Pure Storage, Inc. (PSTG): PESTLE Analysis [Nov-2025 Updated]

Pure Storage, Inc. (PSTG) is navigating a complex 2025, where its shift to the subscription-first Evergreen//One model is a smart economic buffer, but it still faces intense geopolitical supply chain pressure. We need to look past the hardware and analyze the macro forces-Political, Economic, Sociological, Technological, Legal, and Environmental-that will truly determine its stock performance and market share over the next 18 months. The core takeaway? The OpEx model is the critical hedge against high interest rates, but US-China tensions are the clear and present danger.

You need a clear-eyed view of where Pure Storage, Inc. (PSTG) stands right now, especially as we close out 2025. The market is shifting fast, and the PESTLE framework helps us map the near-term risks and opportunities to concrete actions. Here's the quick math: their shift to a subscription-first model, Evergreen//One, is defintely a hedge against economic slowdowns, but geopolitical supply chain risks are real.

We're looking at a company that's successfully transitioning from hardware sales to a consumption-based model, which changes the risk profile entirely. Let's break down the six building blocks.

Political Forces: Tariffs and Data Security

US-China trade tensions remain the primary political risk, directly complicating the supply chain for critical components like NAND flash. This isn't just a headline; trade tariffs on imported hardware components are a tangible cost, putting direct pressure on the Cost of Goods Sold (COGS). Also, increased government scrutiny on data center infrastructure procurement and security standards means higher compliance costs, but it's also an opportunity. US federal IT spending, especially within defense, remains a key, stable revenue driver for the company, provided they meet those strict security mandates.

Economic Forces: The OpEx Buffer

Honestly, high interest rates are slowing down enterprise Capital Expenditure (CapEx)-the big, one-time hardware purchases-across the board. This is where Pure Storage's subscription model, which converts CapEx to Operational Expenditure (OpEx), provides a necessary buffer. The company is expected to report fiscal year 2025 revenue in the strong range of $3.5 billion, and that growth is driven by the stability of those subscription revenues. Still, inflation increases labor and operational costs, affecting margins, and a strong US dollar impacts the conversion of international revenue, though less severely than for pure hardware sellers.

Sociological Forces: The Data and ESG Mandate

The sheer volume of unstructured data from remote work, video, and Internet of Things (IoT) is growing exponentially, demanding scalable storage solutions. This is a massive tailwind. Plus, corporate ESG (Environmental, Social, and Governance) mandates are shifting procurement decisions. Customers are actively looking for energy-efficient data center solutions. We also can't ignore the talent wars: the difficulty in hiring skilled AI and data science professionals influences customer buying decisions, favoring platforms like Pure Storage that offer ease-of-use and integration with modern workloads.

Technological Forces: AI and the All-Flash Lead

The market continues its decisive shift to all-flash arrays (AFA) and QLC (Quad-Level Cell) technology, and Pure Storage is a clear leader here. Their DirectFlash architecture gives them a core advantage because AI/ML workloads require ultra-low latency storage. The real competition isn't just other storage vendors, but the hyperscalers-Amazon Web Services (AWS) and Microsoft Azure-and Hyper-Converged Infrastructure (HCI) vendors. The company's future success hinges on the continued adoption and stickiness of the Evergreen//One subscription platform. Subscription stickiness is the ultimate moat.

Legal Forces: Data Sovereignty and Patent Risk

Data sovereignty and localization laws, like Europe's General Data Protection Regulation (GDPR), are forcing companies to adopt geographically dispersed infrastructure, which creates demand for flexible storage solutions. Compliance costs are rising due to evolving industry-specific regulations in sectors like financial services and healthcare. To be fair, the highly competitive storage technology space also brings an increased risk of patent infringement litigation. Furthermore, securing lucrative government contracts requires strict adherence to security and supply chain transparency mandates.

