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Fourth Quarter & Full Year FY25 Financial Results Nasdaq: PENG October 7, 2025
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This presentation and the oral communications made during the course of this presentation containforward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995 that are not historical in nature, that are predictive or that depend upon or refer to future events or conditions. These statements may include, but are not limited to, statements concerning or regarding future events and the future financial and operating performance of Penguin Solutions, Inc. ("Penguin Solutions," "we," "us,"or "our"); statements regarding the extent and timing of and expectations regarding Penguin Solutions' future net sales, sales mix and expenses and customer demand; statements regarding Penguin Solutions’ strategic transformation and business momentum; statements regarding long-term effective tax rates; statements regarding existing and potential collaborations or partnerships;statements regarding the business and financial outlook for the fiscal year, statements regarding the deployment of Penguin Solutions’ products and services; statements regarding potential stock repurchases and statements regarding Penguin Solutions’ strategic objectives and development of its services and capabilities. These statements can be identified by the fact that they do not relate strictlyto historical or current facts. Forward-looking statements often use words such as “anticipate,” “target,” “expect,” “forecast,” “estimate,” “intend,” “plan,” “potential,” “goal,” “believe,” “could,” “should” and other words of similar meaning. Forward-looking statements provide Penguin Solutions' current expectations or forecasts of future events, circumstances, results or aspirations and are subject to a number of significant risks, uncertainties and other factors, many of which are outside of Penguin Solutions' control, including but not limited to, global business and economic conditions, including the impact on the financial condition of Penguin Solutions’ customers, particularly in challenging macroeconomic environments, growth trends in technology industries (including trends and markets related to artificial intelligence), Penguin Solutions' customer markets and various geographic regions; uncertainties in the geopolitical environment; ability to manage Penguin Solutions’ cost structure; disruptions in Penguin Solutions' operations or supply chain as a resultof global pandemics or otherwise; the ability to manage Penguin Solutions' cost structure; changes in trade regulations and tariffs or adverse developments in international trade relations and agreements; changes in currency exchange rates; overall information technology spending, including changes in customer spending on Penguin Solutions’ products and services; appropriations for government spending; the success of Penguin Solutions' strategic initiatives including Penguin Solutions' redomiciliationto the United States (the “U.S. Domestication”) and its ability to realize the anticipated benefits thereof, rebranding and related strategy, any existing or potential collaborations and additional investments in new products and additional capacity; acquisitions of companies or technologies and the failure to successfully integrate and operate them or customers’ negative reactions to them; issues, delays or complications in integrating the operations of Stratus Technologies; the failure to achieve the intended benefits of the sale of SMART Brazil andits business; the impact of and expected timing of winding down the manufacturing and discontinuing the sale of products offered through Penguin Solutions’ Penguin Edge business; limitations on, or changes in the availability of, supply of materials and components; fluctuations in material costs; the temporary or volatile nature of pricing trends in memory or elsewhere; deterioration in customer relationships; Penguin Solutions’ dependence on a select number of customers, the timing and volume of customer orders and renewals; the impact of customer churn rates, including discounting and churn of significant customers from whom Penguin Solutions derives a significant percentage of its revenue; changes in customer demand and sales mix; production or manufacturing difficulties; competitive factors; technological changes; difficulties with, or delays in, the introduction of new products; slowing or contraction of growth in the memory market, the LED market or other markets in which we participate; changes to applicable tax regimes or rates; changes to the valuation allowance for Penguin Solutions' deferred tax assets, including any potential inability to realize these assets in the future; prices for the end products of Penguin Solutions' customers; strikes or labor disputes; deterioration in or loss of relations with any of Penguin Solutions' limited number of key vendors; the inability to maintain or expand government business; potential sales of our common stock following the end of the lock-up period on the holder of our issued convertible preferred stock or the anticipation of such sales; and the continuing availability of borrowings under term loans and revolving lines of credit or other debt arrangements and Penguin Solutions' ability to raise capital through debt or equity financings. These and other risks, uncertainties and factors are described in greater detail under the sections titled “Risk