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EX-99.2 - EXHIBIT 99.2 - NetApp, Inc. | exh99_2.htm |
8-K - NETAPP, INC. 8-K - NetApp, Inc. | netapp8k.htm |
Exhibit 99.1
Press Contact: | Investor Contacts: | |
Ryan Lowry | Tara Dhillon | Billie Fagenstrom |
NetApp | NetApp | NetApp |
(408) 822-7544 | (408) 822-6909 | (408) 822-6428 |
ryanl@netapp.com | tara@netapp.com | billief@netapp.com |
NETAPP
ANNOUNCES RESULTS FOR FOURTH QUARTER
AND FISCAL YEAR 2010
Annual
and Quarterly Records Reported for Revenue, Earnings
and Free Cash Flow
Sunnyvale, Calif.—May 26,
2010—NetApp (NASDAQ: NTAP) today reported results for the fourth fiscal
quarter and fiscal year 2010, which ended April 30, 2010. Revenues for the
fourth fiscal quarter of 2010 totaled $1.17 billion compared to revenues of $880
million for the same period one year ago.
For the
fourth fiscal quarter, GAAP net income was $145 million, or $.40 per share1
compared to GAAP net income of $68 million, or $0.21 per share for the same
period in the prior year. Non-GAAP net income for the fourth fiscal quarter was
$183 million, or $0.50 per share2,
compared to non-GAAP net income of $103 million, or $0.31 per share for the same
period a year ago.
For
fiscal year 2010, GAAP and non-GAAP revenues totaled $3.93 billion, an increase
of 15% compared to GAAP revenues of $3.41 billion and an increase of 11%
compared to non-GAAP revenue of $3.54 billion for fiscal year 2009. For fiscal
year 2010, GAAP net income was $400 million, or $1.13 per share, compared to
GAAP net income of $65 million, or $0.19 per share for fiscal year 2009.
Non-GAAP net income for fiscal year 2010 was $533 million, or $1.51 per share,
compared to non-GAAP net income of $364 million, or $1.09 per share for fiscal
year 2009.
“With 50%
growth in product revenue this quarter, NetApp significantly outperformed the
competition. With accelerating revenue growth every quarter, we culminated
our fiscal year with record levels of revenue, earnings per share, and free cash
flow,” said Tom Georgens, president & CEO. “The server virtualization
and cloud computing trends are driving significant business for us, as our
competitive advantages in those areas lead more customers to choose NetApp
storage efficiency solutions for larger and larger data center
projects.”
Outlook
§
|
NetApp
estimates revenue for the first quarter of fiscal year 2011 to be in the
range of $1.10 billion to $1.14
billion.
|
§
|
NetApp
estimates share count for the first quarter of fiscal year 2011 to
increase by about 6 million shares.
|
§
|
NetApp estimates that
the first quarter of fiscal year 2011 GAAP earnings per share will be
approximately $0.31 to $0.35 per share. NetApp estimates that the
first quarter fiscal year 2011 non-GAAP earnings per share will be
approximately $0.43 to $0.47 per
share.
|
Business
Highlights
In the
fourth quarter of fiscal year 2010, NetApp expanded key partnerships and
introduced new solutions to enable customers’ virtualization and cloud-based
infrastructures, as well as help service providers deliver compelling cloud services for
enterprise information technology. NetApp also reached several significant
milestones during the quarter related to the adoption and deployment of its
storage solutions. In addition, several new customer deployments demonstrated
how NetApp storage
efficiency technologies can help customers reach never-before-seen levels
of efficiency. Key business highlights included the following.
