Penguin Solutions Q3 Fiscal 2025 Financial Results

Penguin Solutions, Inc. recently released its financial results for the third quarter of fiscal 2025. The company, which specializes in advanced computing, integrated memory, and optimized LED solutions, reported a mix of growth and challenges in its latest earnings report.

Financial Highlights

For the third quarter of fiscal 2025, Penguin Solutions reported net sales of $324 million, marking a 7.9% increase compared to the same quarter last year. However, the company's GAAP gross margin slightly decreased to 29.3%, down 30 basis points from the previous year. The non-GAAP gross margin also saw a decline, coming in at 31.7%, down 60 basis points year-over-year.

GAAP diluted earnings per share (EPS) were reported at $(0.01), a significant drop from $0.10 in the year-ago quarter. On a non-GAAP basis, diluted EPS improved to $0.47 from $0.37 in the same period last year.

Business and Operational Highlights

Penguin Solutions' revenue growth was driven by its Integrated Memory segment, which saw a substantial increase in net sales to $130 million, up from $91.6 million in the year-ago quarter. The Advanced Computing segment, however, experienced a decline in net sales to $132.5 million from $145 million in the previous year. The Optimized LED segment reported net sales of $61.6 million, slightly down from $64 million in the same period last year.

Strategic Initiatives and Corporate Developments

CEO Mark Adams highlighted the company's strategic focus on developing AI software and services capabilities, expanding go-to-market resources, and driving long-term value for stockholders. The company also completed a refinancing after the close of Q3, which strengthened its balance sheet.

Management's Perspective

Mark Adams, CEO of Penguin Solutions, stated, "We delivered solid third quarter results while executing against our strategic objectives. We also strengthened our balance sheet through a refinancing after the close of Q3, and we remain focused on developing our AI software and services capabilities, expanding go-to-market resources, and driving long-term value for our stockholders."

Future Outlook

Looking ahead, Penguin Solutions has provided a financial outlook for fiscal year 2025. The company expects net sales to grow by 17% year-over-year, with a gross margin of 29% +/- 0.5% on a GAAP basis and 31% +/- 0.5% on a non-GAAP basis. Operating expenses are projected to be around $340 million +/- $5 million on a GAAP basis and $260 million +/- $5 million on a non-GAAP basis. The company also anticipates diluted EPS of $0.04 +/- $0.05 on a GAAP basis and $1.80 +/- $0.05 on a non-GAAP basis.

SEC Filing: Penguin Solutions, Inc. [ SGH ] - 8-K - Jul. 08, 2025