NetApp (NTAP)

Enterprise + hybrid-cloud data storage (NetApp) — managed storage software/systems

AI exposure 12% — derived from reported segment revenue, not asserted.

Where it sits

Physical Infrastructure → Storage & Server Systems · figures rebased to Q1 FY2027, reported 2026-09-02

All-flash and hybrid-flash storage systems together are 89.8% of revenue after the Q1 FY2027 rebase, so Storage & Server Systems is effectively the whole company rather than one leg of it. The rest is tagged separately: Data & Infrastructure Software at 10.2%.

Also tagged: emerging in Software Stack → Data & Infrastructure Software.

Reported segments

Hybrid Cloud — 89.8% of revenue
Public Cloud — 10.2% of revenue

NetApp ($2.025B Q1 FY2027, +30% YoY — a record first quarter). Modelled on the storage-category cut the filing discloses rather than the product/support cut, because it is the one that separates growth from the base: all-flash 64.6% ($1.309B, +47%) and hybrid-flash and other 25.2% ($510M, +1.0%) together make up Hybrid Cloud at 89.8% = primary B2 Storage & Server Systems. Public Cloud 10.2% ($206M, +28%) at an 86.4% gross margin — first-party services inside AWS, Azure and Google, now including DataPelago. By revenue type the same quarter was product $987M (+51%), support $720M (+11%) and…

How the 12% is built

Hybrid Cloud — 89.8% of revenue × 11% AI-driven (estimate). Blended across the disclosed storage-category cut: all-flash is 64.6% of company revenue growing 47% and is the tier AI pipelines require, taken at 15%; hybrid-flash and other is 25.2% growing 1.0% and taken at 2%. The flash share is held down because a flat hybrid line implies much of the flash growth is conversion…
Public Cloud — 10.2% of revenue × 20% AI-driven (estimate). First-party services inside the hyperscalers sit next to where AI workloads actually run, and the DataPelago acquisition — an AI data infrastructure company — lands in this line

Investment read

Moat. The ONTAP installed base and the data-management layer above it, now converting to flash at scale: all-flash revenue reached $1.309B, 64.6% of the company, growing 47%, while the hybrid-flash base it is converting from sat flat at $510M. That conversion is the moat working — customers upgrading inside the estate rather than re-platforming — and it is also finite.

Bottleneck / pricing power. Improving but not structural. Non-GAAP operating margin reached 31.9% and product gross margin edged up to 54.6% from 54.0%, with support at 93.2% and Public Cloud at 86.4%. Billings grew 36% against revenue at 30%, so pricing is holding through a NAND cost cycle. It remains a contested enterprise-storage market where NetApp sets price against Pure and Dell rather than above them.

Role in the AI stack. The enterprise/hybrid-cloud data-management layer.

Connected companies

Microsoft (MSFT) — NTAP supplies: data storage/management integrated with Azure (first-party service)
Equinix (EQIX) — NTAP supplies: enterprise storage deployed in colocation
Amazon (AMZN) — NTAP supplies: FSx for NetApp ONTAP first-party AWS service
Everpure (fmr Pure Storage) (P) — NTAP competes with: Enterprise all-flash + data management (NetApp vs Pure/Everpure)
Dell Technologies (DELL) — NTAP competes with: Enterprise storage arrays
Hitachi (HTHIY) — NTAP competes with: enterprise storage — Hitachi Vantara vs NetApp
NVIDIA (NVDA) — NTAP supplies: NVIDIA-certified storage (AFF A90/AIPod) validated for DGX SuperPOD and NVIDIA-Certified Systems (partnership)
Meta Platforms (META) — NTAP supplies: enterprise storage possibly used in Meta corporate IT; Meta's AI data centers use in-house OCP storage, no public NetApp link
Alphabet (GOOGL) — NTAP supplies: NetApp ONTAP storage powers first-party Google Cloud NetApp Volumes service
Oracle (ORCL) — NTAP supplies: co-engineering/certification partnership for Oracle Database workloads (not a hardware supplier into OCI fleet)

Others in Storage & Server Systems

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