Penguin Solutions, Inc.PENG
Penguin Solutions, Inc. Segments Disclosure
Segment and Other Information
Segment information presented below is consistent with how our Chief Operating Decision Maker (“CODM”), the Chief Executive Officer, evaluates our results of operations to make decisions about allocating resources and assessing performance using segment net sales, cost of sales, operating expenses, and operating income (loss). The CODM is regularly provided this segment information to assess relative segment performance and allocate resources to the segment in the annual planning process.
We have the following three business units, which are our reportable segments:
•Advanced Computing: Our Advanced Computing group, under our Penguin Computing and Stratus brands, offers specialized platform solutions and services for HPC, AI, machine learning, advanced modeling and the internet of things that span the continuum of edge, core and cloud. Our solutions are designed specifically for customers across multiple markets, including hyperscale, financial services, energy, government, education, healthcare and others.
•Integrated Memory: Our Integrated Memory group, under our SMART Modular Technologies brand, provides high-performance and reliable integrated memory solutions through the design, development and advanced packaging of leading-edge to extended lifecycle products. These specialty products are tailored to meet customer-specific requirements across networking and communications, enterprise storage and computing, including server applications and other vertical markets. These products are marketed to original equipment manufacturers and to commercial and government customers. The Integrated Memory group also offers SMART Supply Chain Services, which provides customized, integrated supply chain services to enable our customers to better manage supply chain planning and execution, reduce costs and increase productivity.
•Optimized LED: Our Optimized LED group, under our Cree LED brand, offers a broad portfolio of application-optimized LEDs focused on improving lumen density, intensity, efficacy, optical control and/or reliability. Backed by expert design assistance and superior sales support, our LED products enable our customers to develop and market LED-based products for general lighting, video displays and specialty lighting applications.
Segments are determined based on sources of sales, types of customers and operating performance.
There are no differences between the accounting policies for our segment reporting and our consolidated results of operations. Operating expenses directly associated with the activities of a specific segment are charged to that segment. Certain other indirect operating income and expenses are generally allocated to segments based on their respective percentage of net sales. We do not identify (other than goodwill) or report internally our assets nor allocate certain expenses and amortization, interest, other non-operating (income) expense or taxes to segments.
| August 29, 2025 | ||||||||||||||||||||||||||
| Advanced Computing | Integrated Memory | Optimized LED | Total | |||||||||||||||||||||||
| Net sales: | $ | 648,417 | $ | 464,249 | $ | 256,128 | $ | 1,368,794 | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Costs of goods sold | 404,032 | 362,612 | 177,549 | 944,193 | ||||||||||||||||||||||
| Operating expense | 129,376 | 57,998 | 69,575 | 256,949 | ||||||||||||||||||||||
| Operating income: | $ | 115,009 | $ | 43,639 | $ | 9,004 | 167,652 | |||||||||||||||||||
| Reconciliation of profit (loss) | ||||||||||||||||||||||||||
Stock-based compensation expense | (41,176) | |||||||||||||||||||||||||
| Amortization of acquisition-related intangibles | (34,838) | |||||||||||||||||||||||||
| Cost of sales-related restructuring | (746) | |||||||||||||||||||||||||
| Diligence, acquisition and integration expense | (1,829) | |||||||||||||||||||||||||
