NetApp Inc at Raymond James Institutional Investors Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Excellent. So we always kick it off with a brief overview. So for those investors that maybe aren't as familiar with the story, maybe can you give us a quick recap of NetApp, what it does, and what the overarching dynamics are of the business?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Excellent. Excellent. So my plan was to start off with a broader macro discussion, given the recent developments over the last 24 hours. I feel like that's particularly appropriate. And understanding how tricky it is to factor in such a dynamic variable, given that it seems like we are moving forward with tariffs, maybe you can help us and the investors understand what areas NetApp is exposed to in that respect, what kind of impact and exposure you guys are factoring in when you're thinking about forward results and guidance around tariffs and the impacts of tariffs.

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : To what degree does your guidance reflect that already, and kind of what has been put into your guidance around that?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Staying on the macro topics, NetApp has historically had a fairly high federal exposure and given the recent developments with the new administration around that, maybe help us understand how that is possibly impacting the business as well.

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Have you observed any changes recently as of last quarter? Any changes in dynamics and spending order patterns?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : How about exchange rates? Is that something that we need to be aware of and how that impacts results?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Okay. Sure. So moving on to some operational and executional topics, NAND memory pricing has been pretty volatile and dynamic over the past several years, kind of moving between oversupply and undersupply. So how did NetApp navigate that environment last year, and kind of what are your plans to mitigate and manage the pricing for that component going forward this year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 1:05PM, NTAP.OQ - NetApp Inc at Raymond James Institutional Investors Conference

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Are pre-buys something that you could potentially, you know, is that something that you might resume at some point, if the prices fluctuate again in the opposite direction or is that something that you guys might consider engaging in again at some point if it's necessary? Is that kind of a flexible aspect for you guys, or?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Sure. Maybe, can you go over some of your operating OpEx plans? I know some of your peers have started cutting back some and kind of just wondering where NetApp, is thinking about that and what the dynamic is for you guys for operating expenses, managing that going forward? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 1:05PM, NTAP.OQ - NetApp Inc at Raymond James Institutional Investors Conference

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Excellent. That's a good segue into the next area. Investors obviously are very interested in AI opportunities and how NetApp is exposed there. So I think generally, the industry assessment kind of describes storage as a second-order beneficiary of AI. Currently, most of the spend is concentrated around hyperscalers and servers and they're built out of AI clusters. This obviously benefits the server vendors. But what role does the storage market play in supporting AI and how do we see that evolving as the use cases evolve from model training towards inferencing?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : How is your visibility into being able to discern how much revenue is directly being tied to AI right now and your ability to track that metric?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Have you shifted your strategy, your kind of marketing strategy to kind of position the products for AI and maybe specifically around AI? Or has NetApp always kind of been that product, the unstructured product, and has that always just been there? Or have you guys shifted your strategy at all in bringing awareness to customers around AI capabilities?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Excellent. Shifting over to the PCS segment, that's another area of discussion that investors bring up fairly often. Can you maybe give us some color around the components of the PCS business and your expectations around growth for each?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Well, what's the mix of that right now?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : And that's subscription, third party is subscription-based predominantly?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : And then, just kind of shifting into competitive dynamics, so the big three also have competing solutions that compete as well, right? So how do they position that, and how do you position your product to compete with them in that aspect, given that they do offer you as a first party, but then they also compete with you as well? Is there going to be a contradicting dichotomy there? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 1:05PM, NTAP.OQ - NetApp Inc at Raymond James Institutional Investors Conference

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Okay. Excellent. I think we have time for a couple more questions. Maybe just quickly into the competitive dynamics what's NetApp's strategy for differentiating? You have a lot of incumbents in space. Dell has always been a primary competitor and channel checks suggest that the [Pures], you're seeing them in more and more deals, and then now you have new guys like VAST and Weka. So how does NetApp differentiate itself, and what's the strategy for kind of improving your share position?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Excellent. And I guess we always like to end it with kind of your take on what do you think is the least appreciated aspect of the NetApp story?

Question: Victor Chiu - Raymond James & Associates, Inc - Analyst : Excellent. Thank you very much for your time.