Why Penguin Solutions Stock Are Tumbling On Wednesday?

Penguin Solutions, Inc. (NASDAQ:PENG) shares are declining premarket on Wednesday after the company reported mixed fourth-quarter results on Tuesday.

Earnings: The company reported net sales growth of 9% year-over-year to $338 million, up 9% year over year (Y/Y), missing the consensus of $342.1 million.

Adjusted gross margin came in at 30.9%, stable Y/Y, in the quarter.

Adjusted operating income rose 16% Y/Y to $39.17 million in the quarter. Adjusted EPS of $0.43 beat the consensus of $0.38.

Mark Adams, CEO of Penguin Solutions, stated, “Fiscal 2025 was a year of strong execution and meaningful progress in our transformation from a holding company structure to an enterprise AI infrastructure solutions company,”

Share Buyback: On October 6, 2025, the company approved a new $75 million stock repurchase authorization, raising total buyback approvals over the past four years to $225 million.

Guidance: Penguin Solutions expects FY26 adjusted EPS of $1.75-$2.25, vs. the consensus estimate of $2.12 and sales of $1.314 billion-$1.588 billion, vs. the street view of $1.495 billion.

PENG Price Action: Penguin shares are having a rough morning, down 18.52% at $22.00 in premarket trading on Wednesday. It’s one of the stock's bigger single-day moves. Right now, the stock is 9.4% below its 52-week high and trading 12.5% below its 50-day moving average.

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