Penguin Solutions (NASDAQ:PENG) Releases Quarterly Earnings Results, Beats Estimates By $0.08 EPS

Penguin Solutions (NASDAQ:PENG) posted its earnings results on Tuesday. The company reported $0.49 EPS for the quarter, beating analysts’ consensus estimates of $0.41 by $0.08, FiscalAI reports. Penguin Solutions had a net margin of 1.82% and a return on equity of 14.45%. The firm had revenue of $343.07 million for the quarter, compared to the consensus estimate of $345.08 million. Penguin Solutions updated its FY 2026 guidance to 1.750-2.250 EPS.

Here are the key takeaways from Penguin Solutions’ conference call:

• Q1 results came in ahead of several headwinds with revenue of $343M (up 1% YoY), non‑GAAP gross margin 30%, non‑GAAP operating income of $42M and EPS of $0.49, marking continued margin expansion.
• Integrated Memory is a clear growth driver — $137M in Q1 (up 41% YoY) and management raised its FY26 memory growth outlook to +20%–35%, citing strong demand and early CXL/optical memory product shipments.
• Management sees a market shift from hyperscalers to enterprise production deployments and inference workloads and is positioning Penguin with services, ICE clusterware, and the new Rapid Development Workshop to win larger, production‑scale AI projects.
• Optimized LED underperformed with Q1 revenue of $55M (down 18% sequentially) and management now expects FY26 LED sales to decline roughly -15% to -5%, citing weak China demand and softness among some U.S. OEMs.
• Company reaffirmed FY26 guidance (midpoint ~6% net sales growth and ~$2 non‑GAAP EPS) but reiterated key assumptions — no hyperscale hardware revenue and the wind‑down of Penguin Edge — with sales skewed to the second half (~53%–54%), which creates timing risk despite the stable full‑year outlook.

Penguin Solutions Stock Up 2.3%

PENG opened at $21.55 on Wednesday. The business has a 50 day moving average price of $20.45 and a two-hundred day moving average price of $22.72. The company has a quick ratio of 1.71, a current ratio of 2.25 and a debt-to-equity ratio of 1.09. The company has a market cap of $1.13 billion, a PE ratio of 74.31 and a beta of 2.23. Penguin Solutions has a 52 week low of $14.20 and a 52 week high of $29.80.

Analyst Upgrades and Downgrades

PENG has been the topic of several research reports. JMP Securities reaffirmed a “market outperform” rating and set a $26.00 price objective on shares of Penguin Solutions in a report on Wednesday, October 8th. Weiss Ratings raised Penguin Solutions from a “sell (d-)” rating to a “hold (c-)” rating in a research report on Saturday, October 25th. Stifel Nicolaus lifted their price target on Penguin Solutions from $27.00 to $31.00 and gave the stock a “buy” rating in a research report on Monday, October 6th. Wall Street Zen upgraded Penguin Solutions from a “hold” rating to a “buy” rating in a research note on Friday, November 28th. Finally, Rosenblatt Securities reissued a “buy” rating and issued a $30.00 price objective on shares of Penguin Solutions in a report on Wednesday, December 31st. Seven research analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the stock. According to MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus price target of $28.00.

Penguin Solutions News Summary

Here are the key news stories impacting Penguin Solutions this week:

• Positive Sentiment: Q1 non‑GAAP EPS of $0.49 beat Street expectations (~$0.41), driving investor confidence that operational execution is improving. Penguin Solutions non-GAAP EPS of $0.49 beats by $0.05, revenue of $343M beats by $1.06M
• Positive Sentiment: Management highlighted memory‑business strength, improving inventory levels and operational excellence in the release and call, which supports upside to margins if demand continues. Penguin Solutions Reports Q1 Fiscal 2026 Financial Results
• Positive Sentiment: Street commentary and the earnings presentation emphasize execution and memory tailwinds; investor sentiment is reflected in headlines reporting shares surged after the print. Penguin Solutions shares surge as first quarter results top expectations
• Neutral Sentiment: FY2026 guidance was updated to EPS $1.75–$2.25 and revenue $1.3B–$1.6B. The EPS range overlaps consensus but the wide revenue band creates guidance uncertainty — not a clear bullish or bearish signal. Penguin Solutions outlines 6% net sales growth and $2 EPS guidance for fiscal 2026 as memory business outlook strengthens
• Negative Sentiment: Net sales of ~$343.1M were roughly in line but slightly below some analyst estimates (~$345M); net margin remains thin (1.8%), which could limit upside if revenue growth slows. Penguin Solutions Widens 1Q Profit on Rising Revenue
• Neutral Sentiment: Full earnings materials and call transcript are available for deeper read on margins, inventory and segment trends if you want to validate the durability of the memory recovery. Penguin Solutions, Inc. (PENG) Q1 2026 Earnings Call Transcript

Institutional Investors Weigh In On Penguin Solutions

Several large investors have recently modified their holdings of PENG. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. acquired a new stake in shares of Penguin Solutions during the first quarter worth $538,000. Man Group plc raised its position in Penguin Solutions by 75.3% during the 3rd quarter. Man Group plc now owns 18,019 shares of the company’s stock worth $474,000 after buying an additional 7,741 shares during the last quarter. Hancock Whitney Corp acquired a new stake in shares of Penguin Solutions in the 3rd quarter worth $456,000. Comerica Bank purchased a new stake in shares of Penguin Solutions in the third quarter valued at about $383,000. Finally, Envestnet Asset Management Inc. purchased a new stake in shares of Penguin Solutions in the third quarter valued at about $359,000.

Penguin Solutions Company Profile

Penguin Solutions, Inc engages in the designing and development of enterprise solutions worldwide. It operates through three segments: Advanced Computing, Integrated Memory, and Optimized LED. It offers dynamic random access memory modules, solid-state and flash storage, and other advanced integrated memory solutions for networking and telecom, data analytics, artificial intelligence and machine learning applications; and supply chain services, including procurement, logistics, inventory management, temporary warehousing, programming, kitting, and packaging services.