NetApp blames tightwad bankers for lower forecast
Choppy waters ahead in Q4
Network Appliance had a strong fiscal third quarter, but warns that current quarter revenue could suffer because banks are cutting orders.
CEO Dan Warmenhoven told analysts in a conference call yesterday that spending from financial institutions — some of NetApp's largest customers — have dropped due to a shaky economic climate. Major banks, such as France's Société Générale are among those tightening their purse strings.
For the quarter ended January 25, NetApp reported net income of $101.8m, an increase from $66.5m a year earlier.
Revenues for Q3 were $884m, an increase of 21 per cent compared to $729.3m the same quarter last year.
NetApp expects fourth-quarter revenues of $915m to $945m, a growth of 14 per cent to 18 per cent year-over-year. Analysts had expecting to see a much higher figure - near $966.5m.
Warmenhoven said the lowered guidance isn't an indication of any failure on NetApp's part, but a reflection of smaller customer budgets.
The company is trying to reduce its reliance on the financial sector. And it is stretching out into new areas of storage, such introducing de-duplication features in primary storage. ®