NTAP NetApp Inc

   By Maria Armental 
 

NetApp Inc.'s (NTAP) second-quarter profit results beat projections as the data-storage company continues to turnaround operations, sending shares rallying after hours.

For the current quarter, NetApp projects adjusted profit of 72 cents to 77 cents on $1.33 billion to $1.48 billion in revenue. Analysts surveyed by Thomson Reuters had expected 65 cents on $1.36 billion in revenue.

The Silicon Valley company, which has reported lower profit for the past two years and falling sales for three years running, has significantly reduced its payroll as it adjusts to market changes and lower operating expenses. This month, it disclosed an additional 6% in job cuts by the end of the current business year. The bulk of those charges will be booked in the current quarter.

Operating expenses fell to $687 million in the second quarter, down 2% from the previous quarter and 7% from the prior-year period.

Over all, NetApp's profit fell 4% to $109 million, or 38 cents a share. Excluding stock-based compensation and other items, profit rose to 60 cents a share from 46 cents a year earlier.

Net revenue fell 7% to $1.34 billion as product revenue, which accounts for the bulk of its business, declined 13%.

The results, based on 4% fewer shares outstanding, beat profit and adjusted profit projections while revenue was roughly in line with expectations.

Gross profit margin improved to 61.9% from 61.2% a year earlier.

Shares, up 31% this year, rose 8% to $37.62 in after-hours trading.

Write to Maria Armental at maria.armental@wsj.com

(END) Dow Jones Newswires

November 16, 2016 16:47 ET (21:47 GMT)

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