EARNINGS FINANCIALS AI Sep 03, 2026
NetApp reported Q1 FY27 (quarter ended July 31, 2026) after the close on September 2: net revenues of $2.025 billion, up 30% year over year — record quarterly net revenues, with management saying it exceeded guidance "on every metric." Billings were $2.057 billion (+36%), GAAP EPS $1.88 (+63%) and non-GAAP EPS $2.58 (+66%, a record), on a 23.9% GAAP / 31.9% non-GAAP operating margin. The Hybrid Cloud segment grew 30% to $1.819 billion; Public Cloud grew 28% to $206 million (a record).
The growth engine is flash plus AI attach: all-flash array net revenue hit a record $1.3 billion, up 47% year over year — well ahead of the company's 30% overall growth. NetApp also announced the acquisition of DataPelago, an AI data infrastructure company, framed as enabling "computing where data is created and stored" — pushing query and processing work next to the storage tier instead of shipping data to a GPU cluster. Supporting product news in the quarter: StorageGRID 12.1 with a federated global namespace aimed at AI data pipelines, Trident 26.06, GA of Azure NetApp Files large files up to 64 TiB plus the ANF Object REST API, and an expanded Cisco collaboration extending FlexPod toward AI. Guidance: Q2 FY27 revenue of $2.025–2.175 billion, and full-year FY27 raised to $7.975–8.225 billion revenue with $9.73–10.03 non-GAAP EPS. The $0.52 dividend pays October 28. One item to watch: operating cash flow was $503 million (−25% YoY) and free cash flow $401 million (−35%); the release gives no driver, so treat that as unexplained rather than alarming.
The admin lesson: AFA growing 47% while overall revenue grows 30% tells you where NetApp's engineering and partner energy (Cisco, TCS, SK Telecom) is going: the flash-and-AI-pipeline sale. Expect ONTAP, AIPod/FlexPod AI reference architectures, and StorageGRID features to keep chasing GPU checkpoint and inference data workloads. When refreshing AFF/ASA capacity this year, AI capability will be priced into the conversation — hold vendors to MLPerf-class evidence at your model size (see our MLPerf Storage v3.0 note); and StorageGRID 12.1's federated namespace is worth lab-testing if you run multi-site object storage for AI or analytics data. The DataPelago deal also signals NetApp will buy compute-near-data technology — a direction that may change what ONTAP and StorageGRID are asked to run, not just store.
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