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8-K - NETAPP, INC. 8-K - NetApp, Inc. | netapp8k.htm |
Exhibit
99.1
NetApp
Announces Results for Second Quarter of Fiscal Year 2010
Revenue
Up 9% Sequentially and Nearly Flat Year Over Year
SUNNYVALE,
CA--(Marketwire - November 18, 2009) - NetApp (NASDAQ: NTAP) today reported
results for the second quarter of fiscal year 2010, which ended October 30,
2009. Revenues for the second quarter of fiscal 2010 were $910 million, compared
to revenues of $912 million for the same period one year ago.
For the
second fiscal quarter of 2010, GAAP net income was $96 million, or $0.27 per
share(1) compared to GAAP net income of $43 million, or $0.13 per share for the
same period in the prior year. Non-GAAP(2) net income for the second fiscal
quarter of 2010 was $130 million, or $0.37 per share, compared to non-GAAP net
income of $92 million, or $0.28 per share for the same period one year
ago.
Revenues
for the first six months of the current fiscal year totaled $1.75 billion,
compared to revenues of $1.78 billion for the first six months of the prior
fiscal year, a decrease of 2% year over year.
GAAP net
income for the first six months of the current fiscal year totaled $147 million,
or $0.43 per share, compared to GAAP net income of $78 million, or $0.23 per
share for the first six months of the prior fiscal year. Non-GAAP net income for
the first six months of the current fiscal year totaled $206 million, or $0.60
per share, compared to non-GAAP net income of $168 million, or $0.50 per share
for the first six months of the prior fiscal year.
"NetApp
delivered a strong quarter with record gross margins, record revenue from our
SAN products, and overall revenue that exceeded our expectations," said Tom
Georgens, president and chief executive officer. "Our value proposition
resonates particularly well with customers who look to gain efficiency and
streamline operations as they begin to build out their next-generation
virtualized data centers. Driven by this demand, NetApp is forecasting record
revenues for our next fiscal quarter."
Outlook
·
|
NetApp
estimates revenue for the third quarter of fiscal year 2010 to be in a
range of $935 million to $955
million.
|
·
|
NetApp
estimates the third quarter of fiscal year 2010 share count to increase by
about 5 million shares.
|
·
|
NetApp
estimates that the third quarter of fiscal year 2010 GAAP earnings per
share will be approximately $0.24 to $0.25 per share. NetApp estimates
third quarter fiscal year 2010 non-GAAP earnings per share to be
approximately $0.36 to $0.37 per
share.
|
Quarterly
Highlights
In the
second quarter of fiscal year 2010, NetApp unveiled its cloud strategy and
introduced several new products and solutions to help customers transform their
data center architectures to achieve greater storage efficiency through
innovative data management techniques. NetApp also received numerous industry
accolades for its work environment, products, innovative use of technology, and
executive leadership.
The
makeup of the data center is changing drastically as companies seek to take
advantage of virtualization and highly efficient infrastructures. NetApp is
primed to take advantage of this major shift in the market by offering
enterprises industry-leading storage efficiency and data management solutions
that are well suited for both internal and external cloud
deployments.
This
quarter NetApp introduced Data ONTAP® 8, the culmination of years of engineering
effort to integrate the Data ONTAP 7G operating system with a next-generation
scale-out architecture. Data ONTAP 8 will provide seamless data mobility and
secure multi-tenancy, both of which are key requirements for the most
sophisticated cloud infrastructures. In addition, Data ONTAP 8 provides a more
robust platform for the next 10 years of innovation from NetApp.
NetApp
also introduced the following new products and enhancements that uniquely
complement VMware® vSphere 4 and VMware View to help customers optimize their
desktop and cloud computing environments: Virtual Storage Console, SnapManager®
for Virtual Infrastructure, and Rapid Cloning Utility.
Showing
its commitment to midsize enterprise and distributed enterprise customers,
NetApp announced the new FAS2040 storage system, providing customers with
increased performance and capacity to handle demanding Microsoft® Windows®
consolidation and virtualization workloads all on the same system. NetApp also
announced significant price reductions for its FAS2020 systems and associated
software, which are now preconfigured with high-capacity drives and include all
protocols.
