NetApp Earnings Fall But Top Views

NetApp Inc.'s earnings fell from a year ago but still came in better than expected, as the data-storage company continues to increase its digital focus.

"We made good progress as we pivoted towards the faster parts of the market," Chief Executive George Kurian said. Mr. Kurian was promoted to CEO in June, succeeding Tom Georgens, who resigned less than two weeks after NetApp said it would lay off 500 workers and issued a disappointing financial forecast.

Shares of NetApp, down 26% over the past year, were flat at $31.04 in after-hours trading.

NetApp's woes earlier this year had stemmed in part from customers shifting to cloud-based storage for some operations, instead of buying and operating their own hardware. In addition, many of NetApp's largest customers had balked at a new product from the company until certain features were added.

Wednesday, Mr. Kurian said the company was making progress in the faster-growing parts of the data-storage market. He added that Dell Inc.'s recent deal to buy NetApp rival EMC Corp. for $67 billion presented an opportunity for the company.

"Customers are concerned by the uncertainty caused by the announcement and are looking for a long-term road maps," Mr. Kurian said.

For the January quarter, NetApp projected per-share earnings between 47 cents and 42 cents, or 66 cents to 71 cents excluding certain costs, with revenue of $1.4 billion to $1.5 billion. Analysts, on average, were expecting adjusted earnings of 70 cents a share and revenue of $1.48 billion.

For the quarter ended Oct. 30, NetApp reported earnings of $114 million, or 39 cents a share, down from year-ago earnings of $160 million, or 49 cents a share.

Excluding certain costs, such as restructuring charges, the company had earnings of 61 a share. In August, NetApp projected per-share earnings between 55 cents and 60 cents.

Revenue fell 6.4% to $1.45 billion. NetApp in August had projected revenue of $1.4 billion to $1.5 billion.

Mr. Kurian said he was "particularly pleased of the growth rates" for their flash-storage products, which are faster than traditional magnetic-tape-based solutions.

NetApp also said company President Robert Salmon would retire at the end of the 2016 fiscal year. He joined the company in 1994.

Write to Austen Hufford at [e-mail]

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(END) Dow Jones Newswires

November 18, 2015 19:25 ET (00:25 GMT)

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