--- ticker: NTAP company: NetApp Inc. filing_type: 10-K year_current: 2026 year_prior: 2025 risks_added: 13 risks_removed: 16 risks_modified: 73 risks_unchanged: 36 source: SEC EDGAR url: https://riskdiff.com/ntap/2026-vs-2025/ markdown_url: https://riskdiff.com/ntap/2026-vs-2025/index.md generated: 2026-06-07 --- # NetApp Inc.: 10-K Risk Factor Changes 2026 vs 2025 > Source: U.S. Securities and Exchange Commission (EDGAR) > Generated: 2026-06-07 > All data extracted directly from official filings. No hallucinated content. ## Summary | Status | Count | |--------|-------| | New risks added | 13 | | Risks removed | 16 | | Risks modified | 73 | | Unchanged | 36 | --- ## New in Current Filing: Changes in regulations relating to our products or their components, or the manufacture, sourcing, distribution or use thereof, may harm our business, operating results, financial condition and cash flows. The laws and regulations governing the manufacturing, sourcing, distribution and use of our products have become increasingly complex and stringent and costly to comply with. For example, in addition to various environmental laws relating to carbon emissions, the use and discharge of hazardous materials, and the use of certain minerals originating from identified conflict zones, many governments, including the U.S., the United Kingdom, and Australia, have adopted regulations to address the risk of human trafficking in supply chains, which govern how workers are recruited and managed. Given the complexity of our supply chain, we may face reputational harm if our customers or other stakeholders conclude that we are unable to verify sufficiently the origins of the minerals used in the products we sell or the actions of our suppliers with respect to workers. As the laws and regulations governing our products continue to expand and change, our costs are likely to rise, and failure to comply with any such laws and regulations could subject us to business interruptions, litigation risks, and reputational harm. --- ## New in Current Filing: We may be found to infringe on intellectual property rights of others. We compete in markets in which intellectual property infringement claims arise in the normal course of business. Third parties have, from time to time, asserted intellectual property-related claims against us, including claims for alleged patent infringement brought by non-practicing entities. Such claims may be made against our products and services, our customers' use of our products and services, or a combination of our products and third-party products. We also may be subject to claims and indemnification obligations from customers and resellers with respect to third-party intellectual property rights pursuant to our agreements with them. If we refuse to indemnify or defend such claims, even in situations in which the third-party's allegations are meritless, then customers and resellers may refuse to do business with us. Patent litigation is particularly common in our industry, and we expect infringement claims to continue to increase as the number of products and competitors in our industry segment grows and the functionality of products in different industry segments overlaps. We have been, and continue to be, in active patent litigations with non-practicing entities. There is no guarantee that, in patent or other types of intellectual property litigation, we will prevail at trial or be able to settle at a reasonable cost. If a court determined that our products infringe, we could be required to pay significant monetary damages and be subject to non-monetary relief that could cause product shipment delays, require us to redesign our products, affect our ability to supply or service our customers, or require us to enter into compulsory royalty or licensing agreements. Any such claims could be time-consuming, result in costly litigation, and could materially and adversely affect our operating results, financial condition and cash flows. In addition, such royalty or licensing agreements, if required, may not be available on terms acceptable to us or at all. --- ## New in Current Filing: Global Business Environment Supply Chain Inflationary pressures and supply chain constraints have impacted our operations beginning in the second half of fiscal 2026. We have experienced increased costs for memory and other components, which have affected our gross margins, and we expect costs will remain elevated, or continue to increase, in the near term. Additionally, the tight supply environment for specific products, which is anticipated to persist, could pose challenges in meeting customer demand for those products. To address these challenges, we have implemented several strategic actions: •We raised our pricing in the fourth quarter of fiscal 2026, in line with market trends. We expect to continue adjusting prices as necessary to offset rising costs and remain aligned with the market. While we aim to match supplier costs with our pricing to customers, we recognize the need to give customers time to adjust to these changes. We raised our pricing in the fourth quarter of fiscal 2026, in line with market trends. We expect to continue adjusting prices as necessary to offset rising costs and remain aligned with the market. While we aim to match supplier costs with our pricing to customers, we recognize the need to give customers time to adjust to these changes. •We are leveraging our relationships with multiple suppliers where available to enable component availability and manage costs effectively. This strategy helps us maintain competitive positions in the market from a pricing standpoint. Our history of successful supplier management positions us well to navigate these challenges. We are leveraging our relationships with multiple suppliers where available to enable component availability and manage costs effectively. This strategy helps us maintain competitive positions in the market from a pricing standpoint. Our history of successful supplier management positions us well to navigate these challenges. •We continue to offer a wide range of solutions to meet various customer needs and priorities. This includes competitive storage options, all-flash solutions, hybrid-flash solutions, public cloud solutions, and our Keystone Storage-as-a-Service offering. By providing diverse options, we aim to align with our customers' budget priorities and deliver the best value offerings. We continue to offer a wide range of solutions to meet various customer needs and priorities. This includes competitive storage options, all-flash solutions, hybrid-flash solutions, public cloud solutions, and our Keystone Storage-as-a-Service offering. By providing diverse options, we aim to align with our customers' budget priorities and deliver the best value offerings. 37 37 These actions are part of our ongoing efforts to mitigate the impact of inflation and supply chain constraints on our operating results. We will continue to monitor these trends and uncertainties and adjust our strategies as needed to maintain our financial performance.Financial Results and Key Performance Metrics OverviewThe following table provides an overview of key financial metrics for the years indicated (in millions, except per share amounts and percentages): Year Ended April 24, 2026 April 25, 2025 April 26, 2024 Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 April 24, 2026 April 25, 2025 Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues.•Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues.•Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues.•Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year.•Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above.Stock Repurchase Program and Dividend ActivityDuring fiscal 2026, we repurchased 9.0 million shares of our common stock at an average price of $105.89 per share, for an aggregate purchase price of $950 million. We also declared aggregate cash dividends of $2.08 per share in fiscal 2026, for which we paid a total of $413 million.Restructuring EventsDuring fiscal 2026, we executed a restructuring plan and recognized expenses totaling $21 million consisting primarily of employee severance-related costs related to the current year and prior year plans. Senior Notes RepaymentOn June 23, 2025, upon maturity, we repaid the 1.875% Senior Notes due June 2025 for an aggregate amount of $757 million, comprised of the principal and unpaid interest. These actions are part of our ongoing efforts to mitigate the impact of inflation and supply chain constraints on our operating results. We will continue to monitor these trends and uncertainties and adjust our strategies as needed to maintain our financial performance. --- ## New in Current Filing: April 26, 2024 Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## New in Current Filing: Hybrid Cloud Segment Net Revenues by Storage Category (in millions, except percentages): The following table presents Hybrid Cloud segment net revenues by storage category for the periods indicated: Year Ended --- ## New in Current Filing: April 26, 2024 Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## New in Current Filing: Operating Expenses Sales and Marketing, Research and Development and General and Administrative Expenses Sales and marketing, research and development, and general and administrative expenses for fiscal 2026 totaled $3,204 million, or 46% of net revenues, representing a decrease of three percentage points compared to fiscal 2025, primarily due to an increase in net revenues. While fluctuations in foreign currency exchange rates favorably impacted net revenues in fiscal 2026 compared to fiscal 2025, they adversely impacted sales and marketing, research and development and general and administrative expenses. Sales and marketing, research and development, and general and administrative expenses for fiscal 2025 totaled $3,188 million, or 49% of net revenues, representing a decrease of one percentage point compared to fiscal 2024. Compensation costs represent the largest component of operating expenses. Included in compensation costs are salaries, benefits, other compensation-related costs, stock-based compensation expense and employee incentive compensation plan costs. Total compensation costs included in sales and marketing, research and development and general and administrative expenses remained relatively flat in fiscal 2026, 2025 and 2024. Sales and Marketing (in millions, except percentages): Year Ended --- ## New in Current Filing: April 26, 2024 Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## New in Current Filing: April 26, 2024 Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## New in Current Filing: April 25, 2025 Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. •Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. --- ## New in Current Filing: April 26, 2024 Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## New in Current Filing: Income from operations 1,674 1,337 1,214 Other (expense) income, net (26 ) 46 49 --- ## New in Current Filing: Balances, April 25, 2025 201 1,106 - (66 ) 1,040 Net income - - 1,276 - 1,276 Other comprehensive income - - - 55 55 Issuance of common stock under employee stock award plans, net of taxes 4 (34 ) - - (34 ) Repurchase of common stock (9 ) (98 ) (852 ) - (950 ) Excise tax on net stock repurchases - (5 ) - - (5 ) Stock-based compensation - 382 - - 382 Cash dividends declared ($2.08 per common share) - (142 ) (271 ) - (413 ) --- ## No Match in Current: If we do not achieve forecasted sales orders in any quarter, our operating results, financial condition and cash flows could be harmed. *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* We derive a significant amount of our revenues in any given quarter from orders booked in the same quarter. These orders typically follow intra-quarter seasonality patterns, with a significant portion occurring toward the end of the quarter. If we fail to achieve the forecasted level, timing, and mix of orders in line with our quarterly targets and historical patterns, or if we experience cancellations of significant orders, our operating results, financial condition and cash flows could be adversely affected. --- ## No Match in Current: If our products or services are defective, or are perceived to be defective, including as a result of improper use or maintenance, our operating results and customer relationships may be harmed. *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* Our products and services are complex. We have experienced in the past, and expect to experience in the future, quality issues impacting certain products, and we could experience reliability issues with services we provide, including security vulnerabilities, software bugs, hardware failure in networked storage appliances, incompatibility issues with customer systems or other applications, performance deficiencies causing slow data retrieval or processing, firmware or software updates causing system instability, compliance with various product certifications, and data breaches due to flaws in the product design. Such quality and reliability issues may be due to, for example, our own designs or processes, the designs or processes of our suppliers, and/or flaws in third-party software used in our products. These types of risks are most acute when we are introducing new products. Quality or reliability issues have and could again in the future cause customers to experience outages or disruptions in service, data loss or data corruption. If we fail to remedy a product defect or flaw, we may experience a failure of a product line, temporary or permanent withdrawal from a product or market, damage to our reputation, loss of revenue, inventory costs or product reengineering expenses and higher ongoing warranty and service costs, and these occurrences could have a material impact on our gross margins, business and operating results. In addition, we exercise little control over how our customers use or maintain our products and services, and in some cases improper usage or maintenance could impair the performance of our products and services, which could lead to a perception of a quality or reliability issue. Customers may experience losses that may result from or are alleged to result from defects or flaws in our products and services, which could subject us to claims for damages, including consequential damages. --- ## No Match in Current: Our failure to protect our intellectual property could harm our business, operating results, financial condition and cash flows. *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* Our success depends significantly upon developing, maintaining and protecting our proprietary technology. We rely on a combination of patents, copyrights, trademarks, trade secrets, confidentiality procedures and contractual provisions with employees, resellers, strategic partners and customers, to protect our proprietary rights. We currently have multiple U.S. and international patent applications pending and multiple U.S. and international patents issued. The pending applications may not be approved, and our existing and future patents may be challenged. If such challenges are brought, the patents may be invalidated. We may not be able to develop proprietary products or technologies that are patentable, and patents issued to us may not provide us with any competitive advantages and may be challenged by third parties. Further, the patents of others may materially and adversely affect our ability to do business. In addition, a failure to obtain and defend our trademark registrations may impede our marketing and branding efforts and competitive condition. Litigation may be necessary to protect our proprietary technology. Any such litigation may be time-consuming and costly. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or obtain and use information that we regard as proprietary. In addition, the laws of some foreign countries do not protect proprietary rights to as great an extent as do the laws of the U.S. Our means of protecting our proprietary rights may not be adequate or our competitors may independently develop similar technology, duplicate our products, or design around patents issued to us or other intellectual property rights of ours. There is persistent risk that some individuals will improperly take our intellectual property after terminating their employment or other engagements with us, which could lead to intellectual property leakage to competitors and a loss of our competitive advantages. --- ## No Match in Current: Performance Graph *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend reinvested basis, of an investment of $100 for the Company, the S&P 500 Index, the S&P 500 Information Technology Index and the S&P 1500 Technology Hardware & Equipment Index for the five years ended April 25, 2025. The comparisons in the graphs below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. The graph and related information shall not be deemed "soliciting material" or be deemed to be "filed" with the SEC, nor shall such information be incorporated by reference into any past or future filing with the SEC, except to the extent that such filing specifically states that such graph and related information are incorporated by reference into such filing. --- ## No Match in Current: Fiscal Year *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 --- ## No Match in Current: Cost of services revenues *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* $ 675 $ 698 (3 )% $ 636 10 % Support 197 195 1 % 181 8 % Professional and other services 261 243 7 % 211 15 % Public cloud 165 203 (19 )% 184 10 % Unallocated 52 57 (9 )% 60 (5 )% Hybrid Cloud Cost of Hybrid Cloud services revenues, which are composed of the costs of support and professional and other services, increased in fiscal 2025 and fiscal 2024 compared to the respective prior years reflecting the increase in Hybrid Cloud services revenues. Cost of Hybrid Cloud services revenues represented 16%, 16% and 14% of Hybrid Cloud services revenues in fiscal 2025, 2024 and 2023, respectively. Hybrid Cloud support gross margins were similar in fiscal 2025, fiscal 2024 and fiscal 2023. Hybrid Cloud professional and other services gross margins increased by approximately two percentage points in fiscal 2025 compared to fiscal 2024 while they decreased by approximately ten percentage points in fiscal 2024 compared to fiscal 2023 primarily due to the mix of services provided. Public Cloud Cost of Public Cloud revenues decreased in fiscal 2025 compared to fiscal 2024, while Public Cloud gross margins increased by eight percentage points in fiscal 2025 compared to fiscal 2024. The decrease in cost of Public Cloud revenues and improved gross margins was due to cost optimization that included a decrease in fixed assets depreciation and the mix of offerings provided. Cost of Public Cloud revenues increased in fiscal 2024 compared to fiscal 2023, reflecting the increase in Public Cloud revenues. Public Cloud gross margins decreased by one percentage point in fiscal 2024 compared to fiscal 2023 primarily due to the mix of offerings provided. Unallocated Unallocated cost of services revenues decreased in fiscal 2025 compared to fiscal 2024 due to the derecognition of certain intangible assets as a result of the sale of our cloud optimization and management software business known as Spot by NetApp during the fourth quarter of fiscal 2025. Unallocated cost of services revenues decreased in fiscal 2024 compared to fiscal 2023 due to certain intangible assets becoming fully amortized during the first quarter of fiscal 2024. --- ## No Match in Current: Fiscal Year *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 --- ## No Match in Current: Fiscal Year *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 --- ## No Match in Current: Fiscal Year *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 --- ## No Match in Current: April 26,2024 *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* Deferred revenue and financed unearned services revenue $ 4,536 $ 4,234 36 36 •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues.•Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues.•Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues.•Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year.•Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above.Stock Repurchase Program and Dividend ActivityDuring fiscal 2025, we repurchased 10.2 million shares of our common stock at an average price of $112.55 per share, for an aggregate purchase price of $1.2 billion. We also declared aggregate cash dividends of $2.08 per share in fiscal 2025, for which we paid a total of $424 million.Restructuring EventsDuring fiscal 2025, we executed several restructuring plans and recognized expenses totaling $83 million consisting primarily of employee severance-related costs. Senior Notes IssuanceIn March 2025, we issued $625 million aggregate principal amount of 5.50% Senior Notes due 2032 and $625 million aggregate principal amount of 5.70% Senior Notes due 2035, for which we received total proceeds of $1.24 billion, net of discount and issuance costs. •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. •Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. --- ## No Match in Current: Dividends and Stock Repurchase Program *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* On May 22, 2025, we declared a cash dividend of $0.52 per share of common stock, payable on July 23, 2025 to holders of record as of the close of business on July 3, 2025. As of April 25, 2025, our Board of Directors had authorized the repurchase of up to $17.1 billion of our common stock under our stock repurchase program. Under this program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. Since the May 13, 2003 inception of this program through April 25, 2025, we repurchased a total of 382 million shares of our common stock at an average price of $43.93 per share, for an aggregate purchase price of $16.8 billion. As of April 25, 2025, the remaining authorized amount for stock repurchases under this program was $0.4 billion. On May 22, 2025 our Board of Directors authorized the repurchase of an additional $1.1 billion of our common stock. --- ## No Match in Current: Inventory Valuation and Purchase Order Accruals *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* Inventories consist primarily of purchased components and finished goods and are stated at the lower of cost or net realizable value, which approximates actual cost on a first-in, first-out basis. A provision is recorded when inventory is determined to be in excess of anticipated demand or obsolete in order to adjust inventory to its estimated realizable value. The following are the key estimates and assumptions and corresponding uncertainties for estimating the value of our inventories: --- ## No Match in Current: Key Uncertainties *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.*  We evaluate whether products and services promised in our contracts with customers are distinct performance obligations that should be accounted for separately versus together.  In certain contracts, the determination of our distinct performance obligations requires significant judgment. As our business and offerings to customers change over time, the products and services we determine to be distinct performance obligations may change. Such changes may adversely impact the amount of revenue and gross margin we report in a particular period.  In determining the transaction price of our contracts, we estimate variable consideration based on the expected value, primarily relying on our history. In certain situations, we may also use the most likely amount as the basis of our estimate.  We may have insufficient relevant historical data or other information to arrive at an accurate estimate of variable consideration using either the "expected value" or "most likely amount" method. Additionally, changes in business practices, such as those related to sales returns or marketing programs, may introduce new forms of variable consideration, as well as more complexity and uncertainty in the estimation process. 48 48  In contracts with multiple performance obligations, we establish SSPs based on the price at which products and services are sold separately. If SSPs are not observable through past transactions, we estimate them by maximizing the use of observable inputs including pricing strategy, market data, internally-approved pricing guidelines related to the performance obligations and other observable inputs.  As our business and offerings evolve over time, modifications to our pricing and discounting methodologies, changes in the scope and nature of product and service offerings and/or changes in customer segmentation may result in a lack of consistency, making it difficult to establish and/or maintain SSPs. Changes in SSPs could result in different and unanticipated allocations of revenue in contracts with multiple performance obligations. These factors, among others, may adversely impact the amount of revenue and gross margin we report in a particular period. Inventory Valuation and Purchase Order AccrualsInventories consist primarily of purchased components and finished goods and are stated at the lower of cost or net realizable value, which approximates actual cost on a first-in, first-out basis. A provision is recorded when inventory is determined to be in excess of anticipated demand or obsolete in order to adjust inventory to its estimated realizable value. The following are the key estimates and assumptions and corresponding uncertainties for estimating the value of our inventories: Key Estimates and Assumptions Key Uncertainties  We periodically perform an excess and obsolete analysis of our inventory. Inventories are written down based on excess and obsolete reserves determined primarily on assumptions about future demand forecasts and market conditions. At the point of the loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis.  Although we use our best estimates to forecast future product demand, any significant unanticipated changes in demand, including due to macroeconomic uncertainties, or obsolescence related to technological developments, new product introductions, customer requirements, competition or other factors could have a significant impact on the valuation of our inventory. If actual market conditions are less favorable than those projected, additional write-downs and other charges against earnings that adversely impact gross margins may be required. If actual market conditions are more favorable, we may realize higher gross profits in the period when the written-down inventory is sold. We are subject to a variety of environmental laws relating to the manufacture of our products. If there are changes to the current regulations, we may be required to make product design changes which may result in excess or obsolete inventory, which could adversely impact our operating results.  We make commitments to our third-party contract manufacturers and other suppliers to manage lead times and meet product forecasts and to other parties to purchase various key components used in the manufacture of our products. We establish accruals for estimated losses on non-cancelable purchase commitments when we believe it is probable that the components will not be utilized in future operations.  