New
Solutions and Expanded Partnerships
·
|
New service provider
solutions. NetApp unveiled new design guides and capabilities
geared specifically for service providers that will help them deliver
greater value to their cloud customers. NetApp®
service-oriented infrastructure, data protection as a service, backup and
recovery as a service, and NetApp Open Management will help service
providers differentiate their cloud services, accelerate their services'
time to market, and achieve industry-leading cost and service-level
benefits.
|
·
|
CA, Inc. and NetApp build
solutions for cloud infrastructures. CA and NetApp extended their
multiyear solutions partnership to develop management solutions for public
and private cloud environments. The companies will integrate CA
Spectrum®
Automation Manager, CA Spectrum Service Assurance, CA Spectrum
Infrastructure Manager, and CA eHealth®
Performance Manager with NetApp's storage management solutions, including
NetApp Provisioning Manager and NetApp SANscreen®.
|
·
|
NetApp, Brocade, Emulex, and
VMware expand options for FCoE and DCB customers. NetApp will
resell a new Converged Network Adapter from Emulex, and is among the first
storage vendors to support VMware®
vSphere™
4 in a Fibre
Channel over Ethernet (FCoE) host environment. NetApp also
augmented its FCoE portfolio from Brocade and introduced a DCB-only
version of the Brocade 8000. Now customers have even more options to build
complete end-to-end FCoE infrastructures and unify their Ethernet and
Fibre Channel architectures.
|
Milestones
and Awards
·
|
NetApp reaches milestone of
150,000 unified storage systems deployed. This historic milestone
underscores NetApp's long standing commitment and significant industry
innovation in making unified storage
a reality for customers. Customers worldwide are leveraging NetApp's
unified storage solutions to simplify operations, achieve business
breakthroughs, increase productivity, and recognize significant cost
savings.
|
·
|
NetApp gains leadership in SAN
market and reaches significant milestone with more than 30,000 deployments
worldwide. NetApp has more than doubled its SAN business in just
two years by providing customers with an impressive list of technologies
and maximizing strong solution partnerships with companies such as
Brocade, Cisco, Microsoft, and VMware. According to IDC's Worldwide
Quarterly Disk Storage Systems Tracker, Q3 2009, NetApp grew faster than
the FC SAN market year over year.
|
·
|
Customers help NetApp pass
milestone of 5,000 V-Series units shipped. Customers made V-Series
one of NetApp’s fastest growing products, with 70% year-over-year growth
and more than 5,000 units shipped. More customers are turning to NetApp
V-Series to unify their non NetApp storage environments and increase
efficiency, reduce costs, and improve data
protection.
|
·
|
NetApp positioned in Leaders
Quadrant in top analyst firm’s Magic Quadrant. Gartner, Inc.
positioned NetApp in the Leaders Quadrant for Midrange and High-End NAS
Solutions3.
NetApp NAS solutions are built on a unified storage
platform, providing customers of all sizes with increased flexibility and
performance along with industry-leading storage
efficiency capabilities.
|
·
|
NetApp ranked #2 on "Best
Workplaces in Canada" list. NetApp was ranked #2 on the "Best
Workplaces in Canada" list for 2010 and was also recognized as the top
workplace in Canada in the Respect category. NetApp now ranks in the top
20 places to work in 9 different regions, including #7 in the United
States.
|
Mergers
and Acquisitions
·
|
NetApp acquires Bycast.
On May 13, 2010, NetApp completed its acquisition of Bycast Inc., a
privately held company headquartered in Vancouver, British Columbia,
Canada, in an all-cash transaction. Bycast extends NetApp's leadership
position in unified storage
by adding an object-based storage software
offering.
|
Businesses
Built on NetApp
·
|
Weta
Digital, a world leader in visual effects, relied on NetApp storage in the
production of the record-breaking film Avatar. NetApp helped
reduce Weta's data management overhead by 95% and increase its storage
price-to-performance ratio by 40%.
|
·
|
J&B
Group turned to NetApp for its storage to support its perishable foods
production and distribution business. NetApp's storage efficiency
technology helped increase utilization to 67%, and storage requirements
for VMware virtual servers dropped from 4.5TB to 1.5TB, a 66%
reduction.
|
·
|
The
College of Saint Rose implemented NetApp and VMware virtualization
solutions to tackle the challenges of data growth, availability, and
reliability. NetApp thin provisioning and deduplication technologies
helped improve the college's storage efficiency, increasing utilization
rates by up to 85% and deferring $134,000 in hardware costs each
year.
|
Webcast
and Conference Call Information
The
NetApp fourth quarter and fiscal year 2010 results conference call will be
broadcast live on the Internet at http://investors.netapp.com
on Wednesday, May 26, 2010, 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. An audio replay Webcast will also be available after 4:00 p.m.
