NetApp lifts annual profit forecast on resilient demand for cloud services

By Thomson Reuters Feb 29, 2024 | 3:50 PM

(Reuters) – NetApp raised its annual profit forecast on Thursday, as businesses spend more on cloud-based data management services for digital transformation, sending its shares up 13.6% in extended trading.

Enterprises investing in high performance storage to employ artificial intelligence for improving business productivity has benefited NetApp, which helps companies increase efficiency of their data storage infrastructure.

“Our modern approach to unified data storage, spanning all-flash and cloud environments, is clearly resonating with customers,” said CEO George Kurian.

The San Jose, California-based company expects full-year 2024 adjusted profit per share to be between $6.40 and $6.50, compared with its prior range of $6.05 to $6.25.

The hybrid cloud segment, which accounts for almost all of the company’s revenue, posted sales of $1.46 billion in the third quarter, up more than 5% over the year earlier.

For the fourth quarter, the company expects to report net revenue in the range of $1.59 billion and $1.74 billion, the midpoint of which is slightly above LSEG estimates of $1.65 billion.

Net revenue for the quarter ended Jan. 26 came in at $1.61 billion, compared with analysts’ estimate of $1.59 billion.

On an adjusted basis, NetApp earned $1.94 per share compared with $1.37 per share a year earlier.

(Reporting by Harshita Mary Varghese; Editing by Shilpi Majumdar)