Strategic Solutions’ revenue contribution
Since fiscal 2016, NetApp (NTAP) has focused on its Strategic Solutions and Data Fabric segments to drive revenues. Strategic Solutions accounted for 65% of the company’s net product revenue in fiscal 2017, as compared to 56% in fiscal 2016.
Strategic Solutions revenues rose 24% YoY (year-over-year) in fiscal 4Q17 to $596 million and 17.2% YoY to $1.97 billion in fiscal 2017. The firm has aligned its strategic solutions to meet the demands of IT (information technology) enterprises, and the business is growing at a faster rate than peer companies are seeing.
Clustered ONTAP and NTAP’s installed base
US-based (SPY) tech (QQQ) firm NetApp introduced its scale-out storage solution, Clustered ONTAP, in 2013. ONTAP is NetApp’s flagship operating system and is deployed at 50% of the firm’s installed base. The solution was deployed on 95% of the FAS (fabric-attached storage) systems that were shipped in fiscal 4Q17, which represents a 50% YoY rise. Demand for clustered ONTAP continued to rise in fiscal 4Q17 as shipments rose 80% YoY.
NetApp is still the fastest-growing player in the all-flash array segment as well, outpacing peer companies as well as the overall market. The company’s all-flash array revenues have grown 160% YoY, with an annualized revenue run rate of $1.4 billion.
NetApp’s pivot toward these high-growth areas since fiscal 2016 has generated significant revenues for the firm. NetApp believes its total addressable market will grow at a CAGR (compound annual growth rate) of 15% to reach $40 billion by the end of fiscal 2021.