Sunnyvale, Calif.- February 15, 2012
- NetApp (NASDAQ: NTAP) today reported results for the
third quarter of fiscal year 2012, which ended January 27, 2012.
Revenues for the third quarter of fiscal year 2012 totaled $1.566
billion compared to revenues of $1.290 billion for the same period
one year ago.
For the third quarter of fiscal year 2012,
GAAP net income was $120 million, or $0.32 per share, compared to GAAP net income of
$186 million, or $0.46 per share, for the same period a year ago.
Non-GAAP net income for the third quarter of fiscal year 2012 was
$216 million, or $0.58 per share, compared to non-GAAP net income of $226
million, or $0.56 per share, for the same period a year ago.
Revenues for the first nine months of fiscal
year 2012 totaled $4.531 billion compared to revenues of $3.694
billion for the first nine months of the prior fiscal year, an
increase of 23% year over year. GAAP net income for the first nine
months of fiscal year 2012 totaled $425 million, or $1.10 per
share, compared to GAAP net income of $513 million, or $1.31 per
share for the first nine months of the prior fiscal year. Non-GAAP
net income for the first nine months of fiscal year 2012 totaled
$674 million, or $1.75 per share, compared to non-GAAP net income
of $629 million, or $1.61 per share for the first nine months of
the prior fiscal year.
"More and more customers are leveraging
storage virtualization to re-architect their data centers in order
to gain efficiency, flexibility and cost savings, and NetApp
provides the most compelling value proposition in the industry for
both private and public cloud deployments," said Tom Georgens,
president and CEO. "Our success is evident in our results, as
NetApp won a record number of new customers, significantly
increased our units shipped-including a record number of high-end
systems, and saw solid revenue growth across almost all geographies
in our third quarter."
- NetApp estimates revenue for the fourth quarter of fiscal year
2012 to be in the range of $1.645 billion to $1.725 billion, which
equates to approximately 5% to 10% sequential revenue growth and
approximately 15% to 21% year-over-year revenue growth.
- NetApp estimates that fourth quarter fiscal year 2012 GAAP
earnings per share will be approximately $0.38 to $0.43 per share.
NetApp estimates that fourth quarter fiscal year 2012 non-GAAP
earnings per share will be approximately $0.60 to $0.65 per
- NetApp estimates that share count for the fourth quarter of
fiscal year 2012 will increase to approximately 378 million shares,
including an estimated 8 million shares from the Company's
outstanding convertible notes. Share count does not include the Company's
outstanding note hedges which are expected to offset 80% of the
dilution from the convertible notes at maturity or conversion.
During the third quarter of fiscal year 2012, NetApp continued to
demonstrate the innovation and commitment needed to help its
customers and partners address today's expanding data requirements
to drive business success. NetApp unveiled its "Smart Decisions"
initiative aimed at helping midsize business customers start right,
keep it simple, and grow smart, while at the same time enabling its
partners to offer the best technologies and solutions to grow their
own businesses, increase profits, and help their customers succeed.
Highlights for the quarter include the following:
Midsize Business Customers Build on
NetApp to Address Growing Business Demands and the Need to Do More
- NetApp unveiled the new NetApp® FAS2000 entry product line
which enables customers to start right and grow with the needs of
their business. The enhanced portfolio also allows partners to
offer their customers the best technologies and solutions to
increase their own business, increase profits, and help their
customers succeed. The powerful new FAS2240 delivers a two to three
times of performance improvement and greater flexibility, allowing
customers to maximize their storage investments, support demanding
workloads, and add capabilities as their business needs change.
NetApp OnCommand™ System Manager 2.0 software helps customers
simplify, control, and automate setup and management of NetApp
storage. With more than 10,000 midsize business customers already
turning to NetApp each year for their storage needs, the enhanced
portfolio will help NetApp continue to build on its position as an
Be The Match Leverages NetApp to Turn
Its IT Environment into a Catalyst for Life-Saving Speed and
- Be The Match, which operates the world's largest listing of
potential marrow donors and donated cord blood units, depends on
its IT infrastructure to allow the organization to facilitate
thousands of potentially life-saving transplants each year. To help
accelerate the flow of data and enhance its ability to match donors
with patients, Be The Match recently chose NetApp as its storage
foundation. By transforming its IT infrastructure, utilizing NetApp
as one of its vendors, the organization expects to reduce the time
to transplant by 15%, double its annual donor registrations, and
facilitate 50% more transplants around the world.
NetApp Helps Customers Control
Explosive Data Growth and Gain Greater Insight
- New NetApp solution helps customers maximize enterprise
Hadoop implementations. The NetApp Open Solution for
Hadoop provides customers with improved flexibility and performance
along with lower total cost of ownership, enabling customers to
gain greater insight into and a competitive advantage from their
data. Additionally, NetApp teamed with Cloudera to distribute
Cloudera's Distribution, including Apache Hadoop and Cloudera
Enterprise with the NetApp Open Solution for Hadoop, to help speed
enterprise deployment and production use of Apache Hadoop.
- NetApp unveils new solutions based on the E-Series
platform to address big data requirements. The NetApp
High-Performance Computing Solution for Lustre is purpose-built to
help customers efficiently scale bandwidth and density, with proven
reliability to solve difficult research, modeling, and simulation
problems. The NetApp Seismic Processing Solution provides efficient
access to big data generated by seismic processing operations to
help exploration teams make optimal decisions.