If the actual materials demand is significantly lower than our forecast, we may be required to increase our recorded liabilities for estimated losses on non-cancelable purchase commitments. Goodwill and Purchased Intangible AssetsWe allocate the purchase price of acquisitions to identifiable assets acquired and liabilities assumed at their acquisition date fair values based on established valuation techniques. Goodwill represents the residual value as of the acquisition date, which in most cases is measured as the excess of the purchase consideration transferred over the net of the acquisition date fair values of the assets acquired and liabilities assumed.The carrying values of purchased intangible assets are reviewed whenever events and circumstances indicate that the net book value of an asset may not be recovered through expected future cash flows from its use and eventual disposition. We periodically review the estimated remaining useful lives of our intangible assets. This review may result in impairment charges or shortened useful lives, resulting in charges to our consolidated statements of income.  In contracts with multiple performance obligations, we establish SSPs based on the price at which products and services are sold separately. If SSPs are not observable through past transactions, we estimate them by maximizing the use of observable inputs including pricing strategy, market data, internally-approved pricing guidelines related to the performance obligations and other observable inputs.  As our business and offerings evolve over time, modifications to our pricing and discounting methodologies, changes in the scope and nature of product and service offerings and/or changes in customer segmentation may result in a lack of consistency, making it difficult to establish and/or maintain SSPs. Changes in SSPs could result in different and unanticipated allocations of revenue in contracts with multiple performance obligations. These factors, among others, may adversely impact the amount of revenue and gross margin we report in a particular period. --- ## No Match in Current: April 28, 2023 *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* Net revenues $ 6,572 $ 6,268 $ 6,362 Gross profit $ 4,613 $ 4,433 $ 4,209 Gross margin 70 % 71 % 66 % Income from operations $ 1,337 $ 1,214 $ 1,018 Income from operations as a percentage of net revenues 20 % 19 % 16 % Provision (benefit) for income taxes $ 197 $ 277 $ (208 ) Net income $ 1,186 $ 986 $ 1,274 Diluted net income per share $ 5.67 $ 4.63 $ 5.79 Net cash provided by operating activities $ 1,506 $ 1,685 $ 1,107 --- ## No Match in Current: Balances, April 29, 2022 *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* 220 $ 760 $ 122 $ (44 ) $ 838 Net income - - 1,274 - 1,274 Other comprehensive loss - - - (7 ) (7 ) Issuance of common stock under employee stock award plans, net of taxes 5 24 - - 24 Repurchase of common stock (13 ) (45 ) (805 ) - (850 ) Stock-based compensation - 312 - - 312 Cash dividends declared ($2.00 per common share) - (106 ) (326 ) - (432 ) --- ## No Match in Current: Instaclustr Acquisition *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* On May 20, 2022, we acquired all the outstanding shares of privately-held Instaclustr US Holding, Inc. (Instaclustr) for $498 million. Instaclustr is a leading platform provider of fully managed open-source database, pipeline and workflow applications delivered as-a-service. The acquisition-date values of the assets acquired and liabilities assumed are as follows (in millions): Amount Cash $ 4 Intangible assets 107 Goodwill 413 Other assets 19 Total assets acquired 543 Liabilities assumed (45 ) Total purchase price $ 498 The acquisition-date values of the assets acquired and liabilities assumed are as follows (in millions): Amount Cash $ 4 Intangible assets 107 Goodwill 413 Other assets 19 Total assets acquired 543 Liabilities assumed (45 ) Total purchase price $ 498 The components of the intangible assets acquired were as follows (in millions, except useful life): Amount Estimated useful life(years) Developed technology $ 55 5 Customer contracts/relationships 50 5 Trade name 2 3 Total intangible assets $ 107 The components of the intangible assets acquired were as follows (in millions, except useful life): Amount --- ## Modified: If we are unable to maintain and develop relationships with strategic partners, our ability to innovate may be diminished and our revenues may be harmed. **Key changes:** - Reworded sentence: "Strategic partnerships with public cloud providers and other cloud service vendors are particularly critical to the success of our cloud-based business, and partnerships with AI vendors are critical for our continued innovation." - Reworded sentence: "If we are unable to establish new or maintain current partnerships, our strategic partners prioritize their relationships with other vendors in the storage industry, our partners are unsuccessful in providing the services we need, our strategic partners seek to renegotiate or terminate our agreements, or our strategic partners increasingly compete with us, we could experience lower-than-expected revenues, delays in product development, and other adverse effects on our business, operating results, financial condition and cash flows." **Prior (2025):** Our growth strategy relies on developing and maintaining strategic partnerships with major third-party software and hardware vendors to integrate our products into their products and co-market them. Many of our strategic partners are industry leaders that provide us with expanded access to market segments where we do not directly participate. Strategic partnerships with public cloud providers and other cloud service vendors are particularly critical to the success of our cloud-based business. However, there is intense competition for attractive strategic partners, and these relationships may not be exclusive, may not generate significant revenues, and may be terminated on short notice. Some of our partners also collaborate with our competitors, which can increase the availability of competing solutions and hinder our ability to grow these relationships. Additionally, some partners, especially large and diversified technology companies, including major cloud providers, are also our competitors, complicating our relationships. If we are unable to establish new or maintain current partnerships, if our strategic partners prioritize their relationships with other vendors in the storage industry, if our strategic partners seek to renegotiate or terminate our agreements, or if our strategic partners increasingly compete with us, we could experience lower-than-expected revenues, delays in product development, and other adverse effects on our business, operating results, financial condition and cash flows. **Current (2026):** Our growth strategy relies on developing and maintaining strategic partnerships with major third-party software and hardware vendors to integrate our products into their products and co-market them. Many of our strategic partners are industry leaders that provide us with expanded access to market segments where we do not directly participate. Strategic partnerships with public cloud providers and other cloud service vendors are particularly critical to the success of our cloud-based business, and partnerships with AI vendors are critical for our continued innovation. There is intense competition for attractive strategic partners. These relationships may not be exclusive, may not generate significant revenues, and may be terminated on short notice. Some of our partners also collaborate with our competitors, which can increase the availability of competing solutions and hinder our ability to grow these relationships. Additionally, some partners, especially large and diversified technology companies, including major cloud providers, are also our competitors, complicating our relationships. If we are unable to establish new or maintain current partnerships, our strategic partners prioritize their relationships with other vendors in the storage industry, our partners are unsuccessful in providing the services we need, our strategic partners seek to renegotiate or terminate our agreements, or our strategic partners increasingly compete with us, we could experience lower-than-expected revenues, delays in product development, and other adverse effects on our business, operating results, financial condition and cash flows. --- ## Modified: Our stock price is subject to volatility. **Key changes:** - Reworded sentence: "Our stock price is subject to changes in recommendations or earnings estimates by financial analysts, changes in investors' or analysts' valuation measures for our stock, changes in our capital structure, including issuance of additional debt, changes in our credit 28 28 ratings, our ability to pay dividends and to continue to execute our stock repurchase program as planned and market trends and economic volatility unrelated to our performance." - Reworded sentence: "These factors, as well as general economic and political conditions and the timing of announcements in the public market regarding new products or services, product enhancements or technological advances by our competitors or us, and any announcements by us of acquisitions, major transactions, or management changes may adversely affect our stock price." **Prior (2025):** Our stock price is subject to changes in recommendations or earnings estimates by financial analysts, changes in investors' or analysts' valuation measures for our stock, changes in our capital structure, including issuance of additional debt, changes in our credit ratings, our ability to pay dividends and to continue to execute our stock repurchase program as planned and market trends and economic volatility unrelated to our performance. If we fail to meet any investor expectations related to dividends and/or stock repurchases, the market price of our stock could decline significantly, and could have a material adverse impact on investor confidence. Additionally, price volatility of our stock over a given period may cause the average price at which we repurchase our own stock to exceed the stock's market price at a given point in time. Furthermore, speculation in the press or investment community about our strategic position, financial condition, results of operations or business can cause changes in our stock price. These factors, as well as general economic and political conditions and the timing of announcements in the public market regarding new products or services, product enhancements or technological 27 27 advances by our competitors or us, and any announcements by us of acquisitions, major transactions, or management changes may adversely affect our stock price.Our quarterly operating results may fluctuate materially, which could harm our common stock price.Our operating results have fluctuated in the past and will continue to do so, sometimes materially. All of the matters discussed in this Risk Factors section could impact our operating results in any fiscal quarter or year. In addition to those matters, we face the following issues, which could impact our quarterly results: •Seasonality, such as our historical seasonal decline in revenues in the first quarter of our fiscal year and seasonal increase in revenues in the fourth quarter of our fiscal year;•Linearity, such as our historical intra-quarter customer orders and revenue pattern in which a disproportionate percentage of each quarter's total orders and related revenue occur in the last month of the quarter; and•Unpredictability associated with larger scale enterprise software license agreements which generally take longer to negotiate and occur less consistently than other types of contracts, and for which revenue attributable to the software license component is typically recognized in full upon delivery.If our operating results fall below our forecasts and the expectations of public market analysts and investors, the trading price of our common stock may decline. There are risks associated with our outstanding and future indebtedness.As of April 25, 2025, we had $3.3 billion aggregate principal amount of outstanding indebtedness for our senior notes that mature at specific dates in calendar years 2025, 2027, 2030, 2032 and 2035. We may incur additional indebtedness in the future under existing credit facilities and/or enter into new financing arrangements. We may fail to pay these or additional future obligations, as and when required. Specifically, if we are unable to generate sufficient cash flows from operations or to borrow sufficient funds in the future to service or refinance our debt, our business, operating results, financial condition and cash flows will be harmed. Any downgrades from credit rating agencies such as Moody's Investors Service or Standard & Poor's Rating Services may adversely impact our ability to obtain additional financing or the terms of such financing and reduce the market capacity for our commercial paper. Furthermore, if prevailing interest rates or other factors result in higher interest rates upon any potential future financing, then interest expense related to the refinance indebtedness would increase. In addition, all our debt and credit facility arrangements subject us to continued compliance with restrictive and financial covenants. If we do not comply with these covenants or otherwise default under the arrangements, we may be required to repay any outstanding amounts borrowed under these agreements. Moreover, compliance with these covenants may restrict our strategic or operational flexibility in the future, which could harm our business, operating results, financial condition and cash flows.General Risks Our business could be materially and adversely affected as a result of natural disasters, terrorist acts or other catastrophic events.We depend on the ability of our personnel, inventories, equipment and products to move reasonably unimpeded around the world. Any political, military, terrorism, global trade, world health or other issue that hinders this movement or restricts the import or export of materials could lead to significant business disruptions. For example, the COVID-19 pandemic impeded the mobility of our personnel, inventories, equipment and products and disrupted our business operations. Furthermore, any economic failure or other material disruption caused by natural disasters, including fires, floods, droughts, hurricanes, tornadoes, earthquakes, and volcanoes; power or water loss or shortages; environmental disasters; telecommunications or business information systems failures or break-ins and similar events could also adversely affect our ability to conduct business. As a result of climate change, we expect the frequency and impact of such natural disasters or other material disruptions to increase. If such disruptions result in cancellations of customer orders or contribute to a general decrease in economic activity or corporate spending on IT, or directly impact our marketing, manufacturing, financial and logistics functions, or impair our ability to meet our customer demands, our operating results and financial condition could be materially adversely affected. Our headquarters is located in Northern California, an area susceptible to earthquakes and wildfires. If any significant disaster were to occur there, our ability to operate our business and our operating results, financial condition and cash flows could be adversely impacted.We could be subject to additional income tax liabilities. Our effective tax rate is influenced by a variety of factors, many of which are outside of our control. These factors include among other things, fluctuations in our earnings and financial results in the various countries and states in which we do business, changes to advances by our competitors or us, and any announcements by us of acquisitions, major transactions, or management changes may adversely affect our stock price. **Current (2026):** Our stock price is subject to changes in recommendations or earnings estimates by financial analysts, changes in investors' or analysts' valuation measures for our stock, changes in our capital structure, including issuance of additional debt, changes in our credit 28 28 ratings, our ability to pay dividends and to continue to execute our stock repurchase program as planned and market trends and economic volatility unrelated to our performance. If we fail to meet any investor expectations related to dividends and/or stock repurchases, the market price of our stock could decline significantly, and could have a material adverse impact on investor confidence. Additionally, price volatility of our stock over a given period may cause the average price at which we repurchase our own stock to exceed the stock's market price at a given point in time.Furthermore, speculation in the press or investment community about our strategic position, financial condition, results of operations or business can cause changes in our stock price. These factors, as well as general economic and political conditions and the timing of announcements in the public market regarding new products or services, product enhancements or technological advances by our competitors or us, and any announcements by us of acquisitions, major transactions, or management changes may adversely affect our stock price.Our quarterly operating results may fluctuate and differ materially from our forecasts, which could harm our stock price.Our operating results have fluctuated in the past and will continue to do so, sometimes materially. All of the matters discussed in this Risk Factors section could impact our operating results in any fiscal quarter or year. In addition to those matters, we face the following issues, which could impact our quarterly results: •Seasonality, such as our historical seasonal decline in revenues in the first quarter of our fiscal year and seasonal increase in revenues in the fourth quarter of our fiscal year;•Linearity, such as our historical intra-quarter customer orders and revenue pattern in which a disproportionate percentage of each quarter's total orders and related revenue occur in the last month of the quarter; and•Unpredictability associated with larger scale enterprise software license agreements which generally take longer to negotiate and occur less consistently than other types of contracts, and for which revenue attributable to the software license component is typically recognized in full upon delivery.If our operating results fall below our forecasts and the expectations of public market analysts and investors, the trading price of our stock may decline. There are risks associated with our outstanding and future indebtedness.As of April 24, 2026, we had $2.5 billion aggregate principal amount of outstanding indebtedness for our senior notes that mature at specific dates in calendar years 2027, 2030, 2032 and 2035. We may incur additional indebtedness in the future under existing credit facilities and/or enter into new financing arrangements. We may fail to pay these or additional future obligations, as and when required. Specifically, if we are unable to generate sufficient cash flows from operations or borrow sufficient funds in the future to service or refinance our debt, our business, operating results, financial condition and cash flows may be harmed. If we cannot make scheduled payments on our debt, we will be in default and holders of our debt could declare all outstanding principal and interest to be due and payable, the lenders could terminate their commitments to loan money, and we could be forced into bankruptcy or liquidation. Any downgrades from credit rating agencies may adversely impact our ability to obtain additional financing or the terms of such financing and reduce the market capacity for our commercial paper. Further, if prevailing interest rates or other factors result in higher interest rates upon any potential future financing, then interest expense related to the refinance indebtedness would increase. In addition, all our debt and credit facility arrangements subject us to continued compliance with restrictive and financial covenants. If we do not comply with these covenants or otherwise default under the arrangements, we may be required to repay any outstanding amounts borrowed under these agreements. Moreover, compliance with these covenants may restrict our strategic or operational flexibility in the future, which could harm our business, operating results, financial condition and cash flows.General Risk FactorsOur business could be materially and adversely affected as a result of natural disasters, terrorist acts or other catastrophic events.We depend on the ability of our personnel, inventory, equipment and products to move reasonably unimpeded around the world. Any political, military, terrorism, global trade, pandemic, widespread health or other issue that hinders this movement or restricts the import or export of materials could lead to significant business disruptions. Furthermore, any economic failure or other material disruption caused by natural disasters, including fires, floods, droughts, hurricanes, tornadoes, earthquakes, and volcanoes; power or water loss or shortages; environmental disasters; telecommunications or business information systems failures or break-ins and similar events could also adversely affect our ability to conduct business. As a result of climate change, we expect the frequency and impact of such natural disasters or other material disruptions to increase. If such disruptions result in cancellations of customer orders or ratings, our ability to pay dividends and to continue to execute our stock repurchase program as planned and market trends and economic volatility unrelated to our performance. If we fail to meet any investor expectations related to dividends and/or stock repurchases, the market price of our stock could decline significantly, and could have a material adverse impact on investor confidence. Additionally, price volatility of our stock over a given period may cause the average price at which we repurchase our own stock to exceed the stock's market price at a given point in time. Furthermore, speculation in the press or investment community about our strategic position, financial condition, results of operations or business can cause changes in our stock price. These factors, as well as general economic and political conditions and the timing of announcements in the public market regarding new products or services, product enhancements or technological advances by our competitors or us, and any announcements by us of acquisitions, major transactions, or management changes may adversely affect our stock price. --- ## Modified: If a material cybersecurity or other security breach impacts our services, systems, supply chain, or end-user customer systems, or if stored data is improperly accessed, our business could suffer significant harm. **Key changes:** - Reworded sentence: "We store and transmit, and sell products and services that store and transmit, personal, sensitive and proprietary data related to our products, our employees, customers, partners (including third-party vendors such as data centers and providers of SaaS, cloud computing, and internet infrastructure and bandwidth), and their respective customers." - Reworded sentence: "It is critical to our business strategy that our infrastructure, products, and services remain secure and are perceived as secure by customers, and partners." - Reworded sentence: "Increasing use of AI, such as Anthropic's Claude Mythos, in techniques employed by threat actors will continue to increase the risk of successful attacks that may overwhelm our protection systems faster than we can effectively respond." - Reworded sentence: "Cybersecurity incidents or other security breaches have in the past and could in the future result in unauthorized access to, or loss or unauthorized use, alteration, or disclosure of, personal, sensitive and/or proprietary data; litigation, indemnity obligations, government investigations and proceedings, regulatory fines and penalties, and other possible liabilities; remediation costs and increased cybersecurity protection and insurance costs; revenue loss; negative publicity and damage to our reputation; and disruptions to our internal and external operations." - Reworded sentence: "If our employees, customers, partners, or their respective customers use our solutions for the transmission or storage of sensitive information, or our supply-chain cybersecurity is compromised and our security measures are breached as a result of third-party action, employee error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could be damaged, our business may be harmed and we could incur significant liabilities." **Prior (2025):** We store and transmit, and sell products and services that store and transmit, personal, sensitive and proprietary data related to our products, our employees, customers, clients, partners (including third-party vendors such as data centers and providers of SaaS, cloud computing, and internet infrastructure and bandwidth), and their respective customers. This data includes intellectual property, records, and personal information. It is critical to our business strategy that our infrastructure, products, and services remain secure and are perceived as secure by customers, clients, and partners. There are numerous and evolving cybersecurity and privacy risks, including criminal hacking (eCrime), state-sponsored intrusions, industrial espionage, hacktivism, insider threats, inadvertent disclosure, ransomware attacks, social-engineering, exploitation of unpatched or unmanaged vulnerabilities, cyber-attacks to the Company's service providers, suppliers or vendors, technological vulnerabilities, or destruction or other misuse of data that could harm the Company, operations or our competitive position. In some cases, these types of attacks have been successful. Increasing use of AI in techniques employed by threat actors will continue to increase the risk of successful attacks, while also providing opportunities for improved attack detection and prevention capabilities. Our information systems and data have been specifically targeted by various threat actors, including nation-state affiliated threat actors, and we expect that our information systems and data will continue to be targeted in the future. Cybersecurity incidents or other security breaches have in the past and could in the future result in: (1) unauthorized access to, or loss or unauthorized use, alteration, or disclosure of, personal, sensitive and/or proprietary data; (2) litigation, indemnity obligations, government investigations and proceedings, regulatory fines and penalties, and other possible liabilities; (3) revenue loss; (4) negative publicity and damage to our reputation; and (5) disruptions to our internal and external operations. These outcomes could damage our reputation, harm our business, and lead to significant liabilities. Additionally, a cybersecurity incident or loss of personal information has in the past and could in the future result in remediation costs, disruption of internal operations, increased cybersecurity protection costs, significant fines, and/or lost revenues. Our clients and their customers use our platforms to transmit and store sensitive data. We do not generally have the ability to review the information or content they upload and store, nor do we control the substance of this information or content. If our employees, clients, partners, or their respective customers use our platforms for the transmission or storage of sensitive information, or our supply-chain cybersecurity is compromised and our security measures are breached as a result of third-party action, employee 23 23 error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could be damaged, our business may be harmed and we could incur significant liabilities.Security industry experts and U.S. government officials continue to emphasize risks to our industry. Cyber-attacks and security breaches continue to increase, and of particular concern are supply-chain attacks against software development and breaches of