Factors,” “Critical Accounting Estimates,” “Results of Operations,” “Quantitative and Qualitative Disclosures About Market Risk” and “Liquidity and Capital Resources” contained in Penguin Solutions' Annual Report on Form 10-K for the fiscal year ended August 30, 2024, as updated by the risk factors contained in Penguin Solutions’ Quarterly Reports on Form 10-Q and in Penguin Solutions' other filings with the U.S. Securities and Exchange Commission (“SEC”). Such risks, uncertainties and factors as outlined above, and in such SEC filings, could cause Penguin Solutions' actual results to be materially different from such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on any forward- looking statements. Any forward-looking statements that we make in this presentation speak only as of the date of this presentation.Except as required by law, we do not undertake to update the forward-looking statements contained in this presentation to reflect the impact of circumstances or events that may arise after the date that the forward-looking statements were made. Statement Regarding Use of Non-GAAP Financial Measures: This presentation contains the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP operating margin, non-GAAP effective tax rate, non-GAAP net income, non-GAAP weighted-average shares outstanding, non-GAAP diluted earnings per share and adjusted EBITDA. Penguin Solutions' management uses non-GAAP measures to supplement Penguin Solutions' financial results under GAAP. Management uses these measures to analyze its operations and make decisions as to future operational plans and believes that this supplemental non-GAAP information is useful to investors in analyzing and assessing Penguin Solutions' past and future operating performance., These non- GAAP measures exclude certain items, such as stock-based compensation expense, amortization of acquisition-related intangible assets (consisting of amortization of developed technology, customer relationships and trademarks/trade names acquired in connection with business combinations), cost of sales-related restructuring, diligence, acquisition and integration expense, redomiciliation costs, restructuring charge, impairment of goodwill, changes in the fair value of contingent consideration, (gains) losses from changes in foreign currency exchange rates, amortization of debt issuance costs, (gain) loss on extinguishment or prepayment of debt, other infrequent or unusual items and related tax effects and other tax adjustments. While amortization of acquisition-related intangible assets is excluded, the revenues from acquired companies is reflected in Penguin Solutions' non-GAAP measures and these intangible assets contribute to revenue generation. Management believes the presentation of operating results that exclude certain items provides useful supplemental information to investors and facilitates the analysis of Penguin Solutions' core operating results and comparison of operating results across reporting periods. Management also uses adjusted EBITDA, which represents GAAP net income (loss), adjusted for net interest expense, income tax provision (benefit), depreciation expense and amortization of intangible assets, stock-based compensation expense, cost of sales-related restructuring, diligence, acquisition and integration expense, redomiciliation costs, impairment of goodwill, restructuring charges, loss on extinguishment of debt and other infrequent or unusual items. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP, as they exclude important information about Penguin Solutions' financial results, as noted above. The presentation of these adjusted amounts varies from amounts presented in accordance with GAAP and therefore may not be comparable to amounts reported by other companies. In addition, adjusted EBITDA does not purport to represent cash flow provided by, or used for, operating activities in accordance with GAAP and should not be used as a measure of liquidity. Investors are encouraged to review the “GAAP to Non-GAAP Reconciliations" in the appendix at the end of this presentation. Penguin Solutions' fiscal year is the 52- or 53-week period ending on the last Friday in August. © 2025 Penguin Solutions, Inc. All rights reserved. | 2 Disclaimer
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Speakers 3 Mark Adams President and CEO Nate Olmstead SVP and CFO © 2025 Penguin Solutions, Inc. All rights reserved. |
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FY25 Highlights © 2025 Penguin Solutions, Inc. All rights reserved. | 4 Delivering profitable growth while advancing strategic priorities • Net Sales of $1.37B, up 17% vs. FY24 • Non-GAAP operating margin of 12.2%, up 190bp vs. FY24 • Non-GAAP diluted EPS of $1.90, up 53% vs. FY24 Strong Financial Performance • Expanded Advanced C omputing pipeline • Deployed first international AI infra structure implementation • Diversified sources of r evenue with new customers Business Progress • Closed $200M SK Telecom strategic investment • Established or strengthened p artnerships with NVIDIA, CDW, Insight, and Dell SK Telecom Investment and Strategic Partnerships • Rebranded to Penguin S olutions • Redomiciled to the U.S. • R efinanced debt to strengthen balance sheet • Strengthened leadership team Strengthening of Foundation Non-GAAP operating margin and Non-GAAP EPS are non-GAAP measures. For reconciliations to the most directly comparable financial measures prepared in accordance with GAAP, please see the appendix.
