NetApp, Inc. Earnings Cheat Sheet: Snaps Strong Streak with Profit Drop

Rising revenue was not enough for S&P 500 (NYSE:SPY) component NetApp, Inc. (NASDAQ:NTAP) as the data storage devices company saw profit fall in the first quarter. NetApp, Inc. supplies enterprise storage and data management software and hardware products and services.

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NetApp Earnings Cheat Sheet for the First Quarter

Results: Net income for the data storage devices company fell to $139.5 million (34 cents per share) vs. $150.7 million (40 cents per share) a year earlier. This is a decline of 7.4% from the year earlier quarter.

Revenue: Rose 26% to $1.46 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: NTAP reported adjusted net income of 55 cents per share. By that measure, the company beat the mean estimate of 45 cents per share. It fell short of the average revenue estimate of $1.51 billion.

Quoting Management: “Despite the challenging macroeconomic environment modestly impacting our revenue growth, NetApp still produced earnings per share slightly above the midpoint of our targeted range.The company achieved record levels of FAS6000 systems sales, near record numbers of new enterprise customer wins, and our new E-series sales exceeded our forecast,” said Tom Georgens, president and CEO.”Our gross margin performance demonstrates the strength of our competitive position in the market, helping us to achieve healthy operating results and earnings per share.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 30.2%, with the biggest boost coming in the first quarter of the last fiscal year when revenue rose 35.8% from the year earlier quarter.

Last quarter’s profit decrease breaks a streak of four consecutive quarters of year-over-year profit increases. In the fourth quarter of the last fiscal year, net income rose 33.8% from the year earlier, while the figure increased 59.9% in the third quarter of the last fiscal year, 72% in the second quarter of the last fiscal year and more than twofold in the first quarter of the last fiscal year.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 3 cents in the fourth quarter of the last fiscal year, by one cent in the third quarter of the last fiscal year, and by 4 cents in the second quarter of the last fiscal year.

Competitors to Watch: EMC Corporation (NYSE:EMC), Dot Hill Systems Corp. (NASDAQ:HILL), Overland Storage, Inc. (NASDAQ:OVRL), Quantum Corporation (NYSE:QTM), ADPT Corporation (ADPT), Xyratex Ltd. (NASDAQ:XRTX), Seagate Technology PLC (NASDAQ:STX), Western Digital Corp. (NYSE:WDC), Brocade Communications Systems, Inc. (NASDAQ:BRCD), and Intl. Business Machines Corp. (NYSE:IBM).

Investing Insights: Steve Jobs Prepares to Deliver a New Catalyst for Apple’s Stock.

(Source: Xignite Financials)