Penguin Solutions, Inc. (NASDAQ: PENG), a provider of high-performance enterprise infrastructure solutions, reported its financial results for the third quarter of fiscal 2025, indicating a stable performance with a modest increase in revenue. The company saw net sales reach $324 million, a growth of 7.9% from the same quarter last year. The financial data reflects an upward trend in specific segments of the business.

Non-GAAP diluted earnings per share rose to $0.47, representing a 25% year-over-year increase. Non-GAAP operating income was reported at $38 million, up 15% from the previous year, with a non-GAAP operating margin of 11.9% for the quarter. However, non-GAAP gross margins declined slightly to 31.7%, down 0.6 percentage points year-over-year.

Sales figures from business segments reveal a disparity, with Advanced Computing generating $132 million—a decrease of 9% compared to Q3 fiscal 2024. Integrated Memory saw $130 million in revenue, reflecting a significant growth of 42% year-over-year. Meanwhile, Optimized LED reported $62 million, a 4% decline compared to the previous year. The services’ net sales totaled $66 million, down 3% from Q3 last year.

In terms of outlook, Penguin Solutions reaffirmed its full-year revenue growth forecast at a midpoint of 17%, while also narrowing the range to plus or minus 2 percentage points. The company raised its full-year non-GAAP diluted earnings per share estimate to $1.80, compared to a previous expectation of $1.60.

The company’s cash position remains robust, with cash and cash equivalents totaling $736 million, an increase of $268 million from the year-ago quarter. In the operational efficiency domain, cash flows from operating activities amounted to $97 million, up from $80 million a year prior. Days sales outstanding increased to 47 days, while inventory was up to $184 million, reflecting higher sales volumes.

The company’s recent refinancing is expected to strengthen its balance sheet by reducing gross leverage and extending debt maturities while establishing a $400 million credit facility. Additionally, shares repurchased under the program amounted to $30 million for the quarter, highlighting a consistent commitment to returning capital to shareholders.

Overall, Penguin Solutions displayed financial results indicating a stable condition with some growth prospects reflected in their earnings and segment performances. The company is navigating a complex environment while maintaining a long-term focus on investment and market opportunities.