technology service providers. We anticipate that cyberattacks will continue to increase in the future given cyber warfare has become a consistent lever within geopolitical conflicts and increasingly leverages hacktivism. We cannot give assurance that we will always be successful in preventing or repelling unauthorized access to our systems. We also may face delays in our ability to identify or otherwise respond to any cybersecurity incident or any other breach. Future cyber-attacks or incidents could persist undetected in our environments for a period of time. Additionally, we use third-party service providers to provide some services to us that involve the storage or transmission of data, such as SaaS, cloud computing, and internet infrastructure and bandwidth, and they face various cybersecurity threats and also may suffer cybersecurity incidents or other security breaches. While we conduct diligence on these third parties, our ability to monitor these third parties' information security practices is limited, and these third parties may not have adequate information security measures in place. In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties' infrastructure in our supply chain or our third-party partners' supply chains have not been or will not be compromised. Many jurisdictions require companies to notify regulators or individuals of data security incidents involving certain types of personal data. These mandatory disclosures regarding security incidents often lead to widespread negative publicity. The risk of reputational harm may be magnified by the rapid dissemination of information online. Any security incident, loss of data, or other security breach, whether actual or perceived, or whether impacting us or our third-party service providers, could harm our reputation, erode customer confidence in the effectiveness of our data security measures, negatively impact our ability to attract new customers, cause existing customers to elect not to renew their support contracts or their SaaS subscriptions, or subject us to third-party lawsuits, regulatory fines or other action or liability, which could materially and adversely affect our business and operating results.There can be no assurance that the limitations of liability in our contracts would be enforceable or adequate or would otherwise protect us from any such liabilities or damages with respect to any particular claim. Our existing general liability insurance coverage, cybersecurity insurance coverage and coverage for errors and omissions may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims, or our insurers may deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceeds available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, operating results, financial condition and cash flows.If a data center or other third-party who relies on our products experiences a disruption in service or a loss of data, such disruption could be attributed to the quality of our products.Our clients, including data centers, SaaS providers, cloud computing services and internet infrastructure and bandwidth providers, rely on our products for their data storage needs. These clients may authorize third-party technology providers to access their data on our systems. Errors or wrongdoing by clients, their customers, or third-party technology providers resulting in actual or perceived security breaches may result in such actual or perceived breaches being attributed to us. A failure to meet our customers' and partners' expectations regarding security and confidentiality, due to disruptions in services provided by third-party vendors or the loss or alteration of data stored by such vendors, could cause financial or reputational harm to our business. This harm could occur if the disruption or data loss is caused by, or perceived to be caused by, defects in our products. The risk of reputational harm may be magnified by the rapid dissemination of information over the internet, including through news articles, blogs, social media, and other online communication forums and services. This could affect our ability to retain clients and attract new business.Additionally, our operations and select cloud services rely on third-party cloud providers. Interruptions due to technical failures such as hardware or software issues or connectivity problems, security incidents, compliance changes, operational challenges and natural disasters could reduce revenue due to the cloud services' metered billing and could pose reputational risks. Moreover, dependence on key cloud infrastructure providers carries systemic risks, as we could face amplified reputational damage if observability features fail during client outages.Failure to comply with new and existing laws and regulations related to privacy, data protection, AI and information security could cause harm to our reputation, result in liability (including regulatory penalties and litigation), and adversely impact our business.Our business is increasingly subject to regulation by various federal, state and international governmental agencies responsible for enacting and enforcing laws and regulations relating to privacy, data protection, and information security. For example, since the EU's General Data Protection Regulation became effective in 2018, the Court of Justice of the EU has issued rulings that have impacted how multinational companies must implement that law and the European Commission (EC) has published new regulatory error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could be damaged, our business may be harmed and we could incur significant liabilities. Security industry experts and U.S. government officials continue to emphasize risks to our industry. Cyber-attacks and security breaches continue to increase, and of particular concern are supply-chain attacks against software development and breaches of technology service providers. We anticipate that cyberattacks will continue to increase in the future given cyber warfare has become a consistent lever within geopolitical conflicts and increasingly leverages hacktivism. We cannot give assurance that we will always be successful in preventing or repelling unauthorized access to our systems. We also may face delays in our ability to identify or otherwise respond to any cybersecurity incident or any other breach. Future cyber-attacks or incidents could persist undetected in our environments for a period of time. Additionally, we use third-party service providers to provide some services to us that involve the storage or transmission of data, such as SaaS, cloud computing, and internet infrastructure and bandwidth, and they face various cybersecurity threats and also may suffer cybersecurity incidents or other security breaches. While we conduct diligence on these third parties, our ability to monitor these third parties' information security practices is limited, and these third parties may not have adequate information security measures in place. In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties' infrastructure in our supply chain or our third-party partners' supply chains have not been or will not be compromised. Many jurisdictions require companies to notify regulators or individuals of data security incidents involving certain types of personal data. These mandatory disclosures regarding security incidents often lead to widespread negative publicity. The risk of reputational harm may be magnified by the rapid dissemination of information online. Any security incident, loss of data, or other security breach, whether actual or perceived, or whether impacting us or our third-party service providers, could harm our reputation, erode customer confidence in the effectiveness of our data security measures, negatively impact our ability to attract new customers, cause existing customers to elect not to renew their support contracts or their SaaS subscriptions, or subject us to third-party lawsuits, regulatory fines or other action or liability, which could materially and adversely affect our business and operating results. There can be no assurance that the limitations of liability in our contracts would be enforceable or adequate or would otherwise protect us from any such liabilities or damages with respect to any particular claim. Our existing general liability insurance coverage, cybersecurity insurance coverage and coverage for errors and omissions may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims, or our insurers may deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceeds available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, operating results, financial condition and cash flows. **Current (2026):** We store and transmit, and sell products and services that store and transmit, personal, sensitive and proprietary data related to our products, our employees, customers, partners (including third-party vendors such as data centers and providers of SaaS, cloud computing, and internet infrastructure and bandwidth), and their respective customers. This data includes intellectual property, records, and personal information. It is critical to our business strategy that our infrastructure, products, and services remain secure and are perceived as secure by customers, and partners. There are numerous and evolving cybersecurity and privacy risks, including criminal hacking (eCrime), state-sponsored intrusions, industrial espionage, hacktivism, insider threats, inadvertent disclosure, ransomware attacks, social-engineering, phishing, spear-phishing, exfiltration, exploitation of unpatched or unmanaged vulnerabilities, cyber-attacks to the Company's service providers, suppliers or vendors, technological vulnerabilities, or destruction or other misuse of data that could harm the Company, operations or our competitive position. In some cases, these types of attacks have been successful. Increasing use of AI, such as Anthropic's Claude Mythos, in techniques employed by threat actors will continue to increase the risk of successful attacks that may overwhelm our protection systems faster than we can effectively respond. Our information systems and data have been specifically targeted by various threat actors, including nation-state affiliated threat actors, and we expect that our information systems and data will continue to be targeted in the future. Cybersecurity incidents or other security breaches have in the past and could in the future result in unauthorized access to, or loss or unauthorized use, alteration, or disclosure of, personal, sensitive and/or proprietary data; litigation, indemnity obligations, government investigations and proceedings, regulatory fines and penalties, and other possible liabilities; remediation costs and increased cybersecurity protection and insurance costs; revenue loss; negative publicity and damage to our reputation; and disruptions to our internal and external operations. Our customers and their customers use our solutions to transmit and store sensitive data. We do not generally have the ability to review the information or content they upload and store, nor do we control the substance of this information or content. If our employees, customers, partners, or their respective customers use our solutions for the transmission or storage of sensitive information, or our supply-chain cybersecurity is compromised and our security measures are breached as a result of third-party action, employee error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could be damaged, our business may be harmed and we could incur significant liabilities. Cyber-attacks and security breaches continue to increase, and of particular concern are supply-chain attacks against software development and breaches of technology service providers. We anticipate that cyberattacks will continue to increase in the future given cyber warfare has become a consistent lever within geopolitical conflicts and increasingly leverages hacktivism. We may not be successful in preventing or repelling unauthorized access to our systems. We also may face delays in our ability to identify or otherwise respond to any cybersecurity incident or any other breach. Future cyber-attacks or incidents could persist undetected in our environments for a period of time. Additionally, we use third-party service providers to provide some services to us that involve the storage or transmission of data, such as SaaS, cloud computing, and internet infrastructure and bandwidth, and they face various 24 24 cybersecurity threats and also may suffer cybersecurity incidents or other security breaches. Our ability to monitor these third parties' information security practices is limited, and these third parties may not have adequate information security measures in place. In addition, supply-chain attacks have increased in frequency and severity, and third parties' infrastructure in our supply chain or our third-party partners' supply chains may become compromised. A cybersecurity incident at a third-party service provider could result in unauthorized access to or disclosure of personal data for which NetApp has protection obligations, potentially triggering breach notification requirements across multiple jurisdictions and exposing NetApp to regulatory enforcement actions, fines, and litigation.Many jurisdictions require companies to notify regulators or individuals of data security incidents involving certain types of personal data. In addition, regulatory requirements, including SEC cybersecurity disclosure rules, may require us to publicly disclose material cybersecurity incidents within specified timeframes. These mandatory disclosures regarding security incidents often lead to widespread negative publicity which may affect our stock price. The risk of reputational harm may be magnified by the rapid dissemination of information online. Any security incident, loss of data, or other security breach, whether actual or perceived, or whether impacting us or our third-party service providers, could harm our reputation, erode customer confidence in the effectiveness of our data security measures, negatively impact our ability to attract new customers, cause existing customers to elect not to renew their support contracts or their SaaS subscriptions, or subject us to third-party lawsuits, regulatory fines or other action or liability, which could materially and adversely affect our business and operating results.The limitations of liability in our contracts may not be enforceable or adequate or otherwise protect us from any such liabilities or damages with respect to any particular claim. Our existing general liability insurance coverage, cybersecurity insurance coverage and coverage for errors and omissions may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims, or our insurers may deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceeds available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, operating results, financial condition and cash flows.If a data center or other third-party who relies on our products experiences a disruption in service or a loss of data, such disruption could be attributed to the quality of our products.Our customers, including data centers, SaaS providers, cloud computing services and internet infrastructure and bandwidth providers, rely on our products for their data storage needs. These customers may authorize third-party technology providers to access their data on our systems. Errors or wrongdoing by our customers, their customers, or third-party technology providers resulting in actual or perceived security breaches may result in such actual or perceived breaches being attributed to us. A failure to meet our customers' and partners' expectations regarding security and confidentiality, due to disruptions in services provided by third-party vendors or the loss or alteration of data stored by such vendors, could cause financial or reputational harm to our business, which could affect our ability to attract or retain customers.Additionally, our operations and select cloud services rely on third-party cloud providers, and interruptions due to technical failures such as hardware or software issues or connectivity problems, security incidents, compliance changes, operational challenges and natural disasters could reduce our revenue due to the cloud services' metered billing. Moreover, our concentration on a limited number of key cloud infrastructure providers carries heightened systemic risks, as a significant disruption to any of these providers could simultaneously impact multiple aspects of our operations and service delivery. Failure to comply with new and existing laws and regulations related to privacy, data protection, AI and information security could cause harm to our reputation, result in liability (including regulatory penalties and litigation), and adversely impact our business.Our business is increasingly subject to regulation by various federal, state and international governmental agencies responsible for enacting and enforcing laws and regulations relating to privacy, data protection, and information security. For example, since the GDPR became effective in 2018, the Court of Justice of the EU has issued rulings that have impacted how multinational companies must implement that law and the European Commission (EC) has published new regulatory requirements relating to cross-border data transfers. NetApp relies on compliance methods such as Standard Contractual Clauses (SCCs) to transfer personal data of individuals located in the European Economic Area (EEA) to other countries. In June 2021, the EC imposed new SCC requirements which impose certain contractual and operational requirements on NetApp and its contracting parties, including requirements related to government access transparency, enhanced data subject rights, and broader third-party assessments to ensure safeguards necessary to protect personal data transferred from NetApp or its partners to countries outside the EEA, requiring NetApp to revise customer and vendor agreements. Other governments have adopted new privacy and data protection laws implementing similarly comprehensive regulatory frameworks.The interpretation and application of many privacy, data protection, and information security laws and regulations, along with industry standards, are uncertain. These laws, regulations, or standards may be interpreted and applied in ways that are inconsistent cybersecurity threats and also may suffer cybersecurity incidents or other security breaches. Our ability to monitor these third parties' information security practices is limited, and these third parties may not have adequate information security measures in place. In addition, supply-chain attacks have increased in frequency and severity, and third parties' infrastructure in our supply chain or our third-party partners' supply chains may become compromised. A cybersecurity incident at a third-party service provider could result in unauthorized access to or disclosure of personal data for which NetApp has protection obligations, potentially triggering breach notification requirements across multiple jurisdictions and exposing NetApp to regulatory enforcement actions, fines, and litigation. Many jurisdictions require companies to notify regulators or individuals of data security incidents involving certain types of personal data. In addition, regulatory requirements, including SEC cybersecurity disclosure rules, may require us to publicly disclose material cybersecurity incidents within specified timeframes. These mandatory disclosures regarding security incidents often lead to widespread negative publicity which may affect our stock price. The risk of reputational harm may be magnified by the rapid dissemination of information online. Any security incident, loss of data, or other security breach, whether actual or perceived, or whether impacting us or our third-party service providers, could harm our reputation, erode customer confidence in the effectiveness of our data security measures, negatively impact our ability to attract new customers, cause existing customers to elect not to renew their support contracts or their SaaS subscriptions, or subject us to third-party lawsuits, regulatory fines or other action or liability, which could materially and adversely affect our business and operating results. The limitations of liability in our contracts may not be enforceable or adequate or otherwise protect us from any such liabilities or damages with respect to any particular claim. Our existing general liability insurance coverage, cybersecurity insurance coverage and coverage for errors and omissions may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims, or our insurers may deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceeds available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, operating results, financial condition and cash flows. --- ## Modified: If we are unable to attract and retain qualified personnel, our business, operating results, financial condition and cash flows could be harmed. **Key changes:** - Reworded sentence: "19 19 Competition for qualified employees, particularly in the technology industry, is intense." - Reworded sentence: "Failure to hire and retain skilled management and personnel, particularly engineers, salespeople, and key executive management, could disrupt our development efforts, sales results, business relationships, and our ability to execute our business plan and strategy, adversely affecting our operating results, financial condition and cash flows.Many of our employees participate in our hybrid work program and work remotely on a part-time basis." - Reworded sentence: "Restrictions or difficulties in obtaining H-1B, L-1 and other business visas, as well as licenses to work with controlled technologies, along with compliance with new immigration and labor laws and unintended impacts from changes in immigration policy or in the enforcement of existing immigration laws and policies, could lead to unexpected labor costs and hinder our ability to retain and attract skilled professionals, negatively impacting our business, results of operations, financial condition or cash flows.A competitive broad-based equity compensation program is essential to compete for talent in both the hardware and software industries, where competitors offer significant equity compensation." - Reworded sentence: "The benefits we have received, and expect to receive, from these and other acquisitions depend on our ability to successfully conduct due diligence, negotiate the terms of the acquisition and integrate the acquired business into our systems, procedures, and organizational structure." - Reworded sentence: "Additionally, the return on these investments may be lower or may develop more slowly than we expect, which could harm our business, operating results, financial condition, and cash flows.Initiatives to improve our cost structure, business processes, and systems may not achieve the expected benefits and could negatively impact our reputation, business, operating results, financial condition and cash flows." **Prior (2025):** Our success depends on our ability to hire and retain qualified personnel to advance our corporate strategy and maintain key aspects of our corporate culture. As our future success relies on enhancing and introducing new products and features, we particularly need to attract and retain qualified engineers and technical talent, especially in emerging technology areas like AI and machine learning. To increase revenues, we must also increase the productivity of our sales force, which may require an increase in support infrastructure and personnel, to achieve adequate customer coverage. Competition for qualified employees, particularly in the technology industry, is intense. We have periodically reduced our workforce, including restructuring plans announced in fiscal 2023, fiscal 2024, and fiscal 2025, respectively. These actions may make it more challenging to attract and retain qualified employees. Failure to hire and retain skilled management and personnel, particularly engineers, salespeople, and key executive management, could disrupt our development efforts, sales results, business relationships, and our ability to execute our business plan and strategy, adversely affecting our operating results, financial conditions and cash flows. 