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- **Revenue resilience**: $1.71B Q2 (3% YoY), driven by 9% All-Flash growth and 32% Public Cloud expansion.
- **AI leadership**: 200+ AI deals, AFX/AIDE launches, and 76% YoY Keystone growth highlight strategic momentum.
- **Profitability standout**: 72.6% gross margin (vs. 71.1% Q1), $2.05 EPS (10% YoY), and record deferred revenue ($4.45B).
- **Cloud dominance**: 83% Public Cloud gross margin, 32% YoY services growth, and AWS/Azure/GCP AI integrations.
- **Risk mitigation**: Secured component pricing visibility, with U.S. public sector headwinds expected to resolve.

**【CEO Summary Section】**
- Q2 revenue of $1.71 billion, up 3% YoY (4% ex Spot business). All-Flash and Public Cloud (70% of revenue) drove growth, with AI solutions seeing strong demand.
- Launched AFX (AI-optimized storage platform) and AIDE (AI data engine), enabling seamless integration with hyperscalers and enterprise workflows. 200+ AI deals closed, up from 125 in Q1.
- All-Flash revenue grew 9% YoY to $1 billion (annualized run rate $4.1B). Public Cloud services revenue up 32% YoY.
- Cyber resilience innovations, like Ransomware Resilience service, helped win new customers, including a major Asian life insurance company.

**【CFO Financial Commentary】**
- Non-GAAP EPS of $2.05 (10% YoY growth), exceeding high end of guidance. Gross margin 72.6%, up 1.5pts QoQ, driven by product (59.5%) and cloud (83%) margins.
- Q3 guidance: Revenue $1.69B (±$75M), EPS $2.01-$2.11. FY26 revenue $6.625-$6.875B, EPS $7.75-$8.05.
- Free cash flow $78M, with $353M returned to shareholders via buybacks and dividends.

**【Q&A Highlights】**
- **Component Pricing**: Secured visibility for next 2+ quarters; product gross margin stable at ~59.5%. Cloud (80-85% GM) and Keystone (39% YoY unbilled RPO) offset potential headwinds.
- **AI Adoption**: 200+ Q2 deals (vs. 125 Q1), with 45% data prep/modernization, 25-30% training/fine-tuning. AFX gaining traction but still in qualification phase.
- **Public Sector**: U.S. public sector down due to shutdown, but non-U.S. growth offset (e.g., 76% YoY Keystone). Expect normalization post-shutdown.
- **Cloud Growth**: First-party/marketplace cloud services up 32% YoY, highest QoQ incremental revenue in cloud history. Focus on AI/ML workloads in AWS, Azure, GCP.
- **Supply Chain**: No current shortages; dynamic team manages volatility. Will lock in prices if needed, with ability to pass through costs quickly.


NetApp, Inc. (NTAP) Q2 2026 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

NTAP

NTAP fundamentals

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