NetApp Reports Third Quarter Fiscal Year 2019 Results

Expanded Gross Margins, Operating Margins and Earnings Per Share

  • Net revenues of $1.56 billion grew 2% year-over-year
  • Product revenue of $967 million grew 2% year-over-year
  • All-flash array annualized net revenue run rate of $2.4 billion
    increased 19% year-over-year
  • $649 million returned to shareholders in share repurchases and cash
    dividends

SUNNYVALE, Calif.–(BUSINESS WIRE)–NetApp (NASDAQ: NTAP) today reported financial results for the third
quarter of fiscal year 2019, which ended January 25, 2019.

Although I am disappointed that revenue came in at the low-end of our
guidance range, we continue to demonstrate discipline in how we manage
the business. We are playing into the big market transitions from a
position of strength and are focused on execution to maximize our
opportunity in an uncertain macroeconomic environment,” said George
Kurian, chief executive officer. “Our flash, hybrid cloud
infrastructure, and AI solutions are serving as pillars of customers’
new architectures and we are seeing adoption of our cloud offerings as
part of our customers’ foundation for moving applications and data to
the cloud. We have conviction in our strategy to drive long-term growth.”

Third Quarter Fiscal Year 2019 Financial Results

  • Net Revenues: $1.56 billion, increased 2% year-over-year from
    $1.54 billion* in the third quarter of fiscal 2018
  • Net Income: GAAP net income of $249 million, compared to GAAP
    net lossof $479 million*1 in the third quarter
    of fiscal 2018; non-GAAP net income2 of $305 million,
    compared to non-GAAP net income of $289 million* in the third quarter
    of fiscal 2018
  • Earnings per Share: GAAP net income per share3 of
    $0.98 compared to GAAP net loss per share4 of $1.79*1
    in the third quarter of fiscal 2018; non-GAAP net income per share of
    $1.20, compared to non-GAAP net income per share of $1.05* in the
    third quarter of fiscal 2018
  • Cash, Cash Equivalents and Investments: $4.0 billion at the end
    of the third quarter of fiscal 2019
  • Cash from Operations: $451 million, compared to $420 million in
    the third quarter of fiscal 2018
  • Share Repurchase and Dividend: Returned $649 million to
    shareholders through share repurchases and cash dividends

*In the first quarter of fiscal 2019, NetApp adopted Revenue from
Contracts with Customers
(ASC 606) using the full retrospective
method of adoption. Accordingly, NetApp’s condensed consolidated balance
sheet as of April 27, 2018, condensed consolidated statements of
operations and cash flows for all fiscal 2018 periods presented, and all
related financial statement metrics included herein, have been restated
to conform to the new rules.

Fourth Quarter Fiscal Year 2019 Financial Outlook

The Company provided the following financial guidance for the fourth
quarter of fiscal year 2019:

  • Net revenues are expected to be in the range of:
   

$1.590 billion to $1.690 billion

 

GAAP     Non-GAAP
  • Earnings per share is expected to be in the range of:
$1.06-$1.12 $1.22-$1.28

Dividend

Next cash dividend of $0.40 per share to be paid on April 24, 2019, to
shareholders of record as of the close of business on April 5, 2019.

Third Quarter Fiscal Year 2019 Business Highlights

New World-Class Products and Solutions Help Manage Data Demands

  • NetApp announced new data services and solutions that empower
    customers to innovate in the cloud. These new offerings include the
    expanded availability of the Microsoft Azure NetApp™ Files preview.
  • NetApp announced NetApp Element™ 11.0 software, which
    introduces new functionality for their NetApp HCI customers with Protection
    Domains
    . In addition, Element 11.0 has the ability to manage
    storage clusters running Element software on IPv6 networks, 16TiB
    volume support
    , and QoS histograms to help understand the
    user’s environment.

NetApp Strengthens Strategic Partnerships

  • NetApp announced NetApp Cloud Volumes Service for Google Cloud
    Platform
    will soon be available in Europe to help even more
    customers handle the configuring and managing of their storage
    infrastructures.
  • NetApp announced VMware Validated Design for Private Cloud with
    NetApp HCI
    , NetApp Verified Architecture for VMware End-User
    Computing
    with NetApp HCI and NVIDIA GPUs and NetApp
    Technical Report for Object Storage with NetApp HCI.