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Q4 FY25 Financial Highlights © 2025 Penguin Solutions, Inc. All rights reserved. | 5 Net sales of $338M, up 9% YoY Net Sales Non-GAAP gross margin of 30.9%, flat YoY Gross Margin Non-GAAP operating income of $39M, up 16% YoY; Non-GAAP operating margin of 11.6% Operating Income Non-GAAP diluted EPS of $0.43, up 18% YoY EPS Solid finish to a year of strong growth Non-GAAP gross margin, Non-GAAP diluted EPS, Non-GAAP operating income and Non-GAAP operating margin are non-GAAP measures. For reconciliations to the most directly comparable financial measures prepared in accordance with GAAP, please see the appendix.
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Wave 2: Enterprise AI • Signs of broad AI adoption in financial s ervices, energy, federal, and education • Industry-w ide AI pilots from 2023-2024 expected to lay groundwork for production-scale deployments • Early- stage corporate AI build-outs beginning to take shape © 2025 Penguin Solutions, Inc. All rights reserved. | 6 Next Phase of AI Adoption Underway 2 Enterprise AI Model Fine Tuning and Private Model Creation Dedicated Model Inference at Scale Multi-Model Agentic AI 10,000’s of Solutions 1 Hyperscale AI Consumption for Training 100’s of Solutions We have entered Wave 2
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Solving the Complexity of AI © 2025 Penguin Solutions, Inc. All rights reserved. | 7 At Penguin Solutions we understand the boundless potential of technology and enable our customers to harness the power of AI and advanced computing with a relentless commitment to their success. 25+ Years of Expertise Decades of AI, HPC, and high-availability and fault- tolerant computing success AI & HPC Solutions Design, build, deploy, and manage AI and HPC infrastructure Infrastructure Software Evolved from NASA-created cluster management software optimizing AI & HPC performance Fault-tolerant Solutions Deliver continuous, “zero touch” availability of critical applications and data at the Edge Strategic Partnerships with Leaders in AI NVIDIA Managed Services Elite Solution Provider and Dell Authorized Partner Professional, Managed, and Support Services Expert services and support for production environments
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Business Review © 2025 Penguin Solutions, Inc. All rights reserved. | 8
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Advanced Computing 9 • Revenue of $138M in Q4, up 4% vs. Q3 FY25 – FY25 revenue of $648M, up 17% YoY – FY25 HPC/AI revenue from non-hyperscaler customers up 75% • New Business Momentum – Completed the design, build and deployment of Haien, a key element of South Korea’s Sovereign AI initiative – Launched several new AI projects – Continued investment in partnerships for long-term growth opportunities • Differentiation and Platform Investments – Trusted advisor delivering custom, tech-agnostic AI infrastructure – Building out Penguin ICE ClusterWare platform for cluster lifecycle management – Ongoing expansion of Penguin Solutions services to support post-deployment operations © 2025 Penguin Solutions, Inc. All rights reserved. |
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Integrated Memory © 2025 Penguin Solutions, Inc. All rights reserved. | 10 • Revenue of $132M in Q4, up 38% YoY – FY25 revenue of $464M, up 30% YoY – Robust demand in computing, networking, and telecom • Positioned for AI Memory Demands – Enterprises require high bandwidth, high reliability memory for AI workloads – Early traction for CXL, sample orders from OEMs and AI computing companies – Confidence in broader adoption based on customer qualification momentum • Innovation Pipeline – R&D focused on CXL memory pooling to enable higher bandwidth and larger memory access – Continued investment in OMA, with first shipments expected late calendar 2026 / early calendar 2027
