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Aug. 1, 2019, 4:26 p.m. EDT

NetApp stock plunges 13% after warning that earnings, revenue will come in well below forecast

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By Jeremy C. Owens

NTAP

NetApp Inc. /zigman2/quotes/209297588/composite NTAP +1.40% said Thursday afternoon that its fiscal year got off to a worse start than expected, and shares plunged more than 13% in late trading. The data-storage company said that it expects to report earnings of 30 cents to 35 cents a share on sales of $1.22 billion to $1.23 billion for its fiscal first quarter, with adjusted earnings of 55 cents to 60 cents a share. That is lower than NetApp's forecast, which called for earnings of 56 cents to 64 cents a share on sales of $1.32 billion to $1.47 billion, with adjusted earnings of 78 cents to 86 cents a share. Analysts on average were projecting adjusted earnings of 83 cents a share on sales of $1.39 billion, according to FactSet. NetApp also revised its full-year guidance, from expectations for single-digit sales growth to a revenue decline of 5% to 10%, and said investors should not rely on any of the company's forecasts delivered in May. NetApp did not explain the reason for missing its forecast, but planned a conference for 2 p.m. Pacific time. "While we are disappointed that our preliminary results for the first quarter are lower than we had previously anticipated, we remain confident in our long-term strategy and the health of our business model," Chief Executive George Kurian said in the announcement. NetApp shares were halted just after the close of the regular trading session, and fell more than 13% in after-hours trading after they began to trade again about 20 minutes later. NetApp plans to fully report quarterly earnings on Aug. 14. Shares have declined 26.5% in the past year, as the S&P 500 index has gained 5.9%.

/zigman2/quotes/209297588/composite
US : U.S.: Nasdaq
$ 42.80
+0.59 +1.40%
Volume: 2.43M
Aug. 7, 2020 4:00p
P/E Ratio
12.07
Dividend Yield
4.49%
Market Cap
$9.50 billion
Rev. per Employee
$601,456
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