Pacific Time on our web site at http://investors.netapp.com.
NetApp is
now using a new hybrid format for disclosing key financial information
associated with our quarterly results. Concurrent with the press release, NetApp
will post and distribute a separate document with financial commentary and
statistics that were previously disclosed during our earnings calls. These
prepared remarks will be available prior to the conference call in order to
provide the investment community with additional time to analyze our results.
This commentary will not be read during the earnings call.
About
NetApp
NetApp
creates innovative storage and data management solutions that accelerate
business breakthroughs and deliver outstanding cost efficiency. Discover our
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 first quarter of fiscal year 2011, our
expectations regarding our current and new partnerships and strategic alliances
and the benefits that we expect our customers to realize from using our products
and those from our strategic alliances and partnerships. 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 customer demand for our products
and services; our ability to increase revenue and manage our operating costs;
increased competition risks associated with the anticipated growth in network
storage market; our ability to deliver new product architectures and enterprise
service offerings; 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 and 10-Q. We disclaim any obligation to update
information contained in these forward-looking statements whether as a result of
new information, future events, or otherwise.
###
NetApp,
the NetApp logo, Go further, faster, and SANscreen are trademarks or registered
trademarks of NetApp, Inc. in the United States and/or other countries. VMware
is a registered trademark and vSphere is a trademark of VMware, Inc. All other
brands or products are trademarks or registered trademarks of their respective
holders and should be treated as such.
|
1GAAP
earnings per share is calculated using the diluted number of shares for
all periods presented.
|
|
2Non-GAAP
results of operations exclude the GSA settlement, amortization of
intangible assets, stock-based compensation
expenses, acquisition related income and expenses, restructuring and
other charges, asset impairments, non-cash interest expense associated
with our convertible debt, net losses or gains on investments, and our
GAAP tax provision, including discrete items, but includes a non-GAAP tax
provision based upon our projected annual non-GAAP effective tax rate for
the first three quarters of the fiscal year and an actual non-GAAP tax
provision for the fourth quarter of the fiscal year. Non-GAAP earnings per
share is calculated using the diluted number of shares
for
all periods presented.
|
|
3Gartner,
Inc. Magic Quadrant for Midrange and High-End NAS Solutions, Pushan
Rinnen, Robert E. Passmore, Roger W. Cox, March 15,
2010.
|
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 ongoing operational performance. Non-GAAP results of
operations exclude the GSA settlement, amortization of intangible
assets, stock-based compensation expenses, acquisition related income
and expenses, restructuring and other charges, asset impairments, non-cash
interest expense associated with our convertible debt, net losses or gains on
investments, and our GAAP tax provision, including discrete items, but includes
a non-GAAP tax provision based upon our projected annual non-GAAP effective tax
rate for the first three quarters of the fiscal year and an actual non-GAAP tax
provision for the fourth quarter of the fiscal year. 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 are used to: (1) measure company performance against
historical results, (2) facilitate comparisons to our competitors’ operating
results, and (3) allow greater transparency with respect to information used by
management in financial and operational decision making. In addition, these
non-GAAP financial measures are used to measure company performance for the
purposes of determining employee incentive plan compensation. 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,
INC.
|
||||||||
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
||||||||
(In
millions)
|
||||||||
(Unaudited)
|
||||||||
April
30, 2010
|
April
24, 2009
|
|||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash,
cash equivalents and investments
|
$ | 3,724.0 | $ | 2,604.2 | ||||
Accounts
receivable, net
|
471.5 | 446.5 | ||||||
Inventories
|
112.9 | 61.1 | ||||||
Other
current assets
|
228.7 | 327.0 | ||||||
Total
current assets
|
4,537.1 | 3,438.8 | ||||||
Property
and equipment, net
|
804.4 | 807.9 | ||||||
Goodwill
and other intangible assets, net
|
706.1 | 726.7 | ||||||
Long-term
investments and restricted cash
|
72.8 | 127.3 | ||||||
Other
non-current assets
|
374.0 | 283.7 | ||||||
$ | 6,494.4 | $ | 5,384.4 | |||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 184.6 | $ | 137.8 | ||||
Accrued
compensation and other current liabilities
|
591.3 | 527.9 | ||||||
Deferred
revenue
|
1,135.1 | 1,013.6 | ||||||
Total
current liabilities
|
1,911.0 | 1,679.3 | ||||||
Long-term
debt and other obligations
|
1,273.4 | 1,219.3 | ||||||
Long-term
deferred revenue
|
779.5 | 701.6 | ||||||
3,963.9 | 3,600.2 | |||||||
Stockholders'
equity
|
2,530.5 | 1,784.2 | ||||||
$ | 6,494.4 | $ | 5,384.4 |
NETAPP,
INC.
