01—Abstract
Summary
Summary of the 10-Q filed November 25, 2025. Cited figures are marked; the original filing is the authoritative source.
NetApp, Inc. reported net revenues of $1,705 milliona for the second quarter of fiscal 2026 (three months ended October 24, 2025), up from $1,658 million a year earlier, and $3,264 million for the six months, up from $3,199 million.
Net income was $305 millionb for the quarter versus $299 million, and diluted earnings per share were $1.51 versus $1.42. Income from operations rose to $399 million from $345 million, while other expense, net was $6 million compared with other income of $15 million a year earlier, driven by higher interest expense and foreign exchange losses. Cash, cash equivalents and short-term investments fell to $3,014 million from $3,846 million at April 25, 2025, mainly reflecting the $750 million repayment of the 1.875% Senior Notes due June 2025, $550 million of share repurchases, and $207 million of dividends.
Total debt principal was $2,500 millionc, and the company reported a $790 million unrecognized compensation expense balance related to equity awards. Operating cash flow for the six months was $800 million, compared with $446 million a year earlier.
The Board authorized an additional $1.1 billiond for stock repurchases in the first quarter of fiscal 2026, leaving $902 million remaining at period end, and on November 20, 2025 a quarterly dividend of $0.52 per share was declared. Restructuring charges were $23 million for the quarter, and the company paid a final transition tax payment of $179 million in the second quarter.
02—Key points
Key Highlights
- Net revenues rose to $1,705 million in the quarter from $1,658 million, and to $3,264 million for the six months from $3,199 million.
- Income from operations increased to $399 million from $345 million in the quarter; net income was $305 million versus $299 million.
- Diluted EPS was $1.51 for the quarter, compared with $1.42 a year earlier.
- Public Cloud revenues were $171 million in the quarter versus $168 million, and Hybrid Cloud net revenues were $1,534 million.
- Cash, cash equivalents and short-term investments declined to $3,014 million from $3,846 million, after repaying $750 million of senior notes.
- Operating cash flow for the six months was $800 million, up from $446 million, while $550 million was spent on share repurchases.
- The Board authorized an additional $1.1 billion of share repurchases, with $902 million remaining as of October 24, 2025.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2026, NetApp kept $0.18.
- Revenue$1.71B100.0%
- Cost of revenue−$478.0M28.0%
- Gross profit$1.23B72.0%
- Operating costs−$828.0M48.6%
- Operating income$399.0M23.4%
- Interest, other & tax−$94.0M5.5%
- Net income$305.0M17.9%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed November 25, 2025Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $1.71B$1.66B | +2.8% |
| Cost of Revenue | $478.00M$481.00M | −0.6% |
| Gross Profit | $1.23B$1.18B | +4.2% |
| R&D Expenses | $251.00M$257.00M | −2.3% |
| Operating Expenses | $828.00M$832.00M | −0.5% |
| Operating Income | $399.00M$345.00M | +15.7% |
| Net Income | $305.00M$299.00M | +2.0% |
| EPS (Basic) | $1.53$1.47 | +4.1% |
| EPS (Diluted) | $1.51$1.42 | +6.3% |
| Shares Outstanding (Basic) | 199.00M204.00M | −2.5% |
| Shares Outstanding (Diluted) | 202.00M210.00M | −3.8% |
05—Questions
Frequently Asked Questions
How did NetApp's revenue and profitability trend in the second quarter of fiscal 2026?
Net revenues were $1,705 million, compared with $1,658 million a year earlier. Income from operations grew to $399 million from $345 million, and net income reached $305 million versus $299 million. Diluted EPS was $1.51 compared with $1.42.
Why did the company's cash balance decline during the first six months of fiscal 2026?
Cash, cash equivalents and short-term investments decreased by $832 million. The main uses were a $750 million repayment of 1.875% Senior Notes due June 2025, $550 million of stock repurchases, $207 million of dividends, and $102 million of capital expenditures, partially offset by $800 million of operating cash flow.
What is NetApp's debt position as of October 24, 2025?
The principal amount of Senior Notes outstanding was $2,500 million, down from $3,250 million at April 25, 2025, after the June 2025 maturity was repaid. No commercial paper notes were outstanding, and the $1.0 billion revolving credit facility was undrawn. The company stated it was in compliance with all covenants.
What capital return actions did NetApp take or announce?
During the first six months, the company repurchased 5.2 million shares for $550 million at an average price of $106.05 per share and paid $207 million in dividends. The Board authorized an additional $1.1 billion in repurchases, with $902 million remaining at period end, and on November 20, 2025 declared a $0.52 per share dividend payable January 21, 2026.
What drove the change in other expense and the effective tax rate?
Other expense, net was $6 million in the quarter compared with other income of $15 million a year earlier, due to interest expense rising to $26 million from $15 million and a $7 million other net loss, largely from foreign exchange. The quarterly effective tax rate was 22.4% compared with 16.9%, reflecting a decrease in discrete tax benefits related to stock-based compensation.
06—Continue