Analyst(s): Krista Case
Publication Date: May 30, 2025
NetApp’s Q4 FY 2025 results highlight strong demand for cloud services and all-flash storage, driving record profitability. The company continues to gain traction in enterprise AI workloads and modernization initiatives.
What is Covered in this Article:
- NetApp’s Q4 FY 2025 financial results
- Growth acceleration in AI with reference architectures and enterprise deals
- All-flash storage momentum, ASA traction, and market share expansion
- Keystone’s subscription growth and ecosystem-led recurring revenue drivers
- FY 2026 guidance, macro outlook, and AI-driven execution strategy
The News: NetApp Inc. (NASDAQ: NTAP) reported its Q4 FY 2025 results, with net revenue reaching $1.73 billion (+4% year-on-year or YoY), in line with consensus estimates. Product revenue rose 5% YoY to $845 million, while support revenue was flat at $625 million. Public Cloud revenue grew 8% YoY to $164 million. Non-GAAP gross margin stood at 69.5%, down from 71.5% a year earlier. Non-GAAP operating income for the quarter was $496 million (Q4 FY 2024: $469 million), with a margin of 28.6% (+50 basis points YoY), the highest Q4 margin in company history. Non-GAAP earnings per share (EPS) rose 7% YoY to $1.93, exceeding the $1.90 consensus estimate.
For FY 2025, revenue increased 5% YoY to $6.57 billion, driven by 14% YoY growth in all-flash array ARR to $4.1 billion and 43% growth in first-party and marketplace Public Cloud services. Non-GAAP EPS for the year rose to $7.25, up from $6.46 in FY 2024. NetApp returned $1.57 billion to shareholders via dividends and buybacks.
“We are currently negotiating sizable AI and data infrastructure modernization deals with multiple large enterprises, which we expect to close later in the year,” said George Kurian, CEO of NetApp. “We are starting FY 2026 following a year of market share gains, armed with the strongest portfolio in the company’s history and a value proposition that addresses customers’ top priorities.”
NetApp Q4 FY 2025 Results Show Record Margins, Cloud and Flash Momentum
Analyst Take: NetApp ended FY 2025 with robust results, driven by consistent execution in its all-flash and public cloud segments. Flash adoption, cloud momentum, and AI deployment maturity form the core growth drivers going forward. While short-term softness is expected in the public sector and EMEA, the full-year outlook remains supported by pipeline visibility and expanded sales capacity. NetApp’s competitive edge in AI-ready infrastructure, validated by hyperscaler partnerships and OEM certifications, sets the foundation for enterprise expansion in FY 2026.
AI Traction Accelerates with Reference Architectures and Enterprise Wins
NetApp’s AI pipeline gained significant momentum in Q4 FY 2025, with the AI business growing fivefold YoY and the company closing approximately 150 AI infrastructure and data lake modernization deals across multiple verticals. The company introduced several reference architectures during the quarter, including NVIDIA DGX SuperPOD, Cisco FlexPod, Lenovo AIPod, and the newly introduced Intel AIPod Mini, along with validations across NVIDIA Cloud Partners and NVIDIA-Certified Systems. In addition, a major Asian telco selected NetApp as the foundation for its GenAI-as-a-Service deployment, highlighting customer preference for hybrid, AI-ready infrastructure. The momentum reinforces NetApp’s position as a core AI infrastructure partner across enterprise workloads.
All-Flash Momentum Delivers Record Revenue and Market Share Expansion
NetApp’s all-flash portfolio maintained its strong growth momentum, achieving a record annualized revenue run rate of $4.1 billion, reflecting a 14% YoY increase. Flash-based arrays represented approximately two-thirds of Hybrid Cloud revenue and accounted for 44% of systems currently under active support contracts. Management highlighted nearly 300 basis points of market share gains in all-flash storage in 2024, significantly outperforming competitors. Key to this strength is the increased traction in block-optimized ASA systems, which are effectively displacing legacy storage solutions due to their simplicity, performance, and scale-out capabilities. A notable recent win included a major life sciences customer migrating nearly 10 petabytes from a competitor, leveraging NetApp’s unified multi-protocol environment for operational agility. With enterprises increasingly transitioning from spinning disk to all-flash storage, NetApp’s comprehensive portfolio remains well-positioned to capture sustained market share expansion.
Keystone Growth and Partner Ecosystem Drive Recurring Revenue Momentum
Keystone, NetApp’s storage-as-a-service solution, demonstrated robust traction in FY 2025, delivering a total contract value (TCV) of $224 million, representing a substantial 54% YoY increase. The offering notably contributed to a 13% YoY rise in professional services revenue in Q4 FY 2025, while unbilled remaining performance obligations (RPO) – a key indicator of future recurring revenues – grew 23% sequentially to approximately $430 million. NetApp further solidified its market presence through strategic channel expansions, including a new distribution agreement with TD SYNNEX for Keystone across the UK and Ireland, and enhanced hosting partnerships such as the alliance with Servers Australia. NetApp’s strategic investment in Keystone and partner-led expansion positions the company to sustainably accelerate recurring revenue streams.
Guidance and Final Thoughts
NetApp guided Q1 FY 2026 revenue to $1.45-$1.61 billion (in line with consensus) and non-GAAP EPS to $1.48-$1.58 (below consensus estimate of $1.65). Full-year revenue is projected at $6.63-$6.88 billion, implying 3% YoY growth at midpoint (4% ex-Spot). FY 2026 non-GAAP EPS is forecast at $7.60-$7.90, which was in line with consensus expectations of $7.7. The company acknowledged macro caution in the US public sector and EMEA, compounded by tariff-related demand delays, but expressed confidence in full-year execution driven by a strong AI deal pipeline and improving product margins. Backed by an expanded go-to-market engine and deepening traction across enterprise cloud, flash, and AI implementations, NetApp enters FY 2026 with a setup to deliver resilient performance.
See the complete press release on NetApp’s Q4 and FY 2025 earnings on the NetApp website.
Disclosure: Futurum is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum as a whole.
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Author Information
With a focus on data security, protection, and management, Krista has a particular focus on how these strategies play out in multi-cloud environments. She brings approximately 15 years of experience providing research and advisory services and creating thought leadership content. Her vantage point spans technology and vendor portfolio developments; customer buying behavior trends; and vendor ecosystems, go-to-market positioning, and business models. Her work has appeared in major publications including eWeek, TechTarget and The Register.
Prior to joining The Futurum Group, Krista led the data protection practice for Evaluator Group and the data center practice of analyst firm Technology Business Research. She also created articles, product analyses, and blogs on all things storage and data protection and management for analyst firm Storage Switzerland and led market intelligence initiatives for media company TechTarget.