|
||||||||||||||||
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
(In
millions, except net income per share amounts)
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
Three
Months Ended
|
Year
Ended
|
|||||||||||||||
April
30, 2010
|
April
24, 2009
|
April
30, 2010
|
April
24, 2009
|
|||||||||||||
Revenues:
|
||||||||||||||||
Product
|
$ | 758.8 | $ | 506.2 | $ | 2,381.1 | $ | 2,152.7 | ||||||||
Software
entitlements and maintenance
|
173.8 | 164.6 | 679.8 | 618.3 | ||||||||||||
Service
|
239.2 | 209.5 | 870.5 | 764.1 | ||||||||||||
GSA
settlement
|
- | (0.7 | ) | - | (128.7 | ) | ||||||||||
Net
revenues
|
1,171.8 | 879.6 | 3,931.4 | 3,406.4 | ||||||||||||
Cost
of revenues:
|
||||||||||||||||
Cost
of product
|
310.9 | 245.2 | 976.4 | 1,007.6 | ||||||||||||
Cost
of software entitlements and maintenance
|
3.1 | 2.4 | 12.3 | 9.2 | ||||||||||||
Cost
of service
|
109.3 | 98.1 | 423.5 | 399.7 | ||||||||||||
Total
cost of revenues
|
423.3 | 345.7 | 1,412.2 | 1,416.5 | ||||||||||||
Gross
profit
|
748.5 | 533.9 | 2,519.2 | 1,989.9 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Sales
and marketing
|
366.7 | 287.3 | 1,293.7 | 1,186.1 | ||||||||||||
Research
and development
|
143.7 | 125.0 | 535.7 | 498.5 | ||||||||||||
General
and administrative
|
64.2 | 52.2 | 238.8 | 203.7 | ||||||||||||
Restructuring
and other charges
|
(0.2 | ) | 35.5 | 2.5 | 54.4 | |||||||||||
Acquisition
related (income) expense, net
|
1.2 | - | (39.9 | ) | - | |||||||||||
Total
operating expenses
|
575.6 | 500.0 | 2,030.8 | 1,942.7 | ||||||||||||
Income
from operations
|
172.9 | 33.9 | 488.4 | 47.2 | ||||||||||||
Other
income (expenses), net
|
||||||||||||||||
Interest
income
|
8.1 | 11.7 | 31.2 | 57.6 | ||||||||||||
Interest
expense
|
(18.8 | ) | (18.5 | ) | (74.1 | ) | (63.4 | ) | ||||||||
Other
income (expenses), net
|
1.7 | (2.4 | ) | 1.5 | (33.1 | ) | ||||||||||
Total
other expenses, net
|
(9.0 | ) | (9.2 | ) | (41.4 | ) | (38.9 | ) | ||||||||
Income
before income taxes
|
163.9 | 24.7 | 447.0 | 8.3 | ||||||||||||
Provision
for (benefit from) income taxes
|
18.8 | (43.7 | ) | 46.6 | (56.3 | ) | ||||||||||
Net
income
|
$ | 145.1 | $ | 68.4 | $ | 400.4 | $ | 64.6 | ||||||||
Net
income per share:
|
||||||||||||||||
Basic
|
$ | 0.42 | $ | 0.21 | $ | 1.18 | $ | 0.20 | ||||||||
Diluted
|
$ | 0.40 | $ | 0.21 | $ | 1.13 | $ | 0.19 | ||||||||
Shares
used in per share computation:
|
||||||||||||||||
Basic
|
346.1 | 330.9 | 339.6 | 330.3 | ||||||||||||
Diluted
|
364.5 | 333.1 | 353.2 | 334.6 |
NETAPP,
INC.
