NetApp Q1 Profit Rises - Update

(RTTNews) - Data-storage systems maker NetApp Inc. (NTAP), Wednesday reported an increase in profit for the first quarter, as revenues grew 5 percent reflecting release of its Ontap 8.2 storage operating system. Earnings for the quarter came in ahead of analysts' expectations, but revenues fell short of estimates.

Moving ahead, the company detailed its guidance for the second quarter, with mid-point of earnings and revenue outlook slightly below current Street expectations.

NetApp's first-quarter revenues grew 5 percent to $1.52 billion from $1.44 billion last year. Thirty-one analysts had a consensus revenue estimate of $1.53 billion for the quarter.

Product revenues, the biggest contributor to the top line, rose to $930.8 million from $898.0 million last year. Software entitlements and maintenance revenues advanced to $228.5 million from $218.5 million, while service revenues increased to $356.9 million from $328.1 million last year.

"NetApp delivered solid results and innovation with the latest release to our clustered Data ONTAP operating system," said Chief Executive Tom Georgens. "Despite an uneven macro environment, our branded business was strong, with 9% year-over-year growth. This is evidence of the tremendous value we are delivering to customers today and their confidence in our long-term strategy to enable them to navigate the future."

Sunnyvale, California-based NetApp's first-quarter profit rose to $81.6 million or $0.23 per share from $63.8 million or $0.17 per share a year ago.

Adjusted earnings for the quarter improved to $0.53 per share from $0.42 per share last year. On average, thirty-three analysts polled by Thomson Reuters expected earnings of $0.49 per share for the quarter. Analysts' estimates typically exclude special items.

Looking forward to the second quarter, NetApp expect earnings in the range of $0.41 to $0.46 per share, adjusted earnings of $0.60 to $0.65 per share and revenue of $1.56 billion to $1.66 billion. Analysts currently expect earnings of $0.63 per share on revenues of $1.63 billion for the quarter.

NTAP closed Wednesday at $42.33, up $0.04 or 0.09%, on the Nasdaq. The stock, however, slipped $1.58 or 3.73% in after-hours trade.