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Optimized LED 11 • Revenue of $67M in Q4, up 9% vs. Q3 FY25 – FY25 revenue of $256M, down 1% YoY – FY25 operating profit up 250bp YoY • Positioning for Long-Term Growth – Capturing market share – Maintaining operating efficiency – Protecting our strong IP – Driving profitable growth © 2025 Penguin Solutions, Inc. All rights reserved. | 9 © 2025 Penguin Solutions, Inc. All rights reserved. |
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Our Plans to Sharpen Our Focus and Drive Transformation © 2025 Penguin Solutions, Inc. All rights reserved. | 12 Grow enterprise customer base in AI infrastructure deployments Drive innovation across hardware, software, and service portfolio Expand partnerships to strengthen go-to-market efforts Operate with discipline and efficiency to enable long-term success Further strengthen balance sheet to support scale and new capabilities
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Financial Review © 2025 Penguin Solutions, Inc. All rights reserved. | 13
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Q4 FY25 Results 14 $338M Net Sales 30.9% Non-GAAP Gross Margin 11.6% Non-GAAP Operating Margin $0.43 Non-GAAP Diluted EPS Non-GAAP gross margin, Non-GAAP operating margin and Non-GAAP Diluted EPS are non-GAAP measures. For reconciliations to the most directly comparable financial measures prepared in accordance with GAAP, please see the appendix. © 2025 Penguin Solutions, Inc. All rights reserved. | Up 9% YoY Flat YoY Up 0.8% percentage points YoY Up 18% YoY
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FY25 Results 15 $1.37B Net Sales $1.90 Non-GAAP Diluted EPS © 2025 Penguin Solutions, Inc. All rights reserved. | Up 17% YoY Up 53% YoY Non-GAAP Diluted EPS is a non-GAAP measure. For reconciliations to the most directly comparable financial measure prepared in accordance with GAAP, please see the appendix.
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Net Sales Detail1 © 2025 Penguin Solutions, Inc. All rights reserved. | 16 Q4 FY25 41% 20% 39% Advanced Computing Optimized LED Integrated Memory Product Net Sales $275M FY25 Services Net Sales $63M Net Sales by Segment Services Net Sales $264M Product Net Sales $1.11B 1. Summations may not compute precisely due to rounding. 47% 19% 34% Advanced Computing Optimized LED Integrated Memory Net Sales by Segment
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($M except per share amounts) Q4 FY25 Q3 FY25 Q4 FY24 Net sales $338 $324 $311 Advanced Computing $138 $132 $149 Integrated Memory $132 $130 $96 Optimized LED $67 $62 $66 Non-GAAP gross profit2 $104 $103 $96 Non-GAAP operating expenses2 $65 $64 $62 Non-GAAP operating income2 $39 $38 $34 Non-GAAP net income2 $29 $31 $20 Non-GAAP diluted earnings per share2 $0.43 $0.47 $0.37 Adjusted EBITDA2 $43 $45 $39 © 2025 Penguin Solutions, Inc. All rights reserved. | 17 Operating Results 1 1. Summations may not compute precisely due to rounding. 2. Non-GAAP gross profit, Non-GAAP operating expenses, Non-GAAP operating income, Non-GAAP net income, Non-GAAP diluted earnings per share, and Adjusted EBITDA are non-GAAP measures. For reconciliations to the most directly comparable financial measures prepared in accordance with GAAP, please see the appendix. FY25 FY24 $1,369 $1,171 $648 $555 $464 $356 $256 $260 $425 $374 $257 $254 $168 $120 $120 $67 $1.90 $1.25 $187 $146
