Shares of Pure Storage (NYSE:PSTG) sank on Wednesday after the data storage company reported its second-quarter results. While the company beat analyst estimates across the board, it wasn't enough to impress investors. Pure Storage stock was down about 10% at 12:45 p.m. EDT.
The company reported second-quarter revenue of $403.7 million, up 2% year over year and about $8.4 million above the average analyst estimate. Revenue from subscription services came in at $131.4 million, up 37% from the prior-year period.
Pure Storage posted a non-GAAP (adjusted) net income of $0.06 per share, up from $0.01 per share in the second quarter of last year. The company lost $0.25 per share on a GAAP basis, close to unchanged on a year-over-year basis.
While the COVID-19 pandemic is hurting Pure Storage's results, the company has found success with its subscription offerings. "We are particularly pleased with the sustained strong growth and momentum of our subscription services that offer customers a cloud-like experience with more flexibility and compelling total cost of ownership," said CFO Kevan Krysler.
Pure Storage didn't provide any formal guidance due to the uncertainty created by the pandemic. However, the company expects its third-quarter revenue to be approximately flat compared to the second quarter and expects its subscription business to post strong growth. Pure Storage emphasized that these expectations should not be viewed as guidance.
The lack of visibility may be part of the reason for the post-earnings sell-off. Including Wednesday's slump, shares of Pure Storage are down about 12% since the start of the year.