18 18 Many of our employees participate in our hybrid work program and work remotely on a full- or part-time basis. Changes to our office environments, including the adoption of new work models and our requirements and/or expectations about when or how often certain employees work on-site or remotely may not meet the expectations of our employees, and may create challenges in attracting and retaining qualified personnel, adversely affecting our business operations and financial performance. Additionally, many of our employees are foreign nationals relying on visas and entry permits to work legally in the U.S. and other countries, and may be dependent on licenses to work with controlled technology. Restrictions or difficulties in obtaining H-1B, L-1 and other business visas, as well as licenses to work with controlled technologies, along with compliance with new immigration and labor laws and unintended impacts from changes in immigration policy or in the enforcement of existing immigration laws and policies, could lead to unexpected labor costs and hinder our ability to retain and attract skilled professionals, negatively impacting our business, results of operations or financial conditions.Equity grants are a crucial part of our compensation programs, supporting talent attraction and engagement and aligning employee interests with stockholders. A competitive broad-based equity compensation program is essential to compete for talent in both the hardware and software industries, where competitors offer significant equity compensation. Reducing, modifying, or eliminating our equity programs, or failing to grant equity competitively, may hinder our ability to attract and retain critical employees. Furthermore, the structure of our sales, cash, and equity incentive compensation plans may increase the risk of losing employees at certain times, such as after the payment of periodic bonuses or the vesting of equity awards.Our acquisitions or divestitures may not achieve the expected benefits and could increase our liabilities, disrupt our existing business, and harm our operating results, financial condition and cash flows.As part of our strategy, we may seek to acquire other businesses and technologies to complement our current products and services, expand our market reach, or enhance our technical capabilities. The benefits we have received, and expect to receive, from these and other acquisitions depend on our ability to successfully conduct due diligence, negotiate the terms of the acquisition and integrate the acquired business into our systems, procedures and organizational structure. We may also divest businesses, product lines, or divisions that no longer align with our current offerings. For example, we sold our FinOps business to Flexera in fiscal 2025. Realizing the benefits we would expect to receive from a divestiture would depend on our ability to manage the separation of operations, services, products, and personnel, in addition to other risks. Any inaccuracy in our assumptions or failures to identify and mitigate liabilities or risks associated with an acquisition or divestiture - such as differing or inadequate cybersecurity and data privacy protection controls or contractual limitations of liability - could reduce or eliminate the expected acquisition or divestiture benefits. If we fail to make acquisitions or divestitures on favorable terms, integrate or divest the subject business or assets as planned, or retain or separate key employees, our costs could increase, our operations could be disrupted, and we could face additional liabilities, investigations and litigation. This could harm our strategy, business, and operating results. Additionally, the failure to achieve expected benefits from acquisitions or divestitures may result in impairment charges for goodwill and intangible assets.Risks Related to Our OperationsWe often incur expenses before receiving related benefits, and it may be difficult to reduce expenses quickly if demand declines.We base our expense levels partly on future revenue expectations, and a significant portion of our expenses are fixed. Reducing these fixed costs quickly can be challenging, and if our revenue falls below expectations, our operating results could be adversely impacted. During periods of uneven growth or decline, we may incur costs before realizing the anticipated benefits, which could also harm our operating results. We have made, and will continue to make, significant investments in engineering, sales, service and support, marketing, and other functions to support and grow our business. The costs associated with these investments are likely to be recognized earlier than some of the related anticipated benefits, such as revenue growth. Additionally, the return on these investments may be lower or may develop more slowly than we expect, which could harm our business, operating results, financial condition and cash flows.Initiatives to improve our cost structure, business processes, and systems may not achieve the expected benefits and could negatively impact our reputation, business, operating results, financial condition and cash flows.We continuously strive to make our cost structure and business processes more efficient, including by relocating our business activities from higher-cost to lower-cost locations, outsourcing certain business processes and functions, and implementing changes to our business information systems. These efforts require significant investment of financial and human resources and substantial changes to our current operations. For example, in fiscal 2025, we continued our implementation of certain new business information systems, including a new enterprise resource planning (ERP) system to enhance and standardize our processes, improve oversight, and better serve our customers. However, any disruption during this transition could impact our ability to send and track invoices, process Many of our employees participate in our hybrid work program and work remotely on a full- or part-time basis. Changes to our office environments, including the adoption of new work models and our requirements and/or expectations about when or how often certain employees work on-site or remotely may not meet the expectations of our employees, and may create challenges in attracting and retaining qualified personnel, adversely affecting our business operations and financial performance. Additionally, many of our employees are foreign nationals relying on visas and entry permits to work legally in the U.S. and other countries, and may be dependent on licenses to work with controlled technology. Restrictions or difficulties in obtaining H-1B, L-1 and other business visas, as well as licenses to work with controlled technologies, along with compliance with new immigration and labor laws and unintended impacts from changes in immigration policy or in the enforcement of existing immigration laws and policies, could lead to unexpected labor costs and hinder our ability to retain and attract skilled professionals, negatively impacting our business, results of operations or financial conditions. Equity grants are a crucial part of our compensation programs, supporting talent attraction and engagement and aligning employee interests with stockholders. A competitive broad-based equity compensation program is essential to compete for talent in both the hardware and software industries, where competitors offer significant equity compensation. Reducing, modifying, or eliminating our equity programs, or failing to grant equity competitively, may hinder our ability to attract and retain critical employees. Furthermore, the structure of our sales, cash, and equity incentive compensation plans may increase the risk of losing employees at certain times, such as after the payment of periodic bonuses or the vesting of equity awards. **Current (2026):** Our success depends on our ability to hire and retain qualified personnel to advance our corporate strategy and maintain key aspects of our corporate culture. As our future success relies on enhancing and introducing new products and features, we particularly need to attract and retain qualified engineers and technical talent, especially in emerging technology areas like AI and machine learning. 19 19 Competition for qualified employees, particularly in the technology industry, is intense. Higher compensation costs to retain and recruit qualified employees may not be offset by innovation, improved productivity or increased sales. We have periodically reduced our workforce, including restructuring plans announced in fiscal 2024, fiscal 2025, and fiscal 2026. These actions may make it more challenging to attract and retain qualified employees. Failure to hire and retain skilled management and personnel, particularly engineers, salespeople, and key executive management, could disrupt our development efforts, sales results, business relationships, and our ability to execute our business plan and strategy, adversely affecting our operating results, financial condition and cash flows.Many of our employees participate in our hybrid work program and work remotely on a part-time basis. Changes to our office environments, including the adoption of new work models and our requirements and/or expectations about when or how often certain employees work on-site or remotely may not meet the expectations of our employees, and may create challenges in attracting and retaining qualified personnel, adversely affecting our business operations and financial performance. Additionally, many of our employees are foreign nationals relying on visas and entry permits to work legally in the U.S. and other countries, and may be dependent on licenses to work with controlled technology. Restrictions or difficulties in obtaining H-1B, L-1 and other business visas, as well as licenses to work with controlled technologies, along with compliance with new immigration and labor laws and unintended impacts from changes in immigration policy or in the enforcement of existing immigration laws and policies, could lead to unexpected labor costs and hinder our ability to retain and attract skilled professionals, negatively impacting our business, results of operations, financial condition or cash flows.A competitive broad-based equity compensation program is essential to compete for talent in both the hardware and software industries, where competitors offer significant equity compensation. If we cannot obtain shareholder approval to offer additional stock-based awards to our employees, or if our stock price declines significantly, our ability to hire and retain employees may be adversely affected. Furthermore, the structure of our sales, cash, and equity incentive compensation plans may increase the risk of losing employees at certain times, such as after the payment of periodic bonuses or the vesting of equity awards.Our acquisitions or divestitures may not achieve the expected benefits and could increase our liabilities, disrupt our existing business, and harm our operating results, financial condition and cash flows.As part of our strategy, we may seek to acquire other businesses and technologies to complement our current products and services, expand our market reach, or enhance our technical capabilities. The benefits we have received, and expect to receive, from these and other acquisitions depend on our ability to successfully conduct due diligence, negotiate the terms of the acquisition and integrate the acquired business into our systems, procedures, and organizational structure. We may also divest businesses, product lines, or divisions that no longer align with our current offerings or strategy. For example, we sold Spot by NetApp, our cloud optimization and management software business, to Flexera Software LLC in fiscal 2025. Realizing the benefits we forecast to receive from a divestiture depends on our ability to manage the separation of operations, services, products, and personnel, in addition to other risks. Any inaccuracy in our assumptions or failures to identify and mitigate liabilities or risks associated with an acquisition or divestiture, such as differing or inadequate cybersecurity and data privacy protection controls or contractual limitations of liability, could reduce or eliminate the expected acquisition or divestiture benefits. If we fail to make acquisitions or divestitures on favorable terms, integrate or divest the subject business or assets as planned, or retain or separate key employees, our costs could increase, our operations could be disrupted, and we could face additional liabilities, investigations and litigation. This could harm our strategy, business, and operating results. Additionally, the failure to achieve expected benefits from acquisitions or divestitures may result in impairment charges for goodwill and intangible assets.Risks Related to Our OperationsWe often incur expenses before receiving related benefits, and it may be difficult to reduce expenses quickly if demand declines.We base our expense levels partly on future revenue expectations, and a significant portion of our expenses are fixed. Reducing these fixed costs quickly can be challenging, and if our revenue falls below expectations, our operating results could be adversely impacted. During periods of uneven growth or decline, we may incur costs before realizing the anticipated benefits, which could also harm our operating results. We have made, and will continue to make, significant investments in engineering, sales, service and support, marketing, and other functions to support and grow our business. The costs associated with these investments are likely to be recognized earlier than some of the related anticipated benefits, such as revenue growth. Additionally, the return on these investments may be lower or may develop more slowly than we expect, which could harm our business, operating results, financial condition, and cash flows.Initiatives to improve our cost structure, business processes, and systems may not achieve the expected benefits and could negatively impact our reputation, business, operating results, financial condition and cash flows. Competition for qualified employees, particularly in the technology industry, is intense. Higher compensation costs to retain and recruit qualified employees may not be offset by innovation, improved productivity or increased sales. We have periodically reduced our workforce, including restructuring plans announced in fiscal 2024, fiscal 2025, and fiscal 2026. These actions may make it more challenging to attract and retain qualified employees. Failure to hire and retain skilled management and personnel, particularly engineers, salespeople, and key executive management, could disrupt our development efforts, sales results, business relationships, and our ability to execute our business plan and strategy, adversely affecting our operating results, financial condition and cash flows. Many of our employees participate in our hybrid work program and work remotely on a part-time basis. Changes to our office environments, including the adoption of new work models and our requirements and/or expectations about when or how often certain employees work on-site or remotely may not meet the expectations of our employees, and may create challenges in attracting and retaining qualified personnel, adversely affecting our business operations and financial performance. Additionally, many of our employees are foreign nationals relying on visas and entry permits to work legally in the U.S. and other countries, and may be dependent on licenses to work with controlled technology. Restrictions or difficulties in obtaining H-1B, L-1 and other business visas, as well as licenses to work with controlled technologies, along with compliance with new immigration and labor laws and unintended impacts from changes in immigration policy or in the enforcement of existing immigration laws and policies, could lead to unexpected labor costs and hinder our ability to retain and attract skilled professionals, negatively impacting our business, results of operations, financial condition or cash flows. A competitive broad-based equity compensation program is essential to compete for talent in both the hardware and software industries, where competitors offer significant equity compensation. If we cannot obtain shareholder approval to offer additional stock-based awards to our employees, or if our stock price declines significantly, our ability to hire and retain employees may be adversely affected. Furthermore, the structure of our sales, cash, and equity incentive compensation plans may increase the risk of losing employees at certain times, such as after the payment of periodic bonuses or the vesting of equity awards. --- ## Modified: We are exposed to the credit and non-payment risk of our customers, resellers and distributors, especially during times of economic uncertainty and tight credit markets, which could result in material losses. **Key changes:** - Removed sentence: "Additionally, some customers have entered into recourse and non-recourse financing leasing arrangements using third-party leasing companies." - Removed sentence: "Under recourse leases, which typically last three years or less, we remain liable for the unpaid remaining lease payments to the third-party leasing companies if the end-user customer defaults." - Reworded sentence: "This risk may further increase if our customers or their customers are adversely affected by global economic conditions." **Prior (2025):** Most of our sales to customers are on an open credit basis, with typical payment terms of 30 days. During periods of economic uncertainty, when access to liquidity may be limited, we may experience increased losses as more customers become unable to pay their obligations to us, either in full or in part. Additionally, some customers have entered into recourse and non-recourse financing leasing arrangements using third-party leasing companies. Under recourse leases, which typically last three years or less, we remain liable for the unpaid remaining lease payments to the third-party leasing companies if the end-user customer defaults. Our exposure to credit risks from our customers increases during economic uncertainty or volatility. This risk may further increase if our customers, their customers, or their lease financing sources are adversely affected by global economic conditions. **Current (2026):** Most of our sales to customers are on an open credit basis, with typical payment terms of 30 days. During periods of economic uncertainty, when access to liquidity may be limited, we may experience increased losses as more customers become unable to pay their obligations to us, either in full or in part. Our exposure to credit risks from our customers increases during economic uncertainty or volatility. This risk may further increase if our customers or their customers are adversely affected by global economic conditions. --- ## Modified: Risk Management and Strategy **Key changes:** - Reworded sentence: "For additional discussion of cybersecurity risks and potential related impacts on the Company, refer to the risk factors in Part I, Item 1A - "Risk Factors," including "If a material cybersecurity or other security breach impacts our services, systems, supply chain, or end-user customer systems, or if stored data is improperly accessed, our business could suffer significant harm." materially affected GovernanceNetApp's Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees." - Reworded sentence: "The Company's CISO presents cybersecurity updates to the Audit Committee at least twice a year, and has a standing quarterly private session to update the Audit Committee on any relevant matters, as needed." - Reworded sentence: "The Company's CISO presents cybersecurity updates to the Audit Committee at least twice a year, and has a standing quarterly private session to update the Audit Committee on any relevant matters, as needed." - Reworded sentence: "The Company's CISO presents cybersecurity updates to the Audit Committee at least twice a year, and has a standing quarterly private session to update the Audit Committee on any relevant matters, as needed." - Reworded sentence: "The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2." **Prior (2025):** The Company regularly assesses risks from cybersecurity threats, monitors its information systems for potential vulnerabilities, and tests those systems pursuant to the Company's cybersecurity policies, standards, processes and practices, which are integrated into the Company's overall risk management system. To protect the Company's information systems from cybersecurity threats, the Company uses various security technologies and tools that help the Company identify, escalate, investigate, manage, resolve and recover from security incidents in a timely manner. These efforts include: The Company regularly assesses risks from cybersecurity threats, monitors its information systems for potential vulnerabilities, and tests those systems pursuant to the Company's cybersecurity policies, standards, processes and practices, which are integrated integrated into the Company's overall risk management system. •ongoing collection of threat intelligence and environment awareness through monitoring, ongoing collection of threat intelligence and environment awareness through monitoring, •data protection management and vulnerability monitoring through data loss prevention and exfiltration tools, data protection management and vulnerability monitoring through data loss prevention and exfiltration tools, •cybersecurity risk management processes and practices, cybersecurity risk management processes and practices, •control assurance, control assurance, •secure development of new products, secure development of new products, •identity and access management, identity and access management, •incident response, auditing and monitoring, and incident response, auditing and monitoring, and •maintaining a 24x7 security operations center to allow for always available incident response. maintaining a 24x7 security operations center to allow for always available incident response. The Company takes a risk-based approach to cybersecurity and has implemented cybersecurity policies throughout its operations that are designed to address cybersecurity threats and incidents. In particular, the Company follows an incident escalation process that is incorporated into its incident and risk management processes. In the event the Company identifies a cybersecurity incident, its senior management, consisting of the Chief Financial Officer, Chief Information Security Officer (CISO), Chief Administrative Officer, and Executive Vice President of Business Technology and Operations review the facts and circumstances involved in such cybersecurity incident, or series of related cybersecurity incidents. The Company partners with third parties to assess the effectiveness of its cybersecurity prevention and response systems and processes, including third-party review of the Company's Information Security Management System for ISO 27001 controls, assessment of the Company's cloud products and managed services according to the American Institute of CPAs (AICPA) Service Organization Control (SOC) Audit Type II, and new product validation as part of the Company's secure development lifecycle. The Company additionally engages third-party providers in support of endpoint detection and responses, data loss prevention efforts, and incident management efforts. The Company additionally engage engage s third-party providers in support of endpoint detection and responses, data loss prevention efforts, and incident management efforts. To date, the Company is not aware of cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition. For additional discussion of cybersecurity risks and potential related impacts on the Company, refer to the risk factors in Part I, Item 1A. "Risk Factors," including "If a material cybersecurity or other security breach impacts our services, systems, supply chain, or end-user customer systems, or if stored data is improperly accessed, our business could suffer significant harm." materially affected GovernanceNetApp's Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Company's CISO regularly updates each of the Board of Directors and the Audit Committee at least twice a year. Such updates include a review of cybersecurity risks affecting the Company, related metrics, and any incidents or issues that require attention from the Board of Directors. Governance NetApp's Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Company's CISO regularly updates each of the Board of Directors and the Audit Committee at least twice a year. Such updates include a review of cybersecurity risks affecting the Company, related metrics, and any incidents or issues that require attention from the Board of Directors. Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Company's CISO regularly updates each of the Board of Directors and the Audit Committee at least twice a year. Such updates include a review of cybersecurity risks affecting the Company, related metrics, and any incidents or issues that require attention from the Board of Directors. The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. Global Security executives oversee management of risks and track projects progress, remediations, and any issues related to cybersecurity risks.NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. Global Security executives oversee management of risks and track projects progress, remediations, and any issues related to cybersecurity risks. The CISO provides leadership, strategic direction, and oversight The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a 30 30 Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. Item 2. PropertiesWe owned or leased, domestically and internationally, the following properties as of April 25, 2025.We own approximately 0.8 million square feet of facilities in Research Triangle Park (RTP), North Carolina. In addition, we own 65 acres of undeveloped land. The RTP site supports research and development, global services and sales and marketing.We own approximately 0.7 million square feet of facilities in Bangalore, India on 14 acres of land. The Bangalore site supports research and development, finance and global services.We lease approximately 0.3 million square feet of office space for our corporate headquarters located in San Jose, California. The San Jose site supports research and development, corporate general administration, sales and marketing, global services and operations.We lease approximately 0.7 million square feet in other sales offices and research and development facilities throughout the U.S. and internationally. We expect that our existing facilities and those being developed worldwide are suitable and adequate for our requirements over at least the next two years. Item 3. Legal ProceedingsFor a discussion of legal proceedings, see Note 17 - Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, which is incorporated herein by reference.Item 4. Mine Safety DisclosuresNot applicable. Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2 . The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. provides quarterly reports to the Board of Directors and to the Audit Committee. Item 2. Properties We owned or leased, domestically and internationally, the following properties as of April 25, 2025. We own approximately 0.8 million square feet of facilities in Research Triangle Park (RTP), North Carolina. In addition, we own 65 acres of undeveloped land. The RTP site supports research and development, global services and sales and marketing. We own approximately 0.7 million square feet of facilities in Bangalore, India on 14 acres of land. The Bangalore site supports research and development, finance and global services. We lease approximately 0.3 million square feet of office space for our corporate headquarters located in San Jose, California. The San Jose site supports research and development, corporate general administration, sales and marketing, global services and operations. We lease approximately 0.7 million square feet in other sales offices and research and development facilities throughout the U.S. and internationally. We expect that our existing facilities and those being developed worldwide are suitable and adequate for our requirements over at least the next two years. Item 3. Legal Proceedings For a discussion of legal proceedings, see Note 17 - Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, which is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. 