(Reuters) - Data storage equipment maker NetApp Inc (NTAP.O) reported fourth-quarter results below analysts’ estimates, hurt by lower sales to original equipment manufacturers, sending its shares down more than 10 percent in extended trading.
The company, which cut about 500 jobs, also forecast first-quarter profit below market estimates.
NetApp has been trying to boost growth by focusing on cloud-based products as businesses cut spending on high-end storage systems.
It also faces competition from larger rival EMC Corp EMC.N and newer and cheaper flash-based storage technology vendors such as Nimble Storage Inc NMBL.O and Pure Storage.
Net income fell to $134.9 million, or 43 cents per share, for the quarter ended April 24, compared with $197 million, or 59 cents per share, in the year-earlier quarter.
Revenue fell about 7 percent to $1.54 billion.
Excluding items, the company earned 65 cents per share. Analysts were expecting adjusted earnings of 72 cents per share on revenue of $1.59 billion, according to Thomson Reuters I/B/E/S.
For the first quarter, NetApp forecast a profit of 20 cents to 25 cents per share on revenue of $1.28 billion to $1.38 billion.
Analyst on average were expecting a profit of 59 cents on $1.46 billion in revenue.
NetApp expects to incur charges of about $25 million to $35 million related to the job cuts, the company said in a regulatory filing.
Most of the charges will be recognized in the company’s first quarter.
NetApp’s shares closed at $35.33 on the Nasdaq on Wednesday. They were trading down 8 percent at $32.45 in after market trading.
Reporting by Anya George Tharakan in Bengaluru; Editing by Anil D'Silva