: NetApp stock drops 5% as outlook reflects ‘weakening IT spending’


NetApp Inc. NTAP, -0.18% shares declined in the extended session Wednesday after the cloud-based data-services company’s forecast came in light as weak business spending poses a challenge. NetApp shares fell as much as 5% after hours, following a 0.2% decline in the regular session to close at $65.83. NetApp forecast adjusted earnings of $1.30 to $1.40 a share on revenue of $1.48 billion to $1.63 billion for the fourth quarter, and $5.30 to $5.55 a share for the year. Analysts surveyed by FactSet had estimated $1.43 a share on revenue of $1.66 billion for the fourth quarter, and $5.41 a share for the year. The company reported fiscal third-quarter net income of $65 million, or 30 cents a share, compared with $252 million, or $1.10 a share, in the year-ago period. Adjusted earnings, which exclude stock-based compensation expenses and other items, were $1.37 a share, compared with $1.44 a share in the year-ago period, while revenue fell to $1.53 billion from $1.61 billion in the year-ago quarter. Analysts had forecast $1.28 a share on revenue of $1.61 billion. “In Q3, we executed well on the elements under our control in the face of a weakening IT spending environment and continued cloud cost optimization,” said George Kurian, NetApp chief executive, in a statement. “We are confident that we remain well positioned to take advantage of the secular growth trends of data-driven digital and cloud transformations. Building on that solid foundation, we are sharpening our execution to accelerate near-term results while strengthening our position when the spending environment rebounds.”

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