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NetApp Pounds Out Profits

Network Appliance Inc. (Nasdaq: NTAP) posted a strong increase in sales for its most recent quarter and delivered an unambiguously sunny outlook for its current one (see NetApp's Q1 Profits Soar).

The Sunnyvale, Calif., company had revenues of $260.5 million for its first fiscal 2004 quarter, which ended August 1, 2003. That's up 26 percent from revenues of $206.8 million for the same period a year ago and represents an 8 percent increase over the prior quarter. Its net income for the period was $27.1 million, or $0.08 per share, an increase of 67 percent over the $16.2 million, or $0.05 per share, it reported in the year-ago quarter.

NetApp shares were up $2.30 in after-hours trading, or around 13 percent, to $20.35.

Laura Conigliaro, an analyst with Goldman Sachs & Co., says a strong surge in NetApp's products revenues were the driver behind its winning quarter [ed. note: well... sure]. "With or without the July quarter's extra week of sales, NetApp still delivered its best quarter in years," she writes in a research note.

During the quarter, NetApp shipped more than 2.7 petabytes of its NearStore ATA-based disk storage system for nearline data, a 40 percent sequential increase. Analysts noted, however, that revenues from NearStore grew no more than 10 percent from the previous quarter.

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