NetApp Jumps After Forecast Tops Estimates on Storage Demand

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NetApp Inc. issued a quarterly revenue forecast that exceeded analysts’ estimates as stronger demand for data-storage services drives higher sales. The shares jumped the most since May.

The data-management company said it’s expecting revenue of $1.4 billion to $1.5 billion for the fiscal second quarter ending in October. Analysts are projecting, on average, sales of $1.39 billion for the period.

George Kurian, who was appointed as NetApp’s chief executive officer in June, is seeking to turn around the provider of hardware, software and services for storing data, which has seen shrinking sales for the past seven quarters. NetApp has been struggling as consumers shift toward cloud storage, according to Bloomberg Intelligence analysts.

“We are pivoting to better address the changing industry, to improving our own execution and to enhancing value for our shareholders,” Kurian said Wednesday in a statement.

NetApp shares rose 3.4 percent to close at $30.78 Thursday, leaving the stock down 26 percent so far this year.

NetApp also predicted a second-quarter profit, excluding charges, above estimates, of 55 cents to 60 cents a share. Analysts projected profit of 46 cents.

For the first quarter, which ended July 31, the Sunnyvale, California-based company reported profit, excluding some items, of 29 cents a share on sales of $1.34 billion, also beating analysts’ estimates.

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