|
||||||||||||||||
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOW
|
||||||||||||||||
(In
millions)
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
Three
Months Ended
|
Year
Ended
|
|||||||||||||||
April
30, 2010
|
April
24, 2009
|
April
30, 2010
|
April
24, 2009
|
|||||||||||||
Cash
Flows from Operating Activities:
|
||||||||||||||||
Net
income
|
$ | 145.1 | $ | 68.4 | $ | 400.4 | $ | 64.6 | ||||||||
Adjustments
to reconcile net income to net cash
|
||||||||||||||||
provided
by operating activities:
|
||||||||||||||||
Depreciation
and amortization
|
40.0 | 40.7 | 166.0 | 170.5 | ||||||||||||
Stock-based
compensation
|
37.8 | 42.2 | 159.8 | 140.8 | ||||||||||||
Accretion
of discount and issue costs on notes
|
13.1 | 12.2 | 50.8 | 41.0 | ||||||||||||
Other,
net
|
4.1 | (35.3 | ) | (1.6 | ) | (66.8 | ) | |||||||||
Tax
benefit from stock-based compensation
|
1.8 | 4.5 | (0.9 | ) | 45.4 | |||||||||||
Excess
tax benefit from stock-based compensation
|
(7.6 | ) | (1.8 | ) | (8.6 | ) | (36.7 | ) | ||||||||
Changes
in assets and liabilities:
|
||||||||||||||||
Accounts
receivable
|
(13.4 | ) | (101.6 | ) | (21.3 | ) | 128.7 | |||||||||
Inventories
|
(41.2 | ) | 21.1 | (52.1 | ) | 9.1 | ||||||||||
Accounts
payable
|
43.1 | 15.2 | 42.7 | (27.0 | ) | |||||||||||
Accrued
compensation and other current liabilities
|
112.4 | 49.7 | 53.2 | 190.5 | ||||||||||||
Deferred
revenue
|
116.6 | 81.3 | 176.7 | 219.3 | ||||||||||||
Changes
in other operating assets and liabilities, net
|
22.8 | (1.0 | ) | 9.9 | 9.8 | |||||||||||
Net
cash provided by operating activities
|
474.6 | 195.6 | 975.0 | 889.2 | ||||||||||||
Cash
Flows from Investing Activities:
|
||||||||||||||||
Purchases
and redemptions of investments, net
|
(768.9 | ) | (291.9 | ) | (860.3 | ) | (116.8 | ) | ||||||||
Reclassification
from cash and cash equivalents to short-term investments
|
- | - | - | (598.0 | ) | |||||||||||
Purchases
of property and equipment
|
(38.4 | ) | (134.7 | ) | (135.6 | ) | (289.6 | ) | ||||||||
Other
investing activities, net
|
4.1 | 0.7 | 8.2 | 1.1 | ||||||||||||
Net
cash used in investing activities
|
(803.2 | ) | (425.9 | ) | (987.7 | ) | (1,003.3 | ) | ||||||||
Cash
Flows from Financing Activities:
|
||||||||||||||||
Issuance
of common stock
|
40.4 | 16.6 | 197.1 | 85.9 | ||||||||||||
Repurchases
of common stock
|
- | - | - | (400.0 | ) | |||||||||||
Excess
tax benefit from stock-based compensation
|
7.6 | 1.8 | 8.6 | 36.7 | ||||||||||||
Issuance
of debt
|
- | - | - | 1,238.4 | ||||||||||||
Sale
of common stock warrants
|
- | - | - | 163.1 | ||||||||||||
Settlement
(purchase) of note hedge
|
14.2 | - | 14.2 | (254.9 | ) | |||||||||||
Repayment
of long-term debt
|
- | - | - | (172.6 | ) | |||||||||||
Net
cash provided by financing activities
|
62.2 | 18.4 | 219.9 | 696.6 | ||||||||||||
Effect
of Exchange Rate Changes on Cash and Cash Equivalents
|
(4.4 | ) | (2.1 | ) | 3.6 | (24.8 | ) | |||||||||
Net
Increase (Decrease) in Cash and Cash Equivalents
|
(270.8 | ) | (214.0 | ) | 210.8 | 557.7 | ||||||||||
Cash
and Cash Equivalents:
|
||||||||||||||||
Beginning
of period
|
1,975.8 | 1,708.2 | 1,494.2 | 936.5 | ||||||||||||
End
of period
|
$ | 1,705.0 | $ | 1,494.2 | $ | 1,705.0 | $ | 1,494.2 |
NETAPP,
INC.