Recognition for Industry Leading Products

  • NetApp’s AFF A800 took the top spot in the latest SPEC
    SFS2014 swbuild Result
    5 at the time of
    publication in Nov 2018. The AFF A800 delivered performance
    that was 3 times as fast as the nearest competitor. These
    results also highlighted the fact that ONTAP™ with FlexGroup volumes
    can do more work at lower latencies and higher throughput.

Webcast and Conference Call Information

NetApp will host a conference call to discuss these results today at
2:30 p.m. Pacific Time. To access the live webcast of this event, visit
the NetApp Investor Relations website at investors.netapp.com.
In addition, this press release, historical supplemental data tables,
and other information related to the call will be posted on the Investor
Relations website. An audio replay will also be available on the website
after 4:30 p.m. Pacific Time today.

About NetApp

NetApp is the data authority for hybrid cloud. We provide a full range
of hybrid cloud data services that simplify management of applications
and data across cloud and on-premises environments to accelerate digital
transformation. Together with our partners, we empower global
organizations to unleash the full potential of their data to expand
customer touchpoints, foster greater innovation, and optimize their
operations. For more information, visit www.netapp.com.
#DataDriven

“Safe Harbor” Statement Under U.S. Private Securities Litigation
Reform Act of 1995

This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements include, but are not limited to, all of the statements made
under the Fourth Quarter Fiscal Year 2019 Financial Outlook section,
statements about our ability to maximize our opportunity in an uncertain
macroeconomic environment and maintain disciplined execution as well as
statements about the impact of customer adoption of our product
solutions and offerings, and our strategy to drive long-term growth. All
of these forward-looking statements involve risk and uncertainty. Actual
results may differ materially from these statements for a variety of
reasons, including, without limitation, general global political,
macroeconomic and market conditions, changes in U.S. government
spending, revenue seasonality and matters specific to our business, such
as our ability to expand our total available market and grow our
portfolio of products, customer demand for and acceptance of our
products and services, our ability to successfully execute new business
models, our ability to successfully execute on our Data Fabric strategy
to generate profitable growth and stockholder return and our ability to
manage our gross profit margins. These and other equally important
factors are described in reports and documents we file from time to time
with the Securities and Exchange Commission, including the factors
described under the section titled “Risk Factors” in our most recently
submitted reports on 10-Q and 10-K. We disclaim any obligation to update
information contained in this press release whether as a result of new
information, future events, or otherwise.

NetApp and the NetApp logo and the marks listed at http://www.netapp.com/TM
are trademarks of NetApp, Inc. Other company and product names may be
trademarks of their respective owners.

Footnotes

1GAAP net loss for the third quarter of fiscal year 2018
included a one-time charge of $856 million which resulted from the
enactment of the Tax Cuts and Jobs Act on December 22, 2017.

2Non-GAAP net income excludes, when applicable,
(a) amortization of intangible assets, (b) stock-based compensation
expenses, (c) litigation settlements, (d) acquisition-related expenses,
(e) restructuring charges, (f) asset impairments, (g) gains/losses on
the sale of properties, and (h) our GAAP tax provision, but includes a
non-GAAP tax provision based upon our projected annual non-GAAP
effective tax rate for the first three quarters of the fiscal year and
an actual non-GAAP tax provision for the fourth quarter of the fiscal
year. NetApp makes additional adjustments to the non-GAAP tax provision
for certain tax matters as described below. A detailed reconciliation of
our non-GAAP to GAAP results can be found at http://investors.netapp.com.
NetApp’s management uses these non-GAAP measures in making operating
decisions because it believes the measurements provide meaningful
supplemental information regarding NetApp’s ongoing operational
performance.

3GAAP net income per share and non-GAAP income per share are
calculated using the diluted number of shares.

4GAAP net loss per share is calculated using the basic number
of shares and excludes common stock equivalents because the impact would
be anti-dilutive.

5SPEC SFS®2014_swbuild Result. https://www.spec.org/sfs2014/results/res2018q4/sfs2014-20181112-00053.html

NetApp Usage of Non-GAAP Financial Information

To supplement NetApp’s condensed consolidated financial statement
information presented in accordance with generally accepted accounting
principles in the United States (GAAP), NetApp provides investors with
certain non-GAAP measures, including, but not limited to, historical
non-GAAP operating results, non-GAAP net income, non-GAAP effective tax
rate and free cash flow, and historical and projected non-GAAP earnings
per diluted share.