During
the quarter, NetApp extended its leadership in Ethernet storage with
standards-based products that support converged Ethernet (FCoE, iSCSI, NFS,
CIFS) data access and help customers streamline their data centers and maximize
ROI. With partners such as Cisco and QLogic, NetApp is expanding Ethernet as a
storage infrastructure.
In an
effort to help customers maximize the value of their existing storage
investments, NetApp unveiled a program to help customers achieve greater storage
efficiency in their data centers. Under the terms of the Zero Investment
Promise(3) Program ("ZIP Program"), customers with EMC and HP SANs that deploy
NetApp® V-Series can reduce storage capacity and the associated costs of their
existing third-party storage investments. If after 90 days the customer files an
approved claim that the storage savings are not achieved, the customer will keep
the equipment at no charge.
Finally,
in addition to NetApp's various solution and program announcements during the
quarter, the company received the following awards and industry
recognition:
·
|
Best Channel Product 2009:
The NetApp FAS2000 series was named a "Best Channel Product 2009"
in the NAS Storage category by Business Solutions magazine. The FAS2000
was cited for its reliability, durability, and ease of
upgrade.
|
·
|
2009 InformationWeek
500: NetApp ranked 26th on the 2009 InformationWeek 500, which
honors the nation's most innovative users of information technology.
NetApp ranked number three in the information technology
industry.
|
·
|
Oracle Innovation Award:
Recognizing NetApp's innovative use of Oracle® Business Intelligence
software, Oracle named NetApp a winner of the 2009 Innovation Awards in
the Business Intelligence/Enterprise Performance Management
category.
|
·
|
Morgan Stanley Leadership Award
for Global Commerce: Dan Warmenhoven and Tom Mendoza received the
Morgan Stanley Leadership Award for Global Commerce, which recognizes
individuals whose personal leadership has made a critical contribution to
the effective use of information technology throughout the
world.
|
·
|
Washingtonian Magazine's 50
Great Places to Work: NetApp was selected as a winner in the "Think
Big" category, for large companies, on the basis of such measures as
recognition and respect given employees, great work-life balance,
challenging and interesting opportunities, commitment to community, and
generous pay and benefits.
|
Webcast and Conference Call
Information
·
|
The
NetApp quarterly results conference call will be broadcast live on the
Internet at http://investors.netapp.com
on Wednesday, November 18, 2009, at 2:00 p.m. Pacific Time. This press
release and any other information related to the call will also be posted
on the Web site at that location.
|
·
|
The
conference call will also be available live in a listen-only format at
(800) 510-9836 in the United States and (617) 614-3670 outside the United
States. The pass code for both numbers is
11612732.
|
·
|
A
replay will be available for 72 hours following the completion of the live
call by dialing (888) 286-8010 in the United States and (617) 801-6888
outside the United States, using replay code 30335717. The Webcast replay
will be posted on our Web site for at least one
year.
|
About NetApp
NetApp
creates innovative storage and data management solutions that accelerate
business breakthroughs and deliver outstanding cost efficiency. Discover
NetApp's passion for helping companies around the world go further, faster at
www.netapp.com.
"Safe Harbor" Statement Under U.S.
Private Securities Litigation Reform Act of 1995
This
press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements include all
of the statements under the Outlook section relating to our forecasted operating
results, share count and metrics for the third quarter of fiscal year 2010 and
the benefits that we expect our customers to realize from using our products.
These forward-looking statements involve risks and uncertainties, and actual
results could vary. Important factors that could cause actual results to differ
materially from those in the forward-looking statements include risks associated
with the anticipated growth in network storage and content delivery markets; our
ability to deliver new product architectures and enterprise service offerings;
competition risks, including our ability to design products and services that
compete effectively from a price and performance perspective; our reliance on a
limited number of suppliers; our ability to accurately forecast demand for our
products; and other important factors as described in NetApp reports and
documents filed from time to time with the Securities and Exchange Commission
(SEC), including the factors described under the sections captioned "Risk
Factors" in our most recently submitted 10-K. We disclaim any obligation to
update information contained in these forward-looking statements whether as a
result of new information, future events, or otherwise.