|
||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL
INFORMATION
|
||||||||||||||||||||||||||||||||||||
(In
millions)
|
||||||||||||||||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||||||||||||||||
Three
Months Ended April 30, 2010
|
||||||||||||||||||||||||||||||||||||
GSA
Settlement
|
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Asset
Impairment
|
Restructuring
and Other Charges
|
Acquisitions
related (income) expense, net
|
Non-Cash
Interest Expense
|
(Gain)
Loss on Investments, Net
|
Total
|
||||||||||||||||||||||||||||
Cost
of product revenues
|
- | $ | 4.1 | $ | 1.3 | - | - | - | - | - | $ | 5.4 | ||||||||||||||||||||||||
Cost
of service revenues
|
- | - | 3.5 | - | - | - | - | - | 3.5 | |||||||||||||||||||||||||||
Sales
and marketing expense
|
- | 0.8 | 16.9 | - | - | - | - | - | 17.7 | |||||||||||||||||||||||||||
Research
and development expense
|
- | - | 9.0 | - | - | - | - | - | 9.0 | |||||||||||||||||||||||||||
General
and administrative expense
|
- | - | 7.1 | - | - | - | - | - | 7.1 | |||||||||||||||||||||||||||
Restructuring
and other charges
|
- | - | - | - | (0.2 | ) | - | - | - | (0.2 | ) | |||||||||||||||||||||||||
Acquisitions
related (income) expense, net
|
- | - | - | - | - | 1.2 | - | - | 1.2 | |||||||||||||||||||||||||||
Interest
expense
|
- | - | - | - | - | - | 13.1 | - | 13.1 | |||||||||||||||||||||||||||
(Gain)
loss on investments, net
|
- | - | - | - | - | - | - | (1.2 | ) | (1.2 | ) | |||||||||||||||||||||||||
Effect
on income before income taxes
|
- | $ | 4.9 | $ | 37.8 | - | $ | (0.2 | ) | $ | 1.2 | $ | 13.1 | $ | (1.2 | ) | $ | 55.6 | ||||||||||||||||||
Year
Ended April 30, 2010
|
||||||||||||||||||||||||||||||||||||
GSA
Settlement
|
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Asset
Impairment
|
Restructuring
and Other Charges
|
Acquisitions
related (income) expense, net
|
Non-Cash
Interest Expense
|
(Gain)
Loss on Investments, Net
|
Total
|
||||||||||||||||||||||||||||
Cost
of product revenues
|
- | $ | 17.1 | $ | 4.0 | - | - | - | - | - | $ | 21.1 | ||||||||||||||||||||||||
Cost
of service revenues
|
- | - | 14.3 | - | - | - | - | - | 14.3 | |||||||||||||||||||||||||||
Sales
and marketing expense
|
- | 3.4 | 73.7 | - | - | - | - | - | 77.1 | |||||||||||||||||||||||||||
Research
and development expense
|
- | - | 38.5 | - | - | - | - | - | 38.5 | |||||||||||||||||||||||||||
General
and administrative expense
|
- | - | 29.3 | - | - | - | - | - | 29.3 | |||||||||||||||||||||||||||
Restructuring
and other charges
|
- | - | - | - | 2.5 | - | - | - | 2.5 | |||||||||||||||||||||||||||
Acquisitions
related (income) expense, net
|
- | - | - | - | - | (39.9 | ) | - | - | (39.9 | ) | |||||||||||||||||||||||||
Interest
expense
|
- | - | - | - | - | - | 50.8 | - | 50.8 | |||||||||||||||||||||||||||
(Gain)
loss on investments, net
|
- | - | - | - | - | - | - | (4.7 | ) | (4.7 | ) | |||||||||||||||||||||||||