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($M) Q4 FY25 Q3 FY25 Q4 FY24 Working Capital Net Accounts Receivable $308 $293 $252 Days Sales Outstanding 51 days 47 days 49 days Inventory $255 $184 $151 Days of Inventory 51 days 36 days 36 days Accounts Payable $267 $272 $182 Days Payable Outstanding 54 days 53 days 43 days Cash Conversion Cycle 49 days 30 days 42 days Cash Flow Cash, Cash Equivalents and Short-Term Investments (at period end) $454 $736 $389 Net Cash from Operating Activities from Continuing Operations $(70) $97 $(12) Capital Expenditures & Depreciation CapEx $3 $2 $6 Depreciation $5 $5 $5 © 2025 Penguin Solutions, Inc. All rights reserved. | 18 Q4 FY25 Balance Sheet and Cash Flow Highlights Net accounts receivable, days sales outstanding, days of inventory and days payable outstanding are calculated on a gross sales and gross cost of goods sold basis, which were $550M and $453M, respectively, for Q4 FY25, $563M and $468M, respectively, for Q3 FY25, and $470M and $383M, respectively, for Q4 FY24.
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Capital Allocation and Debt Reduction © 2025 Penguin Solutions, Inc. All rights reserved. | 19 • Repurchased 16K shares for $296K in Q4 FY25 • Since April 2022, we have repurchased 6.6M shares for $113M • Audit Committee approved a new $75M stock repurchase authorization in October 2025, bringing total stock repurchase authorizations over the last four years to $225M Stock Repurchases • Repaid $300M term loan with $200M cash + $100M d rawdown from new revolver • Reduced total gross debt by $200M • Extended maturities and lowered debt service costs • N et debt at FY25 year-end of $16M Debt Refinancing
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Our Outlook © 2025 Penguin Solutions, Inc. All rights reserved. | 20
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GAAP Outlook Adjustments Non-GAAP Outlook Net sales 6% YoY Growth+/- 10% — 6% YoY Growth+/- 10% Gross margin 27.5% +/- 1% 2% (A) 29.5% +/- 1% Operating expenses $312 million +/- $10 million $(57) million (B)(C) $255 million +/- $10 million Diluted earnings per share $0.89 +/- $0.25 $1.11 (A)(B)(C)(D)(E) $2.00 +/- $0.25 Diluted shares 55 million — 55 million Non-GAAP adjustments (in millions) (A) Stock-based compensation and amortization of acquisition-related intangibles included in cost of sales $ 30 (B) Stock-based compensation and amortization of acquisition-related intangibles included in R&D and SG&A 49 (C) Other adjustments 8 (D) Estimated income tax effects (19) (E) Estimated effect of allocation of earnings to participating securities (7) $ 61 © 2025 Penguin Solutions, Inc. All rights reserved. | 21 FY 2026 Outlook
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Solving complexity. Accelerating results. © 2025 Penguin Solutions, Inc. All rights reserved. | 22 • Contact information goes here
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23 GAAP to Non-GAAP Reconciliations © 2025 Penguin Solutions, Inc. All rights reserved. |
