NetApp: record quarter with 30% revenue growth, but market eyes valuation

2 сентября NetApp, Inc. раскрыла результаты за первый квартал 2027 финансового года (закончился 31 июля 2026 года). Выручка выросла на 29,9% до 2 025 млн долл., EBITDA – на 43,6%, чистая прибыль – на 60,9%. Акции после выхода отчёта снизились на 1,3%, но с тех пор прибавили 0,9%. Вердикт – «привлекательно»: рост ускорился, маржинальность расширяется, а оценка по EV/EBITDA (18,3x) лишь немного выше собственного трёхлетнего среднего (13,1x), при этом по модели портала потенциал составляет +28%.

Key takeaways

— Revenue grew 30% driven by record all-flash array and public cloud sales

— EBITDA margin expanded to 25.5% from 23.1% a year ago on operating leverage

— Net profit rose 61% – faster than revenue – on higher operating income and a lower effective tax rate

— Operating cash flow fell 25% due to higher inventories and receivables

— Dividend raised to $0.52 per share, yield 1.1% at the current price

— Company raised full-year FY2027 guidance, expecting revenue of $7.975–8.225 billion

— Net debt rose to $663 million, but the ratio to EBITDA is only 0.32

Attractiveness

Key figures, USD bn

Revenue grew 30% driven by record all-flash array and public cloud sales

In the first quarter of fiscal year 2027 (ended July 31, 2026), NetApp, Inc. revenue reached $2,025 million, up 29.9% year-over-year. This is a record quarterly figure for the company. The main driver was all-flash array sales, which grew 47% to $1,309 million, and the Public Cloud segment, up 28% to $206 million.

The Hybrid Cloud segment, which includes products and services, grew 30% to $1,819 million, with product revenue jumping from $654 to $987 million – a 51% increase. The company attributes this to the success of the NetApp platform for AI and hybrid multi-cloud environments, as well as an expanding customer base. Billings (revenue plus change in deferred revenue) grew 36% to $2,057 million, indicating acceleration in future revenue.

EBITDA margin expanded to 25.5% from 23.1% a year ago on operating leverage

EBITDA for the reported quarter rose 43.6% to $517 million, and the EBITDA margin expanded from 23.1% to 25.5%. Operating profit increased from $309 to $484 million – a 56.6% rise. GAAP operating margin was 23.9% versus 19.8% a year ago.

The margin expansion was driven by revenue growing faster than expenses: selling and marketing costs rose only 10%, while R&D and G&A increased 13% and 17%, respectively. The report also includes restructuring charges of $56 million, which the company excludes from non-GAAP measures. Without them, operating margin would have been even higher.

Net profit rose 61% – faster than revenue – on higher operating income and a lower effective tax rate

Net profit for the quarter was $375 million versus $233 million a year ago – a 60.9% increase. Net margin expanded from 14.9% to 18.5%. GAAP earnings per share rose from $1.15 to $1.88, and non-GAAP EPS from $1.55 to $2.58.

Profit growth was driven by operating leverage and a lower effective tax rate, which fell from 23.4% to 22.5%. The report also includes one-off items: restructuring charges of $56 million and acquisition-related expenses of $1 million for DataPelago. Excluding these, non-GAAP net profit would have been $515 million.

Operating cash flow fell 25% due to higher inventories and receivables

Operating cash flow for the quarter was $503 million versus $673 million a year ago – a 25% decline. The reason is a significant build-up in inventories ($176 million outflow versus an inflow of $54 million a year ago) and higher accounts receivable, though less than last year.

Capital expenditures rose from $53 to $102 million, reflecting investments in infrastructure. Free cash flow fell 35% to $401 million. Nevertheless, the company continues to generate sufficient cash flow to fund dividends and share buybacks.

Dividend raised to $0.52 per share, yield 1.1% at the current price

The company declared a quarterly dividend of $0.52 per share, payable on October 28, 2026, to stockholders of record as of October 9, 2026. The trailing twelve-month dividend yield is 1.13%.

At the current share price of around $183, the annual dividend (approximately $2.08 per share) provides a yield of about 1.1%. This is below the average yield in recent years, reflecting the high valuation of the shares. The company continues to pay dividends despite higher capital expenditures and acquisitions.

Company raised full-year FY2027 guidance, expecting revenue of $7.975–8.225 billion

NetApp, Inc. raised its full-year FY2027 guidance: revenue is expected in the range of $7.975–8.225 billion, implying growth of roughly 14–18% over the prior year. The non-GAAP EPS forecast was raised to $9.73–10.03, significantly above the previous target.

For the second quarter of fiscal 2027, the company expects revenue in the range of $2.025–2.175 billion and non-GAAP EPS of $2.54–2.64. The guidance raise reflects management's confidence in sustained demand for AI and hybrid cloud products.

Net debt rose to $663 million, but the ratio to EBITDA is only 0.32

At the end of the quarter, the company's net debt stood at $663 million, up by 1.8 billion RUB (converted) from the previous reporting date. However, the ratio of net debt to EBITDA for the trailing twelve months is only 0.32 – a low level of leverage.

The increase in debt is related to the acquisition of DataPelago, Inc. for $78 million and higher capital expenditures. Nevertheless, the company maintains significant liquidity: cash and investments total $3.576 billion. The debt burden remains comfortable and does not constrain the company's ability to pay dividends and repurchase shares.

Valuation on the latest reported figures

Bottom line

The quarter was strong: revenue grew 30%, margins expanded, and guidance was raised. Growth was driven not by one-offs but by sustained demand for all-flash arrays and cloud services, as confirmed by accelerating billings. However, operating cash flow declined due to higher inventories, which is worth monitoring. At the current price, the shares trade at a premium to their own history, but the portal's model implies +28% upside, making the stock attractive for long-term investors.