NetApp Reports First Quarter of Fiscal Year 2023 Results
SAN JOSE, Calif., Aug. 24, 2022 — NetApp (NASDAQ: NTAP) today reported financial results for the first quarter of fiscal year 2023, which ended on July 29, 2022.
“We delivered a great start to the year, fueled by broad-based demand across our portfolio and geographies, setting all-time Q1 company highs for billings, revenue, gross profit dollars, operating income and EPS,” said George Kurian, chief executive officer. “Our solutions are aligned with our customer’s top priorities helping them reduce cost, risk and complexity for their digital and cloud transformations. This is evidenced by the strong growth of our revenue, billings and profitability.”
Delivers company record for Q1 billings, revenue, gross profit dollars, operating income, and EPS
- Net revenues for the first quarter grew 9% year-over-year to $1.59 billion, 13% in constant currency1
- Q1 product revenue grew 8% year-over-year to $786 million, the sixth consecutive quarter of year-over-year growth
- Q1 billings2 were $1.56 billion, an increase of 13% year-over-year, 18% in constant currency
- NetApp™ Public Cloud annualized revenue run rate (ARR)3 increased 73% year-over-year to $584 million
- All-flash array ARR4 increased 7% year-over-year to $3.0 billion
- $460 million returned to shareholders in share repurchases and cash dividends
First quarter of fiscal year 2023 financial results
- Net revenues: $1.59 billion, compared to $1.46 billion in the first quarter of fiscal year 2022
- Hybrid Cloud segment revenue: $1.46 billion, compared to $1.38 billion in the first quarter of fiscal year 2022
- Public Cloud segment revenue: $132 million, compared to $79 million in the first quarter of fiscal year 2022
- Net income: GAAP net income of $214 million, compared to $202 million in the first quarter of fiscal year 2022; non-GAAP net income5 of $269 million, compared to $263 million in the first quarter of fiscal year 2022
- Earnings per share: GAAP net income per share6 of $0.96, compared to $0.88 in the first quarter of fiscal year 2022; non-GAAP net income per share of $1.20, compared to $1.15 in the first quarter of fiscal year 2022
- Cash, cash equivalents and investments: $3.44 billion at the end of the first quarter of fiscal year 2023
- Cash provided by operations: $281 million, compared to $242 million in the first quarter of fiscal year 2022
- Share repurchase and dividends: Returned $460 million to shareholders through share repurchases and cash dividends
Second quarter of fiscal year 2023 financial outlook
The Company provided the following financial guidance for the second quarter of fiscal year 2023:
| Net revenues are expected to be in the range of: | $1.595 billion to $1.745 billion | |
| GAAP | Non-GAAP | |
| Earnings per share is expected to be in the range of: | $0.93 – $1.03 | $1.28 – $1.38 |
Full fiscal year 2023 financial outlook
The Company provided the following financial guidance for the full fiscal year 2023:
| Net revenues are expected to grow in the range of: | 6% to 8% | |
| Public Cloud ARR is expected to exit the fiscal year in the range of: | $780 million to $820 million | |
| GAAP | Non-GAAP | |
| Consolidated gross margins are expected to be in the range of: | 65% – 66% | 66% – 67% |
| Operating margins are expected to be in the range of: | 18% – 19% | 23% – 24% |
| Earnings per share is expected to be in the range of: | $4.09 – $4.29 | $5.40 – $5.60 |
Dividend
The next cash dividend of $0.50 per share is to be paid on October 26, 2022, to shareholders of record as of the close of business on October 7, 2022.
First quarter of fiscal year 2023 business highlights
Leading product innovation
- NetApp announced the general availability of Spot PC by NetApp, a managed cloud desktop-as-a-service solution with security, automation, observability, and optimization.
- NetApp announced the general availability of Spot Security, delivering continuous, automated security to all users.
- NetApp announced updates to Delight, the free cross-platform monitoring UI for Spark, with a new, more intuitive user interface.
- NetApp announced the general availability of Ocean for Apache Spark on Google Cloud.
- NetApp completed its acquisition of Instaclustr, a leading platform provider of fully managed open-source database, pipeline, and workflow applications delivered as a service.
- NetApp announced new capabilities to simplify hybrid cloud operations, including improved ransomware protection, hybrid cloud storage as a service in a single subscription with Keystone™, improved unified management in a single user interface with Cloud Manager, and collaboration with VMware to help transition workloads to the cloud.
- NetApp enhanced StorageGRID™ with updates including integration with Google Cloud, security, compliance enhancements, faster performance for analytical workloads, and more.
- NetApp announced the general availability of FlexPod™ XCS, leveraging its integration into the Cisco Intersight cloud operations platform.
Customer and partner momentum
- NetApp and NVIDIA extended their partnership to accelerate HPC and AI with turnkey supercomputing infrastructure, announcing that NetApp EF600 all-flash NVMe storage combined with the BeeGFS parallel file system is now certified for NVIDIA DGX SuperPOD.
- NetApp and Kyndryl announced a global alliance to help customers unlock insights from data stored on premises, in the cloud, and in edge computing environments.
- NetApp announced that it is now an AWS Government ISV Competency Partner for Public Sector.
- NetApp and Alluxio collaborated to help customers adapt to new requirements for modernizing data architecture with low-touch operations for analytics, machine learning, and AI.
Corporate news and events
- NetApp announced the winners of its annual Asia-Pacific (APAC) Partner Excellence Award7 at the NetApp Partner Summit 2022.
- NetApp announced that Spot by NetApp joined the FinOps Foundation as a Premier Member.
NetApp awards and recognition
- An IDC study of Spot by NetApp8 customers found significant ROI, productivity, and time-to-market benefits, including an average 696% three-year ROI and a 21% reduction in Public Cloud spending.
- NetApp announced that NetApp AI won a 2022 AI Breakthrough Award for Best Overall Computer Vision.
- NetApp was named to CRN’s Software-Defined Data Center 50 List for 2022.9
- NetApp was listed as a recipient of the CRN Health and Wellbeing Recognition Award10 for the Women & Diversity in Channel Awards 2022.
- NetApp was named among the companies that scored 100% on Disability:IN’s Disability Equality Index 2022 Best Places to Work.11
Executive appointments
- NetApp announced the appointments of Giovanna Sangiorgi and Srivatsan (Sri) Vaiyakarnam to its go-to-market leadership team as part of the ongoing evolution of NetApp’s sales organization to accelerate cloud-led growth.
Webcast and conference call information
NetApp will host a conference call to discuss these results today at 2:00 p.m. Pacific Time. To access the live webcast of this event, go to the NetApp Investor Relations website at investors.netapp.com. In addition, this press release, historical supplemental data tables, and other information related to the call will be posted on the Investor Relations website. An audio replay will be available on the website after 4:00 p.m. Pacific Time today.
Link to full release with footnotes.
About NetApp
NetApp is a global, cloud-led, data-centric software company that empowers organizations to lead with data in the age of accelerated digital transformation. The company provides systems, software, and cloud services that enable them to run their applications optimally from data center to cloud, whether they are developing in the cloud, moving to the cloud, or creating their own cloudlike experiences on premises. With solutions that perform across diverse environments, NetApp helps organizations build their own data fabric and securely deliver the right data, services, and applications to the right people—anytime, anywhere. Learn more at www.netapp.com.
Source: NetApp