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© 2025 Penguin Solutions, Inc. All rights reserved. | 24 GAAP to Non-GAAP Reconciliations Three Months Ended Year Ended (dollars in thousands, except per share data) August 29, 2025 May 30, 2025 August 30, 2024 August 29, 2025 August 30, 2024 GAAP net income (loss) attributable to Penguin Solutions $ 9,431 $ 2,661 $ (24,547) $ 25,391 $ (44,324) Stock-based compensation expense 7,814 10,251 10,359 41,176 43,160 Amortization of acquisition-related intangibles 7,805 8,439 9,747 34,838 39,272 Cost of sales-related restructuring 342 369 865 746 2,136 Diligence, acquisition and integration expense 133 296 2,094 1,829 8,772 Redomiciliation costs (1) 2,734 3,702 470 10,038 470 Impairment of goodwill 4,690 5,294 — 16,063 — Restructuring charges 1,130 — 325 2,098 7,064 Amortization of debt issuance costs 674 916 897 3,493 3,724 Loss (gain) on extinguishment or prepayment of debt 2,908 — 21,646 2,908 22,763 Foreign currency (gains) losses 287 (1,134) (1,072) 205 (830) Other (1) 2,074 280 1,088 2,729 1,088 Income tax effects (2) (11,179) 54 (1,865) (21,189) (16,388) Non-GAAP net income attributable to Penguin Solutions $ 28,843 $ 31,128 $ 20,007 $ 120,325 $ 66,907 Preferred stock dividends 3,034 3,033 — 8,667 — Non-GAAP income available for distribution 25,809 28,095 20,007 111,658 66,907 Income allocated to participating securities 2,639 2,863 — 8,250 — Non-GAAP net income available to common stockholders' $ 23,170 $ 25,232 $ 20,007 $ 103,408 $ 66,907 Weighted-average shares outstanding - Diluted: GAAP weighted-average shares outstanding 54,371 53,738 53,071 54,368 52,428 Adjustment for dilutive securities and capped calls (838) — 1,434 — 1,268 Non-GAAP weighted-average shares outstanding 53,533 53,738 54,505 54,368 53,696 Diluted earnings (loss) per share from continuing operations: GAAP diluted earnings (loss) per share $ 0.11 $ (0.01) $ (0.46) $ 0.28 $ (0.85) Effect of adjustments 0.32 0.48 0.83 1.62 2.10 Non-GAAP diluted earnings per share $ 0.43 $ 0.47 $ 0.37 $ 1.90 $ 1.25 (1) In the second quarter of fiscal 2025 we began breaking out costs related to the U.S. Domestication from “Other.” All periods presented have been adjusted to reflect this change. (2) The three months and year ended August 29, 2025 includes ($8,249) as a one-time tax effect of the U.S. Domestication completed in the fourth quarter of fiscal 2025.
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© 2025 Penguin Solutions, Inc. All rights reserved. | 25 GAAP to Non-GAAP Reconciliations Three Months Ended Year Ended (dollars in thousands) August 29, 2025 May 30, 2025 August 30, 2024 August 29, 2025 August 30, 2024 Net income (loss) attributable to Penguin Solutions $ 9,431 $ 2,661 $ (24,547) $ 25,391 $ (44,324) Interest expense, net 153 573 5,403 7,305 28,378 Income tax provision (benefit) (1,196) 7,259 6,209 20,066 10,618 Depreciation expense and amortization of intangible assets 13,206 14,012 15,381 56,216 65,716 Stock-based compensation expense 7,814 10,251 10,359 41,176 43,160 Cost of sales-related restructuring 342 369 865 746 2,136 Diligence, acquisition and integration expense 133 296 2,094 1,829 8,772 Redomiciliation costs (1) 2,734 3,702 470 10,038 470 Impairment of goodwill 4,690 5,294 — 16,063 — Restructuring charges 1,130 — 325 2,098 7,064 Loss on extinguishment of debt 2,908 — 21,646 2,908 22,763 Other (1) 2,074 280 1,088 2,729 1,088 Adjusted EBITDA $ 43,419 $ 44,697 $ 39,293 $ 186,565 $ 145,841 (1) In the second quarter of fiscal 2025 we began breaking out costs related to the U.S. Domestication from “Other.” All periods presented have been adjusted to reflect this change.
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© 2025 Penguin Solutions, Inc. All rights reserved. | 26 Convertible Dilution Note: Dilution in thousands of shares