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NetApp Annual Report, Year Ended Apr 28, 2000

Filing Date
Filed July 12, 2000
Period End
April 28, 2000
Security
NTAP
In the record · 2016–202610-K1110-Q328-K97

NTAP filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 97 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Dec ’16Dec ’16
  2. FY2019 annual report10-K · Jun ’19Jun ’19
  3. Leadership change8-K · Sep ’21Sep ’21
  4. Leadership change8-K · Sep ’25Sep ’25

01—Abstract

Summary

Summary of the 10-K filed July 12, 2000. Cited figures are marked; the original filing is the authoritative source.

Network Appliance, Inc. reported fiscal 2000 (year ended April 30, 2000) net sales of $579.3 milliona, up from $289.4 million in fiscal 1999, with net income of $73.8 million, or $0.21 per diluted share, compared with $35.6 million in fiscal 1999.

Growth was attributed mainly to higher unit shipments of its F700 filers, increased demand for NetCache caching appliances, Cluster Failover and SnapMirror software, and expansion of the sales organization to 582 from 309. Gross margin held steady at 59.3% of net sales, while sales and marketing, research and development, and general and administrative expenses all rose sharply in absolute dollars. Operating income reached $105.4 millionb, and international sales were $177.9 million, or 30.7% of net sales.

The balance sheet strengthened over the year. Cash, cash equivalents and short-term investments totaled $353.5 millionc, working capital was $419.6 million, and operating cash flow was $118.1 million. Shareholders' equity rose to $478.7 million from $295.7 million.

The company disclosed that it has agreed to lease Sunnyvale facilities through a third-party entity, with purchase options of $55.0 milliond and $62.0 million, and that it had total future minimum lease payments of $69.9 million. Management stated that existing liquidity is sufficient for at least the next twelve months.

The filing also highlights risk factors that management emphasizes, including quarterly fluctuations, dependence on a single disk drive supplier, competition from Sun, HP, EMC, Dell and others, reliance on OEM partners Dell and Fujitsu that have not yet made purchase commitments, and stock price volatility. Stock traded between $9.91 and $120.19 on a split-adjusted basis during fiscal 2000, and the company reported no legal proceedings.

02—Key points

Key Highlights

  1. Net sales rose to $579.3 million in fiscal 2000 from $289.4 million in fiscal 1999.
  2. Net income was $73.8 million, or $0.21 per diluted share, versus $35.6 million in fiscal 1999.
  3. Gross margin was 59.3% of net sales, essentially flat versus 59.2% in fiscal 1999.
  4. Operating income was $105.4 million, or 18.2% of net sales, compared with $55.1 million in fiscal 1999.
  5. Cash, cash equivalents and short-term investments grew to $353.5 million, and operating cash flow was $118.1 million.
  6. International net sales were $177.9 million, or 30.7% of total net sales, and indirect channels accounted for 28.0% of total sales.
  7. The company completed two-for-one stock splits in December 1999 and March 2000, and its stock price peaked at $120.19 in the fourth quarter.

03—Questions

Frequently Asked Questions

  1. What drove the sharp increase in revenue in fiscal 2000?

    The filing attributes the 100.2% increase in net sales primarily to higher unit shipment volume, driven by strong demand for the F700 filer products using fibre-channel connectivity, increased worldwide demand for NetCache solutions, and growth in Cluster Failover and SnapMirror software. Expansion of the sales organization to 582 from 309 and higher indirect channel sales also contributed.

  2. How profitable was the company, and did margins change?

    Net income was $73.8 million, or $0.21 per diluted share, up from $35.6 million, or $0.11 per diluted share, in fiscal 1999. Gross margin was 59.3% of net sales, nearly unchanged from 59.2%, while operating expenses rose to 41.1% of net sales from 40.1%.

  3. What are the main risks the filing highlights?

    The filing highlights quarterly results fluctuation, gross margin pressure from configuration mix and competitive pricing, reliance on a limited number of suppliers (most disk drives come from a single supplier), intense competition from larger vendors such as Sun, HP, EMC and Dell, and the lack of purchase commitments from OEM partners Dell and Fujitsu.

  4. How strong is the company's financial position?

    At April 28, 2000, cash, cash equivalents and short-term investments totaled $353.5 million and working capital was $419.6 million. Shareholders' equity increased to $478.7 million, and management believes existing liquidity is sufficient for at least the next twelve months.

04—Continue

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