8-K: NetApp Q3 FY26: Record All-Flash Revenue, Strong Cloud Growth

NetApp reports strong third-quarter fiscal year 2026 results with a 4% year-over-year revenue increase, record all-flash array revenue, and robust public cloud growth.

Summary

• Net revenues for Q3 FY26 were $1.71 billion, representing a 4% year-over-year increase.
• GAAP earnings per share (EPS) for Q3 FY26 were $1.67, a 16% increase year-over-year.
• Non-GAAP earnings per share (EPS) reached a record $2.12 for Q3 FY26, an 11% increase year-over-year.
• All-flash array revenue grew 11% year-over-year to a record $1.0 billion, achieving an annualized net revenue run rate of $4.2 billion.
• Public Cloud revenue was $174 million in Q3 FY26, with first-party and marketplace storage services growing 27% year-over-year.
• Billings for Q3 FY26 were $1.89 billion, up 10% year-over-year, marking the ninth consecutive quarter of year-over-year growth.
• The company returned $303 million to stockholders through share repurchases and cash dividends during the quarter.
• NetApp introduced several product innovations, including agentic AI capabilities in Workload Factory, Edge-Aware Caching Insights, and various enhancements for Azure NetApp Files and Google Cloud NetApp Volumes.
• Willem Hendrickx was appointed as Senior Vice President and General Manager for EMEA and LATAM, and Paul Fipps joined the Board of Directors.
• NetApp was recognized among the top three global storage vendors by IDC in Q3 2025 and received numerous other industry awards and recognitions.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this as a very positive report, driven by strong revenue and earnings growth, record performance in key segments like all-flash arrays, and significant innovation in cloud and AI solutions, despite a decline in cash from operations.

Positives

• Net revenues increased 4% year-over-year to $1.71 billion in Q3 FY26.
• All-flash array revenue reached a record $1.0 billion, growing 11% year-over-year, with an annualized run rate of $4.2 billion.
• Public Cloud revenue from first-party and marketplace storage services grew 27% year-over-year.
• Billings increased 10% year-over-year to $1.89 billion, marking the ninth consecutive quarter of growth.
• GAAP earnings per share increased 16% year-over-year to $1.67.
• Non-GAAP earnings per share increased 11% year-over-year to a record $2.12.
• Record non-GAAP operating income of $533 million and record non-GAAP operating margin of 31.1% were achieved.
• Returned $303 million to stockholders through share repurchases and cash dividends.
• Introduced significant product innovations, including agentic AI capabilities, Edge-Aware Caching Insights, and various enhancements for AWS, Azure, and Google Cloud storage services.
• Received multiple industry accolades, including Microsoft Partner of the Year, IDC top 3 global storage vendor, GigaOm Leader, CRN Hottest Edge Companies, and recognition on Forbes' Most Trusted Companies list.

Negatives

• Cash provided by operations decreased 18% year-over-year to $317 million in Q3 FY26.
• Free cash flow decreased to $271 million in Q3 FY26 from $338 million in Q3 FY25.
• Days Sales Outstanding (DSO) increased to 70 days in Q3 FY26 from 50 days in Q3 FY25.
• Public Cloud segment revenue remained flat year-over-year at $174 million, despite growth in specific services within the segment.

Risks

• Ability to keep pace with rapid industry, technological, and market trends and changes in the markets in which the company operates.
• Ability to execute the evolved cloud strategy and introduce and gain market acceptance for products and services.
• Ability to maintain customer, partner, supplier, and contract manufacturer relationships on favorable terms and conditions.
• Global political, macroeconomic, and market conditions, including inflation, fluctuating interest rates, tariffs, changes in trade policy, regulations, monetary policy shifts, recession risks, and foreign exchange volatility and the resulting impact on demand for products.
• The impact of new or ongoing geopolitical conflicts and sanctions.
• Adoption or changes to laws, regulations, standards, or policies affecting operations, products, services, the storage industry, or AI usage.
• Material cybersecurity and other security breaches.
• The impact of supply chain disruptions on business operations, financial performance, and results of operations.
• Changes and related uncertainty in U.S. government spending or policy, including due to prolonged federal government shutdowns.
• Changes in overall technology spending by customers.
• Revenue seasonality.
• Changes in laws or regulations, including those relating to privacy, data protection, and information security.
• The timing of orders and their fulfillment.
• Ability to manage gross profit margins, including managing component costs.

Future Outlook

For the fourth quarter of fiscal year 2026, NetApp expects net revenues to be in the range of $1.795 billion to $1.945 billion. GAAP earnings per share are projected between $1.76 and $1.86, while non-GAAP earnings per share are expected to be between $2.21 and $2.31. For the full fiscal year 2026, net revenues are anticipated to be in the range of $6.772 billion to $6.922 billion. GAAP earnings per share for the full year are expected between $6.07 and $6.17, and non-GAAP earnings per share between $7.92 and $8.02.

