Penguin Solutions Reports $324.3M Revenue and $3.5M Net Income for Quarter Ended May 30, 2025

Penguin Solutions, Inc. reported a total revenue of $324.3 million for the three months ended May 30, 2025, marking a 7.9% increase from $300.6 million in the same period last year. The company's net income for the quarter was $3.5 million, a decrease from $6.2 million in the prior year, primarily due to increased operating expenses and an impairment charge of $5.3 million related to goodwill. For the nine months ending May 30, 2025, total revenue reached $1.03 billion, up 19.9% from $859.6 million in the previous year, with net income from continuing operations at $18.3 million compared to a net loss of $27.9 million in the same period last year.

The company experienced significant changes in its financial performance, particularly in its Integrated Memory segment, which saw a revenue increase of 42% year-over-year, driven by higher sales volumes of DRAM products. Conversely, the Advanced Computing segment reported a decline in revenue, attributed to lower hardware sales and the timing of customer projects. The Optimized LED segment also faced a slight decrease in sales, primarily due to reduced direct sales in China and Europe.

Strategically, Penguin Solutions completed the redomiciliation of its parent company from the Cayman Islands to Delaware on June 30, 2025, which was approved by shareholders and is expected to enhance operational efficiencies and market presence. The company also divested an 81% interest in SMART Brazil in November 2023, which has been classified as discontinued operations. This divestiture is anticipated to have a significant impact on the company's financial results moving forward.

Operationally, Penguin Solutions reported a total of 52.4 million shares of common stock outstanding as of July 3, 2025. The company has also been actively managing its workforce, resulting in restructuring charges of $1.0 million in the first nine months of 2025, primarily related to employee severance costs. The company’s cash and cash equivalents increased to $709.9 million as of May 30, 2025, up from $383.1 million a year earlier, reflecting strong cash flow from operations.

Looking ahead, Penguin Solutions anticipates continued growth driven by demand for its Advanced Computing and Integrated Memory segments, particularly in AI and high-performance computing markets. However, the company also acknowledges potential risks, including supply chain disruptions and macroeconomic factors that could impact customer demand. The management remains focused on integrating recent acquisitions and optimizing operational efficiencies to enhance profitability in the coming quarters.