Environmental Forces: The Efficiency Advantage

The environmental factor is a massive selling point for Pure Storage. Their FlashArray consumes up to 80% less power than legacy disk arrays, a huge benefit as data center power consumption is under intense scrutiny. Customers are prioritizing low-PUE (Power Usage Effectiveness) solutions. E-waste reduction is also a key differentiator, as the Evergreen model minimizes the need for costly and wasteful forklift upgrades and hardware disposal. Finally, reporting requirements for Scope 3 emissions (emissions from the supply chain) are becoming more stringent for large enterprises, making a clean supply chain a competitive necessity.

Pure Storage, Inc. (PSTG) - PESTLE Analysis: Political factors

US-China trade tensions complicate NAND flash and component supply chains.

You're seeing the US-China trade tensions directly impact the cost structure of every hardware-centric tech company, and Pure Storage is no exception. The renewed escalation in 2025 has targeted advanced technologies and IT hardware, creating significant supply chain uncertainty. For instance, the US implemented a tariff on Chinese imports that escalated to 125% by April 2025, which is a massive headwind for any company sourcing components from the region. This political friction is forcing a costly and complex diversification of the supply chain, moving manufacturing away from China to other countries. The immediate effect is a strain on the availability and pricing of critical components like NAND flash memory and Solid State Drives (SSDs).

The core issue is that the era of cheap, stable global manufacturing is over. Honestly, every company is now managing geopolitical risk as a procurement cost. The cost to build new data center infrastructure has spiked by an estimated 15-20% in 2025 due to tariffs on raw materials and electronics, which translates to higher capital expenditure for your customers.

Trade tariffs on imported hardware components pressure Cost of Goods Sold (COGS).

The most tangible political factor is the direct pressure on Pure Storage's profitability, specifically through its Cost of Goods Sold (COGS). The company's strategy to offer capacity-optimized arrays like FlashBlade//E, which compete directly with disk-drive-based storage, meant it had to absorb rising component costs to maintain its competitive pricing. This is a clear political tax on the business model.

Here's the quick math on the pressure point:

• Full-Year FY2025 Non-GAAP Gross Margin: 71.8%
• Q4 FY2025 Non-GAAP Gross Margin: 69.2%

The decline in gross margin during Q4 FY2025 was explicitly attributed to NAND price increases that the company had to absorb to keep its FlashBlade//E product competitive. This shows a direct link between global commodity pricing, which is sensitive to trade policy, and the company's bottom line. You can see how political trade actions become a defintely operational cost.

Increased government scrutiny on data center infrastructure procurement and security standards.

Geopolitical tensions are driving a massive, global push for data sovereignty (the principle that data is subject to the laws of the country where it is stored). This is a huge opportunity for Pure Storage because it is a US-based vendor with a strong focus on security and control.

A September 2025 study by Pure Storage found that 100% of industry leaders confirmed sovereignty risks are forcing them to reconsider where data is located. This is leading to a new wave of government and enterprise procurement focused on:

• Data Portability and Encryption: Ensuring data can be managed across hybrid environments while staying compliant.
• Cyber Resilience: The company's platform is being enhanced to provide real-time threat detection and rapid recovery, partnering with firms like CrowdStrike for security at the storage layer.
• Service Level Agreements (SLAs): Offering its Storage-as-a-Service (STaaS) model, Evergreen//One, with a guaranteed six-nines (99.9999%) availability, which is critical for public sector contracts.

This increased scrutiny acts as a barrier to entry for foreign competitors and favors established, secure US providers.

US federal IT spending, especially within defense, remains a key revenue driver.

The US public sector is a critical, high-margin customer base for data storage, driven by non-discretionary spending on defense, intelligence, and civilian agency modernization. The overall US market is the company's primary growth engine.

In Fiscal Year 2025, Pure Storage's total revenue surpassed $3.2 billion, with the US market being the main contributor to growth. While the specific federal revenue is not public, the company's focus on selling its STaaS model to state and local governments, and its emphasis on high-security features, confirms the importance of the public sector. The need for advanced, secure data storage for AI and defense workloads is a non-negotiable budget item for the US government, ensuring a stable revenue stream even during broader economic slowdowns.

