NetApp is Focused On Software Defined Storage For Its Growth

Grazed from GuruFocus. Author: Editorial Staff.

The cloud and the cloud computing technologies are witnessing a major boom, and the market is predicted to continue growth. The growth of this market is due to the fact of more and more businesses are now moving into the cloud environment as the cloud matures. It won’t be a myth to say that various IT organizations are into a metamorphosis by adopting cloud technologies in their product portfolio. One such company is NetApp (NTAP), which is focused on delivering ground-breaking solutions to broaden its customer base and to influence its top and bottom line. NetApp is now primarily focusing the storage and cloud computing technologies and is striving to acquire a wider market.

Financials

The company recently released its third quarter 2014 results. It recorded a sequential quarterly growth by 4% for total revenue of $1.61 billion. But on a year-over-year basis it was down by 1%. The revenue even missed the consensus estimate of $1.64 billion but was in the range of management’s estimate of $1.575 billion to $1.675 billion. The year-over-year decline was mainly due to a decline of 22.3% from the OEM revenues. This was partly offset by an increase of 1.8% branded revenue. On a year-over-year basis, earnings improved 14.5%…

Per segment, Product revenue comprises 63% of total revenue at $1.02 billion, 4.3% down from the year-ago quarter. Software revenue contributes to 14% of the total revenue and was marginally down by 0.7% year over year to a record $227 million. Twetny-three percent of revenue is from the Services, which was the only segment which recorded a growth by 7.9% year over year to record $368 million…

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