NetApp's operations are organized into two segments: Hybrid Cloud and Public Cloud. The company is focused on helping customers modernize their data centers and harness the power of their data and applications.

NetApp is building scalable, high-performance data pipelines for artificial intelligence (AI) workloads. NetApp Astra is a fully managed application-aware data management service built for emerging Kubernetes workloads container infrastructures.

Total research and development expenses were $1,029 million in fiscal 2024, $956 million in fiscal 2023 and $881 million in fiscal 2022. The company believes that technical leadership is essential to its success.

In fiscal 2024, NetApp reorganized its sales resources, which included changes and additions to its sales leadership team, to gain operational efficiencies and improve the alignment of its resources with customer and market opportunities.

In fiscal 2024, NetApp implemented, and in fiscal 2025 will continue to implement, certain new business information systems, including implementing its new enterprise resource planning system.

In fiscal 2024, NetApp initiated a restructuring plan that included a global workforce reduction of approximately 2% and optimization of its global office space for its hybrid work model.

NetApp's business, revenues and profitability are impacted by global economic and market conditions, including inflation, slower growth or recession, changes to fiscal and monetary policy, higher interest rates, tax rates, economic uncertainty, political instability, warfare, changes in laws, reduced consumer confidence and spending, and economic and trade barriers.

The growth in NetApp's industry and the markets in which it competes is driven by the increasing demand for data. Despite these growth drivers, NetApp's markets could be adversely impacted by technology transitions, increased storage efficiency, competitive pricing dynamics, changing consumption models, and/or uncertain macroeconomic conditions.

NetApp offers customers a full range of consumption models, including cloud-based storage services and storage as a service (STaaS) delivered on premises. These business models continue to evolve, and NetApp may not be able to compete effectively, generate significant revenues or maintain the profitability of our consumption-based offerings.

NetApp's markets are intensely competitive and are characterized by fragmentation and rapidly changing technology. NetApp competes with many companies in the markets it serves, including established public companies, newer public companies with a strong flash focus, and new market entrants addressing the opportunity for GenAI and application data management for Kubernetes.

NetApp's growth strategy includes developing and maintaining strategic partnerships with major third-party software and hardware vendors to integrate its products into their products and also co-market its products with them. A number of its strategic partners are industry leaders that offer it expanded access to segments in which it does not directly participate.

NetApp offers customers a full range of consumption models, including cloud-based storage services and storage as a service (STaaS) delivered on premises. These business models continue to evolve, and NetApp may not be able to compete effectively, generate significant revenues or maintain the profitability of our consumption-based offerings.

Supply chain constraints, which substantially began to impact NetApp in the first half of fiscal 2023, led to elevated product component and freight costs during fiscal 2023. Comparatively, the supply chain substantially improved during fiscal 2024, resulting in lower costs.

In an effort to reduce its cost structure and redirect resources to its highest return activities, in fiscal 2024, 2023 and 2022, NetApp initiated a number of business realignment plans designed to streamline its business and focus on key strategic opportunities. These plans resulted in aggregate reductions of its global workforce of approximately 2% in fiscal 2024, 9% in fiscal 2023, and 1% in fiscal 2022.

Initiatives intended to make NetApp's cost structure, business processes and systems more efficient may not achieve the expected benefits and could inadvertently have an adverse effect on its business, operating results, financial condition and cash flows.

NetApp is increasingly building and/or leveraging AI technology, including GenAI, in certain of its products and services and in its business operations. Our research and development of such technology remains ongoing.

NetApp's R&D priorities are defined by how it can help customers realize operational simplicity, cyber resilience and security, AI innovation, infrastructure savings and agility, and sustainability. NetApp designs its products and services from the ground up with cloud connectivity in mind.

Issues related to the development and use of artificial intelligence (AI), including GenAI, could give rise to legal and/or regulatory action, damage NetApp's reputation or otherwise materially harm its business.

During fiscal 2024, NetApp repurchased approximately 12 million shares of its common stock at an average price of $77.87 per share, for an aggregate purchase price of $900 million.

During fiscal 2024, NetApp declared aggregate cash dividends of $2.00 per share in fiscal 2024, for which it paid a total of $416 million.

NetApp anticipates capital expenditures for fiscal 2025 to be between $150 million and $200 million related to the financing of its facilities and equipment requirements.

NetApp has established and publicly announced, and may continue to establish and publicly announce, initiatives and goals regarding environmental matters, diversity, and other related matters, including its commitment to reducing its greenhouse gas emissions and increasing its representation of women in its global workforce and underrepresented minorities in its US workforce.

NetApp's goals and disclosures related to environmental, social and governance (ESG) matters expose it to risks that could adversely affect its reputation and performance. These initiatives and goals could be difficult and expensive to implement, the technologies it needs to implement them may not be cost effective and may not advance at a sufficient pace, and ensuring the accuracy, adequacy or completeness of the disclosure of its ESG initiatives can be costly, difficult and time-consuming.

Due to the global nature of NetApp's business, NetApp is subject to complex legal and regulatory requirements in the U.S. and the foreign jurisdictions in which it operates and sells its products, including antitrust and anti-competition laws, and regulations related to data privacy, data protection, and cybersecurity.

In particular, in fiscal 2024, NetApp continued to experience a weakened demand environment, characterized by cloud optimizations and increased budget scrutiny, which resulted in smaller deal sizes, longer selling cycles, and the delay of some deals.

Due to the global nature of NetApp's business, NetApp is subject to complex legal and regulatory requirements in the U.S. and the foreign jurisdictions in which it operates and sells its products, including antitrust and anti-competition laws, and regulations related to data privacy, data protection, and cybersecurity.

NetApp is exposed to the credit and non-payment risk of its customers, resellers and distributors, especially during times of economic uncertainty and tight credit markets, which could result in material losses.