(1)
Earnings per share is calculated using the diluted number of shares for all
periods presented.
(2)
Non-GAAP results of operations exclude amortization of intangible assets,
stock-based compensation expenses, merger termination proceeds (net of related
expenses), restructuring and other charges, noncash interest expense associated
with our convertible debt, net loss or gain on investments, and our GAAP tax
provision, including discrete items, but includes a proforma tax provision based
upon our projected annual proforma effective tax rate.
(3) The
ZIP Program is limited to the terms set forth in www.netapp.com/zip.
NetApp,
the NetApp logo, Go further, faster, Data ONTAP, and SnapManager are trademarks
or registered trademarks of NetApp, Inc. in the United States and/or other
countries. All other brands or products are trademarks or registered trademarks
of their respective holders and should be treated as such.
NetApp Usage of Non-GAAP
Financials
The
Company refers to the non-GAAP financial measures cited above in making
operating decisions because they provide meaningful supplemental information
regarding the Company's operational performance. Non-GAAP results of operations
exclude amortization of intangible assets, stock-based compensation expenses,
merger termination proceeds (net of related expenses), restructuring and other
charges, noncash interest expense associated with our convertible debt, net loss
or gain on investments, and our GAAP tax provision, including discrete items,
but includes a proforma tax provision based upon our projected annual proforma
effective tax rate. We have excluded these items in order to enhance investors'
understanding of our ongoing operations. The use of these non-GAAP financial
measures has material limitations because they should not be used to evaluate
our company without reference to their corresponding GAAP financial measures. As
such, we compensate for these material limitations by using these non-GAAP
financial measures in conjunction with GAAP financial measures.
These
non-GAAP financial measures facilitate management's internal comparisons to the
Company's historical operating results and comparisons to competitors' operating
results. We include these non-GAAP financial measures in our earnings
announcement because we believe they are useful to investors in allowing for
greater transparency with respect to supplemental information used by management
in its financial and operational decision making, such as employee compensation
planning. In addition, we have historically reported similar non-GAAP financial
measures to our investors and believe that the inclusion of comparative numbers
provides consistency in our financial reporting at this time.
NetApp Use of Corporate Web
Site
In
accordance with SEC guidance published on August 22, 2008 (Release No.
34-58288), NetApp will begin to disseminate material information about the
company through its corporate Web site within the next several fiscal quarters.
NetApp intends to designate a separate portion of its corporate Web site for
purposes of these disclosures and will include a prominent link on its Web site
to allow visitors to locate this material information, which will be routinely
updated. The Web site will supplement, rather than replace, NetApp's current
existing channels of information distribution.
NETAPP,
INC.
|
||||||||
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
||||||||
(In
thousands)
|
||||||||
(Unaudited)
|
||||||||
October
30, 2009
|
April
24, 2009
|
|||||||
ASSETS
|
||||||||
CURRENT
ASSETS:
|
||||||||
Cash
and cash equivalents
|
$ | 1,728,841 | $ | 1,494,153 | ||||
Short-term
investments
|
1,226,697 | 1,110,053 | ||||||
Accounts
receivable, net
|
318,033 | 446,537 | ||||||
Inventories
|
61,141 | 61,104 | ||||||
Prepaid
expenses and other assets
|
115,525 | 119,887 | ||||||
Short-term
deferred income taxes
|
140,352 | 207,050 | ||||||
Total
current assets
|
3,590,589 | 3,438,784 | ||||||
PROPERTY
AND EQUIPMENT, net
|
780,378 | 807,923 | ||||||
GOODWILL
|
680,986 | 680,986 | ||||||
INTANGIBLE
ASSETS, net
|
34,970 | 45,744 | ||||||
LONG-TERM
INVESTMENTS AND RESTRICTED CASH
|
116,406 | 127,317 | ||||||
LONG-TERM
DEFERRED INCOME TAXES AND OTHER ASSETS
|
361,178 | 283,625 | ||||||
$ | 5,564,507 | $ | 5,384,379 | |||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
CURRENT
LIABILITIES:
|
||||||||
Accounts
payable
|
$ | 118,807 | $ | 137,826 | ||||
Accrued
compensation and related benefits
|
220,778 | 204,168 | ||||||
Other
accrued liabilities
|
179,087 | 190,315 | ||||||
Accrual for GSA settlement | - | 128,715 | ||||||
Income
taxes payable
|
3,020 | 4,732 | ||||||
Deferred
revenue
|
1,017,067 | 1,013,569 | ||||||
Total
current liabilities
|
1,538,759 | 1,679,325 | ||||||
LONG-TERM
DEBT AND OTHER OBLIGATIONS
|
1,217,418 | 1,219,216 | ||||||
LONG-TERM
DEFERRED REVENUE
|
704,836 | 701,649 | ||||||
3,461,013 | 3,600,190 | |||||||
STOCKHOLDERS'
EQUITY
|
2,103,494 | 1,784,189 | ||||||
$ | 5,564,507 | $ | 5,384,379 |
NETAPP,
INC.
