NetApp Announces Results For Second Quarter Fiscal Year 2012

Company Reports Q2 FY'12 Revenue of $1.507 Billion, Up 20% Year-over-Year

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Sunnyvale, Calif.- November 16, 2011 - NetApp (NASDAQ: NTAP) today reported results for the second quarter of fiscal year 2012, which ended October 28, 2011. Revenues for the second quarter of fiscal year 2012 totaled $1.507 billion compared to revenues of $1.251 billion for the same period one year ago.

For the second quarter of fiscal year 2012, GAAP net income was $165.6 million, or $0.44 per share[1], compared to GAAP net income of $175.4 million, or $0.45 per share, for the same period a year ago. Non-GAAP net income for the second quarter of fiscal year 2012 was $235.5 million, or $0.63 per share[2], compared to non-GAAP net income of $212.2 million, or $0.54 per share, for the same period a year ago.

Revenues for the first six months of fiscal year 2012 totaled $2.965 billion compared to revenues of $2.405 billion for the first six months of the prior fiscal year, an increase of 23% year over year. GAAP net income for the first six months of fiscal year 2012 totaled $305.1 million, or $0.78 per share, compared to GAAP net income of $326.1 million, or $0.85 per share for the first six months of the prior fiscal year. Non-GAAP net income for the first six months of fiscal year 2012 totaled $457.8 million, or $1.17 per share, compared to non-GAAP net income of $403.1 million, or $1.05 per share for the first six months of the prior fiscal year.

NetApp produced record non-GAAP earnings per share in the second quarter. In aggregate, we saw strong revenue growth across most areas of our business, offset by some unexpected weakness in a handful of our largest accounts, said Tom Georgens, president and CEO. NetApp achieved the highest number of net new customer wins in more than two and a half years this quarter, and in our Smart Decisions are Built on NetApp campaign we just launched the new FAS2000 series platform built on our Data ONTAP 8.1 operating system-all of which will drive market share gains going forward.

Outlook

NetApp estimates revenue for the third quarter of fiscal year 2012 to be in the range of $1.520 billion to $1.610 billion, which equates to approximately 1% to 7% sequential revenue growth and approximately 18 % to 25% year-over-year revenue growth.

NetApp estimates that third quarter fiscal year 2012 GAAP earnings per share will be approximately $0.36 to $0.40 per share. NetApp estimates that third quarter fiscal year 2012 non-GAAP earnings per share will be approximately $0.56 to $0.60 per share.

NetApp estimates that share count for the third quarter of fiscal year 2012 will increase to approximately 380 million shares, including an estimated 9 million shares from the companys outstanding convertible notes[3] and 0.5 million shares from outstanding warrants. Share count does not include the companys outstanding note hedges which are expected to offset 80% of the dilution from the convertible notes at maturity or conversion.

Business Highlights

During the second quarter of fiscal year 2012, NetApp once again was recognized for its unique corporate culture and demonstrated its commitment to delivering the solutions and technologies that help customers and partners accelerate their business. NetApp further cemented its position as a great place to work by ranking #3 on the inaugural Worlds Best Multinational Workplaces list due to its culture of innovation focused on helping customers and partners thrive. Additionally, NetApp continued to provide the storage foundation for customers across all industries who want to achieve the flexibility and efficiency required in todays challenging business and IT landscape. NetApp also expanded its existing solution portfolio to help customers transition to the cloud and address growing big-bandwidth requirements. Highlights for the quarter included the following:

Milestones and Awards

NetApp named one of the best workplaces in the world. Thanks to its culture of innovation focused on customer and partner success, NetApp was named the #3 best workplace in the world by the Great Place to Work Institute, Inc. NetApp joins an elite group of 25 multinational companies on the inaugural list that have been recognized by their employees for their company culture and workplace environment.

NetApp continues to rank as one of the best places to work in the United States. In addition to its global recognition, NetApp was once again named a best place to work, ranking #1 in Research Triangle Park in the giant companies category and one of 50 best places to work in the Washington, DC, area. The honors are a testament to NetApps model company approach, strong culture, and talented employees.

Enterprise, Government, and Education Customers Build on NetApp Foundation to Dramatically Increase IT Efficiency and Flexibility

Thomson Reuters leverages NetApp to transform how the legal industry gets information. Thomson Reuters built on a NetApp shared storage infrastructure to create WestlawNext, an innovative and intuitive research tool that has set a new standard for online professional search. The NetApp foundation enables WestlawNext to search up to 50 times more data than before, return results 64% faster than other online search platforms, and meet or exceed a 99.9% uptime target that is critical for the legal community. Furthermore, improved storage performance helped Thomson Reuters save nearly $65 million in additional data center costs.

U.S. Department of Energy selects NetApp as storage foundation for one of the worlds most powerful supercomputers. The Sequoia supercomputer, which will be deployed in 2012 at Lawrence Livermore National Laboratory (LLNL), will leverage NetApp as its storage foundation. Sequoia is expected to be twice as fast as todays most powerful system and will manage massive compute workloads in wh

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