NetApp cuts first quarter outlook sharply, cites economic concerns

NetApp cuts first quarter outlook sharply, cites economic concerns

Summary: NetApp's first quarter results will fall well short of Wall Street expectations.

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TOPICS: Storage, Hardware
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NetApp cut its outlook for the first quarter citing "increasing uncertainty in the broader macro environment."

The NetApp outlook comes as Dell and Cisco have warned that there's a pause in IT spending.

According to the storage player, first quarter revenue will be $1.40 billion to $1.50 billion, a decline of 12 percent to 18 percent from the fourth quarter. Non-GAAP earnings will be 34 cents a share to 39 cents a share.

Wall Street was expecting NetApp to report first quarter earnings of 59 cents a share on revenue of $1.6 billion. Given the large miss, it's not surprising that NetApp shares were hammered in afterhours trading, falling 20 percent.

The dismal outlook came as NetApp delivered a solid fourth quarter. The company reported fourth quarter earnings of $181 million, or 47 cents a share, on revenue of $1.7 billion, up 19 percent from a year ago. Fourth quarter non-GAAP earnings were 66 cents a share.

Wall Street was expecting fourth quarter earnings of 63 cents a share on revenue of $1.68 billion.

Although NetApp cited economic conditions, the company is also facing stiff competition from EMC.

Topics: Storage, Hardware

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