AI storage infrastructure provider Penguin Solutions reported $479 million in revenue for Q3 of fiscal year 2026, a 48% year-over-year increase; the company has raised its full-year revenue and earnings per share guidance.

Following the U.S. Eastern Time market close on July 7, AI storage infrastructure provider Penguin Solutions released its third-quarter earnings for fiscal year 2026. The company reported record quarterly results and raised its full-year guidance for net sales and earnings per share, driven by strong demand in the artificial intelligence market.

Third-Quarter Financial Highlights

1. Net sales for the quarter reached a record high of $479 million, an increase of 48% year-over-year.

2. GAAP operating income for the quarter hit a record $51 million, up 417% year-over-year.

3. Non-GAAP operating income for the quarter reached a record $64 million, an increase of 67% year-over-year.

4. GAAP diluted earnings per share were $0.68, compared to $(0.01) in the same period last year.

5. Non-GAAP diluted earnings per share were $0.84, up 79% from $0.47 in the same period last year.

Kash Sheikh, Chief Executive Officer of the company, stated: 'Penguin Solutions delivered record-breaking results this quarter, with net sales and earnings per share both exceeding market expectations. The rapid expansion in profitability demonstrates the successful execution of our AI Foundry platform strategy. Net sales from our integrated memory business doubled year-over-year, while our AI infrastructure business continues to maintain strong momentum—clearly reflecting robust market demand and effective execution across our full portfolio of memory and artificial intelligence products.'

“Enterprise demand for memory and AI infrastructure-related products remains exceptionally strong. As AI workloads—particularly inference and intelligent agent applications—continue to proliferate and the volume of contextual data expands, memory is increasingly becoming a critical bottleneck limiting system performance and business scalability. By strategically positioning itself across both the memory and AI infrastructure segments, Penguin Solutions is well-equipped to meet customers’ evolving business requirements. Supported by robust market demand and disciplined operational execution, the company is raising its full-year guidance for net sales and earnings per share.”

Third-Quarter Business Developments

The integrated memory and AI infrastructure businesses continued to expand their customer footprint.

The company continues to implement its 'customer acquisition – capacity expansion' business strategy, converting newly acquired customers into long-term, deeply engaged partners.

• Integrated Memory Business: Over the past four quarters—from Q3 FY2025 to Q2 FY2026—the company added 16 new contracted customers, five of which subsequently expanded their procurement volumes;

• AI Infrastructure Business: Four new customers were added in Q3 FY2026; cumulatively, from Q3 FY2025 to Q2 FY2026, 13 new customers were added, with seven subsequently increasing their procurement spend.

Core Technologies and Industry Collaboration Milestones of the AI Foundry Platform

1. Recognized as $Dell Technologies (DELL.US)$ Americas’ AI Global Partner of the Year, underscoring the company’s full-stack AI foundry platform delivery capabilities, which integrate infrastructure software, high-end memory, computing hardware, and complementary services;

2. Became a $NVIDIA (NVDA.US)$ certified AI foundry specialist partner, equipped with end-to-end capabilities to design, build, deploy, and operate AI foundry infrastructure for enterprise-grade, sovereign AI, and next-generation cloud environments;

3. Upgraded ClusterWareAI, the AI foundry operating system, with a new AI-powered operations intelligent agent. Administrators can now perform cluster operations through natural language dialogue. This intelligent agent is the first product in the company’s planned suite of intelligent operations tools, employing a human-in-the-loop automation model to enable automated AI cluster operations.

Raised full-year earnings guidance for fiscal year 2026

As of July 7, 2026, the company has once again raised its previously issued full-year financial outlook, now expecting net sales and diluted earnings per share for the full fiscal year 2026 to exceed the upper end of the prior guidance range. Driven by strong customer demand fueled by AI-powered intelligent agents, the company’s updated full-year expectations are as follows:

• Full-year net sales growth of 22% year-over-year, with a margin of ±2 percentage points;

• Full-year GAAP diluted earnings per share of $1.97, with a margin of ±$0.05;

• Full-year non-GAAP diluted earnings per share of $2.60, with a margin of ±$0.05.

Quarterly Financial Results

Business Outlook