NetApp (NTAP) expects FQ1 revenue of $1.42B-$1.52B and EPS of $0.53-$0.58, largely below a consensus of $1.52B and $0.62.
A hefty $374.5M was spent on buybacks in FQ4, helping EPS beat estimates in spite of a revenue miss. $1.88B was spent over the whole of FY14 (up from just $590M in FY13).
Product revenue (drives future services revenue) fell 8% Y/Y to $1.04B, worse than FQ3's 4% drop. Software entitlements/maintenance rose slightly to $227.5M, and services rose 8% to $378.7M.
Branded revenue was relatively healthy, falling 1% Y/Y to $1.54B. But OEM revenue, hurt by IBM's struggles, fell 34% to $109.8M. Americas was 56% of revenue, EMEA 31%, Asia-Pac 13%.
Also boosting EPS: Gross margin rose to 64.4% from 63.5% in FQ3 and 61.3% a year ago. Job cuts led GAAP opex to fall 1% Y/Y to $818.2M.
NTAP -1% AH. Some bad news has been priced in amid ongoing worries about competition from EMC's mid-range VNX line, and the impact of cloud storage services seeing constant price cuts. Investors are looking for NetApp's upcoming FlashRay hardware to provide a boost.