NetApp hails partners despite "mixed" financial results

Storage vendor lauds channel success, as Q1 revenue hits bottom end of expectations

Storage vendor NetApp has paid tribute to the contribution its EMEA partners made during its first quarter, despite posting lower than expected revenue.

According to the vendor's Q1 2012 figures, revenue totalled $1.4bn (£860m), up from $1.15bn a year ago.

However, during a conference call with analysts, transcribed by Seeking Alpha, NetApp chief financial officer Steve Gomo said the revenue it achieved during Q1 was "at the bottom end of our targeted range", because of growing economic uncertainty in the US.

"NetApp achieved mixed results this quarter after getting off to an extremely strong start during the first two months," he added.

"Unfortunately, our business softened dramatically during the last few weeks of July under the weight of the debt ceiling crisis and macroeconomic uncertainty."

Aside from July, NetApp's chief executive Tom Georgens said the firm's performance had been strong overall, especially on the channel side.

"April and May were the strongest consecutive growth quarters [for bookings] in the year [and] we entered July with forecasts and results well ahead of our expectations, despite the geographical balance being uneven. APAC and EMEA bookings were especially strong," he said.

"Our indirect channels grew to 76 per cent of revenue [and] Arrow and Avnet contributed 26 per cent of our total revenue, up 21 per cent year over year."

Speaking to ChannelWeb, Pete Rawden, UK and Ireland partner sales director at NetApp, said that while the figures provide a global snapshot of how partners are performing, the firm is seeing similar channel growth in the UK.

"Partners are really delivering on the flexible IT message we have been pushing since November, and have really got behind the product refreshes we recently introduced and our FlexPod story," he explained.

The FlexPod platform, which consists of NetApp, VMware and Cisco technology, allows end users to build their own virtual datacentres and, in turn, private clouds.

Rawden said the tri-vendor offering, in particular, is proving popular with end users who do not want to go down the proprietary stack route to the cloud.

"You can go down the single-vendor route to get the compute, the storage and networking you need [for a virtualised datacentre]," he said. "But while that vendor might be really good at the compute bit, they might not be as strong in storage, for example, and you run the risk of getting a solution that is less good overall."