31 31 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesThe Company's common stock is traded on the NASDAQ Stock Market LLC (NASDAQ) under the symbol NTAP.Price Range of Common StockThe price range per share of common stock presented below represents the highest and lowest intraday sales prices for the Company's common stock on the NASDAQ during each quarter of our two most recent fiscal years. Fiscal 2025 Fiscal 2024 High Low High Low First Quarter $ 135.01 $ 100.24 $ 80.53 $ 61.54 Second Quarter $ 134.37 $ 112.87 $ 80.02 $ 71.25 Third Quarter $ 135.45 $ 112.86 $ 91.76 $ 70.82 Fourth Quarter $ 127.78 $ 71.84 $ 112.48 $ 83.80 HoldersAs of May 29, 2025 there were 403 holders of record of our common stock.DividendsThe Company paid cash dividends of $0.52 per outstanding common share in each quarter of fiscal 2025 for an aggregate of $424 million and $0.50 per outstanding common share in each quarter of fiscal 2024 and fiscal 2023 for an aggregate of $416 million and $432 million, respectively. In the first quarter of fiscal 2026, the Company declared a cash dividend of $0.52 per share of common stock, payable on July 23, 2025 to shareholders of record as of the close of business on July 3, 2025. PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company's common stock is traded on the NASDAQ Stock Market LLC (NASDAQ) under the symbol NTAP. **Current (2026):** The Company regularly assesses risks from cybersecurity threats, monitors its information systems for potential vulnerabilities, and tests those systems pursuant to the Company's cybersecurity policies, standards, processes and practices, which are integrated into the Company's overall risk management system. To protect the Company's information systems from cybersecurity threats, the Company uses various security technologies and tools that help the Company identify, escalate, investigate, manage, resolve and recover from security incidents in a timely manner. These efforts include: The Company regularly assesses risks from cybersecurity threats, monitors its information systems for potential vulnerabilities, and tests those systems pursuant to the Company's cybersecurity policies, standards, processes and practices, which are integrated integrated into the Company's overall risk management system. •ongoing collection of threat intelligence and environment awareness through monitoring, ongoing collection of threat intelligence and environment awareness through monitoring, •data protection management and vulnerability monitoring through data loss prevention and exfiltration tools, data protection management and vulnerability monitoring through data loss prevention and exfiltration tools, •cybersecurity risk management processes and practices, cybersecurity risk management processes and practices, •control assurance, control assurance, •secure development of new products, secure development of new products, •identity and access management, identity and access management, •incident response, auditing and monitoring, and incident response, auditing and monitoring, and •maintaining a 24x7 security operations center to allow for always available incident response. maintaining a 24x7 security operations center to allow for always available incident response. The Company takes a risk-based approach to cybersecurity and has implemented cybersecurity policies throughout its operations that are designed to address cybersecurity threats and incidents. In particular, the Company follows an incident escalation process that is incorporated into its incident and risk management processes. In the event the Company identifies a cybersecurity incident, its senior management, consisting of the Chief Financial Officer, Chief Information Security Officer (CISO), Chief Administrative Officer, and Executive Vice President of Business Technology and Operations review the facts and circumstances involved in such cybersecurity incident, or series of related cybersecurity incidents. The Company partners with third parties to assess the effectiveness of its cybersecurity prevention and response systems and processes, including third-party review of the Company's Information Security Management System for ISO 27001 controls, assessment of the Company's cloud products and managed services according to the American Institute of CPAs (AICPA) Service Organization Control (SOC) Audit Type II, and new product validation as part of the Company's secure development lifecycle. The Company additionally engages third-party providers in support of endpoint detection and responses, data loss prevention efforts, and incident management efforts. The Company additionally engage engage s third-party providers in support of endpoint detection and responses, data loss prevention efforts, and incident management efforts. To date, the Company is not aware of cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition. For additional discussion of cybersecurity risks and potential related impacts on the Company, refer to the risk factors in Part I, Item 1A - "Risk Factors," including "If a material cybersecurity or other security breach impacts our services, systems, supply chain, or end-user customer systems, or if stored data is improperly accessed, our business could suffer significant harm." materially affected GovernanceNetApp's Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Company's CISO presents cybersecurity updates to the Audit Committee at least twice a year, and has a standing quarterly private session to update the Audit Committee on any relevant matters, as needed. Such updates include a review of cybersecurity risks affecting the Company, related metrics, and any incidents or issues that require attention from the Audit Committee or Board of Directors. Additionally, the Board of Directors receives a presentation at least annually regarding key developments and topics in cybersecurity from management along with a third party cybersecurity expert. Governance NetApp's Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Company's CISO presents cybersecurity updates to the Audit Committee at least twice a year, and has a standing quarterly private session to update the Audit Committee on any relevant matters, as needed. Such updates include a review of cybersecurity risks affecting the Company, related metrics, and any incidents or issues that require attention from the Audit Committee or Board of Directors. Additionally, the Board of Directors receives a presentation at least annually regarding key developments and topics in cybersecurity from management along with a third party cybersecurity expert. Board of Directors oversees the Company's risk management process, including cybersecurity risks, directly and through its committees. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Audit Committee of the Board of Directors oversees the Company's risk management program, which focuses on the most significant risks the Company faces in the short-, intermediate-, and long-term timeframes. The Company's CISO presents cybersecurity updates to the Audit Committee at least twice a year, and has a standing quarterly private session to update the Audit Committee on any relevant matters, as needed. Such updates include a review of cybersecurity risks affecting the Company, related metrics, and any incidents or issues that require attention from the Audit Committee or Board of Directors. Additionally, the Board of Directors receives a presentation at least annually regarding key developments and topics in cybersecurity from management along with a third party cybersecurity expert. 31 31 The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. Global Security executives oversee management of risks and track projects progress, remediations, and any issues related to cybersecurity risks.NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. Item 2. PropertiesOur corporate headquarters are located in San Jose, California. We own and lease office facilities and research and development facilities throughout the United States and internationally, primarily in Asia, Europe and North America. We do not consider any of our facilities to be material for disclosure purposes. Item 3. Legal ProceedingsFor a discussion of legal proceedings, see Note 16 - Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, which is incorporated herein by reference.Item 4. Mine Safety DisclosuresNot applicable. The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. Global Security executives oversee management of risks and track projects progress, remediations, and any issues related to cybersecurity risks.NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. Global Security executives oversee management of risks and track projects progress, remediations, and any issues related to cybersecurity risks.NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. Global Security executives oversee management of risks and track projects progress, remediations, and any issues related to cybersecurity risks. The CISO provides leadership, strategic direction, and oversight The CISO provides leadership, strategic direction, and oversight for NetApp's Global Security Risk and Compliance functions and security program. NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. NetApp's CISO is responsible for leading the assessment and management of cybersecurity risks. The current CISO has over 30 years of experience in IT and information security, including over 16 years with NetApp in roles of increasing seniority, and is a Certified Information Security Auditor, Certified Information Security Manager with ISACA and a Certified Information Systems Security Professional with ISC2. The CISO stays informed on information security risks through regular meetings on key cybersecurity projects and KPIs. Updates are communicated to the Global Security Steering Committee, which provides quarterly reports to the Board of Directors and to the Audit Committee. provides quarterly reports to the Board of Directors and to the Audit Committee. Item 2. Properties Our corporate headquarters are located in San Jose, California. We own and lease office facilities and research and development facilities throughout the United States and internationally, primarily in Asia, Europe and North America. We do not consider any of our facilities to be material for disclosure purposes. Item 3. Legal Proceedings For a discussion of legal proceedings, see Note 16 - Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K, which is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. 32 32 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesThe Company's common stock is traded on the NASDAQ Stock Market LLC (NASDAQ) under the symbol NTAP.Price Range of Common StockThe price range per share of common stock presented below represents the highest and lowest intraday sales prices for the Company's common stock on the NASDAQ during each quarter of our two most recent fiscal years. Fiscal 2026 Fiscal 2025 High Low High Low First Quarter $ 110.32 $ 86.70 $ 135.01 $ 100.24 Second Quarter $ 126.66 $ 100.56 $ 134.37 $ 112.87 Third Quarter $ 119.72 $ 93.69 $ 135.45 $ 112.86 Fourth Quarter $ 113.78 $ 94.46 $ 127.78 $ 71.84 HoldersAs of May 28, 2026, there were 387 holders of record of our common stock.DividendsThe Company paid cash dividends of $0.52 per outstanding common share in each quarter of fiscal 2026 and fiscal 2025 for an aggregate of $413 million and $424 million, respectively, and paid cash dividends of $0.50 per outstanding common share in each quarter of fiscal 2024 for an aggregate of $416 million. On May 21, 2026, the Company declared a cash dividend of $0.52 per share of common stock, payable on July 29, 2026 to shareholders of record as of the close of business on July 10, 2026. Decisions regarding future dividends are within the discretion of our Board of Directors, and depend on a number of factors, including, general business and economic conditions, and other factors which are discussed in the "Risk Factors" in Item 1A of this Annual Report on Form 10-K. PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company's common stock is traded on the NASDAQ Stock Market LLC (NASDAQ) under the symbol NTAP. --- ## Modified: Any disruption to our supply chain could materially harm our business, operating results, financial condition and cash flows. **Key changes:** - Reworded sentence: "We rely on third parties to manufacture the components used in our products and handle associated logistics." - Removed sentence: "During these times, our ability to manage relationships among ourselves, our manufacturing partners, and our component suppliers, becomes critical." - Reworded sentence: "Additionally, any disruption to our supply chain, including disruption to our manufacturing operations, or those of our contract manufacturers, could significantly impact our ability to fulfill customer orders on a timely basis, adversely impacting customer satisfaction and relationships, and could produce a near-term severe impact on the Company.We rely on a limited number of suppliers for critical product components.We depend on a limited number of suppliers for drives and other components used in assembling our products, including some single-source suppliers." - Reworded sentence: "When industry demand is high, supply is constrained, or the supply chain is disrupted, our suppliers may allocate volumes away from us and to others, including our competitors, who depend on many of the same suppliers as we do." - Reworded sentence: "We store and transmit, and sell products and services that store and transmit, personal, sensitive and proprietary data related to our products, our employees, customers, partners (including third-party vendors such as data centers and providers of SaaS, cloud computing, and internet infrastructure and bandwidth), and their respective customers." **Prior (2025):** We do not manufacture certain components used in our products. We rely on third parties to manufacture critical components and handle associated logistics. Our lack of direct control over these elements, combined with the diverse international geographic locations of our manufacturing partners and suppliers, creates significant risks for us, including: •Limited number of suppliers for certain components; Limited number of suppliers for certain components; •No guarantees of supply and limited ability to control the quality, quantity and cost of our products or of their components; No guarantees of supply and limited ability to control the quality, quantity and cost of our products or of their components; •Potential for binding price or purchase commitments with our suppliers at higher than market rates; Potential for binding price or purchase commitments with our suppliers at higher than market rates; •Limited ability to adjust production volumes in response to our customers' demand fluctuations; Limited ability to adjust production volumes in response to our customers' demand fluctuations; •Labor and political unrest at facilities we do not operate or own; Labor and political unrest at facilities we do not operate or own; 22 22 •Geopolitical disputes, acts of terrorism, cyber attacks and hacktivism disrupting our supply chain; •Impacts on our supply chain from adverse public health developments; •Business, regulatory compliance, legal compliance, litigation, trade controls and financial concerns affecting our suppliers or their ability to manufacture and ship components in the quantities, quality and manner as required; and •Disruptions due to floods, earthquakes, storms, fires and other natural disasters, especially those caused by climate change, and particularly in countries with limited infrastructure and disaster recovery resources.These risks have subjected us, and could in the future subject us, to supply constraints, price increases, and minimum purchase requirements, which could harm our business, operating results, financial condition, and cash flows. The risks associated with our outsourced manufacturing model are particularly acute when we transition products to new facilities or manufacturers, introduce and increase volumes of new products, or qualify new contract manufacturers or suppliers. During these times, our ability to manage relationships among ourselves, our manufacturing partners, and our component suppliers, becomes critical. New manufacturers, products, components, or facilities create increased costs and risk that we will fail to deliver high quality products in the required volumes to our customers. Any failure of a manufacturer or component supplier to meet our quality, quantity or delivery requirements in a cost-effective manner will harm our business, including customer relationships and as a result could harm our operating results, financial condition and cash flows. Additionally, disruption to our manufacturing operations, or those of our contract manufacturers, could significantly impact our ability to supply our customers and could produce a near-term severe impact on the Company.We rely on a limited number of suppliers for critical product components.We depend on a limited number of suppliers for drives and other components used in assembling our products, including some single-source suppliers. This reliance has subjected us, and could in the future subject us, to price rigidity, periodic supply constraints, and challenges in producing our products with the required quality and quantities. Consolidation among suppliers, particularly within the semiconductor and storage media industries, has led to price volatility and supply constraints. When industry supply is constrained or the supply chain is disrupted, our suppliers may allocate volumes away from us and to our competitors, who depend on many of the same suppliers as we do. As a result, our business, operating results, financial condition and cash flows may be adversely affected.If a material cybersecurity or other security breach impacts our services, systems, supply chain, or end-user customer systems, or if stored data is improperly accessed, our business could suffer significant harm. We store and transmit, and sell products and services that store and transmit, personal, sensitive and proprietary data related to our products, our employees, customers, clients, partners (including third-party vendors such as data centers and providers of SaaS, cloud computing, and internet infrastructure and bandwidth), and their respective customers. This data includes intellectual property, records, and personal information. It is critical to our business strategy that our infrastructure, products, and services remain secure and are perceived as secure by customers, clients, and partners. There are numerous and evolving cybersecurity and privacy risks, including criminal hacking (eCrime), state-sponsored intrusions, industrial espionage, hacktivism, insider threats, inadvertent disclosure, ransomware attacks, social-engineering, exploitation of unpatched or unmanaged vulnerabilities, cyber-attacks to the Company's service providers, suppliers or vendors, technological vulnerabilities, or destruction or other misuse of data that could harm the Company, operations or our competitive position. In some cases, these types of attacks have been successful. Increasing use of AI in techniques employed by threat actors will continue to increase the risk of successful attacks, while also providing opportunities for improved attack detection and prevention capabilities. Our information systems and data have been specifically targeted by various threat actors, including nation-state affiliated threat actors, and we expect that our information systems and data will continue to be targeted in the future. Cybersecurity incidents or other security breaches have in the past and could in the future result in: (1) unauthorized access to, or loss or unauthorized use, alteration, or disclosure of, personal, sensitive and/or proprietary data; (2) litigation, indemnity obligations, government investigations and proceedings, regulatory fines and penalties, and other possible liabilities; (3) revenue loss; (4) negative publicity and damage to our reputation; and (5) disruptions to our internal and external operations. These outcomes could damage our reputation, harm our business, and lead to significant liabilities. Additionally, a cybersecurity incident or loss of personal information has in the past and could in the future result in remediation costs, disruption of internal operations, increased cybersecurity protection costs, significant fines, and/or lost revenues.Our clients and their customers use our platforms to transmit and store sensitive data. We do not generally have the ability to review the information or content they upload and store, nor do we control the substance of this information or content. If our employees, clients, partners, or their respective customers use our platforms for the transmission or storage of sensitive information, or our supply-chain cybersecurity is compromised and our security measures are breached as a result of third-party action, employee •Geopolitical disputes, acts of terrorism, cyber attacks and hacktivism disrupting our supply chain; Geopolitical disputes, acts of terrorism, cyber attacks and hacktivism disrupting our supply chain; •Impacts on our supply chain from adverse public health developments; Impacts on our supply chain from adverse public health developments; •Business, regulatory compliance, legal compliance, litigation, trade controls and financial concerns affecting our suppliers or their ability to manufacture and ship components in the quantities, quality and manner as required; and Business, regulatory compliance, legal compliance, litigation, trade controls and financial concerns affecting our suppliers or their ability to manufacture and ship components in the quantities, quality and manner as required; and •Disruptions due to floods, earthquakes, storms, fires and other natural disasters, especially those caused by climate change, and particularly in countries with limited infrastructure and disaster recovery resources. Disruptions due to floods, earthquakes, storms, fires and other natural disasters, especially those caused by climate change, and particularly in countries with limited infrastructure and disaster recovery resources. These risks have subjected us, and could in the future subject us, to supply constraints, price increases, and minimum purchase requirements, which could harm our business, operating results, financial condition, and cash flows. The risks associated with our outsourced manufacturing model are particularly acute when we transition products to new facilities or manufacturers, introduce and increase volumes of new products, or qualify new contract manufacturers or suppliers. During these times, our ability to manage relationships among ourselves, our manufacturing partners, and our component suppliers, becomes critical. New manufacturers, products, components, or facilities create increased costs and risk that we will fail to deliver high quality products in the required volumes to our customers. Any failure of a manufacturer or component supplier to meet our quality, quantity or delivery requirements in a cost-effective manner will harm our business, including customer relationships and as a result could harm our operating results, financial condition and cash flows. Additionally, disruption to our manufacturing operations, or those of our contract manufacturers, could significantly impact our ability to supply our customers and could produce a near-term severe impact on the Company. **Current (2026):** We rely on third parties to manufacture the components used in our products and handle associated logistics. Our lack of direct control over these elements, combined with the diverse international geographic locations of our manufacturing partners and suppliers, creates significant risks for us, including: •Limited number of suppliers for certain components; Limited number of suppliers for certain components; •No guarantees of supply and limited ability to control the quality, quantity and cost of our products or components; No guarantees of supply and limited ability to control the quality, quantity and cost of our products or components; •Potential for binding price or purchase commitments with our suppliers at higher than market rates; Potential for binding price or purchase commitments with our suppliers at higher than market rates; •Limited ability to adjust production volumes in response to our customers' demand fluctuations; Limited ability to adjust production volumes in response to our customers' demand fluctuations; •Labor and political unrest at facilities we do not operate or own; Labor and political unrest at facilities we do not operate or own; •Geopolitical disputes, acts of terrorism, cyber attacks and hacktivism disrupting our supply chain; Geopolitical disputes, acts of terrorism, cyber attacks and hacktivism disrupting our supply chain; •Impacts on our supply chain from adverse public health developments; Impacts on our supply chain from adverse public health developments; •Business, regulatory compliance, legal compliance, litigation, trade controls and financial concerns affecting our suppliers or their ability to manufacture and ship components in the quantities, quality and manner as required; and Business, regulatory compliance, legal compliance, litigation, trade controls and financial concerns affecting our suppliers or their ability to manufacture and ship components in the quantities, quality and manner as required; and •Disruptions due to floods, earthquakes, storms, fires and other natural disasters, especially those caused by climate change, and particularly in countries with limited infrastructure and disaster recovery resources. Disruptions due to floods, earthquakes, storms, fires and other natural disasters, especially those caused by climate change, and particularly in countries with limited infrastructure and disaster recovery resources. 23 23 These risks have subjected us, and could in the future subject us, to supply constraints, price increases, and minimum purchase requirements, which could harm our business, operating results, financial condition, and cash flows. For example, we experienced inflationary pressure and supply chain constraints beginning in the second half of fiscal 2026, resulting in increased costs for memory and other components, which have adversely affected our gross margin. Additionally, the ongoing conflict in the Middle East has disrupted our ability to fulfill customer orders in the region on a timely basis. The risks associated with our outsourced manufacturing model are particularly acute when we transition products to new facilities or manufacturers, introduce and increase volumes of new products, or qualify new contract manufacturers or suppliers. New manufacturers, products, components, or facilities create increased costs and risk that we will fail to deliver high quality products in the required volumes to our customers. Any failure of a manufacturer or component supplier to meet our quality, quantity or delivery requirements in a cost-effective manner will harm our business, including customer relationships and as a result could harm our operating results, financial condition and cash flows. Additionally, any disruption to our supply chain, including disruption to our manufacturing operations, or those of our contract manufacturers, could significantly impact our ability to fulfill customer orders on a timely basis, adversely impacting customer satisfaction and relationships, and could produce a near-term severe impact on the Company.We rely on a limited number of suppliers for critical product components.We depend on a limited number of suppliers for drives and other components used in assembling our products, including some single-source suppliers. This reliance has subjected us, and could in the future subject us, to price rigidity, periodic supply constraints, and challenges in producing our products with the required quality and quantities. Consolidation among suppliers, particularly within the semiconductor and storage media industries, has led to price volatility and supply constraints. When industry demand is high, supply is constrained, or the supply chain is disrupted, our suppliers may allocate volumes away from us and to others, including our competitors, who depend on many of the same suppliers as we do. As a result, our business, operating results, financial condition and cash flows may be adversely affected.If a material cybersecurity or other security breach impacts our services, systems, supply chain, or end-user customer systems, or if stored data is improperly accessed, our business could suffer significant harm. We store and transmit, and sell products and services that store and transmit, personal, sensitive and proprietary data related to our products, our employees, customers, partners (including third-party vendors such as data centers and providers of SaaS, cloud computing, and internet infrastructure and bandwidth), and their respective customers. This data includes intellectual property, records, and personal information. It is critical to our business strategy that our infrastructure, products, and services remain secure and are perceived as secure by customers, and partners. There are numerous and evolving cybersecurity and privacy risks, including criminal hacking (eCrime), state-sponsored intrusions, industrial espionage, hacktivism, insider threats, inadvertent disclosure, ransomware attacks, social-engineering, phishing, spear-phishing, exfiltration, exploitation of unpatched or unmanaged vulnerabilities, cyber-attacks to the Company's service providers, suppliers or vendors, technological vulnerabilities, or destruction or other misuse of data that could harm the Company, operations or our competitive position. In some cases, these types of attacks have been successful. Increasing use of AI, such as Anthropic's Claude Mythos, in techniques employed by threat actors will continue to increase the risk of successful attacks that may overwhelm our protection systems faster than we can effectively respond. Our information systems and data have been specifically targeted by various threat actors, including nation-state affiliated threat actors, and we expect that our information systems and data will continue to be targeted in the future. Cybersecurity incidents or other