Pure Storage plans tariff-related price hikes on hardware

While the company is not changing list prices for its hardware offerings, it is planning to reduce special pricing discounts in what could lead to an increase in hardware prices by approximately ten per cent

Flash storage provider Pure Storage is telling its channel partners that prices for its hardware, but not for software or services, are slated to rise in response to new tariffs put in place by the Trump administration.

Pure Storage Wednesday told channel partners that, while list prices remain unchanged, adjustments to special pricing discounts will lead to overall hardware price increases.

A source close to Pure Storage said the overall increase in hardware prices because of the special discount pricing changes could be approximately ten per cent.

Pure Storage was not available to discuss the changes.

However, in a message to partners that Pure Storage provided to CRN, the California-based company said that it needed to update its pricing policies in the wake of the Trump administration tariff increases.

Those new tariffs, recently announced to impact imports into the US from every country worldwide, are as high as 125 per cent for imports from China, the source of much of the hardware consumed by the US IT industry.

“After evaluating the Trump administration’s decision on tariffs, Pure Storage is updating some of its policies to provide flexibility during a dynamic environment and accommodate the impact of tariffs on our products,” the company wrote.

“We are fully committed to supporting our customers and partners during this time of uncertainty and change, and we endeavour to minimise disruption to their businesses.

“Existing US quotes will expire on 4 May.”

“Pure Storage will honour all currently approved US quotes without changes to price if they are purchased by placing a purchase order (PO) by close of business (COB) on 4 May.

“All new US quotes after that date will be subject to a price increase.

“Pure Storage’s Evergreen portfolio - including Evergreen//One, Foundation, and Forever - is not impacted by these tariff-related changes.

“These offerings continue to provide pricing predictability, operational simplicity, and long-term value for customers,” Pure Storage wrote.

The company also wrote that there will be no change to list prices.

“Price changes will be reflected in adjustments to special pricing discounts on updated quotes,” the company wrote.

Pure Storage said there will be no changes to existing Evergreen//One storage subscription quotes for new contracts or renewals.

In deals where the hardware price is impacted, the company’s Evergreen//Forever storage hardware and software subscription and its Evergreen//Foundation storage subscription option, those line items will not change.

Pure Storage also said partners will see no changes to their deal registration discounts across its FlashArray and FlashBlade lines for approved registrations.

There will be no change to the company’s partner programme incentives and rebates.

One CEO at a large regional Pure Storage channel partner, who preferred to remain anonymous, told CRN via text message that his company is just letting the “tariff thing” play out as things keep changing.

“Customers of course are asking about it and considering potential implications, and are trying to plan accordingly,” the solution provider CEO wrote.

“It’s not a ‘panic’ moment. We and they will react as facts and realities emerge.”

Bob Keblusek, chief innovation and technology officer for Sentinel Technologies, number 99 on the 2024 CRN SP500, praised Pure for being proactive and transparent on the tariff issue.

“We’re talking to and advising customers on the tariffs in case they would like to move up an order to take advantage of current pricing,” he said.

“If you can pull some orders forward before that May time frame it could be beneficial to the customer to save a few dollars before the price increase occurs.”

Sentinel is also working with customers with a focus on managed services, consumption models and maintenance agreements to help alleviate any pricing issues.

“We are a cradle to grave, full lifecycle provider for our customers so we can shift resources to provide a support agreement or managed service that is applicable to the times,” he said.

“Support agreements and subscriptions are not impacted.”

Sentinel has been speaking with its vendor partners proactively about what to expect given the tariff situation.

Now that Trump has dropped new tariff rates on imports from most US trade partners to ten per cent for 90 days, Keblusek speculated some vendors are likely going to “extend their time” as to when they make a decision on potential price increases.

Scott Trinque, co-founder and chairman of EchoStor Technologies, a Massachusetts-based solution provider and Pure Storage channel partner, told CRN it’s hard to know exactly how the change in special pricing discounts will impact his business.

“For now, we haven’t seen it in any of our deals,” Trinque said.

“We know there’s some dates they have out there that they want to refresh quotes after certain times.

“But those internal thresholds and discount structures typically aren’t exposed to us.”

With price increases, there is a chance customers will close their purses until they have a better understanding of what to expect going forward, Trinque said.

“Most of our customers knew that things were going to be volatile,” he said.

“Everybody kind of knew that.

“I think a lot of customers, the ones that had budgeted projects and stuff, are still executing and a great first quarter.

“But I also think everybody’s a little shy with their next projects and are just trying to figure out what the next 90 days will bring.”

Steve Burke contributed to this story.

This article originally appeared on CRN UK sister website CRN.