Extra week added $65M services revenue and $22M opex
The first quarter of fiscal 2027 included 14 weeks, adding roughly $65 million to services revenue and $22 million to combined sales, marketing, R&D and G&A expenses.
Source: 10-Q Item 2 MD&A
Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
NetApp's Q1 FY2026 was defined by a 14-week quarter, compared with 13 weeks in the year-ago period, and by product revenue growth driven by all-flash array sales and price increases implemented in Q4 FY2026. Management attributed the increase in product revenues to higher sales of all-flash array systems, supported by those price increases, while the extra week contributed approximately $65 million of additional services revenue. Operating leverage improved materially, but supply chain inflation and higher component costs continued to pressure gross margins. Cash from operations fell year over year, even as net income rose sharply, reflecting working capital movements and restructuring charges of $56 million.
Revenue
$1.82B
+30.11% YoY
EPS (Diluted)
$1.88
+63.48% YoY
Gross Margin
78.0%
-0.5 pts YoY
Operating Income
$484M
+56.63% YoY
Source: SEC XBRL
NetApp (NTAP) reported Q1 FY2026 revenue of $1.82B, up 30.1% year over year. Operating margin was 26.6%, up 4.5 points from 22.1% a year earlier. Operating cash flow was $503M, down 25.3% year over year. NTAP's fiscal Q1 FY2026 corresponds to calendar Q3 2026.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Sep 2026 | 2.58 | 2.16 | Beat +19.4% |
| Jun 2026 | 2.43 | 2.31 | Beat +5.1% |
| Mar 2026 | 2.12 | 2.11 | Beat +0.7% |
| Dec 2025 | 2.05 | 1.92 | Beat +6.6% |
2 reported segments · SEC XBRL
Segment revenue totals $2.02B, which is the $2.02B of consolidated revenue on the income statement.
Compiled by AI from 10-Q Item 2 of this filing
The first quarter of fiscal 2027 included 14 weeks, adding roughly $65 million to services revenue and $22 million to combined sales, marketing, R&D and G&A expenses.
Source: 10-Q Item 2 MD&A
All-flash revenues rose to 72% of Hybrid Cloud segment net revenues from 64% a year earlier, driven by customer demand and Q4 FY2026 price increases.
Source: 10-Q Item 2 MD&A
Public Cloud gross margins increased by six percentage points, as cost of public cloud revenues fell 13% due to cost optimization including lower fixed asset depreciation.
Source: 10-Q Item 2 MD&A
Management approved a restructuring plan with $56 million in charges, and acquired DataPelago for $193 million to address AI and analytics data processing bottlenecks.
Source: 10-Q Item 2 MD&A
Compiled by AI from this SEC filing · 2 high, 3 medium, 0 low
NetApp bases expense levels and purchase commitments on future revenue expectations, and a significant portion of expenses are fixed. If revenue falls below expectations, the company may not be able to reduce costs quickly, harming operating results.
Source: 10-Q Item 1A Risk Factors
A significant portion of purchase commitments are firm, non-cancelable, and unconditional, requiring purchases at prices set before delivery. If market prices decline, NetApp could be obligated to buy inventory above prevailing market prices, pressuring gross margins and cash flows.
Source: 10-Q Item 1A Risk Factors
If demand is lower than anticipated, NetApp may experience excess or obsolete inventory and incur charges related to its purchase commitments, negatively affecting results.
Source: 10-Q Item 1A Risk Factors
NetApp continues to invest significantly in engineering, sales, marketing, and support; costs are often recognized before benefits, and returns may be lower or slower than expected.
Source: 10-Q Item 1A Risk Factors
Inflationary pressures and global supply chain constraints increased memory and component costs, and management expects costs to remain elevated or increase in the near term, which could continue to pressure margins.
Source: 10-Q Item 2 MD&A
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 1.82 $B | 1.40 $B | +30.11% |
Cost of Revenue $M | 606.00 $M | 461.00 $M | +31.45% |
Gross Profit $B | 1.42 $B | 1.10 $B | +29.23% |
Operating Income $M | 484.00 $M | 309.00 $M | +56.63% |
Net Income $M | 375.00 $M | 233.00 $M | +60.94% |
EPS (Basic) $ | 1.91 $ | 1.16 $ | +64.66% |
EPS (Diluted) $ | 1.88 $ | 1.15 $ | +63.48% |
R&D Expense $M | 274.00 $M | 242.00 $M | +13.22% |
Answers draw on this SEC filing and the data on this page
NTAP's Q3 FY2026 results show strong revenue growth and improved margins, driven by increased operating income and effective cost management.
NetApp delivered a strong fiscal year 2026, with revenue growing 5.6% to $6.24B, operating income surging 25.2% to $1.67B, and operating cash flow jumping 37.3% to $2.07B, reflecting disciplined cost management and expanding margins.
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