Pure Storage's 'disingenuous' financial figures still out there

"Pure couldn't say anything about the disparity because it was technically in a quiet period following its S1 filing and would break the law if it said anything".

Hmm, convinient. Having just had some Pure storage rock up recently, I'm taking a bit more of an interest in their activities.

So what is your comment here Chris?

All this artical states is what's happening. Yes Gartner got it wrong (AGAIN), and yes Pure can't talk numbers because they're gearing for IPO (last time it was because they're a private company) but the artical is labelled as comment and you didn't offer an opinion.

What are your thoughts on this? Should Pure have breached the Law and fessed up or should Gartner realise they need to get their house in order and stop touting fairtales as fact?

Funny way of not filing

"Pure Storage is a private company and does not disclose our financials"

"Pure Storage has a strict policy not to disclose or provide guidance on financials to third parties"

And yet...

"Pure Storage's S1 IPO filing said it recorded $42.733m in revenues"

So they do, in fact, disclose their financials to third parties. Perhaps not on an annual basis as a matter of routine, but that's not really relevant to the fact that they have disclosed the relevant figures. It can hardly be considered a breach of the law to discuss anything following the S1 filing, when it's that exact filing that has the numbers in the first place.

More importantly, is this an SEC violation?

I'm no lawyer, but I do wonder if a pre-IPO company with significant VC investment that was knowingly promoting grossly inflated sales numbers violated securities laws. It's certainly not ethical but I wonder if it's much worse.

Breaking the Law

You couldn't make this stuff up (well Pure clearly could!).

So now they are in a quiet period they cannot talk about the numbers because they would be breaking the law.

However for the last two years they have been shouting very loudly from every possible rooftop about revenue numbers that the Exec team knew were wrong (and not just slightly wrong). I don't blame the sales teams because they would not have known details on the real numbers but the Pure Executive team should be highly embarrassed about the way they have misled their employees, customers, competitors and the analyst community.

Perhaps they will live to regret not being a little bit more quiet over the last two years.

I wonder what else was exaggerated???

Don't blame Vaughn Stewart!

I reject the suggestion that Vaughn Stewart should be held responsible for circulating information about Pure's sales numbers, market position and product capabilities. I hope for the sake of cooperation we can stop creating scape goats. Vaughn Stewart is a man of integrity and deserves respect.

The price of saying nothing

As previously stated, what else are they not telling us an letting the industry overstate their offerings?

Ethics matter

Here is the big problem - they took Gartner's numbers, and ran with them, as if a disclaimer absolves them. What would anyone do with a child that acted like that? Probably we'd tell them that lying is wrong!

Willfully promoting misleading data is just wrong. Very glad I turned down a job there. I could not put my finger on why I did not like them, but here is your sign.

What I would like to know is this:

If the Gartner reports had under- instead of over-stated Pure's numbers, would they still not have corrected them?

Would they not at least have said something like "while we cannot disclose anything because [insert excuse], those numbers are way off and you should ignore them"...?

Pure deception, Violin redux

Gartner indeed does let all vendors participating know the financial figures that it has estimated and does ask the vendor to make corrections/updates in order to ensure the accuracy of the Gartner data. Pure clearly deceived Gartner in not correcting the massive disparity. I'm surprised Gartner chose to be the fall-guy. This reminds me a bit of the behavior exhibited by companies like Violin who failed to maintain their integrity and bit it hard in the end.

The real red flag

Violin called out in their S-1 that they could not be successful unless their burgeoning PCI-e card business was successful. Nutanix is now hanging their hat on FC and all flash variants. Pure has started talking CI and "other cool mysterious stuff that will blow your mind".

"This isn't all we do."

Shouldn't it be a red flag when a company starts talking about "other stuff" before they have proven the original business plan?

In a world where success = raising money and spending it, maybe not.

Popcorn ready.