NetApp 2026 Q2 Earnings EPS Surges 4.1%, Net Income Rises 2.0%

NetApp (NTAP) reported fiscal 2026 Q2 earnings on Nov 26, 2025, with revenue rising 2.8% year-over-year to $1.71 billion. The company exceeded revenue expectations by $20 million and Non-GAAP EPS by $0.17, while raising full-year guidance to a $7.75–$8.05 midpoint, reflecting strong demand in AI and cloud solutions.

Revenue

Product revenues reached $788 million, while support services contributed $647 million. Professional and other services added $99 million, and public cloud revenue totaled $171 million. Collectively, these segments drove a 3% year-over-year revenue increase, with 70% of total revenue stemming from high-margin All-Flash and Public Cloud solutions.

Earnings/Net Income

NetApp’s EPS rose 4.1% to $1.53 in Q2 2026, outpacing the $1.47 reported in the prior year. Net income grew by 2.0% to $305 million, reflecting improved profitability. The 4.1% EPS increase underscores continued earnings momentum despite modest net income growth.

Post-Earnings Price Action Review

The strategy of buying NetApp shares after its revenue beat expectations on the financial report release date and holding for 30 days resulted in an 8.61% return over the past three years. However, this performance lagged significantly behind the benchmark return of 65.99%, with an excess return of -57.38% and a CAGR of 2.81%. The strategy had a maximum drawdown of 0.00% and a Sharpe ratio of 0.09, indicating a low-risk profile but modest returns compared to the market.

CEO Commentary

CEO George Kurian highlighted NetApp’s Q2 performance with $1.71 billion in revenue (up 3% YoY), driven by AI and cloud solutions. The company’s operating margin hit a record 31.1%, and leadership emphasized confidence in sustained growth.

Guidance

NetApp raised its full-year 2026 EPS guidance to a midpoint of $7.90, reflecting optimism in AI and all-flash storage demand. Q3 revenue is projected between $1.615 billion and $1.765 billion, with non-GAAP gross margins expected to range from 71.3% to 72.3%.

Additional News

1. Dividend Declaration: NetApp declared a $0.52/share quarterly dividend, consistent with prior payouts, yielding 1.87% annually.

2. Guidance Raise: The company increased full-year EPS guidance to $7.75–$8.05, driven by strong AI and cloud adoption.

3. Product Launches: NetApp unveiled the AFX storage platform and AI data engine AIDE, enhancing its hybrid cloud offerings to meet growing demand for AI workloads.

NetApp’s Q2 results highlight strategic momentum in AI and cloud solutions, with improved margins and raised guidance. The company’s focus on innovation and operational efficiency positions it to capitalize on high-growth markets.