|
||||||||||||||||
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
(In
thousands, except net income per share amounts)
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
October
30, 2009
|
October
24, 2008
|
October
30, 2009
|
October
24, 2008
|
|||||||||||||
REVENUES:
|
||||||||||||||||
Product
|
$ | 525,148 | $ | 570,436 | $ | 1,003,394 | $ | 1,118,291 | ||||||||
Software
entitlements and maintenance
|
169,815 | 152,722 | 335,105 | 297,134 | ||||||||||||
Service
|
215,064 | 188,473 | 409,489 | 364,982 | ||||||||||||
Net
revenues
|
910,027 | 911,631 | 1,747,988 | 1,780,407 | ||||||||||||
COST
OF REVENUES:
|
||||||||||||||||
Cost
of product
|
199,134 | 260,332 | 411,669 | 510,110 | ||||||||||||
Cost
of software entitlements and maintenance
|
3,106 | 2,259 | 6,218 | 4,445 | ||||||||||||
Cost
of service
|
101,106 | 102,884 | 200,927 | 203,048 | ||||||||||||
Total
cost of revenues
|
303,346 | 365,475 | 618,814 | 717,603 | ||||||||||||
GROSS
MARGIN
|
606,681 | 546,156 | 1,129,174 | 1,062,804 | ||||||||||||
OPERATING
EXPENSES:
|
||||||||||||||||
Sales
and marketing
|
300,835 | 304,045 | 602,268 | 607,152 | ||||||||||||
Research
and development
|
132,354 | 125,496 | 262,671 | 250,848 | ||||||||||||
General
and administrative
|
56,939 | 51,011 | 116,490 | 100,474 | ||||||||||||
Restructuring
and other charges
|
1,179 | - | 2,675 | - | ||||||||||||
Merger termination proceeds, net | - | - | (41,120 | ) | - | |||||||||||
Total
operating expenses
|
491,307 | 480,552 | 942,984 | 958,474 | ||||||||||||
INCOME
FROM OPERATIONS
|
115,374 | 65,604 | 186,190 | 104,330 | ||||||||||||
OTHER
INCOME (EXPENSES), net:
|
||||||||||||||||
Interest
income
|
6,979 | 17,619 | 15,596 | 33,094 | ||||||||||||
Interest
expense
|
(17,916 | ) | (17,807 | ) | (37,117 | ) | (27,319 | ) | ||||||||
Loss
(gain) on investments, net
|
2,805 | (22,613 | ) | 2,713 | (25,234 | ) | ||||||||||
Other
expenses, net
|
(1,270 | ) | (479 | ) | (2,218 | ) | (2,468 | ) | ||||||||
Total
other expenses, net
|
(9,402 | ) | (23,280 | ) | (21,026 | ) | (21,927 | ) | ||||||||
INCOME
BEFORE INCOME TAXES
|
105,972 | 42,324 | 165,164 | 82,403 | ||||||||||||
PROVISION
(BENEFIT) FOR INCOME TAXES
|
10,295 | (729 | ) | 17,823 | 4,627 | |||||||||||
NET
INCOME
|
$ | 95,677 | $ | 43,053 | $ | 147,341 | $ | 77,776 | ||||||||
NET
INCOME PER SHARE:
|
||||||||||||||||
BASIC
|
$ | 0.28 | $ | 0.13 | $ | 0.44 | $ | 0.24 | ||||||||
DILUTED
|
$ | 0.27 | $ | 0.13 | $ | 0.43 | $ | 0.23 | ||||||||
SHARES
USED IN PER SHARE CALCULATION:
|
||||||||||||||||
BASIC
|
336,667 | 327,319 | 335,602 | 330,587 | ||||||||||||
DILUTED
|
349,751 | 333,385 | 344,313 | 337,253 |
NETAPP,
INC.