NetApp believes that the presentation of non-GAAP net income, non-GAAP
effective tax rates, and non-GAAP earnings per share data, when shown in
conjunction with the corresponding GAAP measures, provides useful
information to investors and management regarding financial and business
trends relating to its financial condition and results of operations.
NetApp believes that the presentation of free cash flow, which it
defines as the net cash provided by operating activities less cash used
to acquire property and equipment, to be a liquidity measure that
provides useful information to management and investors because it
reflects cash that can be used to, among other things, invest in its
business, make strategic acquisitions, repurchase common stock, and pay
dividends on its common stock. As free cash flow is not a measure of
liquidity calculated in accordance with GAAP, free cash flow should be
considered in addition to, but not as a substitute for, the analysis
provided in the statement of cash flows.

NetApp’s management uses these non-GAAP measures in making operating
decisions because it believes the measurements provide meaningful
supplemental information regarding NetApp’s ongoing operational
performance. These non-GAAP financial measures are used to: (1) measure
company performance against historical results, (2) facilitate
comparisons to our competitors’ operating results and (3) allow greater
transparency with respect to information used by management in financial
and operational decision making.

NetApp excludes the following items from its non-GAAP measures when
applicable:

A. Amortization of intangible assets. NetApp records amortization
of intangible assets that were acquired in connection with its business
combinations. The amortization of intangible assets varies depending on
the level of acquisition activity. Management finds it useful to exclude
these charges to assess the appropriate level of various operating
expenses to assist in budgeting, planning and forecasting future periods
and in measuring operational performance.

B. Stock-based compensation expenses. NetApp excludes stock-based
compensation expenses from its non-GAAP measures primarily because they
are non-cash expenses. While management views stock-based compensation
as a key element of our employee retention and long-term incentives, we
do not view it as an expense to be used in evaluating operational
performance in any given period.

C. Litigation settlements. NetApp may periodically incur charges
or benefits related to litigation settlements. NetApp excludes these
charges and benefits, when significant, because it does not believe they
are reflective of ongoing business and operating results.

D. Acquisition-related expenses. NetApp excludes
acquisition-related expenses, including (a) due diligence, legal and
other one-time integration charges and (b) write down of assets acquired
that NetApp does not intend to use in its ongoing business, from its
non-GAAP measures, primarily because they are not related to our ongoing
business or cost base and, therefore, cannot be relied upon for future
planning and forecasting.

E. Restructuring charges. These charges consist of restructuring
charges that are incurred based on the particular facts and
circumstances of restructuring decisions, including employment and
contractual settlement terms, and other related charges, and can vary in
size and frequency. We therefore exclude them in our assessment of
operational performance.

F. Asset impairments. These are non-cash charges to write down
assets when there is an indication that the asset has become impaired.
Management finds it useful to exclude these non-cash charges due to the
unpredictability of these events in its assessment of operational
performance.

G. Gains/losses on the sale of properties. These are gains/losses
from the sale of our properties. Management believes that these
transactions do not reflect the results of our underlying, on-going
business and, therefore, cannot be relied upon for future planning or
forecasting.

H. Income tax adjustments. NetApp’s non-GAAP tax provision is
based upon a projected annual non-GAAP effective tax rate for the first
three quarters of the fiscal year and an actual non-GAAP tax provision
for the fourth quarter of the fiscal year. The non-GAAP tax provision
also excludes, when applicable, (a) tax charges or benefits in the
current period that relate to one or more prior fiscal periods that are
a result of events such as changes in tax legislation, authoritative
guidance, income tax audit settlements and/or court decisions, (b) tax
charges or benefits that are attributable to unusual or non-recurring
book and/or tax accounting method changes, (c) tax charges that are a
result of a non-routine foreign cash repatriation, (d) tax charges or
benefits that are a result of infrequent restructuring of the Company’s
tax structure, (e) tax charges or benefits that are a result of a change
in valuation allowance, and (f) tax charges resulting from the
integration of intellectual properties from acquisitions. Management
believes that the use of non-GAAP tax provisions provides a more
meaningful measure of the Company’s operational performance.