Awards and Milestones
- NetApp continues to earn recognition as a great place
to work. Built on a culture of innovation committed to
partner and customer success, NetApp was ranked #6 on
FORTUNE magazine's "100 Best Companies to Work For" list
for 2012. The honor marks the fourth consecutive year that NetApp
was ranked in the top 10 and the sixth consecutive year it was
ranked in the top 15. Additionally, NetApp was ranked #6 on the
Crain's New York Business annual "Best Places to Work in
New York City" list for 2011.
- NetApp is One of Six Companies Named "Partner of the
Year" by CDW. NetApp was among only six companies named a
winner of CDW's fifth annual "Partner of the Year" awards which
recognized companies that have consistently provided exemplary
support to CDW and its customers, as well as delivered strong
growth and financial performance over the previous 12 months.
NetApp was honored not only for its outstanding performance, but
also the value it delivers which has greatly contributed to both
CDW and its customers' success.
- NetApp positioned in Leaders quadrant.
Gartner, Inc. placed NetApp in the Leaders quadrant for midrange
and high-end modular disk arrays. Gartner asserted that vendors in
the Leaders quadrant "have the highest scores in their ability to
execute and completeness of vision." 
Webcast and Conference Call
The NetApp third quarter fiscal year 2012 results conference call
will be broadcast live on the Internet at investors.netapp.com on
Wednesday, February 15, 2012, at 2 p.m. Pacific Time. This press
release and any other information related to the call will also be
posted on the Web site at that location. An audio replay Webcast
will be available after 4 p.m. Pacific Time on the Web site.
NetApp uses a hybrid format for disclosing
key financial information associated with our quarterly results.
Concurrent with the press release, NetApp posts a supplemental
commentary with financial information and statistics to our Web
site at investors.netapp.com.
NetApp creates innovative storage and data management solutions
that deliver outstanding cost efficiency and accelerate business
breakthroughs. Discover our passion for helping companies around
the world go further, faster at www.netapp.com.
NetApp, the NetApp logo, Go further, faster,
and OnCommand are trademarks or registered trademarks of NetApp,
Inc. All other marks are the property of their respective owners
and should be treated as such.
"Safe Harbor" Statement Under U.S.
Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These statements include all of the statements under the Outlook
section relating to our forecasts for the fourth quarter of fiscal
year 2012, expected benefits our customers may realize from our
products and partnerships, and our expectations regarding future
competitive positions, all of which involve risk and uncertainty.
Actual results may differ materially for a variety of reasons,
including general economic and market conditions, such as the
flooding in Thailand; and matters specific to our business, such as
customer demand for and acceptance of our products and services.
These and other equally important factors are described in reports
and documents we file from time to time with the Securities and
Exchange Commission (SEC), including the factors described under
the sections titled "Risk Factors" in our most recently submitted
Annual and Quarterly Reports on Forms 10-K and 10-Q, respectively.
We disclaim any obligation to update information contained in these
forward-looking statements whether as a result of new information,
future events, or otherwise.
NetApp Usage of Non-GAAP
The Company refers to the non-GAAP financial measures cited above
in making operating decisions because they provide meaningful
supplemental information regarding the Company's ongoing
operational performance. Non-GAAP net income excludes the
amortization of intangible assets, stock-based compensation,
acquisition-related income and expenses, restructuring and other
charges, asset impairments, non-cash interest expense associated
with our convertible debt, net losses or gains on investments, and
our GAAP tax provision, but includes a non-GAAP tax provision based
upon our projected annual non-GAAP effective tax rate for the first
three quarters of the fiscal year and an actual non-GAAP tax
provision for the fourth quarter of the fiscal year. We have
excluded these items in order to enhance investors' understanding
of our ongoing operations. The use of these non-GAAP financial
measures has material limitations because they should not be used
to evaluate our Company without reference to their corresponding
GAAP financial measures. As such, we compensate for these material
limitations by using these non-GAAP financial measures in
conjunction with GAAP financial measures.
These non-GAAP financial measures are used
to: (1) measure Company performance against historical results, (2)
facilitate comparisons to our competitors' operating results, and
(3) allow greater transparency with respect to information used by
management in financial and operational decision making. In
addition, these non-GAAP financial measures are used to measure
Company performance for the purposes of determining employee
incentive plan compensation. We have historically reported similar
non-GAAP financial measures to our investors and believe that the
inclusion of comparative numbers provides consistency in our
financial reporting at this time.
GAAP earnings per share is calculated using the
diluted number of shares for all periods presented.
Non-GAAP net income excludes the amortization of
intangible assets, stock-based compensation, acquisition-related
income and expenses, restructuring and other charges, asset
impairments, non-cash interest expense associated with our
convertible debt, net losses or gains on investments, and our GAAP
tax provision, but includes a non-GAAP tax provision based upon our
projected annual non-GAAP effective tax rate for the first three
quarters of the fiscal year and an actual non-GAAP tax provision
for the fourth quarter of the fiscal year. Non-GAAP earnings per
share is calculated using the diluted number of shares for all
80% hedged on maturity or conversion of the
 "Magic Quadrant for Midrange and High-End Modular
Disk Arrays" by Roger W. Cox, Pushan Rinnen, Stanley Zaffos, and
Jimmie Chang, November 17, 2011.