Next Step: Strategy Team: Model the COGS impact of a 50% tariff on 25% of all NAND components by end of Q1 2026.

Pure Storage, Inc. (PSTG) - PESTLE Analysis: Economic factors

High interest rates are slowing enterprise Capital Expenditure (CapEx) for large hardware purchases.

The Federal Reserve's prolonged policy of maintaining higher interest rates has significantly increased the cost of capital for businesses across the US. This environment makes it difficult for companies to justify large, one-time Capital Expenditure (CapEx) investments, like purchasing a new data storage array. Financial executives are reassessing CapEx budgets, prioritizing only high-impact projects that promise immediate or rapid returns. The cost of borrowing for equipment loans has risen, forcing many enterprises to delay or shrink major infrastructure refreshes. This macro trend creates a significant headwind for any traditional storage vendor focused purely on product sales.

Pure Storage's subscription model (OpEx) provides a necessary buffer against CapEx cuts.

Pure Storage's pivot to a subscription-based, Storage-as-a-Service (STaaS) model, primarily through Evergreen//One, is a direct counter to the CapEx slowdown. This model shifts the cost from a large upfront CapEx expense to a predictable Operating Expenditure (OpEx), which is far easier for finance teams to approve in a high-rate environment. This strategy has proven highly effective, driving strong growth in recurring revenue metrics. The company's Remaining Performance Obligations (RPO), a key indicator of future contracted revenue, reached approximately $2.6 billion at the end of fiscal year 2025, representing a year-over-year increase of 14%. That RPO figure is a defintely solid sign of model resilience.

Here's the quick math on the subscription model's growing importance:

Inflationary pressures increase labor and operational costs, affecting margins.

Persistent inflation is a constant drag, pushing up operational costs and threatening gross margins across the technology sector. For Pure Storage, this pressure is felt mainly in two areas: labor and infrastructure. Personnel costs, particularly for highly-skilled engineering and sales talent, are rising, with labor expenses broadly expected to increase by around 3.5% in 2025. Plus, the surge in demand for AI-ready infrastructure means compute and infrastructure outlays for enterprises rose by an estimated 36% in 2025, which affects the cost structure for delivering cloud-based services like Evergreen//One. Despite these headwinds, the company maintained a high non-GAAP gross margin of 71.8% for the full fiscal year 2025, demonstrating strong pricing power and cost management.

Strong dollar impacts international revenue conversion, though less so than pure hardware sellers.

As a US-based multinational, Pure Storage is exposed to foreign currency exchange rate risk, which is a constant factor in the economic landscape. A strong US dollar reduces the value of international earnings when they are converted back into dollars, creating a revenue headwind. However, the company's high-margin, software-centric subscription revenue is less sensitive to currency swings than the low-margin product sales of pure hardware competitors. To be fair, the dollar saw a slump in mid-2025, which provided a temporary tailwind for many US multinationals' international revenue. Still, currency volatility remains a risk factor that requires active hedging and management.

The company reported fiscal year 2025 revenue of $3.2 billion, driven by subscription growth.

Pure Storage reported full fiscal year 2025 revenue of $3.2 billion, a 12% increase year-over-year, which surpassed the $3 billion milestone for the first time. The primary driver for this growth was the subscription segment, with Subscription Services Revenue climbing 22% to $1.5 billion. This strong performance, especially in the recurring revenue streams, positions the company well to weather economic uncertainty.

• Subscription ARR hit $1.7 billion, up 21% year-over-year.
• Non-GAAP operating income reached $559.4 million, reflecting a margin of 17.7%.

The shift to OpEx consumption is a clear competitive advantage in this macro environment.

Pure Storage, Inc. (PSTG) - PESTLE Analysis: Social factors

Exponential growth in unstructured data from video, IoT, and remote work demands scalable storage.

The shift in how we work and consume media has fundamentally changed the data landscape, creating a massive social demand for scalable, simple storage. This isn't just about more data; it's about the kind of data-unstructured content like video, sensor readings from the Internet of Things (IoT), and the constant stream from remote collaboration tools. This is a defintely a tailwind for a company like Pure Storage, Inc. that focuses on high-density flash.

