Pure Storage Inc (NYSE:PSTG) stock surged more than 30% on Thursday, setting up for a record close, after the data storage firm delivered stronger-than-expected quarterly results and raised its full-year outlook.
A major factor behind the rally was excitement on Wall Street about the company's growing partnership with Meta Platforms, Inc. (NASDAQ:META), according to CNBC.
In March, Pure signed a deal to become Meta's primary storage provider. Pure confirmed on its earnings call Wednesday that it began recognizing revenue from the Meta deployments during its second quarter.
The company had anticipated rolling out 1–2 exabytes for Meta by the end of the fiscal year and now says it's increasingly confident in hitting, or even exceeding, that target.
Tarek Robbiati, Pure's newly appointed CFO, offered more color on the company’s earnings call.
"Our relationship with Meta continues to advance," Robbiati said, adding that Pure is seeing "increased interest from other hyperscalers."
For the second quarter, revenue climbed 13% to $861 million, ahead of analysts' projection of $846.9 million, according to LSEG. Adjusted earnings came in at 43 cents per share, beating expectations of 39 cents. Pure also raised its full-year revenue forecast to between $3.6 and $3.63 billion, up from its earlier $3.52 billion outlook.
Pure Storage CEO Charles Giancarlo told CNBC that targeting hyperscalers is now a core growth strategy.
"We believe that will continue to scale in the years ahead," he said, adding that the key is Pure's ability to more efficiently manage space, power and cooling.
"With power being at such a premium, the ability to use less power on storage and therefore be able to use more power for things such as AI becomes very, very interesting" Giancarlo said.
Price Action: Wednesday's surge lifted Pure's market capitalization to $26 billion. The stock price surpassed its previous record from January.
The gain also marked one of the strongest trading days in company history, following a 22% leap last December when it revealed its first hyperscaler customer alongside earnings.
According to data from Benzinga Pro, Pure Storage stock was up 30.1% at $79.18 heading into Thursday’s closing bell.
Read Next:
- Could Trump Target A Stake In UnitedHealth Next? Maybe … Here’s Why
Photo: Shutterstock