| Redomiciliation costs | (10,038) | |||||||||||||||||||||||||
| Impairment of goodwill | (16,063) | |||||||||||||||||||||||||
| Restructuring charges | (2,098) | |||||||||||||||||||||||||
Other | (2,729) | |||||||||||||||||||||||||
| Total unallocated | (109,517) | |||||||||||||||||||||||||
Total non-operating expense | (9,234) | |||||||||||||||||||||||||
| Income (loss) before taxes | $ | 48,901 | ||||||||||||||||||||||||
| August 30, 2024 | ||||||||||||||||||||||||||
| Advanced Computing | Integrated Memory | Optimized LED | Total | |||||||||||||||||||||||
| Net sales: | $ | 554,552 | $ | 356,426 | $ | 259,818 | $ | 1,170,796 | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Costs of Goods Sold | 324,152 | 283,821 | 188,838 | 796,811 | ||||||||||||||||||||||
| Operating Expense | 135,109 | 50,192 | 68,427 | 253,728 | ||||||||||||||||||||||
| Segment operating income: | $ | 95,291 | $ | 22,413 | $ | 2,553 | 120,257 | |||||||||||||||||||
| Reconciliation of profit (loss) | ||||||||||||||||||||||||||
Stock-based compensation expense | (43,160) | |||||||||||||||||||||||||
| Amortization of acquisition-related intangibles | (39,272) | |||||||||||||||||||||||||
| Cost of sales-related restructuring | (2,136) | |||||||||||||||||||||||||
| Diligence, acquisition and integration expense | (8,772) | |||||||||||||||||||||||||
| Redomiciliation costs | (470) | |||||||||||||||||||||||||
| Restructuring charges | (7,064) | |||||||||||||||||||||||||
Other | (1,088) | |||||||||||||||||||||||||
| Total unallocated | (101,962) | |||||||||||||||||||||||||
Total non-operating expense | (49,462) | |||||||||||||||||||||||||
| Income (loss) before taxes | $ | (31,167) | ||||||||||||||||||||||||
| August 25, 2023 | ||||||||||||||||||||||||||
| Advanced Computing | Integrated Memory | Optimized LED | Total | |||||||||||||||||||||||
| Net sales: | $ | 749,708 | $ | 443,264 | $ | 248,278 | $ | 1,441,250 | ||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Costs of Goods Sold | 488,602 | 314,247 | 181,853 | 984,702 | ||||||||||||||||||||||
| Operating Expense | 150,131 | 55,378 | 71,245 | 276,754 | ||||||||||||||||||||||
| Segment operating income: | $ | 110,975 | $ | 73,639 | $ | (4,820) | 179,794 | |||||||||||||||||||
| Reconciliation of profit (loss) | ||||||||||||||||||||||||||
Stock-based compensation expense | (39,228) | |||||||||||||||||||||||||
| Amortization of acquisition-related intangibles | (44,601) | |||||||||||||||||||||||||
| Flow through of inventory step up | (2,599) | |||||||||||||||||||||||||
| Cost of sales-related restructuring | (6,813) | |||||||||||||||||||||||||
| Diligence, acquisition and integration expense | (20,869) | |||||||||||||||||||||||||
| Impairment of goodwill | (19,092) | |||||||||||||||||||||||||
| Change in fair value of contingent consideration | (29,000) | |||||||||||||||||||||||||
| Restructuring charges | (7,047) | |||||||||||||||||||||||||
| Other | (1,800) | |||||||||||||||||||||||||
| Total unallocated | (171,049) | |||||||||||||||||||||||||
Total non-operating expense | (48,258) | |||||||||||||||||||||||||
| Income (loss) before taxes | $ | (39,513) | ||||||||||||||||||||||||
Depreciation included in segment operating income was as follows:
| Year ended | August 29, 2025 | August 30, 2024 | August 25, 2023 | ||||||||||||||
| Advanced Computing | $ | 7,946 | $ | 9,495 | $ | 9,196 | |||||||||||
| Integrated Memory | 4,053 | 3,873 | 3,891 | ||||||||||||||
| Optimized LED | 8,580 | 12,352 | 13,411 | ||||||||||||||
| $ | 20,579 | $ | 25,720 | $ | 26,498 | ||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Oct 21, 2025 | Showing above |
| 2024 | Oct 24, 2024 | |
| 2023 | Oct 20, 2023 | |
| 2022 | Oct 14, 2022 | |
| 2021 | Oct 25, 2021 | |
| 2020 | Oct 22, 2020 | |
| 2019 | Nov 6, 2019 | |
| 2018 | Oct 30, 2018 | |
| 2017 | Oct 13, 2017 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.