The remote work trend alone is a significant driver. Upwork estimates that 22% of the American workforce, or approximately 36.2 million Americans, will be working remotely by the end of 2025. This sustained shift means more video conferencing, more large file transfers, and more complex collaboration data that needs to be stored and accessed instantly. Plus, the explosion of Artificial Intelligence (AI) workloads, which rely heavily on massive, unstructured data sets, is accelerating this demand. Global data center electricity consumption, a proxy for data processing volume, is predicted to reach 536 terawatt-hours (TWh) in 2025.

Here's the quick math on the data drivers:

• Remote Workers (US 2025): 36.2 million Americans.
• Global Data Center Power (2025): Projected 536 TWh.
• Data Type: Dominated by unstructured content (video, sensor data, AI training sets).

Corporate ESG (Environmental, Social, and Governance) mandates favor energy-efficient data center solutions.

Corporate responsibility is no longer a footnote; it's a critical buying factor for C-suite executives, driven by investor pressure and new regulatory frameworks. The 'E' in ESG is directly impacting data center procurement. Companies are now mandated to report their environmental impact, with new rules like the U.S. SEC's proposed climate disclosure rules and the European Union's Corporate Sustainability Reporting Directive (CSRD) and Energy Efficiency Directive (EED) coming into effect in 2025.

This regulatory environment creates a clear competitive advantage for vendors offering energy-saving technology. Pure Storage, Inc. has positioned its all-flash arrays directly against this trend, claiming its products reduce energy use and carbon emissions by up to 85% compared to competitors' all-flash systems. Their FY25 Impact Report highlights that their technology delivers 80% lower power and space consumption. This is a massive selling point when a company's Power Usage Effectiveness (PUE) is under intense investor scrutiny.

The following table illustrates the direct ESG benefit of choosing high-efficiency flash storage:

Talent wars for skilled AI and data science professionals influence customer buying decisions on platform ease-of-use.

The scarcity of top-tier AI and data science talent is a major operational risk for clients. These professionals are commanding staggering compensation packages; for example, top AI researchers have seen compensation packages offered up to $300 million over four years. This talent war means that companies cannot afford to waste their expensive data scientists' time on complex, legacy data infrastructure management.

The shortage is a significant hurdle for AI adoption. Consequently, customers are prioritizing data platforms that are simple, automated, and require minimal specialized storage administration. If a platform is hard to use, it raises the total cost of ownership (TCO) by requiring more of that scarce, high-cost talent. Solutions that embed AI agents and automation to simplify operations are becoming the preferred choice, as they help bridge the skills gap. Simplicity is now a cost-saving feature.

Increasing public awareness of data center power consumption as an environmental issue.

Data centers are now a front-page environmental story, moving from an obscure IT detail to a major public concern as their energy footprint skyrockets. This heightened public awareness creates reputational risk for companies that use inefficient infrastructure. In the U.S., there were 5,426 data centers nationally as of March 2025.

The sheer scale of energy demand is the core issue. U.S. data centers consumed 183 terawatt-hours (TWh) of electricity in 2024, representing over 4% of the country's total electricity consumption. Projections show this figure could grow by 133% to 426 TWh by 2030. This growth, coupled with the fact that 56% of the electricity used to power data centers nationwide comes from fossil fuels, fuels public and political pressure for green alternatives. This social pressure reinforces the business case for Pure Storage, Inc.'s low-power solutions, making sustainability a core part of their value proposition, not just a marketing add-on.

Pure Storage, Inc. (PSTG) - PESTLE Analysis: Technological factors

Continued market shift to all-flash arrays (AFA) and QLC (Quad-Level Cell) technology, where Pure Storage leads.

The core technological tailwind for Pure Storage is the industry's continued, aggressive shift from legacy hard disk drives (HDDs) to All-Flash Arrays (AFA). The global AFA market is projected to reach $23.38 billion in 2025, reflecting a Compound Annual Growth Rate (CAGR) of 18.85% through 2030. This trend is driven by the need for low-latency performance to handle modern workloads like real-time analytics and virtualization.

