nearly 24%. The company’s stock has risen 24% so far this year, tracking the S&P 500’s SPX gains this year, -0.16% SPX and -0.16%, although the company has now lowered its revenue expectations for the past three quarters.
The cloud storage developer called an analyst’s executives said that prices fell by double digits in the quarter, leading to a shortage of income. Pure Storage described third-quarter revenue of US$ 428 million, a 15% year-over-year increase, while analysts had expected revenue of US$ 440 million. Although we are seeing more challenging signs of the global business environment represented by other big infrastructure providers, the continued price decline is higher than our expectation, which constitutes between the beginning of the quarter and our revenue expectations. The gap, storage CEO Charles Giancarlo told analysts. He added that due to falling prices and a more challenging environment, the company’s expected range of revenues from US$ 484 million to US$ 496 million was lower than expected, while Wall Street’s forecast was about $512 million. Analysts questioned if there is a company that specializes in price competition, but Pure Storage executives say this is the overall trend in the industry, coupled with recent fluctuations in flash memory costs, although they have no lead in pricing, they do it to competitors. Out of reaction. They added that Dell Technology DELL (-2.82%) and NetApp Inc. NTAP (-1.20%) has been bold in pricing.
More positively, the company also said it had found a replacement for its CFO, Tim Ritters, who left this fall. Pure Storage said Krysler, a former senior vice president and chief accounting officer at VMware Inc., accounted for -2.31%. VMW will join the company as Chief Financial Officer in early December.