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Inside NetApp’s Performance Since the Fiscal 4Q17 Results

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Dec. 4 2020, Updated 10:43 a.m. ET

Falling shares after fiscal 4Q17 results

NetApp (NTAP) announced its fiscal 4Q17 results on May 24, 2017. Its share price rose 3.4% to $40.96 on May 25, 2017, from $39.56 one day previously. Since then, NetApp shares have fallen further, closing at $38.7 on June 6, 2017.

NetApp reported revenues of $1.48 billion in fiscal 4Q17. Its non-GAAP (generally accepted accounting principles) EPS (earnings per share) came in at $0.86, while analysts expected the firm to post revenue of $1.44 billion, with EPS of $0.82. NetApp thus beat the analyst revenue estimate by 2.8% and the analyst earnings estimate by 4.9% in fiscal 4Q17.

While NetApp’s revenue rose 7.3%, its EPS rose 56% YoY (year-over-year) in fiscal 4Q17. In the trailing 12 months, NetApp has topped EPS expectations over the past four quarters, while its revenues have surpassed expectations in three of the past four quarters.

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Broad portfolio of solutions beneficial for NetApp

NetApp had been struggling with declining revenues in fiscal 2016, when revenues fell 9.4% YoY to $5.54 billion. But NetApp was late to enter the all-flash array market and had been experiencing limited traction in the hybrid cloud segment.

All-flash array has now become vital to NetApp’s revenue in fiscal 2017, and the firm has grown its market share faster than any other competitor. NetApp now has a broad portfolio of products, which focus on IT (information technology) transformation for enterprises.

During the company’s fiscal 2016 call, CEO (chief executive officer) George Kurian stated: “Our momentum with customers is accelerating. Data is at the heart of our customers’ IT transformation efforts, and this is where NetApp has a profoundly important role to play.”

Kurian added: “Our strategic relevance to customers’ digital transformation roadmaps is evidenced by the growth of our strategic solutions.”

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