security breaches have in the past and could in the future result in unauthorized access to, or loss or unauthorized use, alteration, or disclosure of, personal, sensitive and/or proprietary data; litigation, indemnity obligations, government investigations and proceedings, regulatory fines and penalties, and other possible liabilities; remediation costs and increased cybersecurity protection and insurance costs; revenue loss; negative publicity and damage to our reputation; and disruptions to our internal and external operations. Our customers and their customers use our solutions to transmit and store sensitive data. We do not generally have the ability to review the information or content they upload and store, nor do we control the substance of this information or content. If our employees, customers, partners, or their respective customers use our solutions for the transmission or storage of sensitive information, or our supply-chain cybersecurity is compromised and our security measures are breached as a result of third-party action, employee error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could be damaged, our business may be harmed and we could incur significant liabilities.Cyber-attacks and security breaches continue to increase, and of particular concern are supply-chain attacks against software development and breaches of technology service providers. We anticipate that cyberattacks will continue to increase in the future given cyber warfare has become a consistent lever within geopolitical conflicts and increasingly leverages hacktivism. We may not be successful in preventing or repelling unauthorized access to our systems. We also may face delays in our ability to identify or otherwise respond to any cybersecurity incident or any other breach. Future cyber-attacks or incidents could persist undetected in our environments for a period of time. Additionally, we use third-party service providers to provide some services to us that involve the storage or transmission of data, such as SaaS, cloud computing, and internet infrastructure and bandwidth, and they face various These risks have subjected us, and could in the future subject us, to supply constraints, price increases, and minimum purchase requirements, which could harm our business, operating results, financial condition, and cash flows. For example, we experienced inflationary pressure and supply chain constraints beginning in the second half of fiscal 2026, resulting in increased costs for memory and other components, which have adversely affected our gross margin. Additionally, the ongoing conflict in the Middle East has disrupted our ability to fulfill customer orders in the region on a timely basis. The risks associated with our outsourced manufacturing model are particularly acute when we transition products to new facilities or manufacturers, introduce and increase volumes of new products, or qualify new contract manufacturers or suppliers. New manufacturers, products, components, or facilities create increased costs and risk that we will fail to deliver high quality products in the required volumes to our customers. Any failure of a manufacturer or component supplier to meet our quality, quantity or delivery requirements in a cost-effective manner will harm our business, including customer relationships and as a result could harm our operating results, financial condition and cash flows. Additionally, any disruption to our supply chain, including disruption to our manufacturing operations, or those of our contract manufacturers, could significantly impact our ability to fulfill customer orders on a timely basis, adversely impacting customer satisfaction and relationships, and could produce a near-term severe impact on the Company. --- ## Modified: Our gross margins may fluctuate. **Key changes:** - Reworded sentence: "Our gross margins are influenced by a variety of factors, including macroeconomic volatility, competitive pricing, customer price sensitivity, component and product design costs, inflation, foreign exchange currency fluctuations, and the volume and relative mix of revenues from product sales, software support, hardware support, and other services offerings." - Reworded sentence: "These costs are difficult to manage if supplies of certain components, including NAND, become limited relative to demand or component prices rise significantly." - Reworded sentence: "For example, we have experienced inflationary pressure and supply chain constraints beginning in the second half of fiscal 2026, resulting in increased costs for memory and other components, which have affected our gross margins." **Prior (2025):** Our gross margins are influenced by a variety of factors, including macroeconomic volatility, competitive pricing, component and product design costs, inflation, foreign exchange currency fluctuations, and the volume and relative mix of revenues from product sales, software support, hardware support, and other services offerings. Factors such as increased component and labor costs, pricing and discounting pressures, changes in component costs and product prices, or shifts in revenue mix and volume from different offerings could negatively impact our revenues, gross margins or earnings. Additionally, our gross margins are affected by the cost of any substandard materials and our sales and distribution activities, including pricing actions, rebates, sales initiatives, discount levels, and the timing of service contract renewals. Third-party component costs make up a significant portion of our product costs. We may have difficulty managing these costs if supplies of certain components, including NAND, become limited or component prices rise. Such limitations could increase our product costs. We have experienced, and may continue to experience, negative impacts on our gross margins due to rising component costs, logistics costs, tariffs and other trade barriers, and inflationary pressures. An increase in component or design costs relative to our product prices could harm our gross margins and earnings. Failure to sustain or improve our gross margins may have a material adverse effect on our business and stock price. **Current (2026):** Our gross margins are influenced by a variety of factors, including macroeconomic volatility, competitive pricing, customer price sensitivity, component and product design costs, inflation, foreign exchange currency fluctuations, and the volume and relative mix of revenues from product sales, software support, hardware support, and other services offerings. Factors such as increased component, labor, and transportation costs, cost of any substandard materials, pricing and discounting pressures, changes in product prices, or shifts in revenue mix and volume from different offerings could negatively impact our revenues, gross margins or earnings. Additionally, our gross margins are affected by our sales and distribution activities, including pricing actions, rebates, sales initiatives, discount levels, and the timing of service contract renewals. Third-party component costs make up a significant portion of our product costs. These costs are difficult to manage if supplies of certain components, including NAND, become limited relative to demand or component prices rise significantly. We have experienced, and may continue to experience, negative impacts on our gross margins due to rising component costs, logistics costs, tariffs and other trade barriers, and inflationary pressures. For example, we have experienced inflationary pressure and supply chain constraints beginning in the second half of fiscal 2026, resulting in increased costs for memory and other components, which have affected our gross margins. An increase in component or design costs relative to our product prices could continue to harm our gross margins. Failure to sustain or improve our gross margins may have a material adverse effect on our business and stock price. --- ## Modified: Issues related to the development and use of artificial intelligence (AI), could lead to legal or regulatory action, damage our reputation, or otherwise materially harm our business. **Key changes:** - Reworded sentence: "Non-compliance with these emerging regulations, even if inadvertent or without our knowledge, could result in legal and financial penalties, reputational damage, and operational disruptions." - Reworded sentence: "We are increasingly building and/or deploying AI technology in certain products, services, and business operations, and our research and development in this area is ongoing." - Reworded sentence: "AI algorithms and training methodologies may be flawed, biased, or produce inaccurate outputs, which could result in public controversy or loss of customer trust." - Reworded sentence: "Customer demand continues to be influenced by cloud adoption, digital transformation initiatives, cybersecurity requirements, and increasing use of artificial intelligence and data-driven applications, driving significant changes in storage architectures and solution requirements." - Reworded sentence: "The long-term potential and competitiveness of emerging vendors remain uncertain." **Prior (2025):** As a technology company at the forefront of AI innovation, our business faces potential risks associated with the rapidly evolving regulatory landscape for AI. Governments and regulatory bodies worldwide are increasingly enacting new laws and guidelines to address the ethical, privacy, and security implications of AI technologies. Non-compliance, even if inadvertent or without our knowledge, with these emerging regulations could result in legal and financial penalties, reputational damage, and operational disruptions. Additionally, the diverse and sometimes conflicting nature of international AI regulations may pose challenges in maintaining consistent compliance across different jurisdictions. The complexity and novelty of these laws may also require investments in compliance infrastructure, including enhanced data governance frameworks, algorithmic transparency, and bias mitigation strategies. We are increasingly building and/or leveraging AI technology in certain products, services, and business operations, and our research and development in this area is ongoing. As with many innovations, AI presents risks, challenges, and potential unintended consequences that could affect our and our customers' adoption and use of this technology. AI algorithms and training methodologies may be flawed, and AI technologies are complex and rapidly evolving. We face significant competition in the market and from other companies regarding such technologies. 17 17 We may be unsuccessful in identifying or resolving ethical and legal issues presented by the use of AI before they arise. AI-related issues, deficiencies and/or failures could result in (i) legal or regulatory action, including to enforce new legislation regulating AI in various jurisdictions where we operate, and the application of existing data protection, privacy, intellectual property, and other laws; (ii) damage to our reputation; (iii) time-consuming and costly litigation, including related to intellectual property; (iv) inability to protect our intellectual property; (v) disclosure of our confidential information or (vi) other material harm to our business. If regulation significantly delays or impedes the adoption of AI, we may not be able to meet our development goals or our sales forecasts.Increasing competition and industry consolidation could harm our business, operating results, financial condition and cash flows.Our markets are highly competitive, fragmented, and characterized by rapidly changing technology. We face competition from many companies, including established public companies, newer public companies with a strong focus on flash storage, and new market entrants targeting opportunities in GenAI and application data management for Kubernetes. Some competitors offer a broad range of IT products and services (full-stack vendors), while others offer a more limited set. Technology trends, such as GenAI, hosted or public cloud storage, software as a service (SaaS), IT as a service, and flash storage are driving significant changes in storage architectures and solution requirements. Cloud service providers offer storage on demand without requiring capital expenditure, which meets rapidly evolving business needs and has altered the competitive landscape. Competitors may develop new technologies, products, or services ahead of us or establish new business models, more flexible purchase models, or disruptive technologies. By extending our offerings in flash, cloud storage, converged infrastructure, and block storage, and GenAI, we are entering new segments and facing competition from both traditional competitors and emerging competitors. The long-term potential and competitiveness of emerging vendors remains uncertain. New competitors or alliances among existing competitors could emerge and quickly gain significant market share or buying power. Changes in customer requirements or increased industry consolidation could result in stronger competitors better able to compete. Additionally, current and potential competitors may establish cooperative relationships among themselves or with third parties, including some of our partners or suppliers. For additional information regarding our competitors, see the section entitled "Competition" contained in Part I, Item 1 - Business of this Annual Report on Form 10-K.Transition to consumption-based business models may adversely affect our revenues and profitability in other areas of our business, potentially harming our business, operating results, financial condition and cash flows.We offer customers a variety of consumption models, including cloud-based storage services and storage as a service (STaaS) delivered on-premises. As these business models continue to evolve, we may face challenges in competing effectively, generating significant revenues, or maintaining the profitability of our consumption-based offerings. Additionally, the growing prevalence of cloud and SaaS delivery models offered by us and our competitors may reduce overall demand for our traditional on-premises offerings sold through a capital expenditure (capex) model, which could negatively impact our revenues and cash flow, at least in the short term. Failure to successfully execute our consumption model strategy or anticipate customer needs could lead to a decline in our revenues and our profitability could decline.As customer demand for our consumption model offerings increases, we will encounter differences in the timing of revenue recognition compared to our traditional purchase arrangements. Revenue from traditional purchases is generally recognized in full at the time of delivery, whereas revenue from consumption model offerings is generally recognized ratably over the term of the arrangement. We incur certain expenses related to the infrastructure and marketing of our consumption model offerings before we can recognize the associated revenues.If we are unable to attract and retain qualified personnel, our business, operating results, financial condition and cash flows could be harmed.Our success depends on our ability to hire and retain qualified personnel to advance our corporate strategy and maintain key aspects of our corporate culture. As our future success relies on enhancing and introducing new products and features, we particularly need to attract and retain qualified engineers and technical talent, especially in emerging technology areas like AI and machine learning. To increase revenues, we must also increase the productivity of our sales force, which may require an increase in support infrastructure and personnel, to achieve adequate customer coverage.Competition for qualified employees, particularly in the technology industry, is intense. We have periodically reduced our workforce, including restructuring plans announced in fiscal 2023, fiscal 2024, and fiscal 2025, respectively. These actions may make it more challenging to attract and retain qualified employees. Failure to hire and retain skilled management and personnel, particularly engineers, salespeople, and key executive management, could disrupt our development efforts, sales results, business relationships, and our ability to execute our business plan and strategy, adversely affecting our operating results, financial conditions and cash flows. We may be unsuccessful in identifying or resolving ethical and legal issues presented by the use of AI before they arise. AI-related issues, deficiencies and/or failures could result in (i) legal or regulatory action, including to enforce new legislation regulating AI in various jurisdictions where we operate, and the application of existing data protection, privacy, intellectual property, and other laws; (ii) damage to our reputation; (iii) time-consuming and costly litigation, including related to intellectual property; (iv) inability to protect our intellectual property; (v) disclosure of our confidential information or (vi) other material harm to our business. If regulation significantly delays or impedes the adoption of AI, we may not be able to meet our development goals or our sales forecasts. **Current (2026):** As a technology company at the forefront of AI innovation, our business faces potential risks associated with the rapidly evolving regulatory landscape for AI. Governments and regulatory bodies worldwide are increasingly enacting new laws and guidelines to address the ethical, privacy, and security implications of AI technologies. Non-compliance with these emerging regulations, even if inadvertent or without our knowledge, could result in legal and financial penalties, reputational damage, and operational disruptions. Additionally, the diverse and sometimes conflicting nature of international AI regulations may pose challenges in maintaining consistent compliance across different jurisdictions. The complexity and novelty of these laws may also require investments in compliance infrastructure, including enhanced data governance frameworks, algorithmic transparency, and bias mitigation strategies. We are increasingly building and/or deploying AI technology in certain products, services, and business operations, and our research and development in this area is ongoing. As with many innovations, AI presents risks, challenges, and potential unintended consequences that could affect our and our customers' adoption and use of this technology. AI algorithms and training methodologies may be flawed, biased, or produce inaccurate outputs, which could result in public controversy or loss of customer trust. Furthermore, AI technologies are complex and rapidly evolving and could expose us to an increased risk of cybersecurity threats and incidents. Our usage of third-party AI technologies introduces challenges, including with respect to vendor management, oversight, and integration, 18 18 that may increase our risk exposure. We face significant competition in the market and from other companies regarding AI technologies. We may be unsuccessful in identifying or resolving ethical and legal issues presented by the use of AI before they arise. AI-related issues, deficiencies and/or failures could result in (i) legal or regulatory action, including to enforce new legislation regulating AI in various jurisdictions where we operate, and the application of existing data protection, privacy, intellectual property, and other laws; (ii) damage to our reputation; (iii) time-consuming and costly litigation, including related to intellectual property; (iv) inability to protect our intellectual property, including the inability to claim intellectual property ownership over content or source code generated using AI; (v) disclosure of our confidential information, including the inadvertent input of proprietary, sensitive, or customer data into publicly available third-party AI training models; or (vi) other material harm to our business. If regulation significantly delays or impedes the adoption of AI, we may not be able to meet our development goals or our sales forecasts.Increasing competition or industry consolidation could harm our business, operating results, financial condition and cash flows.Our markets are highly competitive, fragmented, and characterized by rapidly changing technology. We face competition from many companies, including established public companies, newer public companies focused on flash storage, and new market entrants targeting the AI opportunity. Some competitors offer a broad range of IT products and services (full-stack vendors), while others offer a more limited set. Customer demand continues to be influenced by cloud adoption, digital transformation initiatives, cybersecurity requirements, and increasing use of artificial intelligence and data-driven applications, driving significant changes in storage architectures and solution requirements. The emergence of artificial intelligence workloads has introduced additional competitive dynamics, particularly in areas related to data readiness, performance, scalability, and integration with compute and cloud ecosystems. Additionally, cloud service providers offer storage on demand without requiring capital expenditure, which meets rapidly evolving business needs and has altered the competitive landscape. We also face competition from alternative architectures or approaches that may reduce or eliminate demand for some of our offerings.Competitors may develop new technologies, products, or services ahead of us or establish new business models, more flexible purchase models, or disruptive technologies. By extending our offerings in flash, cloud storage, converged infrastructure, and block storage, and GenAI, we are entering new segments and facing competition from both traditional competitors and emerging competitors. The long-term potential and competitiveness of emerging vendors remain uncertain. New competitors or alliances among existing competitors could emerge and quickly gain significant market share or buying power. Changes in customer requirements or increased industry consolidation could result in stronger competitors who are better able to compete against us. Additionally, current and potential competitors may establish cooperative relationships among themselves or with third parties, including some of our partners or suppliers. For additional information regarding our competitors, see the section entitled "Competition" contained in Part I, Item 1 - Business of this Annual Report on Form 10-K.Transition to consumption-based business models may adversely affect our revenues and profitability in other areas of our business, potentially harming our business, operating results, financial condition and cash flows.We offer customers a variety of consumption models, including cloud-based storage services and storage-as-a-service (STaaS) delivered on-premises. As these business models continue to evolve, we may face challenges in competing effectively, generating significant revenues, or maintaining the profitability of our consumption-based offerings. Additionally, the growing prevalence of cloud and software-as-a-service (SaaS) delivery models offered by us and our competitors may reduce overall demand for our traditional on-premises offerings sold through a capital expenditure (capex) model, which could negatively impact our revenues and cash flow, at least in the short term. Failure to successfully execute our consumption model strategy or anticipate customer needs could lead to a decline in our revenues and our profitability could decline.As customer demand for our consumption model offerings increases, we will encounter differences in the timing of revenue recognition compared to our traditional purchase arrangements. Revenue from traditional purchases is generally recognized in full at the time of delivery, whereas revenue from consumption model offerings is generally recognized ratably over the term of the arrangement. We incur certain expenses related to the infrastructure and marketing of our consumption model offerings before we can recognize the associated revenues.If we are unable to attract and retain qualified personnel, our business, operating results, financial condition and cash flows could be harmed.Our success depends on our ability to hire and retain qualified personnel to advance our corporate strategy and maintain key aspects of our corporate culture. As our future success relies on enhancing and introducing new products and features, we particularly need to attract and retain qualified engineers and technical talent, especially in emerging technology areas like AI and machine learning. that may increase our risk exposure. We face significant competition in the market and from other companies regarding AI technologies. We may be unsuccessful in identifying or resolving ethical and legal issues presented by the use of AI before they arise. AI-related issues, deficiencies and/or failures could result in (i) legal or regulatory action, including to enforce new legislation regulating AI in various jurisdictions where we operate, and the application of existing data protection, privacy, intellectual property, and other laws; (ii) damage to our reputation; (iii) time-consuming and costly litigation, including related to intellectual property; (iv) inability to protect our intellectual property, including the inability to claim intellectual property ownership over content or source code generated using AI; (v) disclosure of our confidential information, including the inadvertent input of proprietary, sensitive, or customer data into publicly available third-party AI training models; or (vi) other material harm to our business. If regulation significantly delays or impedes the adoption of AI, we may not be able to meet our development goals or our sales forecasts. --- ## Modified: There are risks associated with our outstanding and future indebtedness. **Key changes:** - Reworded sentence: "As of April 24, 2026, we had $2.5 billion aggregate principal amount of outstanding indebtedness for our senior notes that mature at specific dates in calendar years 2027, 2030, 2032 and 2035." - Reworded sentence: "Specifically, if we are unable to generate sufficient cash flows from operations or borrow sufficient funds in the future to service or refinance our debt, our business, operating results, financial condition and cash flows may be harmed." **Prior (2025):** As of April 25, 2025, we had $3.3 billion aggregate principal amount of outstanding indebtedness for our senior notes that mature at specific dates in calendar years 2025, 2027, 2030, 2032 and 2035. We may incur additional indebtedness in the future under existing credit facilities and/or enter into new financing arrangements. We may fail to pay these or additional future obligations, as and when required. Specifically, if we are unable to generate sufficient cash flows from operations or to borrow sufficient funds in the future to service or refinance our debt, our business, operating results, financial condition and cash flows will be harmed. Any downgrades from credit rating agencies such as Moody's Investors Service or Standard & Poor's Rating Services may adversely impact our ability to obtain additional financing or the terms of such financing and reduce the market capacity for our commercial paper. Furthermore, if prevailing interest rates or other factors result in higher interest rates upon any potential future financing, then interest expense related to the refinance indebtedness would increase. In addition, all our debt and credit facility arrangements subject us to continued compliance with restrictive and financial covenants. If we do not comply with these covenants or otherwise default under the arrangements, we may be required to