Effect
on pre-tax income
|
- | $ | 20.5 | $ | 159.8 | - | $ | 2.5 | $ | (39.9 | ) | $ | 50.8 | $ | (4.7 | ) | $ | 189.0 | ||||||||||||||||||
Three
Months Ended April 24, 2009
|
||||||||||||||||||||||||||||||||||||
GSA
Settlement
|
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Asset
Impairment
|
Restructuring
and Other Charges
|
Acquisitions
related (income) expense, net
|
Non-Cash
Interest Expense
|
(Gain)
Loss on Investments, Net
|
Total
|
||||||||||||||||||||||||||||
Total
revenues
|
$ | 0.7 | - | - | - | - | - | - | - | $ | 0.7 | |||||||||||||||||||||||||
Cost
of product revenues
|
- | 4.9 | 1.0 | - | - | - | - | - | 5.9 | |||||||||||||||||||||||||||
Cost
of service revenues
|
- | - | 3.9 | - | - | - | - | - | 3.9 | |||||||||||||||||||||||||||
Sales
and marketing expense
|
- | 0.8 | 20.1 | - | - | - | - | - | 20.9 | |||||||||||||||||||||||||||
Research
and development expense
|
- | - | 11.3 | - | - | - | - | - | 11.3 | |||||||||||||||||||||||||||
General
and administrative expense
|
- | - | 5.9 | - | - | - | - | - | 5.9 | |||||||||||||||||||||||||||
Restructuring
and other charges
|
- | - | - | - | 35.5 | - | - | - | 35.5 | |||||||||||||||||||||||||||
Interest
expense
|
- | - | - | - | - | - | 11.0 | - | 11.0 | |||||||||||||||||||||||||||
(Gain)
loss on investments, net
|
- | - | - | - | - | - | 2.6 | 2.6 | ||||||||||||||||||||||||||||
Effect
on income before income taxes
|
$ | 0.7 | $ | 5.7 | $ | 42.2 | - | $ | 35.5 | - | $ | 11.0 | $ | 2.6 | $ | 97.7 | ||||||||||||||||||||
Year
Ended April 24, 2009
|
||||||||||||||||||||||||||||||||||||
GSA
Settlement
|
Amortization
of Intangible Assets
|
Stock-based
Compensation Expenses
|
Asset
Impairment
|
Restructuring
and Other Charges
|
Acquisitions
related (income) expense, net
|
Non-Cash
Interest Expense
|
(Gain)
Loss on Investments, Net
|
Total
|
||||||||||||||||||||||||||||
Total
revenues
|
$ | 128.7 | - | - | - | - | - | - | - | $ | 128.7 | |||||||||||||||||||||||||
Cost
of product revenues
|
- | 24.5 | 3.3 | - | - | - | - | - | 27.8 | |||||||||||||||||||||||||||
Cost
of service revenues
|
- | - | 12.3 | - | - | - | - | - | 12.3 | |||||||||||||||||||||||||||
Sales
and marketing expense
|
- | 4.4 | 65.1 | 9.4 | - | - | - | - | 78.9 | |||||||||||||||||||||||||||
Research
and development expense
|
- | - | 37.9 | - | - | - | - | - | 37.9 | |||||||||||||||||||||||||||
General
and administrative expense
|
- | - | 22.2 | - | - | - | - | - | 22.2 | |||||||||||||||||||||||||||
Restructuring
and other charges
|
- | - | - | - | 54.4 | - | - | - | 54.4 | |||||||||||||||||||||||||||
Interest
expense
|
- | - | - | - | - | - | 36.6 | - | 36.6 | |||||||||||||||||||||||||||
(Gain)
loss on investments, net
|
- | - | - | - | - | - | - | 29.6 | 29.6 | |||||||||||||||||||||||||||
Effect
on pre-tax income
|
$ | 128.7 | $ | 28.9 | $ | 140.8 | $ | 9.4 | $ | 54.4 | - | $ | 36.6 | $ | 29.6 | $ | 428.4 |
