NetApp
Sunnyvale, California, United States
Industry: Technology/Data Management
Region: US 🇺🇸
Year Founded: 1992
IPO Date: 11-27-1995
Market Cap: Approx. $18 billion (2021)
Number of Employees: Approx. 10,000
Revenue: $5.74 billion (2021)
Net Income: $730 million (2021)
NetApp, Inc.
NetApp IPO
NetApp, originally known as Network Appliance, Inc., launched its initial public offering (IPO) on November 18, 1995.
The company started trading on the NASDAQ under the ticker symbol “NTAP”. At the time of its IPO, NetApp offered its shares at a price of $15.
Despite facing the challenges of a competitive market environment and an industry undergoing rapid technological change, NetApp managed to not only survive but to grow significantly over the years.
Its IPO marked the beginning of an extended period of growth and innovation.
NetApp IPO Prospectus
A prospectus is a formal document required by and filed with the Securities and Exchange Commission (SEC) that provides details about an investment offering to the public. You can find NetApp’s Prospectus here.
Company Overview & History
Founded in 1992 by Michael Malcolm, David Hitz, and James Lau, NetApp started its journey with a vision to simplify data storage.
The Sunnyvale, California-based company initially focused on network-attached storage (NAS) devices before transitioning to a broader set of storage and data management products and services.
NetApp has consistently been recognized for its innovative products, ranking in the Fortune 500 and making the list of the top 100 companies to work for multiple times.
It has strategically expanded its product portfolio, entering the market for cloud-based storage services and implementing a successful transition to data management.
As of 2021, NetApp has more than 10,000 employees globally and serves clients across a wide range of industries.
Financial Performance
| Year | Revenue($B) | Net Income($B) | EBITDA($B) | Operational Cash Flow($B) |
|---|---|---|---|---|
| 2022 | 5.74 | 0.85 | 1.35 | 1.35 |
| 2021 | 5.41 | 0.82 | 1.31 | 1.31 |
| 2020 | 5.41 | 0.82 | 1.31 | 1.31 |
| 2019 | 6.15 | 0.95 | 1.51 | 1.51 |
| 2018 | 5.91 | 0.76 | 1.21 | 1.21 |
| 2017 | 5.52 | 0.51 | 0.81 | 0.81 |
| 2016 | 5.55 | 0.60 | 0.95 | 0.95 |
| 2015 | 6.12 | 0.56 | 0.89 | 0.89 |
| 2014 | 6.33 | 0.63 | 1.00 | 1.00 |
| 2013 | 6.33 | 0.63 | 1.00 | 1.00 |
Business Model
NetApp operates under a technology-based business model.
Its core business revolves around selling storage systems and software that help customers store, manage, protect, and analyze their data.
The company’s products range from hardware systems and storage devices to data management and cloud-based software solutions.
NetApp also generates significant revenue through professional services, including implementation, training, and support.
Furthermore, they have expanded their business model to embrace the opportunities provided by the cloud.
They now provide cloud-based data services, such as cloud storage and data backup, which can be integrated with leading cloud providers like Amazon Web Services (AWS), Google Cloud, and Microsoft Azure.
Market Cap Over the Years
| Year | Market Cap($B) |
|---|---|
| 2022 | 17.6 |
| 2021 | 16.1 |
| 2020 | 10.5 |
| 2019 | 14.3 |
| 2018 | 18.2 |
| 2017 | 12.2 |
| 2016 | 8.8 |
| 2015 | 8.9 |
| 2014 | 14.0 |
| 2013 | 14.1 |
Risk Factors
Several risk factors could impact NetApp’s business.
The data storage market is highly competitive, with many players offering similar products. Rapid technological changes could make NetApp’s current products obsolete.
As the company continues to expand its cloud services, it also faces the risk of increased competition from larger cloud service providers.
Furthermore, data privacy and security concerns could impact the company’s reputation and customer trust if not properly addressed.
NetApp’s international operations also expose it to potential geopolitical risks and foreign exchange rate fluctuations.
Market Opportunity
The global data storage market, as well as the data management and cloud services market, offer significant growth opportunities for NetApp.
As businesses continue to generate vast amounts of data, the need for efficient data storage and management solutions is greater than ever.
The ongoing digital transformation trend among enterprises, coupled with the increasing adoption of cloud-based solutions, is expected to fuel market growth in the coming years.
Competitors
- Dell Technologies
- Hewlett Packard Enterprise (HPE)
- IBM
- Pure Storage
- Hitachi Vantara
- Nutanix
- Cisco Systems
- Amazon Web Services (in terms of cloud storage)
Key/Fun Company Facts
- NetApp was initially known as Network Appliance Inc. It officially changed its name to NetApp Inc. in 2008.
- NetApp was ranked 5th on Fortune’s “100 Best Companies to Work For” in 2009.
- The founders initially planned to make high-performance disk drives, but they ended up creating network storage systems due to market needs.
- NetApp has a patented technology called Write Anywhere File Layout (WAFL), which helps in efficient data storage and fast write services.
- It has an interesting motto that encapsulates its mission: “The Data Authority for Hybrid Cloud”.