New Delhi, India – August 28, 2025 – NetApp, Inc., a global leader in data management and cloud services, has released its financial results for the first quarter of fiscal year 2026. The company’s Form 10-Q filing outlines steady performance. It showed modest revenue growth and a sharpened focus on cloud innovation and AI infrastructure.
In the three months ending July 2025, NetApp posted net revenues of $1.56 billion. This was a 1% increase compared to the same period last year. The growth was largely driven by a rise in services revenue. However, product sales in certain segments saw a decline.
Despite the modest revenue uptick, net income fell to $233 million, down from $248 million a year earlier. The company attributed the dip to a higher effective tax rate. Basic earnings per share stood at $1.16. Diluted earnings per share came in at $1.15. Both were slightly lower than last year’s figures.
Still, NetApp’s operating income rose to $309 million, representing 20% of net revenues. This was up from 18% in the prior year. The company maintained a strong gross margin of 70.4%, consistent with its performance in the previous year.
NetApp continues to divide its business into two main segments: Hybrid Cloud and Public Cloud. The Hybrid Cloud segment includes software, hardware, and support services. The Public Cloud segment focuses on products delivered as-a-service, such as cloud storage and data services.
While Hybrid Cloud product revenues declined due to lower sales of hybrid systems, the company saw stronger demand for all-flash array systems. This helped offset some of the losses. The Public Cloud segment remained stable, reflecting NetApp’s ongoing transition toward cloud-first solutions.
Geographically, the Americas led the way with $791 million in net revenues, showing growth over the previous year. The EMEA region (Europe, Middle East, and Africa) contributed $503 million. The Asia-Pacific region held steady at $265 million. This regional performance highlights NetApp’s balanced global footprint. The Americas continue to be the company’s strongest market.
Looking ahead, NetApp plans to invest between $125 million and $175 million in capital expenditures for the remainder of fiscal 2026. These investments will support the company’s efforts to modernize data centers, strengthen cybersecurity, and build scalable data pipelines for AI workloads. The company is also closely monitoring regulatory developments, including the One Big Beautiful Bill Act (OBBB) and Pillar Two rules. These could impact its operations and tax strategies.
During the quarter, NetApp repurchased 3 million shares of its common stock and declared a cash dividend of $0.52 per share. This reinforces its commitment to returning value to shareholders. Additionally, the company repaid its 1.875% Senior Notes due in June 2025. This move affected its cash flow but improved its liquidity management.
NetApp’s Q1 FY2026 results reflect a company in transition, balancing steady financial performance with strategic shifts toward cloud services and AI infrastructure. While net income dipped slightly, the rise in operating margins and continued investment in future-ready technologies signal confidence in long-term growth.
As the tech landscape evolves, NetApp appears focused on staying ahead. It is modernizing its offerings and expanding its cloud capabilities, positioning itself as a key player in the data-driven future.
