NetApp
NetApp sells enterprise storage and hybrid cloud data management built around its ONTAP software.
On the record
Checkpoint: Q1 FY2027 earnings, first test of whether FY2026 growth holds or was pulled forward
The call
NetApp is growing and profitable, but Pure Storage, VAST Data and Dell are all shipping AI-storage rivals in the same window, narrowing its edge.
NetApp makes software and hardware that companies use to store, manage, and protect their data. The company has built a loyal customer base over decades because switching to a competitor is expensive and complicated, but rivals like Pure Storage and Dell now offer comparable AI-powered storage systems that work just as well. The key thing to watch is whether Pure Storage can grab enough customers in the next two years to overtake NetApp's market share, which would signal that NetApp's traditional advantage is finally crumbling.
Why
01
AI pressure: VAST Data's AI-native storage platform. VAST Data ships GPU-accelerated, AI-native storage that competes for the same AI training and inference deals NetApp is chasing. Could AI do the core job? Unlikely.
02
Bigger players: Dell Technologies (PowerStore, PowerScale, ObjectScale). Dell bundles storage with its AI server lineup, pressuring NetApp on price and account control in the same infrastructure deals. Could a giant copy it? Probably.
03
What protects it. ONTAP data management lock-in plus direct placement inside AWS, Azure and Google Cloud as NetApp Volumes keeps switching costs high.
What would change this call
Pure Storage reports all-flash revenue matching or exceeding NetApp's by late 2026. would show NetApp losing its lead in the core all-flash storage market.
NetApp's Public Cloud segment revenue growth rate in upcoming quarterly reports. a drop below roughly 5% growth would signal hyperscaler placement weakening.
DataPelago-based GPU-accelerated data prep feature ships (or doesn't) within about 12 months. would show whether NetApp can differentiate against VAST Data and Dell in AI workflows.
NetApp's Public Cloud segment revenue growth rate in upcoming quarterly reports. a drop below roughly 5% growth would signal hyperscaler placement weakening.
DataPelago-based GPU-accelerated data prep feature ships (or doesn't) within about 12 months. would show whether NetApp can differentiate against VAST Data and Dell in AI workflows.
Key numbers
- FY2026 revenue $6.93B, up 5% YoY
- All-flash revenue hit record $4.2B for FY2026
- Shipped storage capacity fell 11% even as revenue rose 5%
Named risks
- Pure Storage and other rivals shipping comparable NVIDIA-based AI storage within months, narrowing differentiation.
- Recurring layoffs (77 cut July 2026, ~700 in 2025) despite record financials signal ongoing restructuring.
- DataPelago integration (acquired July 16, 2026) unproven at scale against Dell and VAST's earlier-shipped equivalents.
- FY2027 guidance flags gross-margin pressure from rising memory and component costs.
- Shareholder governance proposal (written consent) creates uncertainty ahead of Sept 9, 2026 meeting.
Rivals, as read in July 2026
| Rival | Direction | Evidence |
|---|---|---|
| Pure Storage | gaining on | IDC-tracker data shows Pure's revenue and capacity growth outpacing NetApp's through 2025 (reported 2026-04-02) |
| Dell Technologies | contesting | Running competitive marketing vs flash rivals on power/rack efficiency using NVIDIA benchmarks, July 13, 2026 |
| VAST Data | contesting | Launched NVIDIA-based AI OS, Database, and Sirius query engine at VAST Forward, February 2026 |
| HPE | gaining on | HPE claims (vendor-claimed) fastest-growing all-flash block vendor with 2x market growth TTM as of April 2026 |
Questions people ask
- Is NetApp profitable in 2026?
- Yes. NetApp reported FY2026 net revenue of $6.93B, up 5% YoY, with Q4 revenue of $1.95B up 12% YoY as of April 24, 2026. FY2027 guidance projects 29.1 to 30.1% operating margin, and the company returned $1.36B to shareholders via buybacks and dividends.
- Is NetApp doing layoffs in 2026?
- Yes, but small and recurring. WARN filings show 77 San Jose jobs cut effective July 18, 2026, following 56 cuts in June 2025 and roughly 700 employees (about 6% of workforce) cut across 2025, framed by NetApp as strategic realignment toward cloud and AI, not overall downsizing.
- Who is NetApp's biggest competitor?
- Pure Storage is the sharpest threat: independent IDC-tracker data cited April 2, 2026 shows Pure's revenue and capacity growth outpacing NetApp's in 2025, with all-flash revenue potentially matching or passing NetApp's by late 2026. Dell, VAST Data, and HPE are also shipping competing NVIDIA-based AI storage architectures.
- Could AI replace NetApp?
- Unlikely soon. NetApp's ONTAP data-management layer, compliance features like SnapLock, and decades of hyperscaler/VMware/Oracle integrations create switching costs AI tools can't replicate. Instead AI is a tailwind: NetApp launched its AI Data Engine with NVIDIA on March 16, 2026 and acquired GPU-data-prep startup DataPelago on July 16, 2026.
- Who owns NetApp?
- NetApp is an independent public company trading on Nasdaq as NTAP, with no parent entity. CEO is George Kurian and CFO is Wissam Jabre. Market capitalization was roughly $31.6B as of July 21, 2026, with shares near $165.72.
- Is NetApp losing market share to Pure Storage?
- Partially. NetApp posted record all-flash array revenue of $1.2B in Q4 FY2026 (up 18% YoY), but an independent IDC-based tracker analysis published April 2, 2026 found Pure Storage's revenue and shipped capacity growing faster than NetApp's through 2025.
Timeline
- 2026-07-17Shareholder proposal filed for written-consent action ahead of Sept 9 annual meeting
- 2026-07-16Acquired DataPelago, GPU-accelerated zero-copy AI data-processing startup
- 2026-07-15Launched joint storage service with Oracle
- 2026-07-01Daiwa raised price target to $180 from $117, outperform rating
- 2026-06-23Released StorageGRID 12.1, named Forrester Wave Leader for Object Storage
- 2026-05-28Reported FY2026 results: $6.93B revenue, issued FY2027 guidance
- 2026-04-24FY2026 fiscal year end; Q4 revenue $1.95B, up 12% YoY
- 2026-03-16Launched NetApp AI Data Engine (AIDE) co-engineered with NVIDIA
Revision history
22 July 2026
First assessed. Defensible for now. The text above is fixed as of this date and is not edited afterwards.
In the same band
Sources
- NetApp Reports Fourth Quarter and Fiscal Year 2026 Results (2026-05-28)
- NetApp Q4 Earnings Call Highlights (2026-07-12)
- EX-99.1 (2026-05-28)
- gurufocus.com
- Everpure is outpacing competitors in revenue and capacity growth (2026-04-02)
- NetApp: Number of Employees 2012-2026
- NetApp Number of Employees 2026 (2026-06-29)
- NetApp Layoffs Will Impact 77 In California Amid Strategic Realignment
- NetApp Fourth-Quarter FY26 financials PDF (2026-05-28)
- NetApp Accelerates Momentum in AI Leadership with NVIDIA (2026-03-16)
- NetApp Enhances Support for AI Workloads at Massive Scale (2026-06-23)
- NetApp Acquires DataPelago, Making Data AI-Ready at the Infrastructure Layer (2026-07-16)