Penguin Solutions, Inc. (PENG)

Pretax margin

May 31, 2025 Feb 28, 2025 Nov 30, 2024 Aug 31, 2024 May 31, 2024 Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020
Earnings before tax but after interest (EBT) (ttm) US$ in thousands 21,964 16,158 -11,165 -31,167 -17,434 -34,391 -48,396 -33,003 -9,310 32,393 67,765 88,503 96,930 64,637 61,123 37,972 23,368 29,537 14,113 9,360
Revenue (ttm) US$ in thousands 1,342,020 1,318,349 1,237,651 1,170,796 1,022,916 1,066,754 1,170,310 1,287,860 1,562,289 1,680,411 1,741,205 1,819,352 1,849,364 1,824,552 1,679,390 1,501,143 1,330,464 1,174,023 1,142,056 1,122,377
Pretax margin 1.64% 1.23% -0.90% -2.66% -1.70% -3.22% -4.14% -2.56% -0.60% 1.93% 3.89% 4.86% 5.24% 3.54% 3.64% 2.53% 1.76% 2.52% 1.24% 0.83%

May 31, 2025 calculation

Pretax margin = EBT (ttm) ÷ Revenue (ttm)
= $21,964K ÷ $1,342,020K
= 1.64%

The pretax margin of Penguin Solutions, Inc. has exhibited notable fluctuations over the analyzed period. Initially, as of August 31, 2020, the pretax margin was a modest 0.83%, indicating a relatively low level of profitability before taxes. This margin showed steady improvement, reaching a peak of 5.24% by May 31, 2022, reflecting enhanced operational efficiency or pricing strategies resulting in higher pre-tax earnings relative to revenue.

However, following this peak, the pretax margin declined markedly, falling to approximately 3.89% in November 2022, and subsequently to 1.93% by February 2023. This downward trend continued into 2023, with the margin turning negative at -0.60% on May 31, 2023, and further declining to -4.14% by November 30, 2023. The negative margins persisted into early 2024, reaching -3.22% on February 29, 2024, and continuing to hover below zero, indicative of periods where pre-tax expenses exceeded revenues.

The data suggest that the company experienced significant challenges in maintaining profitability on a pre-tax basis during this timeframe, marked by periods of losses. There were signs of recovery beginning in early 2025, with the pretax margin turning positive again at 1.23% on February 28, 2025, and slightly increasing to 1.64% by May 31, 2025. Overall, the trend indicates a volatile profitability pattern with periods of growth followed by declines, culminating in negative margins in recent years before signs of partial recovery.