Pure Storage maintains a technological lead by embracing Quad-Level Cell (QLC) NAND flash, which dramatically increases storage density and lowers cost per gigabyte, making all-flash competitive with disk for capacity-oriented workloads. The company's proprietary DirectFlash Modules (DFMs) are central to this. By the end of 2025, Pure Storage is expected to have its 300 TB DirectFlash Modules generally available, doubling the density from the prior generation's 150 TB modules while maintaining power efficiency. This is a defintely a game-changer for data center economics.

Intense competition from hyperscalers (AWS, Azure) and Hyper-Converged Infrastructure (HCI) vendors.

The competitive environment is fierce, with technological threats coming from two major fronts: the public cloud giants and Hyper-Converged Infrastructure (HCI) providers. The 'Big Three' cloud providers-Amazon Web Services (AWS), Microsoft Azure, and Google Cloud-control 63% of the global cloud infrastructure market as of Q2 2025, with AWS holding 30% and Azure 20%. Their native storage services (like AWS S3 or Azure Blob Storage) compete directly with Pure Storage's on-premises and hybrid cloud offerings.

Simultaneously, the HCI market, which simplifies infrastructure by combining compute, storage, and networking into a single platform, is expected to reach $16.72 billion in 2025. Market leaders like Nutanix (with approximately 56.53% share in the converged-infrastructure category) and Dell EMC VxRail (9.17% share) offer compelling, simplified alternatives to traditional external storage arrays. Pure Storage is fighting back by securing a significant design win in FY2025 with a top-four hyperscaler, integrating its DirectFlash software into their massive-scale environments, a move traditionally dominated by hard disk drives.

AI/ML workloads require ultra-low latency storage, a core advantage of the DirectFlash architecture.

The explosive growth in Artificial Intelligence (AI) and Machine Learning (ML) workloads, especially for inference and Retrieval-Augmented Generation (RAG), demands storage with ultra-low, consistent latency. This is where Pure Storage's DirectFlash architecture provides a significant technological moat.

The latest FlashArray//ST R5, for example, is specifically engineered to deliver performance exceeding 18 million IOPS and 200GB/s throughput, all while maintaining consistent sub-100 microsecond latency. This level of performance is critical for eliminating storage as a bottleneck for high-value AI compute resources, like NVIDIA GPUs. The introduction of the Pure Key-Value Accelerator (KVA) further enhances this, claiming up to 20x faster response times for AI inference tasks. This focus on performance is key to capturing the high-end AI storage market, which is growing faster than any other segment.

Success hinges on the continued adoption and stickiness of the Evergreen//One subscription platform.

Pure Storage's long-term technological and financial success is increasingly tied to the adoption of its consumption-based, subscription model, Evergreen//One (Storage-as-a-Service or STaaS). This model provides a non-disruptive, evergreen upgrade path, eliminating the need for costly, forklift-style hardware replacements, which is a major technological pain point for customers.

The financial results for the 2025 fiscal year demonstrate the platform's stickiness and growth trajectory, which is crucial for future revenue predictability:

The subscription Annual Recurring Revenue (ARR) of $1.7 billion is growing faster than the total revenue, which shows customers are embracing the shift from capital expenditure (CapEx) to operational expenditure (OpEx). This model locks in customers and creates a predictable revenue stream, mitigating the volatility inherent in hardware sales cycles.

Pure Storage, Inc. (PSTG) - PESTLE Analysis: Legal factors

Data sovereignty and localization laws (like Europe's GDPR) necessitate geographically dispersed infrastructure.

The global regulatory environment for data is fragmenting, forcing companies like Pure Storage to engineer solutions that respect jurisdictional boundaries. This isn't just a compliance headache; it's a core architectural challenge. The European Union's General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), along with the California Privacy Rights Act (CPRA), are the baseline, but the trend is toward stricter data residency requirements-the principle that data must be physically stored within a specific geographic territory.

