NetApp, Inc. (NTAP) reported second-quarter fiscal 2025 non-GAAP earnings of $1.87 per share, which beat the Zacks Consensus Estimate by 4.5% and jumped 18.4% year over year. The bottom line also surpassed the company’s guided range of $1.73-$1.83.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Revenues of $1.66 billion increased 6% year over year and came within the guided range of $1.565-$1.715 billion. This upside resulted from strong sales across Hybrid Cloud and Public Cloud se ...

Q2 FY25 Financial Highlights - NetApp delivered Q2 year-over-year revenue growth of 6% and billings growth of 9%[68] - The company set Q2 records for operating margin at 29% and EPS at $1.87[68] - All-flash annualized revenue run rate grew by 19% year-over-year, reaching an all-time high of $3.8 billion[68] - First party and marketplace cloud storage services revenue grew approximately 43% year-over-year[68] Q2 FY25 Performance vs Guidance - Q2 revenue reached $1.66 billion, a 6.1% year-over-year increase, exceeding the initial guidance of $1.565 billion[70] - Billings amounted to $1.59 billion, reflecting a 9.1% year-over-year growth[70] - Non-GAAP gross margin was 72.0%, consistent with the guidance, while non-GAAP operating margin was 28.6%, a 180 bps year-over-year increase[70] - Non-GAAP EPS was $1.87, an 18.4% year-over-year increase, surpassing the guidance of $1.73 - $1.83[70] YTD FY25 Performance - Year-to-date revenue reached $3.20 billion, a 6.8% year-over-year increase[73] - Year-to-date billings amounted to $3.04 billion, reflecting a 10.2% year-over-year growth[73] - Year-to-date non-GAAP gross margin was 72.1%, a 70 bps year-over-year increase, and non-GAAP operating margin was 27.3%, a 300 bps year-over-year increase[73] - Year-to-date non-GAAP EPS was $3.42, a 25.7% year-over-year increase[73] FY25 Guidance - The company updated FY25 revenue guidance to $6.54 billion - $6.74 billion, with a non-GAAP operating margin between 28% - 28.5% and non-GAAP EPS between $7.20 - $7.40[115] Sustainability - NetApp responsibly managed and diverted 99% of e-waste from landfills[59] - The company achieved a 37% reduction in Scope 1 & 2 emissions and a 19% reduction in Scope 3 intensity as of FY23, compared to the FY20 baseline[64]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $1.66 billion, a 6% year-over-year increase, marking the fourth consecutive quarter of growth [34][31] - Billings increased by 9% year-over-year to $1.59 billion [34] - Operating margin reached 29%, with gross margin at 72%, both near all-time highs [31][37] - EPS was $1.87, exceeding guidance expectations [40] - Free cash flow was $60 million, down from $97 million year-over-year, primarily due to strategic SSD purchases [41][45] Business Line Data and Key Metrics Changes - All-flash storage revenue grew 19% year-over-year, contributing significantly to overall revenue growth [10][15] - Hybrid Cloud segment revenue increased by 6%, with product revenue up 9% [14] - Keystone, the Storage-as-a-Service offering, saw revenue growth of approximately 55% year-over-year [18] - Public Cloud revenue grew 9% year-over-year to $168 million, driven by first-party and marketplace cloud storage services [25][34] Market Data and Key Metrics Changes - Public Cloud segment gross margins improved to 74% from 66% year-over-year [39] - Deferred revenue was $4.1 billion, up 2% year-over-year, indicating strong future revenue potential [36] - Unbilled remaining performance obligations (RPO) increased by 11% quarter-over-quarter to approximately $330 million [36] Company Strategy and Development Direction - The company is focused on executing its strategy in data center modernization, cloud, and AI, aligning with customer spending priorities [54] - Continued innovation in product offerings, particularly in all-flash arrays and AI solutions, is a key focus [15][19] - The company aims to return to double-digit growth in cloud revenues in the second half of fiscal year 2025 [35][100] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment remains unchanged, with a focus on priority spending areas [54] - The company expects to achieve mid to upper-single digit revenue growth and double-digit EPS growth on average through fiscal year 2027 [30] - There is optimism regarding the AI business, with over 100 wins in Q2, indicating strong future growth potential [22][56] Other Important Information - The company returned over $400 million to shareholders through dividends and share repurchases [32] - Strategic purchase commitments for SSDs have been made to mitigate rising prices, providing confidence in product gross margins [37] Q&A Session Summary Question: Insights on macroeconomic recovery and revenue growth - Management indicated that macro conditions have remained stable and the growth outlook is independent of macro factors [54] Question: Updates on AI deployment and future expectations - Early stages of AI infrastructure readiness are being observed, with significant wins across various sectors [56] Question: Durability of all-flash array growth - The company has experienced consistent high-teens growth in all-flash arrays, outpacing competitors [61] Question: Inventory pre-buying strategy - The increase in inventory is primarily due to pre-buys, but no further pre-buys are planned for the remainder of the fiscal year [63][64] Question: Public sector performance and outlook - The public sector business performed well, supported by long-term projects and program spending [74] Question: Competitive environment and pricing - The competitive landscape remains rational, with no significant changes noted [91] Question: Impact of new U.S. administration on business - The company is well-protected from potential tariffs and will monitor policy changes from the new administration [94] Question: Public cloud revenue recovery - Growth in public cloud revenue is attributed to a focused go-to-market strategy and broadening service offerings [100] Question: Customer feedback on Keystone - Customer feedback on Keystone has been positive, with no churn reported, indicating strong market traction [110]

