November 14, 2018 / 9:12 PM / a month ago

NetApp's second quarter beats, but weak forecast weighs on shares

(Reuters) - Data storage equipment maker NetApp Inc (NTAP.O) beat quarterly sales and profit estimates on Wednesday, but a soft third-quarter revenue forecast sent its shares down 5 percent.

NetApp said it expected revenue of between $1.55 billion and $1.65 billion (£1.20 billion and £1.28 billion) in the third quarter, the mid-point of which was in line with analysts’ average estimate, according to IBES data from Refinitiv.

The Sunnyvale, California-based company’s shares, which have gained 41 percent this year, were down at $73.89 in extended trading.

The company’s net income jumped 39 percent to $241 million, or 91 cents per share, in the second quarter ended Oct. 26, helped by its foray into the data management business.

“I think it’s clearly the cornerstone of our success in the market,” Chief Executive George Kurian said, referring to the data management business.

Kurian, who took the helm in 2015, has stepped up efforts to transform the legacy storage firm into a data management firm, as more companies look for ways to manage and find insights from vast amounts of data.

Excluding items, the company earned $1.06 per share, while analysts on average had expected a profit of 99 cents.

Total revenue rose 7 percent to $1.52 billion, edging past estimates of $1.51 billion.

Reporting by Munsif Vengattil in Bengaluru; Editing by Maju Samuel

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