In a September 2025 pulse survey, 100% of industry leaders confirmed that data sovereignty risks have forced them to reconsider where their data is located. This directly impacts Pure Storage's customers, pushing them toward hybrid cloud and sovereign data center strategies that rely on Pure's on-premises and private cloud solutions. The US government is also tightening controls; the Department of Justice Final Rule, effective April 8, 2025, restricts bulk transfers of sensitive personal data (like health or financial data) to 'countries of concern.'

This means your data platform must be defintely smart about where it puts the data.

• GDPR/CCPA/CPRA: Mandate strict controls over personal data processing.
• EU DORA: Requires secure, physically and logically separated backup storage for financial sector operators in the EU.
• US DOJ Rule (April 2025): Restricts bulk transfer of sensitive data (genomic, financial, etc.) to certain foreign countries.

Increased risk of patent infringement litigation in the highly competitive storage technology space.

The data storage industry is a patent minefield, and litigation risk is a constant, material operating cost. Pure Storage's competitive success, driven by its proprietary DirectFlash technology, makes it a target for intellectual property (IP) claims from legacy competitors and non-practicing entities (NPEs). The company's own filings confirm that a claim of infringement could harm customer relationships and lead to costly litigation and settlement expenses.

To defend its position, Pure Storage has historically invested in building a robust patent portfolio, including the acquisition of over 100 storage patents from IBM in 2014 for defensive purposes. This is a common strategy, but it requires continuous, high-cost legal defense. For context on the financial risk, a jury in a 2016 case awarded EMC Corporation $14 million in a patent infringement trial against Pure Storage. The threat is real and expensive, and the constant threat of new lawsuits forces a significant allocation of capital to legal defense.

Compliance costs rise due to evolving industry-specific regulations (e.g., financial services, healthcare).

The cost of compliance is not a static figure; it's an accelerating expense embedded within the company's operational structure, especially as it expands internationally and into highly-regulated sectors. These costs cover everything from infrastructure changes to legal counsel and software development necessary to meet new mandates like the EU's Digital Operational Resilience Act (DORA).

Here's the quick math: Legal and compliance costs are a component of Selling, General, and Administrative (SG&A) expenses. For the full fiscal year 2025, Pure Storage's annual SG&A expenses reached $1.307 billion, representing a 9.18% increase year-over-year. This substantial jump reflects the increasing investment required to navigate a complex global regulatory landscape, including heightened requirements for international operations, anti-bribery laws, and data privacy.

Government contracts require strict adherence to security and supply chain transparency mandates.

Securing and maintaining government contracts-a key revenue stream-demands absolute compliance with stringent federal and state mandates. Pure Storage is a vendor under the NASPO ValuePoint contract, which was active through June 30, 2025, for various state and local entities.

These contracts impose specific legal obligations that go beyond commercial agreements:

• Transactional Data Reporting (TDR): The GSA is mandating the expansion of TDR across its Multiple Award Schedule (MAS) program, starting with key product and cloud services Special Item Numbers (SINs) in June 2025. This requires granular, continuous reporting of pricing data to the government.
• Trade Agreements Act (TAA): For supply contracts valued above the TAA threshold of $183,000, products must be wholly manufactured or substantially transformed in the U.S. or a designated country. Pure Storage must manage its global supply chain to maintain TAA compliance, a critical factor for federal sales.
• Supply Chain Security: Beyond TAA, there are increasing demands for supply chain transparency and security, particularly for technology used in defense and critical infrastructure. The Defense Contract Audit Agency (DCAA) may require an approved accounting system for cost-reimbursable contracts.

The complexity of these mandates adds significant overhead to the sales and contracting process. Finance: ensure the cost of TDR compliance is accurately factored into the gross margin for all MAS business by year-end.

Pure Storage, Inc. (PSTG) - PESTLE Analysis: Environmental factors

Pure Storage leverages its energy efficiency-FlashArray consumes up to 80% less power than legacy disk arrays.