NetApp (NTAP) reported $1.66 billion in revenue for the quarter ended October 2024, representing a year-over-year increase of 6.2%. EPS of $1.87 for the same period compares to $1.58 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $1.65 billion, representing a surprise of +0.79%. The company delivered an EPS surprise of +4.47%, with the consensus EPS estimate being $1.79.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street e ...

NetApp (NTAP) came out with quarterly earnings of $1.87 per share, beating the Zacks Consensus Estimate of $1.79 per share. This compares to earnings of $1.58 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 4.47%. A quarter ago, it was expected that this data storage company would post earnings of $1.46 per share when it actually produced earnings of $1.56, delivering a surprise of 6.85%.Over the last four quarters, the compan ...

Exhibit 99.1 NetApp Reports Second Quarter of Fiscal Year 2025 Results Net revenues of $1.66 billion for the second quarter; 6% year-over-year increase • Record all-flash array annualized net revenue run rate 1 of $3.8 billion, an increase of 19% year-over-year • First party and marketplace cloud storage services revenue grew approximately 43% year-over-year • Second quarter GAAP operating margin of 21%; record second quarter non-GAAP operating margin 2 of 29% • Second quarter GAAP net income per share 3 of ...

In its upcoming report, NetApp (NTAP) is predicted by Wall Street analysts to post quarterly earnings of $1.79 per share, reflecting an increase of 13.3% compared to the same period last year. Revenues are forecasted to be $1.64 billion, representing a year-over-year increase of 5.3%.The current level reflects a downward revision of 0.2% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial proje ...

Investors in NetApp, Inc. (NTAP) need to pay close attention to the stock based on moves in the options market lately. That is because the Jan 17, 2025 $30.00 Put had some of the highest implied volatility of all equity options today.What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean ...

Core Viewpoint - NetApp (NTAP) is expected to report its second-quarter fiscal 2025 earnings on November 21, with anticipated non-GAAP earnings per share between $1.73 and $1.83, reflecting a 13.3% increase year-over-year [1][2]. Financial Expectations - The Zacks Consensus Estimate for NTAP's earnings is $1.79 per share, while net revenues are projected to be between $1.565 billion and $1.715 billion, with a consensus estimate of $1.64 billion, indicating a 5.3% increase from the previous year [2]. - NTAP has outperformed estimates in three of the last four quarters, achieving an average earnings surprise of 8.6% [3]. Market Performance - NTAP's stock has increased by 50.3% over the past year, significantly outperforming the industry growth of 12.1% [3]. Product Demand and Growth Drivers - Continued demand for NTAP's modern all-flash arrays, particularly the C-series and ASA products, is expected to positively impact earnings. The new all-flash A-series is also anticipated to contribute to growth [3][4]. - Keystone's storage-as-a-service offering has seen over 60% year-over-year revenue growth in the last reported quarter [4]. Revenue Projections - The estimated revenue for Hybrid Cloud in the second quarter is $1.4835 billion, representing a 5.4% increase from the previous year [4]. - Public Cloud revenues are projected to be $159 million, up 3.3% from the prior year, although there are concerns regarding a decline in subscription services revenue [6]. Strategic Initiatives - NTAP is benefiting from data-driven digital and cloud transformations, including business analytics, AI, data security, and application modernization, having secured over 50 AI and data lake modernization deals in the first quarter [5]. - Strengthening go-to-market activities and cloud collaborations are seen as positive factors for the company [7]. Margin and Economic Conditions - Margin performance is expected to improve due to a favorable product mix and operational discipline, despite challenges from global macroeconomic conditions and cautious IT spending [8].

The market expects NetApp (NTAP) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended October 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on November 21, 2024, might help the stock move higher if these key numbers are b ...