repay any outstanding amounts borrowed under these agreements. Moreover, compliance with these covenants may restrict our strategic or operational flexibility in the future, which could harm our business, operating results, financial condition and cash flows. **Current (2026):** As of April 24, 2026, we had $2.5 billion aggregate principal amount of outstanding indebtedness for our senior notes that mature at specific dates in calendar years 2027, 2030, 2032 and 2035. We may incur additional indebtedness in the future under existing credit facilities and/or enter into new financing arrangements. We may fail to pay these or additional future obligations, as and when required. Specifically, if we are unable to generate sufficient cash flows from operations or borrow sufficient funds in the future to service or refinance our debt, our business, operating results, financial condition and cash flows may be harmed. If we cannot make scheduled payments on our debt, we will be in default and holders of our debt could declare all outstanding principal and interest to be due and payable, the lenders could terminate their commitments to loan money, and we could be forced into bankruptcy or liquidation. Any downgrades from credit rating agencies may adversely impact our ability to obtain additional financing or the terms of such financing and reduce the market capacity for our commercial paper. Further, if prevailing interest rates or other factors result in higher interest rates upon any potential future financing, then interest expense related to the refinance indebtedness would increase. In addition, all our debt and credit facility arrangements subject us to continued compliance with restrictive and financial covenants. If we do not comply with these covenants or otherwise default under the arrangements, we may be required to repay any outstanding amounts borrowed under these agreements. Moreover, compliance with these covenants may restrict our strategic or operational flexibility in the future, which could harm our business, operating results, financial condition and cash flows. --- ## Modified: April 25, 2025 **Key changes:** - Reworded sentence: "Net cash provided by operating activities $ 2,067 $ 1,506 Net cash (used in) provided by investing activities (595 ) 147 Net cash used in financing activities (2,147 ) (828 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 1 15 Net change in cash, cash equivalents and restricted cash $ (674 ) $ 840 As of April 24, 2026, our cash, cash equivalents and short-term investments totaled $3.6 billion, reflecting a decrease of $262 million from April 25, 2025." - Reworded sentence: "•Deferred revenue increased by $208 million, primarily due to an increase in deferred revenue for software and hardware support contracts." - Reworded sentence: "We expect that cash provided by operating activities may materially fluctuate in future periods due to a number of factors, including fluctuations in our operating results, shipping linearity, accounts receivable collections performance, inventory and supply chain management, vendor payment initiatives, and the timing and amount of compensation, income taxes and other payments." - Reworded sentence: "For a discussion of risks related to our cash flows and liquidity requirements, see Item 1A." - Reworded sentence: "For a discussion of risks related to our cash flows and liquidity requirements, see Item 1A." **Prior (2025):** 2025 2024 Net cash provided by operating activities $ 1,506 $ 1,685 Net cash provided by (used in) investing activities 147 (735 ) Net cash used in financing activities (828 ) (1,344 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 15 (19 ) Net change in cash, cash equivalents and restricted cash $ 840 $ (413 ) As of April 25, 2025, our cash, cash equivalents and short-term investments totaled $3.8 billion, reflecting an increase of $594 million from April 26, 2024. The increase was primarily due to $1.24 billion of net proceeds from the issuance of Senior Notes and $1.5 billion of cash generated from operating activities, partially offset by $1.2 billion used to repurchase shares of our common stock, a $400 million principal repayment of our 3.30% Senior Notes due September 2024, $424 million used for the payment of dividends, and $168 million in purchases of property and equipment. Net working capital was $1.2 billion as of April 25, 2025, an increase of $398 million when compared to April 26, 2024, primarily due to the increases in cash, cash equivalents and short-term investments discussed above. Cash Flows from Operating Activities During fiscal 2025, cash provided by operating activities reflected net income of $1.2 billion which was increased for non-cash depreciation and amortization expense of $243 million and non-cash stock-based compensation expense of $386 million. Significant changes in assets and liabilities during fiscal 2025 included the following: •Accounts receivable increased by $219 million, primarily reflecting higher billing in the fourth quarter of fiscal 2025 compared to the fourth quarter of fiscal 2024. Accounts receivable increased by $219 million, primarily reflecting higher billing in the fourth quarter of fiscal 2025 compared to the fourth quarter of fiscal 2024. •Deferred revenue and financed unearned services revenue increased by $208 million, primarily due to an increase in deferred revenue for software and hardware support contracts. Deferred revenue and financed unearned services revenue increased by $208 million, primarily due to an increase in deferred revenue for software and hardware support contracts. •Long-term taxes payable decreased by $207 million, primarily due to settlements associated with certain IRS tax examinations and changes in prior period tax positions. Long-term taxes payable decreased by $207 million, primarily due to settlements associated with certain IRS tax examinations and changes in prior period tax positions. 44 44 During fiscal 2024, cash provided by operating activities reflected net income of $1.0 billion which was increased for non-cash depreciation and amortization expense of $255 million and non-cash stock-based compensation expense of $357 million.Significant changes in assets and liabilities during fiscal 2024 included the following:•Accounts payable increased by $123 million, primarily reflecting the timing of inventory purchases from, and payments to, our contract manufacturers.•Accrued expenses increased by $113 million, primarily due to higher employee compensation accruals as of the end of fiscal 2024 compared to fiscal 2023 related to incentive compensation and commissions plans.We expect that cash provided by operating activities may materially fluctuate in future periods due to a number of factors, including fluctuations in our operating results, shipping linearity, accounts receivable collections performance, inventory and supply chain management, vendor payment initiatives, and the timing and amount of compensation, income taxes and other payments.Cash Flows from Investing ActivitiesDuring fiscal 2025, we generated $245 million primarily from maturities and sales of investments, net of purchases, and paid $168 million for capital expenditures. Additionally, we received proceeds of $70 million from the sale of our Spot by NetApp business.During fiscal 2024, we used $580 million for the purchases of investments, net of maturities and sales, and $155 million for capital expenditures.Cash Flows from Financing ActivitiesDuring fiscal 2025, we used $1.2 billion for the repurchase of 10.2 million shares of common stock, $424 million for the payment of dividends and $400 million principal repayment upon maturity, partially offset by $1.24 billion of net proceeds from the issuance of Senior Notes.During fiscal 2024, we used $900 million for the repurchase of 11.5 million shares of common stock, and $416 million for the payment of dividends.Key factors that that could affect our cash flows include changes in our revenue mix and profitability, our ability to effectively manage our working capital, in particular, accounts receivable, accounts payable and inventories, the timing and amount of stock repurchases and payment of cash dividends, the impact of foreign exchange rate changes, our ability to effectively integrate acquired products, businesses and technologies and the timing of repayments of our debt. Based on past performance and our current business outlook, we believe that our sources of liquidity, including cash, cash equivalents and short-term investments, cash generated from operations, and our ability to access capital markets and committed credit lines will satisfy our working capital needs, capital expenditures, investment requirements, stock repurchases, cash dividends, contractual obligations, commitments, principal and interest payments on our debt and other liquidity requirements associated with operations and meet our cash requirements for at least the next 12 months and thereafter for the foreseeable future. We may choose to periodically raise additional debt capital based on certain conditions, including the refinancing of upcoming maturities and/or for potential strategic acquisitions and investments. Our ability to obtain this or any additional financing that we may pursue or need, will depend on, among other things, our business plans, operating performance and the condition of the capital markets at the time we seek financing. We may not be able to obtain such financing on terms acceptable to us or at all. In the event our liquidity is insufficient and we are unable to enter into new financing arrangements, we may be required to curtail spending and implement additional cost saving measures and restructuring actions. We cannot be certain that we will continue to generate cash flows at or above current levels. For further discussion of factors that could affect our cash flows and liquidity requirements, see Item 1A. Risk Factors.LiquidityOur principal sources of liquidity as of April 25, 2025 consisted of cash, cash equivalents and short-term investments, cash we expect to generate from operations, and our commercial paper program and related credit facility.Cash, cash equivalents and short-term investments consisted of the following (in millions): April 25, 2025 April 26,2024 Cash and cash equivalents $ 2,742 $ 1,903 Short-term investments 1,104 1,349 Total $ 3,846 $ 3,252 During fiscal 2024, cash provided by operating activities reflected net income of $1.0 billion which was increased for non-cash depreciation and amortization expense of $255 million and non-cash stock-based compensation expense of $357 million. Significant changes in assets and liabilities during fiscal 2024 included the following: •Accounts payable increased by $123 million, primarily reflecting the timing of inventory purchases from, and payments to, our contract manufacturers. Accounts payable increased by $123 million, primarily reflecting the timing of inventory purchases from, and payments to, our contract manufacturers. •Accrued expenses increased by $113 million, primarily due to higher employee compensation accruals as of the end of fiscal 2024 compared to fiscal 2023 related to incentive compensation and commissions plans. Accrued expenses increased by $113 million, primarily due to higher employee compensation accruals as of the end of fiscal 2024 compared to fiscal 2023 related to incentive compensation and commissions plans. We expect that cash provided by operating activities may materially fluctuate in future periods due to a number of factors, including fluctuations in our operating results, shipping linearity, accounts receivable collections performance, inventory and supply chain management, vendor payment initiatives, and the timing and amount of compensation, income taxes and other payments. Cash Flows from Investing Activities During fiscal 2025, we generated $245 million primarily from maturities and sales of investments, net of purchases, and paid $168 million for capital expenditures. Additionally, we received proceeds of $70 million from the sale of our Spot by NetApp business. During fiscal 2024, we used $580 million for the purchases of investments, net of maturities and sales, and $155 million for capital expenditures. Cash Flows from Financing Activities During fiscal 2025, we used $1.2 billion for the repurchase of 10.2 million shares of common stock, $424 million for the payment of dividends and $400 million principal repayment upon maturity, partially offset by $1.24 billion of net proceeds from the issuance of Senior Notes. During fiscal 2024, we used $900 million for the repurchase of 11.5 million shares of common stock, and $416 million for the payment of dividends. Key factors that that could affect our cash flows include changes in our revenue mix and profitability, our ability to effectively manage our working capital, in particular, accounts receivable, accounts payable and inventories, the timing and amount of stock repurchases and payment of cash dividends, the impact of foreign exchange rate changes, our ability to effectively integrate acquired products, businesses and technologies and the timing of repayments of our debt. Based on past performance and our current business outlook, we believe that our sources of liquidity, including cash, cash equivalents and short-term investments, cash generated from operations, and our ability to access capital markets and committed credit lines will satisfy our working capital needs, capital expenditures, investment requirements, stock repurchases, cash dividends, contractual obligations, commitments, principal and interest payments on our debt and other liquidity requirements associated with operations and meet our cash requirements for at least the next 12 months and thereafter for the foreseeable future. We may choose to periodically raise additional debt capital based on certain conditions, including the refinancing of upcoming maturities and/or for potential strategic acquisitions and investments. Our ability to obtain this or any additional financing that we may pursue or need, will depend on, among other things, our business plans, operating performance and the condition of the capital markets at the time we seek financing. We may not be able to obtain such financing on terms acceptable to us or at all. In the event our liquidity is insufficient and we are unable to enter into new financing arrangements, we may be required to curtail spending and implement additional cost saving measures and restructuring actions. We cannot be certain that we will continue to generate cash flows at or above current levels. For further discussion of factors that could affect our cash flows and liquidity requirements, see Item 1A. Risk Factors. Liquidity Our principal sources of liquidity as of April 25, 2025 consisted of cash, cash equivalents and short-term investments, cash we expect to generate from operations, and our commercial paper program and related credit facility. Cash, cash equivalents and short-term investments consisted of the following (in millions): **Current (2026):** Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. •Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. --- ## Modified: Other comprehensive income (loss): **Key changes:** - Reworded sentence: "Foreign currency translation adjustments 52 (3 ) (5 ) Defined benefit obligations: Defined benefit obligation adjustments 1 (2 ) (4 ) Unrealized gains on available-for-sale securities: Unrealized holding gains arising during the period - 1 - Unrealized gains (losses) on cash flow hedges: Unrealized holding gains (losses) arising during the period - (2 ) 2 Reclassification adjustments for losses (gains) included in net income 2 (1 ) (1 )" **Prior (2025):** Foreign currency translation adjustments (3 ) (5 ) (4 ) Defined benefit obligations: Defined benefit obligation adjustments (2 ) (4 ) (2 ) Unrealized gains on available-for-sale securities: Unrealized holding gains arising during the period 1 - - Unrealized gains (losses) on cash flow hedges: Unrealized holding gains (losses) arising during the period (2 ) 2 (6 ) Reclassification adjustments for (gains) losses included in net income (1 ) (1 ) 5 **Current (2026):** Foreign currency translation adjustments 52 (3 ) (5 ) Defined benefit obligations: Defined benefit obligation adjustments 1 (2 ) (4 ) Unrealized gains on available-for-sale securities: Unrealized holding gains arising during the period - 1 - Unrealized gains (losses) on cash flow hedges: Unrealized holding gains (losses) arising during the period - (2 ) 2 Reclassification adjustments for losses (gains) included in net income 2 (1 ) (1 ) --- ## Modified: Cash, cash equivalents and restricted cash: **Key changes:** - Reworded sentence: "Beginning of period 2,749 1,909 2,322 End of period $ 2,075 $ 2,749 $ 1,909 See accompanying notes to consolidated financial statements." **Prior (2025):** Beginning of period 1,909 2,322 4,119 End of period $ 2,749 $ 1,909 $ 2,322 See accompanying notes to consolidated financial statements. 58 58 NETAPP, INC.CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY(In millions, except per share amounts) Accumulated Common Stock and Other Additional Paid-in Capital Retained Comprehensive Shares Amount Earnings Loss Total Balances, April 29, 2022 220 $ 760 $ 122 $ (44 ) $ 838 Net income - - 1,274 - 1,274 Other comprehensive loss - - - (7 ) (7 ) Issuance of common stock under employee stock award plans, net of taxes 5 24 - - 24 Repurchase of common stock (13 ) (45 ) (805 ) - (850 ) Stock-based compensation - 312 - - 312 Cash dividends declared ($2.00 per common share) - (106 ) (326 ) - (432 ) Balances, April 28, 2023 212 945 265 (51 ) 1,159 Net income - - 986 - 986 Other comprehensive loss - - - (8 ) (8 ) Issuance of common stock under employee stock award plans, net of taxes 6 (27 ) - - (27 ) Repurchase of common stock (12 ) (102 ) (798 ) - (900 ) Excise tax on net stock repurchases - (5 ) - - (5 ) Stock-based compensation - 353 - - 353 Modification of liability-classified awards - 4 - - 4 Cash dividends declared ($2.00 per common share) - (171 ) (245 ) - (416 ) Balances, April 26, 2024 206 997 208 (59 ) 1,146 Net income - - 1,186 - 1,186 Other comprehensive loss - - - (7 ) (7 ) Issuance of common stock under employee stock award plans, net of taxes 5 (91 ) - - (91 ) Repurchase of common stock (10 ) (50 ) (1,100 ) - (1,150 ) Excise tax on net stock repurchases - (6 ) - - (6 ) Stock-based compensation - 386 - - 386 Cash dividends declared ($2.08 per common share) - (130 ) (294 ) - (424 ) Balances, April 25, 2025 201 $ 1,106 $ - $ (66 ) $ 1,040 See accompanying notes to consolidated financial statements. **Current (2026):** Beginning of period 2,749 1,909 2,322 End of period $ 2,075 $ 2,749 $ 1,909 See accompanying notes to consolidated financial statements. 57 57 NETAPP, INC.CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY(In millions, except per share amounts) Accumulated Common Stock and Other Additional Paid-in Capital Retained Comprehensive Shares Amount Earnings Loss Total Balances, April 28, 2023 212 $ 945 $ 265 $ (51 ) $ 1,159 Net income - - 986 - 986 Other comprehensive loss - - - (8 ) (8 ) Issuance of common stock under employee stock award plans, net of taxes 6 (27 ) - - (27 ) Repurchase of common stock (12 ) (102 ) (798 ) - (900 ) Excise tax on net stock repurchases - (5 ) - - (5 ) Stock-based compensation - 353 - - 353 Modification of liability-classified awards - 4 - - 4 Cash dividends declared ($2.00 per common share) - (171 ) (245 ) - (416 ) Balances, April 26, 2024 206 997 208 (59 ) 1,146 Net income - - 1,186 - 1,186 Other comprehensive loss - - - (7 ) (7 ) Issuance of common stock under employee stock award plans, net of taxes 5 (91 ) - - (91 ) Repurchase of common stock (10 ) (50 ) (1,100 ) - (1,150 ) Excise tax on net stock repurchases - (6 ) - - (6 ) Stock-based compensation - 386 - - 386 Cash dividends declared ($2.08 per common share) - (130 ) (294 ) - (424 ) Balances, April 25, 2025 201 1,106 - (66 ) 1,040 Net income - - 1,276 - 1,276 Other comprehensive income - - - 55 55 Issuance of common stock under employee stock award plans, net of taxes 4 (34 ) - - (34 ) Repurchase of common stock (9 ) (98 ) (852 ) - (950 ) Excise tax on net stock repurchases - (5 ) - - (5 ) Stock-based compensation - 382 - - 382 Cash dividends declared ($2.08 per common share) - (142 ) (271 ) - (413 ) Balances, April 24, 2026 196 $ 1,209 $ 153 $ (11 ) $ 1,351 See accompanying notes to consolidated financial statements. --- ## Modified: April 25, 2025 **Key changes:** - Reworded sentence: "Cash and cash equivalents $ 2,070 $ 2,742 Short-term investments 1,514 1,104 Total $ 3,584 $ 3,846 As of April 24, 2026 and April 25, 2025, $2.3 billion and $2.5 billion, respectively, of cash, cash equivalents and short-term investments were held by various foreign subsidiaries and were generally based in U.S." - Reworded sentence: "We are not aware of any significant deterioration in the fair value of our cash equivalents or investments from the values reported as of April 24, 2026." - Reworded sentence: "We also have an automatic 46 46 shelf registration statement on file with the U.S." - Reworded sentence: "We may in the future offer an additional unspecified amount of debt, equity and other securities.Senior NotesThe following table summarizes the principal amount of our Senior Notes as of April 24, 2026 (in millions): Amount 2.375% Senior Notes Due June 2027 $ 550 2.70% Senior Notes Due June 2030 700 5.50% Senior Notes Due March 2032 625 5.70% Senior Notes Due March 2035 625 Total $ 2,500 Interest on the Senior Notes is payable semi-annually." - Reworded sentence: "No commercial paper notes were outstanding as of April 24, 2026.Material Capital Expenditure RequirementsWe expect to fund our capital expenditures, including our commitments related to facilities, equipment, operating leases and internal-use software development projects for at least the next 12 months through existing cash, cash equivalents, investments and cash generated from operations." **Prior (2025):** Deferred revenue and financed unearned services revenue $ 4,536 $ 4,234 36 36 •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues.•Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues.•Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues.•Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year.•Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above.Stock Repurchase Program and Dividend ActivityDuring fiscal 2025, we repurchased 10.2 million shares of our common stock at an average price of $112.55 per share, for an aggregate purchase price of $1.2 billion. We also declared aggregate cash dividends of $2.08 per share in fiscal 2025, for which we paid a total of $424 million.Restructuring EventsDuring fiscal 2025, we executed several restructuring plans and recognized expenses totaling $83 million consisting primarily of employee severance-related costs. Senior Notes IssuanceIn March 2025, we issued $625 million aggregate principal amount of 5.50% Senior Notes due 2032 and $625 million aggregate principal amount of 5.70% Senior Notes due 2035, for which we received total proceeds of $1.24 billion, net of discount and issuance costs. •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. •Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. **Current (2026):** Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. •Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. --- ## Modified: If a data center or other third-party who relies on our products experiences a disruption in service or a loss of data, such disruption could be attributed to the quality of our products. **Key changes:** - Reworded sentence: "Our customers, including data centers, SaaS providers, cloud computing services and internet infrastructure and bandwidth providers, rely on our products for their data storage needs." **Prior (2025):** Our clients, including data centers, SaaS providers, cloud computing services and internet infrastructure and bandwidth providers, rely on our products for their data storage needs. These clients may authorize third-party technology providers to access their data on our systems. Errors or wrongdoing by clients, their customers, or third-party technology providers resulting in actual or perceived security breaches may result in such actual or perceived breaches being attributed to us. A failure to meet our customers' and partners' expectations regarding security and confidentiality, due to disruptions in services provided by third-party vendors or the loss or alteration of data stored by such vendors, could cause financial or reputational harm to our business. This harm could occur if the disruption or data loss is caused by, or perceived to be caused by, defects in our products. The risk of reputational harm may be magnified by the rapid dissemination of information over the internet, including through news articles, blogs, social media, and other online communication forums and services. This could affect our ability to retain clients and attract new business. Additionally, our operations and select cloud services rely on third-party cloud providers. Interruptions due to technical failures such as hardware or software issues or connectivity problems, security incidents, compliance changes, operational challenges and natural disasters could reduce revenue due to the cloud services' metered billing and could pose reputational risks. Moreover, dependence on key cloud infrastructure providers carries systemic risks, as we could face amplified reputational damage if observability features fail during client outages. **Current (2026):** Our customers, including data centers, SaaS providers, cloud computing services and internet infrastructure and bandwidth providers, rely on our products for their data storage needs. These customers may authorize third-party technology providers to access their data on our systems. Errors or wrongdoing by our customers, their customers, or third-party technology providers resulting in actual or perceived security breaches may result in such actual or perceived breaches being attributed to us. A failure to meet our customers' and partners' expectations regarding security and confidentiality, due to disruptions in services provided by third-party vendors or the loss or alteration of data stored by such vendors, could cause financial or reputational harm to our business, which could affect our ability to attract or retain customers. Additionally, our operations and select cloud services rely on third-party cloud providers, and interruptions due to technical failures such as hardware or software issues or connectivity problems, security incidents, compliance changes, operational challenges and natural disasters could reduce our revenue due to the cloud services' metered billing. Moreover, our concentration on a limited number of key cloud infrastructure providers carries heightened systemic risks, as a significant disruption to any of these providers could simultaneously impact multiple aspects of our operations and service delivery. --- ## Modified: Transition Tax Payments **Key changes:** - Reworded sentence: "A final transition tax payment of $179 million was paid during the second quarter of fiscal 2026." **Prior (2025):** The Tax Cuts and Jobs Act of 2017 imposed a mandatory, one-time transition tax on accumulated foreign earnings and profits that had not previously been subject to U.S. income tax. As of April 25, 2025, a final transition tax payment of $178 million remains outstanding and is expected to be paid during fiscal 2026. During fiscal 2025, transition tax payments totaled $115 million. **Current (2026):** The Tax Cuts and Jobs Act of 2017 imposed a mandatory, one-time transition tax on accumulated foreign earnings and profits that had not previously been subject to U.S. income tax. A final transition tax payment of $179 million was paid during the second quarter of fiscal 2026. --- ## Modified: Income before income taxes **Key changes:** - Reworded sentence: "24 21 20 Provision for income taxes 5 3 4 Net income 18 % 18 % 16 % Percentages may not add due to rounding" **Prior (2025):** 21 20 17 Provision (benefit) for income taxes 3 4 (3 ) Net income 18 % 16 % 20 % Percentages may not add due to rounding **Current (2026):** 24 21 20 Provision for income taxes 5 3 4 Net income 18 % 18 % 16 % Percentages may not add due to rounding --- ## Modified: Stock Repurchase Program and Dividend Activity **Key changes:** - Reworded sentence: "During fiscal 2026, we repurchased 9.0 million shares of our common stock at an average price of $105.89 per share, for an aggregate purchase price of $950 million." **Prior (2025):** During fiscal 2025, we repurchased 10.2 million shares of our common stock at an average price of $112.55 per share, for an aggregate purchase price of $1.2 billion. We also declared aggregate cash dividends of $2.08 per share in fiscal 2025, for which we paid a total of $424 million. **Current (2026):** During fiscal 2026, we repurchased 9.0 million shares of our common stock at an average price of $105.89 per share, for an aggregate purchase price of $950 million. We also declared aggregate cash dividends of $2.08 per share in fiscal 2026, for which we paid a total of $413 million. --- ## Modified: Shares used in net income per share calculations: **Key changes:** - Reworded sentence: "Basic 199 204 208 Diluted 201 209 213 See accompanying notes to consolidated financial statements." **Prior (2025):** Basic 204 208 217 Diluted 209 213 220 See accompanying notes to consolidated financial statements. 