|
||||||||||||||||
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOW
|
||||||||||||||||
(In
thousands)
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
October
30, 2009
|
October
24, 2008
|
October
30, 2009
|
October
24, 2008
|
|||||||||||||
Cash
Flows from Operating Activities:
|
||||||||||||||||
Net
income
|
$ | 95,677 | $ | 43,053 | $ | 147,341 | $ | 77,776 | ||||||||
Adjustments
to reconcile net income to net cash
|
||||||||||||||||
provided
by operating activities:
|
||||||||||||||||
Depreciation
and amortization
|
42,148 | 43,918 | 85,189 | 85,467 | ||||||||||||
Stock-based
compensation
|
33,245 | 27,763 | 85,429 | 64,167 | ||||||||||||
Loss
(gain) on investments
|
(2,835 | ) | 13,315 | (2,537 | ) | 15,936 | ||||||||||
Asset
impairment and write-offs
|
846 | 581 | 1,140 | 760 | ||||||||||||
Allowance
for doubtful accounts
|
144 | 1,740 | 9 | 1,704 | ||||||||||||
Accretion
of discount and issue costs on notes
|
12,211 | 11,509 | 25,291 | 17,076 | ||||||||||||
Deferred
income taxes
|
163 | (36,041 | ) | (1,919 | ) | (47,300 | ) | |||||||||
Deferred
rent
|
(434 | ) | 2,184 | (829 | ) | 3,011 | ||||||||||
Income
tax benefit from stock-based compensation
|
(4,638 | ) | 25,690 | 14,410 | 45,549 | |||||||||||
Excess
tax benefit from stock-based compensation
|
(1,350 | ) | (24,169 | ) | (1,350 | ) | (34,311 | ) | ||||||||
Changes
in assets and liabilities:
|
||||||||||||||||
Accounts
receivable
|
14,462 | 60,915 | 131,717 | 211,207 | ||||||||||||
Inventories
|
774 | (14,756 | ) | 334 | (8,014 | ) | ||||||||||
Prepaid
expenses and other assets
|
(13,347 | ) | (29,504 | ) | (1,071 | ) | (20,002 | ) | ||||||||
Accounts
payable
|
(2,357 | ) | 13,740 | (16,858 | ) | (16,333 | ) | |||||||||
Accrued
compensation and related benefits
|
82,579 | 23,683 | 9,561 | (30,756 | ) | |||||||||||
Other
accrued liabilities
|
7,174 | 6,312 | (19,456 | ) | 4,909 | |||||||||||
Accrual
for GSA settlement
|
- | - | (128,715 | ) | - | |||||||||||
Income
taxes payable
|
970 | 1,857 | (1,608 | ) | (536 | ) | ||||||||||
Long
term other liabilities
|
6,234 | 401 | (6,334 | ) | (818 | ) | ||||||||||
Deferred
revenue
|
(4,371 | ) | 35,249 | (14,215 | ) | 88,143 | ||||||||||
Net
cash provided by operating activities
|
267,295 | 207,440 | 305,529 | 457,635 | ||||||||||||
Cash
Flows from Investing Activities:
|
||||||||||||||||
Purchases
of investments
|
(722,334 | ) | (219,024 | ) | (883,231 | ) | (483,962 | ) | ||||||||
Redemptions
of investments
|
386,288 | 155,711 | 780,808 | 263,643 | ||||||||||||
Reclassification
from cash and cash equivalents to short-term investments
|
- | (597,974 | ) | - | (597,974 | ) | ||||||||||
Change
in restricted cash
|
967 | 457 | (827 | ) | 682 | |||||||||||
Proceeds
from nonmarketable securities
|
3,115 | 932 | 4,480 | 807 | ||||||||||||
Purchases
of property and equipment
|
(22,776 | ) | (27,354 | ) | (47,490 | ) | (103,967 | ) | ||||||||
Net
cash used in investing activities
|
(354,740 | ) | (687,252 | ) | (146,260 | ) | (920,771 | ) | ||||||||