These non-GAAP measures are not in accordance with, or an alternative
for, measures prepared in accordance with GAAP, and may be different
from non-GAAP measures used by other companies. In addition, these
non-GAAP measures are not based on any comprehensive set of accounting
rules or principles. NetApp believes that non-GAAP measures have
limitations in that they do not reflect all of the amounts associated
with the Company’s results of operations as determined in accordance
with GAAP and that these measures should only be used to evaluate the
Company’s results of operations in conjunction with the corresponding
GAAP measures. NetApp management compensates for these limitations by
analyzing current and projected results on a GAAP basis as well as a
non-GAAP basis. The presentation of non-GAAP financial information is
not meant to be considered in isolation or as a substitute for the
directly comparable financial measures prepared in accordance with
generally accepted accounting principles in the United States. The
non-GAAP financial measures are meant to supplement, and be viewed in
conjunction with, GAAP financial measures.

       

NETAPP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

 
January 25, April 27,
2019 2018
 
ASSETS
 
Current assets:
Cash, cash equivalents and investments $ 4,049 $ 5,391
Accounts receivable 872 1,047
Inventories 100 122
Other current assets   340   392
Total current assets 5,361 6,952
 
Property and equipment, net 763 756
Goodwill and purchased intangible assets, net 1,798 1,833
Other non-current assets   496   450
Total assets $ 8,418 $ 9,991
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
Accounts payable $ 497 $ 609
Accrued expenses 730 825
Commercial paper notes 163 385
Current portion of long-term debt 399
Short-term deferred revenue and financed unearned services revenue   1,641   1,712
Total current liabilities 3,430 3,531
Long-term debt 1,144 1,541
Other long-term liabilities 898 992
Long-term deferred revenue and financed unearned services revenue   1,716   1,651
Total liabilities   7,188   7,715
 
Stockholders’ equity   1,230   2,276
Total liabilities and stockholders’ equity $ 8,418 $ 9,991
 
     

NETAPP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

(Unaudited)

 
Three Months Ended Nine Months Ended
January 25,     January 26, January 25,     January 26,
2019 2018 2019 2018
 
Revenues:
Product $ 967 $ 952 $ 2,755 $ 2,498
Software maintenance 239 221 704 668
Hardware maintenance and other services   357   366   1,095   1,109
Net revenues   1,563   1,539   4,554   4,275
 
Cost of revenues:
Cost of product 469 469 1,295 1,242
Cost of software maintenance 10 6 25 19
Cost of hardware maintenance and other services   102   108   315   334
Total cost of revenues   581   583   1,635   1,595
Gross profit   982   956   2,919   2,680
 
Operating expenses:
Sales and marketing 401 419 1,218 1,263
Research and development 203 193 622 580
General and administrative 67 72 209 209
Restructuring charges 19
Gain on sale of properties     (218 )     (218 )
Total operating expenses   671   466   2,068   1,834
 
Income from operations 311 490 851 846
 
Other income, net   8   14   33   25
 
Income before income taxes 319 504 884 871
 
Provision for income taxes   70   983   111   1,045
 
Net income (loss) $ 249 $ (479 ) $ 773 $ (174 )
 
Net income (loss) per share:
Basic $ 1.00 $ (1.79 ) $ 3.01 $ (0.65 )
 
Diluted $ 0.98 $ (1.79 ) $ 2.94 $ (0.65 )
 
Shares used in net income (loss) per share calculations:
Basic   250   268   257   269
 
Diluted   255   268   263   269
 
Cash dividends declared per share $ 0.40 $ 0.20 $ 1.20 $ 0.60
 
     

NETAPP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

 
Three Months Ended Nine Months Ended
January 25,   January 26, January 25,   January 26,
2019 2018 2019 2018
Cash flows from operating activities:
Net income (loss) $ 249 $ (479 ) $ 773 $ (174 )
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
Depreciation and amortization 51 48 149 150
Stock-based compensation 43 38 121 125
Deferred income taxes 4 205 (21 ) 245
Gain on sale of properties (218 ) (218 )
Other items, net (3 ) (3 ) 8 (8 )
Changes in assets and liabilities, net of acquisitions of businesses:
Accounts receivable (104 ) (156 ) 165 (10 )
Inventories (14 ) 10 22 68
Accounts payable 26 81 (101 ) 115
Accrued expenses 77 126 (85 ) 58
Deferred revenue and financed unearned services

