NetApp Earnings Fall But Top Views
November 18 2015 - 7:40PM
Dow Jones News
NetApp Inc.'s earnings fell from a year ago but still came in
better than expected, as the data-storage company continues to
increase its digital focus.
"We made good progress as we pivoted towards the faster parts of
the market," Chief Executive George Kurian said. Mr. Kurian was
promoted to CEO in June, succeeding Tom Georgens, who resigned less
than two weeks after NetApp said it would lay off 500 workers and
issued a disappointing financial forecast.
Shares of NetApp, down 26% over the past year, were flat at
$31.04 in after-hours trading.
NetApp's woes earlier this year had stemmed in part from
customers shifting to cloud-based storage for some operations,
instead of buying and operating their own hardware. In addition,
many of NetApp's largest customers had balked at a new product from
the company until certain features were added.
Wednesday, Mr. Kurian said the company was making progress in
the faster-growing parts of the data-storage market. He added that
Dell Inc.'s recent deal to buy NetApp rival EMC Corp. for $67
billion presented an opportunity for the company.
"Customers are concerned by the uncertainty caused by the
announcement and are looking for a long-term road maps," Mr. Kurian
said.
For the January quarter, NetApp projected per-share earnings
between 47 cents and 42 cents, or 66 cents to 71 cents excluding
certain costs, with revenue of $1.4 billion to $1.5 billion.
Analysts, on average, were expecting adjusted earnings of 70 cents
a share and revenue of $1.48 billion.
For the quarter ended Oct. 30, NetApp reported earnings of $114
million, or 39 cents a share, down from year-ago earnings of $160
million, or 49 cents a share.
Excluding certain costs, such as restructuring charges, the
company had earnings of 61 a share. In August, NetApp projected
per-share earnings between 55 cents and 60 cents.
Revenue fell 6.4% to $1.45 billion. NetApp in August had
projected revenue of $1.4 billion to $1.5 billion.
Mr. Kurian said he was "particularly pleased of the growth
rates" for their flash-storage products, which are faster than
traditional magnetic-tape-based solutions.
NetApp also said company President Robert Salmon would retire at
the end of the 2016 fiscal year. He joined the company in 1994.
Write to Austen Hufford at austen.hufford@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 18, 2015 19:25 ET (00:25 GMT)
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