Cash
Flows from Financing Activities:
|
||||||||||||||||
Proceeds
from sale of common stock related to employee stock
transactions
|
27,385 | 10,038 | 65,888 | 45,565 | ||||||||||||
Tax
withholding payments reimbursed by employee stock
transactions
|
(490 | ) | (37 | ) | (5,717 | ) | (2,591 | ) | ||||||||
Excess
tax benefit from stock-based compensation
|
1,350 | 24,169 | 1,350 | 34,311 | ||||||||||||
Proceeds
from issuance of convertible notes
|
- | - | - | 1,265,000 | ||||||||||||
Payment
of financing costs
|
- | (1,136 | ) | - | (26,581 | ) | ||||||||||
Sale
of common stock warrants
|
- | - | - | 163,059 | ||||||||||||
Purchase
of note hedge
|
- | - | - | (254,898 | ) | |||||||||||
Repayment
of revolving credit facility
|
- | (65,416 | ) | - | (107,251 | ) | ||||||||||
Repurchases
of common stock
|
- | - | - | (399,981 | ) | |||||||||||
Net
cash provided by (used in) financing activities
|
28,245 | (32,382 | ) | 61,521 | 716,633 | |||||||||||
Effect
of Exchange Rate Changes on Cash and Cash Equivalents
|
3,653 | (19,172 | ) | 13,898 | (18,947 | ) | ||||||||||
Net
Increase (Decrease) in Cash and Cash Equivalents
|
(55,547 | ) | (531,366 | ) | 234,688 | 234,550 | ||||||||||
Cash
and Cash Equivalents:
|
||||||||||||||||
Beginning
of period
|
1,784,388 | 1,702,395 | 1,494,153 | 936,479 | ||||||||||||
End
of period
|
$ | 1,728,841 | $ | 1,171,029 | $ | 1,728,841 | $ | 1,171,029 |
SUPPLEMENTAL
INFORMATION
|
||||||||||||||||||||||||||||
(In
thousands)
|
||||||||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||||||||
Three
Months Ended October 30, 2009
|
||||||||||||||||||||||||||||
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Restructuring
and Other Charges
|
Mergers
Termination Proceeds, Net
|
Non-Cash
Interest Expense
|
Loss
(Gain) on Investments, Net
|
Total
|
||||||||||||||||||||||
Cost
of product revenues
|
$ | 4,273 | $ | 510 | - | - | - | - | $ | 4,783 | ||||||||||||||||||
Cost
of service revenues
|
- | 2,942 | - | - | - | - | 2,942 | |||||||||||||||||||||
Sales
and marketing expense
|
849 | 15,690 | - | - | - | - | 16,539 | |||||||||||||||||||||
Research
and development expense
|
- | 7,909 | - | - | - | - | 7,909 | |||||||||||||||||||||
General
and administrative expense
|
- | 6,194 | - | - | - | - | 6,194 | |||||||||||||||||||||
Restructuring
and other charges
|
- | - | 1,179 | - | - | - | 1,179 | |||||||||||||||||||||
Interest
expense
|
- | - | - | - | 12,211 | - | 12,211 | |||||||||||||||||||||
Gain
on investments, net
|
- | - | - | - | - | (2,805 | ) | (2,805 | ) | |||||||||||||||||||
Effect
on income before income taxes
|
$ | 5,122 | $ | 33,245 | $ | 1,179 | - | $ | 12,211 | $ | (2,805 | ) | $ | 48,952 | ||||||||||||||
Six
Months Ended October 30, 2009
|
||||||||||||||||||||||||||||
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Restructuring
and Other Charges
|
Mergers
Termination Proceeds, Net
|
Non-Cash
Interest Expense
|
Loss
(Gain) on Investments, Net
|
Total
|
||||||||||||||||||||||
Cost
of product revenues
|
