By Don Clark and Maria Armental 

NetApp Inc. is laying off about 500 workers as the data storage specialist grapples with internal and external problems that hurt results in its fourth fiscal quarter.

The Silicon Valley company reported Wednesday that profit for the quarter ended in April fell 32%. NetApp also issued a disappointing forecast for results in the current period.

NetApp's shares, up 4% over the past 12 months, fell nearly 9% to $32.26 in after-hours trading, below a 52-week-low set Tuesday during regular trading.

The company sells data storage hardware in competition with EMC Corp. and others. Tom Georgens, its chairman and chief executive, said sales of all data storage companies are being affected as customers consider shifting to cloud-based storage for some operations instead of buying and operating their own hardware.

But NetApp is also struggling with the impact of a major product-line overhaul, shifting to a new offering it calls Clustered OnTAP. Mr. Georgens said many of the company's largest customers had balked at making the change, waiting until NetApp introduced new versions with certain features they were seeking.

"We underestimated the complexity associated with these transitions," Mr. Georgens said during a conference call with analysts. "That is entirely our fault, and it is up to us to fix it."

NetApp said the job cuts come to about 4% of its global workforce. It plans to eliminate the positions by the third quarter and expects to record a charge of $25 million to $35 million related to the cuts. Most of those charges are expected to be recognized in the first quarter, the company said in a securities filing.

Overall, for the quarter ended April 24, NetApp reported a profit of $134.9 million, or 43 cents a share, compared with $197 million, or 59 cents a share, a year earlier. Net revenue fell nearly 7% to $1.54 billion.

Excluding stock-based compensation and other items, earnings fell to 65 cents a share from 84 cents a share a year earlier. NetApp had projected earnings of 70 cents and 75 cents on revenue of $1.55 billion to $1.65 billion.

For the current period, NetApp projected profit of 20 cents to 25 cents a share on $1.28 billion to $1.38 billion in revenue, compared with the consensus of 59 cents on $1.46 billion in revenue, according to Thomson Reuters.

Mr. Georgens said the company expected cost cuts and the gradual acceptance of its new products to begin driving a rebound in revenue in the second half of the fiscal year.

NetApp, which is based in Sunnyvale, Calif., also said it would boost its quarterly dividend by 9% to 18 cents a share.

Write to Don Clark at don.clark@wsj.com and Maria Armental at maria.armental@wsj.com

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