Management Comments

• "We are pleased to announce another strong quarter with accelerating revenue and earnings growth, driven by a record quarter in all-flash array revenue, strong performance in first-party and marketplace cloud storage services, growing leadership in enterprise AI, and operational discipline."
• "Our unified data platform continues to deliver exceptional customer benefits, establishing us as the intelligent data backbone for the AI era."
• "Building on our strong portfolio and momentum, we are well-positioned to drive sustained growth and are confident in our ability to deliver long-term value for our shareholders."

Industry Context

StockSavvy.ai notes that NetApp's strong performance in all-flash arrays and public cloud storage services aligns with broader industry trends emphasizing data-intensive workloads, hybrid cloud adoption, and the increasing demand for AI-driven infrastructure. The company's focus on integrating AI capabilities into its offerings positions it well against competitors in a rapidly evolving data landscape, particularly as enterprises selectively increase storage investments alongside accelerating AI-driven server spending, as highlighted by IDC.

Comparison to Industry Standards

• Ranked among the top three global storage vendors in Q3 2025 by IDC's Worldwide Quarterly Enterprise Storage Systems Tracker.
• Named a Leader and Fast Mover in GigaOm's latest Primary Storage Radar, recognizing strength and momentum across enterprise features, innovation, and business criteria.
• CRN named NetApp one of the 50 Hottest Edge Hardware, Software, and Services Companies as part of its 2025 Edge Computing 100 List, recognizing the NetApp AI Data Engine.
• CRN named NetApp to its 2026 Cloud 100 list in the 20 Coolest Cloud Storage Companies category, recognizing its leadership in cloud-native data infrastructure.
• NetApp AFF A-Series/C-Series was a subcategory winner in CRN's 2025 Products of the Year awards for Storage: Enterprise-Class, earning top honors for revenue and profit among partner-friendly solutions.
• NetApp ONTAP was a subcategory winner for the Storage: Cloud-Focused category in CRN's 2025 Products of the Year awards, recognized for driving strong revenue and profit in cloud-focused data management.
• Placed #109 on Forbes 2026 Most Trusted Companies in America list.
• Ranked #206 on Forbes 2026 Americas Best Companies list.
• Named to The Wall Street Journal's 250 Best-Managed Companies of 2025 list.
• Forbes named NetApp #16 on its 2026 Americas Best-in-State Companies list for California.
• Triangle Business Journal ranked NetApp #28 on its 2025 list of the Triangles largest employers, recognizing its significant regional presence with 1,900 local employees.

Management Changes

Stakeholder Impact

• Shareholders: Positive impact due to strong financial performance, increased earnings, record segment revenues, and continued return of capital through dividends and share repurchases. The positive future outlook also suggests potential for continued value creation.
• Customers: Positive impact from continuous product innovation, particularly in AI-driven and cloud-native solutions across AWS, Azure, and Google Cloud, enhancing performance, security, and cost efficiency for their data infrastructure needs.
• Employees: Positive recognition as a leading technology employer (Triangle Business Journal ranking) and strong company reputation (Forbes, WSJ lists) may enhance employee morale and talent attraction.
• Partners: Positive impact through recognition (Microsoft Partner of the Year) and continued integration with hyperscalers, fostering collaboration and solution delivery, which can lead to increased business opportunities.

Next Steps

• NetApp will host a conference call to discuss these results on February 26, 2026, at 2:30 p.m. Pacific Time.
• An audio replay of the conference call will be available on the NetApp Investor Relations website after 4:30 p.m. Pacific Time on February 26, 2026.
• The next cash dividend of $0.52 per share is to be paid on April 22, 2026, to stockholders of record as of the close of business on April 3, 2026.

Key Dates

Recommendation

NetApp delivered a robust third quarter with accelerating revenue and earnings growth, driven by record all-flash array revenue and significant year-over-year growth in public cloud storage services. The company's strategic focus on AI and hybrid cloud solutions is yielding strong results, as evidenced by numerous product innovations and industry accolades. Despite a dip in cash from operations, the overall financial health, strong billings growth, and positive future outlook, coupled with consistent shareholder returns, make NetApp a compelling 'strong buy' for investors seeking exposure to the intelligent data infrastructure market.

Keywords

NetApp, NTAP, Cloud Storage, All-Flash Array, Hybrid Cloud, Public Cloud, AI Data Engine, Data Management, Enterprise AI, Financial Results, Earnings, Q3 FY26, Storage Solutions, AWS, Azure, Google Cloud, ONTAP, Data Infrastructure