$ | 8,988 | $ | 1,730 | - | - | - | - | $ | 10,718 | ||||||||||||||||||
Cost
of service revenues
|
- | 7,461 | - | - | - | - | 7,461 | |||||||||||||||||||||
Sales
and marketing expense
|
1,697 | 39,655 | - | - | - | - | 41,352 | |||||||||||||||||||||
Research
and development expense
|
- | 20,625 | - | - | - | - | 20,625 | |||||||||||||||||||||
General
and administrative expense
|
- | 15,958 | - | - | - | - | 15,958 | |||||||||||||||||||||
Restructuring
and other charges
|
- | - | 2,675 | - | - | - | 2,675 | |||||||||||||||||||||
Mergers
termination proceeds, net
|
- | - | - | (41,120 | ) | - | - | (41,120 | ) | |||||||||||||||||||
Interest
expense
|
- | - | - | - | 25,291 | - | 25,291 | |||||||||||||||||||||
Gain
on investments, net
|
- | - | - | - | - | (2,805 | ) | (2,805 | ) | |||||||||||||||||||
Effect
on pre-tax income
|
$ | 10,685 | $ | 85,429 | $ | 2,675 | $ | (41,120 | ) | $ | 25,291 | $ | (2,805 | ) | $ | 80,155 | ||||||||||||
Three
Months Ended October 24, 2008
|
||||||||||||||||||||||||||||
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Restructuring
and Other Charges
|
Mergers
Termination Proceeds, Net
|
Non-Cash
Interest Expense
|
Loss
(Gain) on Investments, Net
|
Total
|
||||||||||||||||||||||
Cost
of product revenues
|
$ | 6,748 | $ | 624 | - | - | - | - | $ | 7,372 | ||||||||||||||||||
Cost
of service revenues
|
- | 2,419 | - | - | - | - | 2,419 | |||||||||||||||||||||
Sales
and marketing expense
|
1,259 | 12,849 | - | - | - | - | 14,108 | |||||||||||||||||||||
Research
and development expense
|
- | 7,482 | - | - | - | - | 7,482 | |||||||||||||||||||||
General
and administrative expense
|
- | 4,389 | - | - | - | - | 4,389 | |||||||||||||||||||||
Interest
expense
|
- | - | - | - | 10,265 | - | 10,265 | |||||||||||||||||||||
Loss
on investments, net
|
- | - | - | - | - | 22,613 | 22,613 | |||||||||||||||||||||
Effect
on income before income taxes
|
$ | 8,007 | $ | 27,763 | - | - | $ | 10,265 | $ | 22,613 | $ | 68,648 | ||||||||||||||||
Six
Months Ended October 24, 2008
|
||||||||||||||||||||||||||||
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Restructuring
and Other Charges
|
Mergers
Termination Proceeds, Net
|
Non-Cash
Interest Expense
|
Loss
(Gain) on Investments, Net
|
Total
|
||||||||||||||||||||||
Cost
of product revenues
|
$ | 13,496 | $ | 1,572 | - | - | - | - | $ | 15,068 | ||||||||||||||||||
Cost
of service revenues
|
- | 5,460 | - | - | - | - | 5,460 | |||||||||||||||||||||
Sales
and marketing expense
|
2,518 | 29,191 | - | - | - | - | 31,709 | |||||||||||||||||||||
Research
and development expense
|
- | 17,669 | - | - | - | - | 17,669 | |||||||||||||||||||||
General
and administrative expense
|
- | 10,275 | - | - | - | - | 10,275 | |||||||||||||||||||||
Interest
expense
|
- | - | - | - | 15,202 | - | 15,202 | |||||||||||||||||||||
Loss
on investments, net
|
- | - | - | - | - | 25,234 | 25,234 | |||||||||||||||||||||
Effect
on pre-tax income
|
$ | 16,014 | $ | 64,167 | - | - | $ | 15,202 | $ | 25,234 | $ | 120,617 |
NETAPP,
INC.