You can't talk about data center economics in 2025 without talking about power. Honestly, with AI-driven demand pushing US data center power consumption to potentially double by 2035, efficiency is the new capacity. Pure Storage's core value proposition is built on this trend. Their all-flash architecture, especially the FlashArray family, is designed to drastically cut energy use compared to traditional spinning disk (HDD) or even older all-flash systems.

The numbers here are defintely a game-changer for customers facing rising utility costs. Pure Storage products reduce energy use and carbon emissions by up to 85% compared to competitors' all-flash systems. This isn't just a marketing claim; it's a measurable reduction in operational expenditure (OpEx) for every petabyte stored.

Here's the quick math on the product-level savings, based on Life Cycle Assessments (LCA) for key arrays:

• FlashArray//X™: Achieves 84.7% direct energy savings versus competitive all-flash.
• FlashArray//XL™: Delivers 80% direct energy savings versus competitive all-flash.
• FlashArray//C™: Provides 75% direct energy savings versus competitive hybrid arrays.

The new 150TB DirectFlash® Modules (DFMs) introduced in FY25 further doubled product density without increasing power consumption, which is a massive efficiency leap.

Data center power consumption is a major focus; customers prioritize low-PUE (Power Usage Effectiveness) solutions.

The industry's push for lower PUE-the ratio of total data center energy to IT equipment energy-is relentless, and it's driven by both cost and regulation. Traditional facilities are still stuck with PUEs ranging from 1.55 to 1.67, meaning for every watt of IT power, an additional 0.55 to 0.67 watts is wasted on cooling and infrastructure.

Hyperscalers like Google are setting the benchmark, reporting a fleet-wide trailing twelve-month (TTM) PUE of just 1.09 in Q3 2025. This is the target your customers are aiming for, and high-efficiency storage is a critical path to getting there. Storage can account for around 11% of the energy in a typical server rack, or roughly $3,300 a year per rack in energy costs. Cutting that storage energy draw by 80% immediately impacts the PUE calculation and frees up power for more compute, especially for intensive AI workloads.

Global data center electricity use is projected to grow from approximately 415 TWh in 2024 to about 945 TWh by 2030, more than doubling. That kind of demand growth means every single percentage point of efficiency matters.

E-waste reduction is a selling point, as the Evergreen model minimizes forklift upgrades and hardware disposal.

The circular economy (a system aimed at eliminating waste and the continual use of resources) isn't just theoretical for Pure Storage; it's baked into their business model with the Evergreen® architecture. This model allows for non-disruptive, modular hardware upgrades that extend the life of the array beyond 10 years.

This long lifespan eliminates two to three full system replacements and the associated data migrations that traditional storage architectures require. What this estimate hides is the massive reduction in e-waste and the embodied carbon emissions from manufacturing new equipment. A single Pure Storage DirectFlash Module (DFM) can replace 15 or more hard-disk drives (HDDs) over its service life, which drastically reduces e-waste.

Independent analysis confirms the impact:

Reporting requirements for Scope 3 emissions (supply chain) are becoming more stringent for large enterprises.

For your large enterprise customers, the biggest environmental risk is increasingly their Scope 3 emissions-the indirect emissions that occur in a company's value chain, like the emissions from the products they purchase (Pure Storage's products) and the use of the products they sell. The regulatory landscape is forcing their hand.

The EU's Corporate Sustainability Reporting Directive (CSRD) mandates that the first cohort of large companies must publish disclosures in 2025 based on their 2024 financial year data, and Scope 3 is a mandatory part of this. Also, California's climate disclosure laws, like the one requiring companies with over $1 billion in revenue to report, are setting a US precedent for future Scope 3 mandates.

This is where Pure Storage's efficiency becomes a direct risk mitigator for their customers. Pure Storage is committed to reducing its own Scope 3, Category 11 (Use of Sold Product) emissions per effective petabyte by 66% by 2030, against an FY20 baseline. This commitment means buying Pure Storage helps customers lower their own reported Scope 3 footprint. Plus, Pure Storage is pushing sustainability down its supply chain, targeting 45% of supplier spend to be with suppliers that have science-based climate targets by 2029.