NetApp shares shocked by profit warning
Stock drops nearly 20 per cent
In brief NetApp stock plunged nearly 20 per cent in after hours trading when the storage supplier warned first quarter revenue may be down further than previously expected.
The company's preliminary results today are below the previously gloomy forecast released in May. When NetApp reports its earnings on August 15, revenue is now expected to be in the range of $684m to $688m. The figure is short of the $745m to $753m it had forecast during its Q4 07 report.
"We are disappointed with our Q1 results," NetApp CEO, Dan Warmenhoven said in a statement. "We believe our performance was impacted by some continued softness in enterprise storage spending, most notably in our existing customer accounts in the U.S. and parts of Europe."
The lowered expectations would put revenue growth between 10 to 11 per cent year-over-year in the first quarter. The company vowed to slow spending and hiring to compensate for the slump. ®