|
||||||||||||||||
RECONCILIATION
OF NON-GAAP AND GAAP
|
||||||||||||||||
IN
THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
(In
thousands, except net income per share amounts)
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
October
30, 2009
|
October
24, 2008
|
October
30, 2009
|
October
24, 2008
|
|||||||||||||
SUMMARY RECONCILIATION OF NET
INCOME
|
||||||||||||||||
NET
INCOME
|
$ | 95,677 | $ | 43,053 | $ | 147,341 | $ | 77,776 | ||||||||
Adjustments:
|
||||||||||||||||
Amortization
of intangible assets
|
5,122 | 8,007 | 10,685 | 16,014 | ||||||||||||
Stock-based
compensation expenses
|
33,245 | 27,763 | 85,429 | 64,167 | ||||||||||||
Restructuring
and other charges
|
1,179 | - | 2,675 | - | ||||||||||||
Merger
termination proceeds, net
|
- | - | (41,120 | ) | - | |||||||||||
Non-cash
interest expense
|
12,211 | 10,265 | 25,291 | 15,202 | ||||||||||||
Loss
(gain) on investments, net
|
(2,805 | ) | 22,613 | (2,805 | ) | 25,234 | ||||||||||
Discrete
GAAP tax provision items
|
(645 | ) | 3,816 | (7,837 | ) | 4,308 | ||||||||||
Income
tax effect
|
(13,848 | ) | (23,410 | ) | (13,591 | ) | (34,655 | ) | ||||||||
NON-GAAP
NET INCOME
|
$ | 130,136 | $ | 92,107 | $ | 206,068 | $ | 168,046 | ||||||||
NET
INCOME PER SHARE
|
$ | 0.274 | $ | 0.129 | $ | 0.428 | $ | 0.231 | ||||||||
Adjustments:
|
||||||||||||||||
Amortization
of intangible assets
|
0.015 | 0.024 | 0.031 | 0.047 | ||||||||||||
Stock-based
compensation expenses
|
0.095 | 0.083 | 0.248 | 0.190 | ||||||||||||
Restructuring
and other charges
|
0.003 | - | 0.008 | - | ||||||||||||
Merger
termination proceeds, net
|
- | - | (0.119 | ) | - | |||||||||||
Non-cash
interest expense
|
0.035 | 0.031 | 0.073 | 0.045 | ||||||||||||
Loss
(gain) on investments, net
|
(0.008 | ) | 0.068 | (0.008 | ) | 0.075 | ||||||||||
Discrete
GAAP tax provision items
|
(0.002 | ) | 0.011 | (0.023 | ) | 0.013 | ||||||||||
Income
tax effect
|
(0.040 | ) | (0.070 | ) | (0.039 | ) | (0.103 | ) | ||||||||
NON-GAAP
NET INCOME PER SHARE
|
$ | 0.372 | $ | 0.276 | $ | 0.599 | $ | 0.498 | ||||||||
NETAPP, INC. | ||||
RECONCILIATION OF NON GAAP GUIDANCE TO GAAP | ||||
EXPRESSED AS EARNINGS PER SHARE | ||||
THIRD QUARTER 2010 | ||||
(Unaudited) | ||||
Third
Quarter
|
||||
2010
|
||||
Non-GAAP
Guidance
|
$ | 0.36 - $0.37 | ||
Adjustments
of Specific Items to
|
||||
Earnings
Per Share for the Third
|
||||
Quarter
2010:
|
||||
Non
cash interest expense
|
(0.03 | ) | ||
Amortization
of intangible assets
|
(0.01 | ) | ||
Stock
based compensation expense
|
(0.10 | ) | ||
Income
tax effect
|
0.02 | |||
Total
Adjustments
|
(0.12 | ) | ||
GAAP
Guidance - Earnings Per Share
|
$ | 0.24 - $0.25 |
Press
Contact:
NetApp
Jodi
Baumann
Ph: (408)
822-3974
Jodi.Baumann@netapp.com
Investor
Contacts:
NetApp
Tara
Dhillon
Ph: (408)
822-6909
tara@netapp.com
NetApp
Billie
Fagenstrom
Ph: (408)
822-6428
billief@netapp.com