revenue

146 64 17 (99 )
Long-term taxes payable 3 721 (60 ) 723
Changes in other operating assets and liabilities, net   (27 )   (17 )   (46 )   9
Net cash provided by operating activities   451   420   942   984
Cash flows from investing activities:
Redemptions (purchases) of investments, net 172 (226 ) 661 (178 )
Purchases of property and equipment (31 ) (32 ) (138 ) (97 )
Proceeds from sale of properties 210 210
Acquisitions of businesses, net of cash acquired (3 ) (75 )
Other investing activities, net   (1 )   (1 )   1   (1 )
Net cash provided by (used in) investing activities   140   (49 )   521   (141 )
Cash flows from financing activities:
Proceeds from issuance of common stock under employee

stock award plans

53 100 118 157
Payments for taxes related to net share settlement of stock

awards

(3 ) (7 ) (92 ) (67 )
Repurchase of common stock (550 ) (150 ) (1,611 ) (450 )
Proceeds from (repayments of) commercial paper notes,

net

(86 ) (86 ) (221 ) 132
Issuance of long-term debt, net 795
Repayment of long-term debt (750 ) (750 )
Dividends paid (99 ) (53 ) (306 ) (161 )
Other financing activities, net   (3 )   (5 )   (5 )   (6 )
Net cash used in financing activities   (688 )   (951 )   (2,117 )   (350 )
 
Effect of exchange rate changes on cash, cash equivalents and
restricted cash
8 24 (17 ) 37
 
Net increase (decrease) in cash, cash equivalents and restricted
cash
(89 ) (556 ) (671 ) 530
Cash, cash equivalents and restricted cash:
Beginning of period   2,365   3,536   2,947   2,450
End of period $ 2,276 $ 2,980 $ 2,276 $ 2,980
 
   

SELECTED CONDENSED CONSOLIDATED BALANCE SHEET LINE ITEMS

(In millions)

(Unaudited)

 
As of April 27, 2018
     

As Previously
Reported

Impact of ASC
606 Adoption

As Adjusted
ASSETS
Accounts receivable $ 1,009 $ 38 $ 1,047
Inventories 126 (4 ) 122
Other current assets 330 62 392
Other non-current assets 420 30 450
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Short-term deferred revenue and financed unearned services revenue $ 1,804 $ (92 ) $ 1,712
Other long-term liabilities 961 31 992
Long-term deferred revenue and financed unearned services revenue 1,673 (22 ) 1,651
Total stockholders’ equity 2,067 209 2,276
 
 
NETAPP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share amounts)
(Unaudited)
                 
Three Months Ended Nine Months Ended
January 26, 2018 January 26, 2018

As
Previously
Reported

Impact of ASC
606 Adoption

As
Adjusted

As
Previously
Reported

Impact of ASC
606 Adoption

As
Adjusted

 
Revenues:
Product $ 920 $ 32 $ 952 $ 2,450 $ 48 $ 2,498
Software maintenance 237 (16 ) 221 711 (43 ) 668
Hardware maintenance and other services   366     366   1,109     1,109
Net revenues   1,523   16   1,539   4,270   5   4,275
 
Cost of revenues:
Cost of product 468 1 469 1,238 4 1,242
Cost of software maintenance 6 6 19 19
Cost of hardware maintenance and other services   108     108   336   (2 )   334
Total cost of revenues   582   1   583   1,593   2   1,595
Gross profit   941   15   956   2,677   3   2,680
 
Operating expenses:
Sales and marketing 423 (4 ) 419 1,268 (5 ) 1,263
Research and development 193 193 580 580
General and administrative 72 72 209 209
Gain on sale of properties   (218 )     (218 )   (218 )     (218 )
Total operating expenses   470   (4 )   466   1,839   (5 )   1,834
 
Income from operations 471 19 490 838 8 846
 
Other income, net   14     14   25     25
 
Income before income taxes 485 19 504 863 8 871
 
Provision for income taxes   991   (8 )   983   1,058   (13 )   1,045
 
Net loss $ (506 ) $ 27 $ (479 ) $ (195 ) $ 21 $ (174 )
 
Net loss per share:
Basic $ (1.89 ) $ 0.10 $ (1.79 ) $ (0.72 ) $ 0.07 $ (0.65 )
 
Diluted $ (1.89 ) $ 0.10 $ (1.79 ) $ (0.72 ) $ 0.07 $ (0.65 )
 
Shares used in net loss per share calculations:
Basic   268   268   268   269   269   269
 
