The stock of Pure Storage (PSTG -2.12%), a provider of computer data storage hardware, was up 14.5% at 12:12 p.m. EDT on Thursday, even though the company reported only the very slimmest of earnings beats for its fiscal second quarter of 2022 last night.
Analysts had forecast that Pure Storage would earn $0.05 per share, pro forma, while in fact the company earned $0.06. On the revenue front, however, Pure Storage blew away the expectations, recording $496.8 million where Wall Street had foreseen only $469.5 million.
Indeed, second-quarter 2022 sales rocketed 23% year over year, and subscription revenue for its online storage solutions jumped 31%.
Still, despite exceeding analyst expectations, I have to say that Pure Storage earnings seemed like a bit of a disappointment. According to CEO Charles Giancarlo, the company recorded its highest second-quarter operating profit in its history, a fact he said made it "clear that our long-term strategy ... is working."
It might have been more accurate to say, however, that Pure Storage only lost less money in the second quarter than it had in prior quarters. The company recorded a $33.9 million operating loss and a 6.8% negative operating margin, and on the bottom line suffered a net loss of $45.3 million -- $0.16 per share.
Nevertheless, management is entitled to spin its results however it likes, as long as the numbers are accurate. Pure Storage says third-quarter sales are expected to be $530 million, and full-year sales should be $2.04 billion. If it hits those targets, it should continue beating analyst expectations all year long.
Whether it can do that and also earn an honest-to-goodness profit remains to be seen.