RECONCILIATION
OF NON-GAAP AND GAAP
|
||||||||||||||||
IN
THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
(In
millions, except net income per share amounts)
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
Three
Months Ended
|
Year
Ended
|
|||||||||||||||
April
30, 2010
|
April
24, 2009
|
April
30, 2010
|
April
24, 2009
|
|||||||||||||
SUMMARY RECONCILIATION OF NET
INCOME
|
||||||||||||||||
NET
INCOME
|
$ | 145.1 | $ | 68.4 | $ | 400.4 | $ | 64.6 | ||||||||
Adjustments:
|
||||||||||||||||
GSA settlement
|
- | 0.7 | - | 128.7 | ||||||||||||
Amortization
of intangible assets
|
4.9 | 5.7 | 20.5 | 28.9 | ||||||||||||
Stock-based
compensation expenses
|
37.8 | 42.2 | 159.8 | 140.8 | ||||||||||||
Asset
impairment
|
- | - | - | 9.4 | ||||||||||||
Restructuring
and other charges
|
(0.2 | ) | 35.5 | 2.5 | 54.4 | |||||||||||
Acquisitions
related (income) expense, net
|
1.2 | - | (39.9 | ) | - | |||||||||||
Non-cash
interest expense
|
13.1 | 11.0 | 50.8 | 36.6 | ||||||||||||
(Gain)
loss on investments, net
|
(1.2 | ) | 2.6 | (4.7 | ) | 29.6 | ||||||||||
Discrete
GAAP tax provision items
|
(13.1 | ) | 6.5 | (20.4 | ) | 6.9 | ||||||||||
Income
tax effect
|
(4.5 | ) | (69.8 | ) | (36.0 | ) | (135.6 | ) | ||||||||
NON-GAAP
NET INCOME
|
$ | 183.1 | $ | 102.8 | $ | 533.0 | $ | 364.3 | ||||||||
NET
INCOME PER SHARE
|
$ | 0.398 | $ | 0.205 | $ | 1.134 | $ | 0.193 | ||||||||
Adjustments:
|
||||||||||||||||
GSA settlement
|
- | 0.002 | - | 0.385 | ||||||||||||
Amortization
of intangible assets
|
0.013 | 0.017 | 0.058 | 0.086 | ||||||||||||
Stock-based
compensation expenses
|
0.104 | 0.127 | 0.452 | 0.421 | ||||||||||||
Asset
impairment
|
- | - | - | 0.028 | ||||||||||||
Restructuring
and other charges
|
(0.001 | ) | 0.106 | 0.007 | 0.163 | |||||||||||
Acquisitions
related (income) expense, net
|
0.003 | - | (0.113 | ) | - | |||||||||||
Non-cash
interest expense
|
0.036 | 0.033 | 0.144 | 0.109 | ||||||||||||
(Gain)
loss on investments, net
|
(0.003 | ) | 0.008 | (0.013 | ) | 0.088 | ||||||||||
Discrete
GAAP tax provision items
|
(0.036 | ) | 0.020 | (0.058 | ) | 0.021 | ||||||||||
Income
tax effect
|
(0.012 | ) | (0.210 | ) | (0.102 | ) | (0.405 | ) | ||||||||
NON-GAAP
NET INCOME PER SHARE
|
$ | 0.502 | $ | 0.308 | $ | 1.509 | $ | 1.089 |
NETAPP, INC. | |||||
RECONCILIATION OF NON GAAP GUIDANCE TO GAAP | |||||
EXPRESSED AS EARNINGS PER SHARE | |||||
FIRST QUARTER 2011 | |||||
(Unaudited) | |||||
First
Quarter
|
|||||
2011
|
|||||
Non-GAAP
Guidance
|
$0.43 - $0.47 | ||||
Adjustments
of Specific Items to
|
|||||
Net
Income Per Share for the First
|
|||||
Quarter
2011:
|
|||||
Stock
based compensation expense
|
(0.11) | ||||
Amortization
of intangible assets
|
(0.01) | ||||
Non
cash interest expense
|
(0.03) | ||||
Income
tax effect
|
0.03 | ||||
Total
Adjustments
|
(0.12) | ||||
GAAP
Guidance -Net Income Per Share
|
$0.31 - $0.35 |