European Investor
03 Sep 2026, 15:29
NetApp Shares Rise 3% After Record Quarter Beats Guidance Across the Board
NetApp (NASDAQ: NTAP) shares climbed 3% Wednesday after the storage and data infrastructure company reported record first-quarter fiscal 2027 results that exceeded guidance on every metric, alongside a significant upward revision to its full-year outlook.
Record Revenue and Sharp Profit Growth
NetApp posted net revenues of $2.03 billion for the quarter ended July 31, up 30% year-over-year. The growth was broad-based: Hybrid Cloud segment revenue rose 30% to $1.82 billion, while Public Cloud segment revenue grew 28% to a record $206 million. Billings came in at $2.06 billion, up 36% year-over-year.
Profitability expanded even faster than revenue. GAAP net income jumped 61% to $375 million, translating to GAAP earnings per share of $1.88. On a non-GAAP basis, EPS reached $2.58, up 66% from the prior year. GAAP operating margin came in at 23.9%, with non-GAAP operating margin at 31.9%.
The standout performer was NetApp's all-flash array business, which posted record net revenue of $1.3 billion, up 47% year-over-year — a sign of continued enterprise migration toward flash storage, likely aided by AI workload demands.
AI Push Continues with DataPelago Acquisition
CEO George Kurian pointed to customer wins and demand for the NetApp Platform to support AI and hybrid multi-cloud initiatives as a key driver of the quarter's strength. During the quarter, the company acquired DataPelago, an AI data infrastructure company, aimed at helping customers accelerate AI deployment and improve compute efficiency where data is created and stored.
NetApp also expanded its product lineup with releases including StorageGRID 12.1 for AI data pipelines, new Kubernetes capabilities in Trident software, and an MCP Gateway service connecting its Instaclustr managed infrastructure to AI applications and agents. On the partnership front, the company deepened ties with Cisco, CGI, SK Telecom, and Tata Consultancy Services.
Guidance Raised Significantly
For the second quarter of fiscal 2027, NetApp guided for net revenues between $2.025 billion and $2.175 billion, with non-GAAP EPS in a range of $2.54 to $2.64.
For the full fiscal year, the company raised its outlook to net revenues of $7.975 billion to $8.225 billion and non-GAAP EPS of $9.73 to $10.03 — guidance that reflects confidence in sustained demand across both its core storage business and its cloud and AI-adjacent offerings.
Why the Stock Moved
Today's 3% gain is a comparatively modest reaction given a quarter that beat guidance across every reported metric, which may reflect that strong results were already partly anticipated given the company's recent innovation cadence and AI-related partnership announcements. Still, the raised full-year guidance and record performance in the all-flash array business appear to have been well-received, even if the market's response was measured relative to the scale of the earnings beat.
NetApp (NASDAQ: NTAP) shares climbed 3% Wednesday after the storage and data infrastructure company reported record first-quarter fiscal 2027 results that exceeded guidance on every metric, alongside a significant upward revision to its full-year outlook.
Record Revenue and Sharp Profit Growth
NetApp posted net revenues of $2.03 billion for the quarter ended July 31, up 30% year-over-year. The growth was broad-based: Hybrid Cloud segment revenue rose 30% to $1.82 billion, while Public Cloud segment revenue grew 28% to a record $206 million. Billings came in at $2.06 billion, up 36% year-over-year.
Profitability expanded even faster than revenue. GAAP net income jumped 61% to $375 million, translating to GAAP earnings per share of $1.88. On a non-GAAP basis, EPS reached $2.58, up 66% from the prior year. GAAP operating margin came in at 23.9%, with non-GAAP operating margin at 31.9%.
The standout performer was NetApp's all-flash array business, which posted record net revenue of $1.3 billion, up 47% year-over-year — a sign of continued enterprise migration toward flash storage, likely aided by AI workload demands.
AI Push Continues with DataPelago Acquisition
CEO George Kurian pointed to customer wins and demand for the NetApp Platform to support AI and hybrid multi-cloud initiatives as a key driver of the quarter's strength. During the quarter, the company acquired DataPelago, an AI data infrastructure company, aimed at helping customers accelerate AI deployment and improve compute efficiency where data is created and stored.
NetApp also expanded its product lineup with releases including StorageGRID 12.1 for AI data pipelines, new Kubernetes capabilities in Trident software, and an MCP Gateway service connecting its Instaclustr managed infrastructure to AI applications and agents. On the partnership front, the company deepened ties with Cisco, CGI, SK Telecom, and Tata Consultancy Services.
Guidance Raised Significantly
For the second quarter of fiscal 2027, NetApp guided for net revenues between $2.025 billion and $2.175 billion, with non-GAAP EPS in a range of $2.54 to $2.64.
For the full fiscal year, the company raised its outlook to net revenues of $7.975 billion to $8.225 billion and non-GAAP EPS of $9.73 to $10.03 — guidance that reflects confidence in sustained demand across both its core storage business and its cloud and AI-adjacent offerings.
Why the Stock Moved
Today's 3% gain is a comparatively modest reaction given a quarter that beat guidance across every reported metric, which may reflect that strong results were already partly anticipated given the company's recent innovation cadence and AI-related partnership announcements. Still, the raised full-year guidance and record performance in the all-flash array business appear to have been well-received, even if the market's response was measured relative to the scale of the earnings beat.
