NetApp Gearing Up to Report Q2 Earnings: Here's What to Expect

NetApp, Inc. NTAP is slated to release second-quarter fiscal 2026 earnings on Nov. 25, after the closing bell.

The company expects non-GAAP earnings per share to be between $1.84 and $1.94 for the quarter. The Zacks Consensus Estimate is currently pegged at $1.89 per share, representing 1.1% growth from the year-ago level.

Net sales are anticipated to be in the range of $1.615 billion to $1.765 billion. The Zacks Consensus Estimate is pegged at $1.69 billion, implying a 1.7% increase from the prior-year reported number.

NTAP’s earnings beat estimates in three of the trailing four quarters, while matching once, delivering an average surprise of 1.68%.

Key Factors to Note for NTAP’s Q2 Earnings

NetApp has been witnessing higher demand from customers for its portfolio of modern all-flash arrays, especially the C-series capacity flash and ASA block-optimized flash. The company is focused on capitalizing on enterprise AI and advancing its all-flash and cloud portfolios, with these segments expected to drive sustained performance going forward.

NetApp’s all-flash array annualized revenue run rate rose 6% year over year in the fiscal first quarter to $3.6 billion. Strong customer engagement and growing interest in NetApp’s unified and block-optimized all-flash portfolio have allowed it to successfully displace competing all-flash and hybrid-flash deployments. Our estimate for Hybrid Cloud’s fiscal second-quarter revenues is pegged at $1.51 billion, indicating a rise of 1.1% from the year-ago level.

Increasing demand for NetApp’s cloud storage and AI solutions bodes well. In the fiscal first quarter, the company won more than 125 AI and data lake modernization deals. The company expanded its AI ecosystem and launched a new AIPod Mini with Intel.

NetApp, Inc. Price and EPS Surprise

NetApp, Inc. price-eps-surprise | NetApp, Inc. Quote

Also, NetApp’s Public Cloud segment’s revenues improved 1% to $161 million in the last reported quarter, while excluding the divested Spot business, Public Cloud revenues grew 18% year over year. First-party and marketplace cloud storage services grew 33%. Strong hyperscaler partnerships with Amazon and Microsoft position NetApp as a key player in cloud infrastructure as enterprises accelerate cloud migration. We expect the Total Public Cloud segment revenues to be $178.7 million, up 6.4% year over year in the fiscal second quarter.

Moreover, the global macroeconomic environment remains uncertain, with inflation pressures and elevated volatility. These factors might have weighed on its fiscal second-quarter results.

What Our Model Says About NTAP

Our proven model does not predict an earnings beat for NTAP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. This is not the case here.

NTAP has an Earnings ESP of -0.12% and a Zacks Rank #4 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With Favorable Combination

Here are a few companies worth considering, as our model indicates that they possess the right combination of factors to exceed earnings expectations in their upcoming releases:

Ulta Beauty, Inc. ULTA currently has an Earnings ESP of +0.24% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for revenues and earnings is pegged at $2.71 billion and $4.47 per share, respectively. Ulta Beauty is slated to report third-quarter fiscal 2026 results on Dec. 4.

American Eagle Outfitters, Inc. AEO has an Earnings ESP of +2.67% and a Zacks Rank #2 at present.

The Zacks Consensus Estimate for revenues and earnings is pegged at $1.32 billion and 43 cents per share, respectively. Abercrombie & Fitch is slated to report third-quarter fiscal 2025 results on Dec. 2.

lululemon athletica inc. LULU currently has an Earnings ESP of +0.56% and a Zacks Rank #3.

The Zacks Consensus Estimate for revenues and earnings is pegged at $2.49 billion and $2.22 per share, respectively. LULU is scheduled to report third-quarter fiscal 2025 results on Dec. 4.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research