NETAPP REPORTS FOURTH QUARTER AND FISCAL YEAR 2014 RESULTS

Achieves Fourth Quarter and Full Fiscal Year Non-GAAP Earnings per Share Growth of 22% Year over Year 

• Net revenues for Q4 of $1.649 billion; $6.325 billion for fiscal year 2014
• Branded revenue for fiscal year 2014 grew 4% year over year
• Cash from operations for fiscal year 2014 of $1.350 billion; free cash flow 18% of revenue

Sunnyvale, CA—May 21, 2014—NetApp (NASDAQ: NTAP) today reported financial results for the fourth quarter and fiscal year 2014, ended April 25, 2014.

Fourth Quarter Financial Results

Net revenues for the fourth quarter of fiscal year 2014 were $1.649 billion. GAAP net income for the fourth quarter of fiscal year 2014 was $197 million, or $0.59 per share,1compared to GAAP net income of $174 million, or $0.47 per share, for the comparable period of the prior year. Non-GAAP net income for the fourth quarter of fiscal year 2014 was $284 million, or $0.84 per share,2compared to non-GAAP net income of $253 million, or $0.69 per share, for the comparable period of the prior year.

Fiscal Year 2014 Financial Results

Net revenues for fiscal year 2014 were $6.325 billion. GAAP net income for fiscal year 2014 was $638 million, or $1.83 per share,1compared to GAAP net income of $505 million, or $1.37 per share, for the comparable period of the prior year. Non-GAAP net income for fiscal year 2014 was $968 million, or $2.78 per share,2compared to non-GAAP net income of $841 million, or $2.28 per share, for the comparable period of the prior year.

Cash, Cash Equivalents, and Investments

NetApp ended fiscal year 2014 with $5.003 billion of total cash, cash equivalents, and investments and generated $1.350 billion in cash from operations. During fiscal year 2014, the Company returned $2.083 billion to shareholders through share repurchases and cash dividends.

The Company increased the next dividend to $0.165 per share to be paid on July 22, 2014 to shareholders of record as of the close of business on July 10, 2014.

“NetApp saw market share gains and delivered a solid operational performance in fiscal year 2014, highlighted by margin expansion and strong cash generation,” said Tom Georgens, Chairman and CEO. “With solutions like clustered Data ONTAP, our broad flash portfolio and differentiated approach to the cloud, customers are solving the challenges of today, with innovative solutions that pave the way for the future.”

Q1 Fiscal Year 2015 Outlook

The Company provides the following financial guidance for the first quarter of fiscal year 2015:

• Net revenues are expected to be in the range of $1.420 billion to $1.520 billion
• GAAP earnings per share is expected to be in the range of $0.32 to $0.37 per share
• Non-GAAP earnings per share is expected to be in the range of $0.53 to $0.58 per share

Business Highlights 
In its fourth quarter of fiscal year 2014, NetApp continued to help global enterprises achieve success with one of the industry’s broadest portfolios of flash-accelerated, cloud-integrated storage and data management solutions. Its industry-leading enterprise storage systems and software meet customer needs across a wide range of application workloads. Highlights include:

• NetApp Introduces Unified Scale-Out Storage Systems for the Hybrid Cloud Era. The new FAS8000 series unified storage systems are NetApp’s most powerful and feature-rich scale-out storage systems with superior flexibility to simplify complex upgrades as IT needs change.
• NetApp Introduces FlexArray Virtualization Software. With new FlexArray virtualization software, NetApp® V-Series becomes a software option that can be licensed on the FAS8000 to virtualize and manage multivendor data storage platforms, paving the way for software-defined storage.
• NetApp Announces the Latest Release of Clustered Data ONTAP®. The latest release of the clustered Data ONTAP operating system, version 8.2.1, helps organizations seamlessly scale out operations and manage data consistently, without disruption across both private and public cloud environments.
• NetApp Teams with SAP to Set New Record for World's Largest Data Warehouse. SAP announced that it teamed with partners, including NetApp, to generate a world record for the largest data warehouse. The NetApp E5460 storage system was chosen for its ability to handle large data volumes, enormous throughput requirements, consistent high performance and availability demands, all at the same time.
• NetApp Again Honored as a Channel Champion. CRN’s 24th annual Channel Champions awards highlights vendor partners voted to be the best-of-the-best by the solutions providers for 2014. NetApp moved into the No. 2 position on this year's list in the Enterprise Network Storage category.

