Pure Storage (NYSE:PSTG) just landed a game-changing design win with one of the top-four hyperscalers, and Wall Street is buzzing. The deal cements Pure Storage's position as a major player in the high-stakes data storage market, leveraging its cutting-edge DirectFlash technology to dominate hyperscale environments. It's a big win for CEO Charles Giancarlo, who's been hinting at this breakthrough all year. Pair that with their Q3 results$831.1 million in revenue (up 9% YoY) and a 22% spike in subscription ARRand you've got a company firing on all cylinders. Oh, and they just raised Q4 guidance, signaling the momentum isn't slowing anytime soon.

• Warning! GuruFocus has detected 3 Warning Sign with PSTG.

The Street isn't holding back on its enthusiasm. Needham, JPMorgan, and Guggenheim have all bumped their price targets to $75 or more, with Guggenheim going bold at $93. Analysts are predicting that this hyperscaler deal could start adding serious revenue by FY27 as deployments ramp up to over 10 exabytes. For now, Pure Storage is keeping expectations measured, estimating $75 million in revenue from the deal initially while they double down on investments to scale their hyperscaler solutions. Gross margins are sitting pretty at 71%, so the company has plenty of wiggle room to grow while keeping profitability intact.

Pure Storage isn't just riding the hyperscale waveit's making big moves in AI too. From FlashBlade//S500 certification with NVIDIA DGX SuperPOD to new generative AI-focused solutions, they're proving they're more than a one-trick pony. With a $1.6 billion cash cushion and a market cap flirting with $18 billion (up 50% YTD), this isn't just a growth storyit's a transformation in full swing. If you're watching the data storage space, Pure Storage just made itself impossible to ignore.

This article first appeared on GuruFocus.