NetApp Inc. (NASDAQ: NTAP) stock fell 4.2% on 24th may pre market session as the company’s outlook was below estimates. The company has posted the non-GAAP net income of $288 million, compared to non-GAAP net income of $239 million in the fourth quarter of fiscal 2017.
NTAP in the fourth quarter of FY 18 has reported the adjusted earnings per share of $1.05, beating the analysts’ estimates for the adjusted earnings per share of $1.01. The company had reported the adjusted revenue growth of 11 percent to $1.64 billion in the fourth quarter of FY 18, beating the analysts’ estimates for revenue of $1.6 billion. The company has achieved over $1 billion in product revenue, which rose by 19% year-over-year, reflecting the continued strength of the strategic products, as well as a 4.5-point currency benefit.
Moreover, the combination of hardware maintenance and other services and software maintenance revenues of $630 million were flat year-over-year and increased 4% sequentially, which reflects improved execution on renewals and continued growth in product revenue. The company in the fourth quarter has posted the gross margin of 63%, which is above the high end of the company’s guidance range. Product gross margin is of 51.5%, has increased 2.6 points year-over-year, reflecting improved sales discipline and some currency benefit. However, both of hardware maintenance and other services gross margin and software maintenance gross margin were relatively flat year-over-year.
Additionally, at the end of the fourth quarter 2018, the company had Cash, Cash Equivalents and Investments of $5.4 billion. The Cash from Operations is of $494 million in the Q4 2018, compared to $365 million in the fourth quarter of fiscal 2017. Further, during the fourth quarter, NTAP has repurchased $344 million of the shares and reduced the outstanding commercial paper by nearly $250 million. NTAP has authorized a new $4 billion share repurchase program and declared Q1 FY 19 cash dividend of $0.40 per share, which will be paid on July 25th.
For the first quarter of 2019, NTAP expects earnings per share in the range of $0.76-$0.82, versus the consensus of $0.78. NTAP expects Q1 2019 revenue in the range of $1.365-1.465 billion, versus the consensus of $1.42 billion.