It has been about a month since the last earnings report for NetApp (NTAP). Shares have added about 4.4% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is NetApp due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

NetApp's Q1 Earnings & Revenues Beat

NetApp reported first-quarter fiscal 2025 non-GAAP earnings of $1.56 per share, which surpassed the Zacks Consensus Estimate by 6.9%. The company reported earnings of $1.15 per share in the prior year period. The bottom line surpassed the company’s guided range of $1.4–$1.5.

Revenues of $1.54 billion increased 8% year over year. The company projected revenues in the range of $1.455–$1.605 billion. The upside resulted from strong sales across Hybrid Cloud and Public Cloud segments, notably a growth of about 40% in first party and marketplace cloud storage services revenue. However, it remains wary about the challenging macroeconomic backdrop that is hurting IT spending. Also, the top line beat the consensus mark by 0.46%.

Witnessing the continued momentum across flash, block, AI and cloud storage solutions, management has tweaked its outlook for fiscal 2025. It now expects full-year revenues in the range of $6.48–$6.68 billion, up 5% year over year at the mid-point. Earlier it projected sales in the band of $6.45–$6.65 billion.

The company now forecasts non-GAAP earnings per share for fiscal 2025 to be between $7 and $7.2, up 10% year over year at the mid-point. Earlier, it projected non-GAAP earnings between $6.8 and $7 per share.

For fiscal 2025, NetApp continues to expect non-GAAP gross margin in the range of 71-72%. Non-GAAP operating margin is projected in the band of 27-28%, unchanged from the prior view.

NetApp’s Top-Line Details

The company reports revenues under two segments — Hybrid Cloud and Public Cloud.

The Hybrid Cloud segment includes revenues from the enterprise data center business, including product, support and professional services.

The Public Cloud segment comprises revenues from products delivered as a service and related supports. The portfolio contains cloud automation and optimization services, storage and cloud infrastructure monitoring services.

Revenues from the Hybrid Cloud segment increased 7.8% year over year to $1.38 billion. The Public Cloud segment’s revenues improved 3.2% to $159 million.

We projected fiscal first-quarter revenues from the Hybrid Cloud and Public Cloud segments at $1,368 million and $161.1 million, respectively.

Within the Hybrid Cloud segment, Product revenues (48.4% of segmental revenues) increased 13.4% year over year to $669 million.

Revenues from Support Contracts (45.6%) totaled $631 million, up 3.3% year over year. Professional and Other Services revenues (6%) amounted to $82 million, up 6.5%.

Region-wise, the Americas, Europe, Middle East and Africa and Asia Pacific contributed 50%, 33% and 17% to total revenues, respectively.

Direct and indirect revenues added 22% and 78%, respectively, to total revenues.