Webcast and Conference Call Information

NetApp will host a conference call to discuss these results today at 2:00 p.m. Pacific Time. To access the live webcast of this event, visit the NetApp Investor Relations website at investors.netapp.com. In addition, this press release and other information related to the call will be posted on the Investor Relations website. An audio replay will also be available on the website after 4:00 p.m. Pacific Time today.

Historical supplemental data tables, providing historical multi-period financial information, are also available on our Investor Relations website at investors.netapp.com.

About NetApp

NetApp creates innovative storage and data management solutions that deliver outstanding cost efficiency and accelerate business breakthroughs. Our commitment to living our core values and consistently being recognized as a great place to work around the world are fundamental to our long-term growth and success, as well as the success of our pathway partners and customers. Discover our passion for helping companies around the world go further, faster at www.netapp.com.

“Safe Harbor” Statement Under U.S. Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include all of the statements under the Q1 Fiscal Year 2015 Outlook section relating to the financial guidance for the first quarter of fiscal year 2015; the benefits to us and our customers of our products and services, including clustered Data ONTAP and our  flash storage solutions. All of these forward-looking statements involve risk and uncertainty. Actual results may differ materially from these statements for a variety of reasons, including, without limitation, general economic and market conditions, changes in U.S. government spending, revenue seasonality, and matters specific to our business, such as customer demand for and acceptance of our products and services and changes in storage consumption models. These and other equally important factors are described in reports and documents we file from time to time with the Securities and Exchange Commission (SEC), including the factors described under the sections titled “Risk Factors” in our most recently submitted Annual and Quarterly Reports on Forms 10-K and 10-Q, respectively. We disclaim any obligation to update information contained in these forward-looking statements whether as a result of new information, future events, or otherwise.

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NetApp, the NetApp logo, Go further, faster, and Data ONTAP are trademarks of NetApp, Inc. All other marks are the property of their respective owners.

1GAAP earnings per share is calculated using the diluted number of shares for all periods presented.

2Non-GAAP net income excludes the amortization of intangible assets, stock-based compensation, acquisition-related income and expenses, restructuring and other charges, asset impairments, non-cash interest expense associated with our debt, net losses or gains on investments, and our GAAP tax provision, but includes a non-GAAP tax provision based upon our projected annual non-GAAP effective tax rate for the first three quarters of the fiscal year and an actual non-GAAP tax provision for the fourth quarter of the fiscal year. Non-GAAP earnings per share is calculated using the diluted number of shares for all periods presented. A detailed reconciliation of our non-GAAP to GAAP results can be found at http://investors.netapp.com.

NetApp Usage of Non-GAAP Financials

The Company refers to the non-GAAP financial measures in making operating decisions because they provide meaningful supplemental information regarding the Company's ongoing operational performance. Non-GAAP net income excludes the amortization of intangible assets, stock-based compensation, acquisition-related income and expenses, restructuring and other charges, asset impairments, non-cash interest expense associated with our debt, net losses or gains on investments, and our GAAP tax provision, but includes a non-GAAP tax provision based upon our projected annual non-GAAP effective tax rate for the first three quarters of the fiscal year and an actual non-GAAP tax provision for the fourth quarter of the fiscal year. We have excluded these items in order to enhance investors’ understanding of our ongoing operations. The use of these non-GAAP financial measures has limitations and they should not solely be used to evaluate our Company without reference to their corresponding GAAP financial measures. As such, we provide both non-GAAP financial measures in conjunction with GAAP financial measures.

These non-GAAP financial measures are used to: (1) measure Company performance against historical results, (2) facilitate comparisons to our competitors’ operating results, and (3) allow greater transparency with respect to information used by management in financial and operational decision making. In addition, these non-GAAP financial measures are used to measure Company performance for the purposes of determining employee incentive plan compensation. We have historically reported similar non-GAAP financial measures to our investors and believe that the inclusion of comparative numbers provides consistency in our financial reporting at this time.

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Om NetApp
NetApp skapar innovativa lösningar för lagring och datahantering som ger enastående kostnadseffektivitet och påskyndar innovation. Vi arbetar för långsiktig tillväxt och framgång, även för våra pathway-partner och kunder. Vi har uppmärksammats som ett bra ställe att arbeta på runt om i världen. Läs om vårt engagemang för att hjälpa företag jorden runt att nå längre, snabbare på www.netapp.com.

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