Diluted   268   268   268   269   269   269
 
 
NETAPP, INC.
SUPPLEMENTAL DATA
(In millions except net income per share, percentages, DSO, DIO,
DPO, CCC and Inventory Turns)
(Unaudited)
           
Q3 FY’19 Q2 FY’19 Q3 FY’18
 
Revenues
Product $ 967 $ 913 $ 952
Strategic $ 674 $ 649 $ 657
Mature $ 293 $ 264 $ 295
Software Maintenance $ 239 $ 236 $ 221
Hardware Maintenance and Other Services $ 357 $ 368 $ 366
Hardware Maintenance Support Contracts $ 292 $ 303 $ 300
Professional and Other Services $ 65 $ 65 $ 66
Net Revenues $ 1,563 $ 1,517 $ 1,539
 
 
Geographic Mix
% of Q3 FY’19 % of Q2 FY’19 % of Q3 FY’18
Revenue Revenue Revenue
Americas 52 % 57 % 53 %
Americas Commercial 41 % 44 % 43 %
U.S. Public Sector 11 % 14 % 10 %
EMEA 33 % 28 % 33 %
Asia Pacific 14 % 15 % 14 %
 
 
Pathways Mix
% of Q3 FY’19 % of Q2 FY’19 % of Q3 FY’18
Revenue Revenue Revenue
Direct 19 % 23 % 22 %
Indirect 81 % 77 % 78 %
 
 
Non-GAAP Gross Margins
Q3 FY’19 Q2 FY’19 Q3 FY’18
Non-GAAP Gross Margin 63.7 % 64.9 % 63.0 %
Product 52.6 % 54.1 % 51.8 %
Software Maintenance 95.8 % 96.6 % 97.3 %
Hardware Maintenance and Other Services 72.3 % 71.5 % 71.3 %
 
 
Non-GAAP Income from Operations, Income before Income Taxes &
Effective Tax Rate
Q3 FY’19 Q2 FY’19 Q3 FY’18
Non-GAAP Income from Operations $ 367 $ 336 $ 329
% of Net Revenues 23.5 % 22.1 % 21.4 %
Non-GAAP Income before Income Taxes $ 375 $ 343 $ 343
Non-GAAP Effective Tax Rate 18.7 % 18.5 % 15.7 %
 
 
 
 
 
 
Non-GAAP Net Income
Q3 FY’19 Q2 FY’19 Q3 FY’18
Non-GAAP Net Income $ 305 $ 280 $ 289
Non-GAAP Weighted Average Common Shares Outstanding, Diluted 255 264 276
Non-GAAP Income per Share, Diluted $ 1.20 $ 1.06 $ 1.05
 
 
Select Balance Sheet Items
Q3 FY’19 Q2 FY’19 Q3 FY’18
Deferred Revenue and Financed Unearned Services Revenue $ 3,357 $ 3,206 $ 3,143
DSO (days) 51 46 46
DIO (days) 16 14 14
DPO (days) 78 79 71
CCC (days) (11 ) (19 ) (12 )
Inventory Turns 23 25 26
 
Days sales outstanding (DSO) is defined as accounts receivable
divided by net revenues, multiplied by the number of days in the
quarter.
Days inventory outstanding (DIO) is defined as net inventories
divided by cost of revenues, multiplied by the number of days in the
quarter.
Days payables outstanding (DPO) is defined as accounts payable
divided by cost of revenues, multiplied by the number of days in the
quarter.
Cash conversion cycle (CCC) is defined as DSO plus DIO minus DPO.
Inventory turns is defined as annualized cost of revenues divided
by net inventories.
 
 
Select Cash Flow Statement Items
Q3 FY’19 Q2 FY’19 Q3 FY’18
Net Cash Provided by Operating Activities $ 451 $ 165 $ 420
Purchases of Property and Equipment $ 31 $ 43 $ 32
Free Cash Flow $ 420 $ 122 $ 388
Free Cash Flow as a % of Net Revenues 26.9 % 8.0 % 25.2 %
 
Free cash flow is a non-GAAP measure and is defined as net cash
provided by operating activities less purchases of property and
equipment.
 
Some items may not add or recalculate due to rounding.
 

Contacts

(Press)
Madge Miller
1 408 419 5263
[email protected]

(Investors)
Kris Newton
1 408 822 3312
[email protected]

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