56 56 NETAPP, INC.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(In millions) Year Ended April 25, 2025 April 26, 2024 April 28, 2023 Net income $ 1,186 $ 986 $ 1,274 Other comprehensive loss Foreign currency translation adjustments (3 ) (5 ) (4 ) Defined benefit obligations: Defined benefit obligation adjustments (2 ) (4 ) (2 ) Unrealized gains on available-for-sale securities: Unrealized holding gains arising during the period 1 - - Unrealized gains (losses) on cash flow hedges: Unrealized holding gains (losses) arising during the period (2 ) 2 (6 ) Reclassification adjustments for (gains) losses included in net income (1 ) (1 ) 5 Other comprehensive loss (7 ) (8 ) (7 ) Comprehensive income $ 1,179 $ 978 $ 1,267 See accompanying notes to consolidated financial statements. **Current (2026):** Basic 199 204 208 Diluted 201 209 213 See accompanying notes to consolidated financial statements. 55 55 NETAPP, INC.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(In millions) Year Ended April 24, 2026 April 25, 2025 April 26, 2024 Net income $ 1,276 $ 1,186 $ 986 Other comprehensive income (loss): Foreign currency translation adjustments 52 (3 ) (5 ) Defined benefit obligations: Defined benefit obligation adjustments 1 (2 ) (4 ) Unrealized gains on available-for-sale securities: Unrealized holding gains arising during the period - 1 - Unrealized gains (losses) on cash flow hedges: Unrealized holding gains (losses) arising during the period - (2 ) 2 Reclassification adjustments for losses (gains) included in net income 2 (1 ) (1 ) Other comprehensive income (loss) 55 (7 ) (8 ) Comprehensive income $ 1,331 $ 1,179 $ 978 See accompanying notes to consolidated financial statements. --- ## Modified: Any violation of U.S. or international customs or export control laws and other laws affecting the countries in which our products and services may be sold, distributed, or delivered could have a material adverse effect on our business, operating results, financial condition and cash flows. **Key changes:** - Reworded sentence: "Due to the global nature of our business, we are subject to customs and export restrictions and regulations, including the Export Administration Regulations administered by the Commerce Department's Bureau of Industry and Security (BIS), customs regulations overseen by U.S." - Reworded sentence: "or international export control laws or any trade-related laws or regulations, even if inadvertent or without our knowledge, we may be subject to various penalties available under the laws, any of which could have a material and adverse impact on our business, operating results and financial condition." **Prior (2025):** Due to the global nature of our business, we are subject to import and export restrictions and regulations, including the Export Administration Regulations administered by the Commerce Department's Bureau of Industry and Security (BIS) and the trade and economic sanctions regulations administered by the Treasury Department's Office of Foreign Assets Control (OFAC). The U.S., through the BIS and OFAC, places restrictions on the sale or export of certain products and services to certain countries, entities, and persons, including most recently to Russia, Belarus and regions of Ukraine. These regulations have caused us to temporarily stop selling or servicing our products temporarily in restricted areas. Violators of export control and sanctions laws may be subject to significant penalties, which may include significant monetary fines, criminal proceedings against them and their officers and employees, a denial of export privileges, and suspension or debarment from selling products to the federal government. Our products could be diverted by third parties (including potentially our channel partners) to countries or end users under sanctions / embargo orders, despite our precautions. If we were ever found to have violated U.S. export control laws or any trade-related laws or regulations, even if inadvertent or without our knowledge, we may be subject to various penalties available under the laws, any of which could have a material and adverse impact on our business, operating results and financial condition. Even if we were not found to have violated such laws, the political and media scrutiny surrounding any governmental investigation of us could cause us significant expense and reputational harm. Such collateral consequences could have a material adverse impact on our business, operating results, financial condition and cash flows. **Current (2026):** Due to the global nature of our business, we are subject to customs and export restrictions and regulations, including the Export Administration Regulations administered by the Commerce Department's Bureau of Industry and Security (BIS), customs regulations overseen by U.S. Customs and Border Protection, and the trade and economic sanctions regulations administered by the Treasury Department's Office of Foreign Assets Control (OFAC). The U.S., through the BIS and OFAC, places restrictions on the sale or export of certain products, technology and services to certain countries, entities, and persons. These regulations have caused us to stop selling or servicing our products to entities, parties, and regions designated as restricted by the authorities. In addition, the U.S. has continued to expand and refine export controls, in particular with respect to China, as well as related to semiconductors and other critical technologies. We are also subject to the customs and export control laws and regulations of other jurisdictions in which we operate or sell our products and services. These laws may impose additional compliance obligations, restrict the sale or distribution of our products and services in certain markets, and may conflict with the U.S. laws. Changes in any of these laws, whether in the U.S. or internationally, may occur with limited advance notice, and may increase our operating costs or limit the products or services we are able to sell or how we sell them in certain geographies. Violators of export control and sanctions laws may be subject to significant penalties, which may include significant monetary fines, criminal proceedings against them and their officers and employees, a denial of export privileges, and under U.S. law, suspension or debarment from selling products to the U.S. federal government. Our products could be diverted by third parties (including potentially our channel partners) to countries or end users under sanctions or embargo orders, despite our precautions. If we were ever found to have violated U.S. or international export control laws or any trade-related laws or regulations, even if inadvertent or without our knowledge, we may be subject to various penalties available under the laws, any of which could have a material and adverse impact on our business, operating results and financial condition. Even if we were not found to have violated such laws, the political and media scrutiny surrounding any governmental investigation of us could cause us significant expense and reputational harm. Such collateral consequences could have a material adverse impact on our business, operating results, financial condition and cash flows. --- ## Modified: Reduced U.S. government demand could materially harm our business, operating results, financial condition and cash flows. **Key changes:** - Added sentence: "In each of fiscal 2024, 2025 and 2026, revenues from the U.S." - Added sentence: "public sector markets (including the U.S." - Added sentence: "federal government and U.S." - Added sentence: "state governments, local municipalities and educational institutions) represented 11%, 11% and 10% of our net revenues, respectively." - Reworded sentence: "22 22 Additionally, we have faced, and may in the future face, a prolonged U.S." **Prior (2025):** The U.S. government is an important customer for us, but its demand is uncertain due to political and budgetary fluctuations and constraints. Uncertainty related to the U.S. government budget and debt levels, changes to governmental agency structure, compliance with new initiatives and executive orders, and reductions in force have increased demand uncertainty for our products. Changes in administration may also lead to programs and initiatives moving in or out of favor, which may lead to varied perception of our company in the U.S. government market and may negatively impact our sales to the U.S. government. Additionally, the U.S. government, like other customers, may evaluate competing products and delay purchases during technology transitions in the storage 21 21 industry. If the U.S. government or its agencies reduce or shift their IT spending patterns, our revenues and operating results may be adversely affected.Selling our products to the U.S. government, whether directly or through channel partners, subjects us to specific regulatory and contractual requirements, which may change or increase at short notice. Some of these requirements may extend past the specific nature and products of the arrangement and impact our broader corporate policies, initiatives and employee resources. Failure to comply with these requirements by either us or our channel partners could lead to investigations, fines, and other penalties (including the loss of such government contracts), harming our operating results and financial condition. For example, the U.S. Department of Justice (DOJ) has previously pursued claims and settlements with IT vendors, including us and our competitors and channel partners, under the False Claims Act and other statutes related to violations of regulatory and contractual requirements, which may include such areas as pricing and discount practices, cybersecurity, or procurement integrity. These actions, in addition to potential fines and other penalties as well as potential government audits and investigations, could also result in suspension or disbarment from future government contracts. Additionally, government certification requirements may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications (or are able to make the required certifications to the government). We could also be harmed by claims of non-compliance with these requirements by us or our channel partners. Any of these outcomes could materially adversely affect our business, operating results, financial condition and cash flows. In response to evolving and increasing security threats, the U.S. government has imposed additional requirements on IT vendors, including us. These requirements range from software development security (e.g., the Executive Order on Improving the Nation's Cybersecurity (EO 14028), issued in May 2021, to require attestation to minimum requirements for our software development framework), to supply chain security (e.g., Section 5949 of the FY23 National Defense Authorization Act (NDAA) prohibits us from including in our products or using in our corporate environment certain semiconductor products and services), to cybersecurity (e.g., the U.S. Department of Defense's Cybersecurity Maturity Model Certification (CMMC) program). Failure to meet these requirements as they apply to us and our products may result in delays or inability to execute contracts with customers, particularly with government entities.If we do not achieve forecasted sales orders in any quarter, our operating results, financial condition and cash flows could be harmed.We derive a significant amount of our revenues in any given quarter from orders booked in the same quarter. These orders typically follow intra-quarter seasonality patterns, with a significant portion occurring toward the end of the quarter. If we fail to achieve the forecasted level, timing, and mix of orders in line with our quarterly targets and historical patterns, or if we experience cancellations of significant orders, our operating results, financial condition and cash flows could be adversely affected.We are exposed to the credit and non-payment risk of our customers, resellers and distributors, especially during times of economic uncertainty and tight credit markets, which could result in material losses.Most of our sales to customers are on an open credit basis, with typical payment terms of 30 days. During periods of economic uncertainty, when access to liquidity may be limited, we may experience increased losses as more customers become unable to pay their obligations to us, either in full or in part. Additionally, some customers have entered into recourse and non-recourse financing leasing arrangements using third-party leasing companies. Under recourse leases, which typically last three years or less, we remain liable for the unpaid remaining lease payments to the third-party leasing companies if the end-user customer defaults. Our exposure to credit risks from our customers increases during economic uncertainty or volatility. This risk may further increase if our customers, their customers, or their lease financing sources are adversely affected by global economic conditions.Risks Related to Our Products and ServicesAny disruption to our supply chain could materially harm our business, operating results, financial condition and cash flows.We do not manufacture certain components used in our products. We rely on third parties to manufacture critical components and handle associated logistics. Our lack of direct control over these elements, combined with the diverse international geographic locations of our manufacturing partners and suppliers, creates significant risks for us, including:•Limited number of suppliers for certain components; •No guarantees of supply and limited ability to control the quality, quantity and cost of our products or of their components; •Potential for binding price or purchase commitments with our suppliers at higher than market rates; •Limited ability to adjust production volumes in response to our customers' demand fluctuations; •Labor and political unrest at facilities we do not operate or own; industry. If the U.S. government or its agencies reduce or shift their IT spending patterns, our revenues and operating results may be adversely affected. Selling our products to the U.S. government, whether directly or through channel partners, subjects us to specific regulatory and contractual requirements, which may change or increase at short notice. Some of these requirements may extend past the specific nature and products of the arrangement and impact our broader corporate policies, initiatives and employee resources. Failure to comply with these requirements by either us or our channel partners could lead to investigations, fines, and other penalties (including the loss of such government contracts), harming our operating results and financial condition. For example, the U.S. Department of Justice (DOJ) has previously pursued claims and settlements with IT vendors, including us and our competitors and channel partners, under the False Claims Act and other statutes related to violations of regulatory and contractual requirements, which may include such areas as pricing and discount practices, cybersecurity, or procurement integrity. These actions, in addition to potential fines and other penalties as well as potential government audits and investigations, could also result in suspension or disbarment from future government contracts. Additionally, government certification requirements may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications (or are able to make the required certifications to the government). We could also be harmed by claims of non-compliance with these requirements by us or our channel partners. Any of these outcomes could materially adversely affect our business, operating results, financial condition and cash flows. In response to evolving and increasing security threats, the U.S. government has imposed additional requirements on IT vendors, including us. These requirements range from software development security (e.g., the Executive Order on Improving the Nation's Cybersecurity (EO 14028), issued in May 2021, to require attestation to minimum requirements for our software development framework), to supply chain security (e.g., Section 5949 of the FY23 National Defense Authorization Act (NDAA) prohibits us from including in our products or using in our corporate environment certain semiconductor products and services), to cybersecurity (e.g., the U.S. Department of Defense's Cybersecurity Maturity Model Certification (CMMC) program). Failure to meet these requirements as they apply to us and our products may result in delays or inability to execute contracts with customers, particularly with government entities. **Current (2026):** The U.S. government is an important customer for us, but its demand is uncertain due to political and budgetary fluctuations and constraints. In each of fiscal 2024, 2025 and 2026, revenues from the U.S. public sector markets (including the U.S. federal government and U.S. state governments, local municipalities and educational institutions) represented 11%, 11% and 10% of our net revenues, respectively. Uncertainty related to the U.S. government budget and debt levels, changes to governmental agency structure, compliance with new initiatives and executive orders, and reductions in force have increased demand uncertainty for our products. 22 22 Additionally, we have faced, and may in the future face, a prolonged U.S. government shutdown, which could lead to program cancellations or disruptions, delays in funding authorizations or appropriations and limitations on the U.S. government's ability make timely payments, which could in turn harm our business and financial condition. Programs and initiatives may change or move in or out of favor, which may lead to varied perception of our company in the U.S. government market and may negatively impact our sales to the U.S. government. Additionally, the U.S. government, like other customers, may evaluate competing products and delay purchases during technology transitions in the storage industry. If the U.S. government or its agencies reduce or shift their IT spending patterns, our revenues and operating results may be adversely affected.Selling our products to the U.S. government through channel partners, subjects us to specific regulatory and contractual requirements, which may change or increase at short notice. Some of these requirements may extend past the specific nature and products of the arrangement and impact our broader corporate policies, initiatives and employee resources. Failure to comply with these requirements by either us or our channel partners could lead to investigations, fines, and other penalties (including the loss of access to such government contracts), harming our operating results and financial condition. For example, the U.S. Department of Justice (DOJ) has previously pursued claims and settlements with IT vendors, including us and our competitors and channel partners, under the False Claims Act and other statutes related to violations of regulatory and contractual requirements, which may include such areas as pricing and discount practices, cybersecurity, or procurement integrity. These actions, in addition to potential fines and other penalties as well as potential government audits and investigations, could also result in suspension or disbarment from future government contracts. Additionally, government certification requirements may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications (or are able to make the required certifications to the government). We could also be harmed by claims of non-compliance with these requirements by us or our channel partners. Any of these outcomes could materially adversely affect our business, operating results, financial condition and cash flows. In response to evolving and increasing security threats, the U.S. government has imposed, and may impose in the future, requirements relating to product security, supply chain security, and cyber/information security that have impacted, and may in the future impact NetApp. Failure to meet these requirements as they apply to us and our products may result in delays or inability to sell our products to government entities.We are exposed to the credit and non-payment risk of our customers, resellers and distributors, especially during times of economic uncertainty and tight credit markets, which could result in material losses.Most of our sales to customers are on an open credit basis, with typical payment terms of 30 days. During periods of economic uncertainty, when access to liquidity may be limited, we may experience increased losses as more customers become unable to pay their obligations to us, either in full or in part. Our exposure to credit risks from our customers increases during economic uncertainty or volatility. This risk may further increase if our customers or their customers are adversely affected by global economic conditions.Risks Related to Our Products and ServicesAny disruption to our supply chain could materially harm our business, operating results, financial condition and cash flows.We rely on third parties to manufacture the components used in our products and handle associated logistics. Our lack of direct control over these elements, combined with the diverse international geographic locations of our manufacturing partners and suppliers, creates significant risks for us, including:•Limited number of suppliers for certain components; •No guarantees of supply and limited ability to control the quality, quantity and cost of our products or components; •Potential for binding price or purchase commitments with our suppliers at higher than market rates; •Limited ability to adjust production volumes in response to our customers' demand fluctuations; •Labor and political unrest at facilities we do not operate or own; •Geopolitical disputes, acts of terrorism, cyber attacks and hacktivism disrupting our supply chain; •Impacts on our supply chain from adverse public health developments; •Business, regulatory compliance, legal compliance, litigation, trade controls and financial concerns affecting our suppliers or their ability to manufacture and ship components in the quantities, quality and manner as required; and •Disruptions due to floods, earthquakes, storms, fires and other natural disasters, especially those caused by climate change, and particularly in countries with limited infrastructure and disaster recovery resources. Additionally, we have faced, and may in the future face, a prolonged U.S. government shutdown, which could lead to program cancellations or disruptions, delays in funding authorizations or appropriations and limitations on the U.S. government's ability make timely payments, which could in turn harm our business and financial condition. Programs and initiatives may change or move in or out of favor, which may lead to varied perception of our company in the U.S. government market and may negatively impact our sales to the U.S. government. Additionally, the U.S. government, like other customers, may evaluate competing products and delay purchases during technology transitions in the storage industry. If the U.S. government or its agencies reduce or shift their IT spending patterns, our revenues and operating results may be adversely affected. Selling our products to the U.S. government through channel partners, subjects us to specific regulatory and contractual requirements, which may change or increase at short notice. Some of these requirements may extend past the specific nature and products of the arrangement and impact our broader corporate policies, initiatives and employee resources. Failure to comply with these requirements by either us or our channel partners could lead to investigations, fines, and other penalties (including the loss of access to such government contracts), harming our operating results and financial condition. For example, the U.S. Department of Justice (DOJ) has previously pursued claims and settlements with IT vendors, including us and our competitors and channel partners, under the False Claims Act and other statutes related to violations of regulatory and contractual requirements, which may include such areas as pricing and discount practices, cybersecurity, or procurement integrity. These actions, in addition to potential fines and other penalties as well as potential government audits and investigations, could also result in suspension or disbarment from future government contracts. Additionally, government certification requirements may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications (or are able to make the required certifications to the government). We could also be harmed by claims of non-compliance with these requirements by us or our channel partners. Any of these outcomes could materially adversely affect our business, operating results, financial condition and cash flows. In response to evolving and increasing security threats, the U.S. government has imposed, and may impose in the future, requirements relating to product security, supply chain security, and cyber/information security that have impacted, and may in the future impact NetApp. Failure to meet these requirements as they apply to us and our products may result in delays or inability to sell our products to government entities. --- ## Modified: Cash flows from financing activities: **Key changes:** - Reworded sentence: "Proceeds from issuance of common stock under employee stock award plans 103 108 100 Payments for taxes related to net share settlement of stock awards (137 ) (199 ) (127 ) Repurchase of common stock (950 ) (1,150 ) (900 ) Issuances of debt, net of issuance costs - 1,240 - Repayments and extinguishment of debt (750 ) (400 ) - Dividends paid (413 ) (424 ) (416 ) Other financing activities, net - (3 ) (1 ) Net cash used in financing activities (2,147 ) (828 ) (1,344 )" **Prior (2025):** Proceeds from issuance of common stock under employee stock award plans 108 100 108 Payments for taxes related to net share settlement of stock awards (199 ) (127 ) (84 ) Repurchase of common stock (1,150 ) (900 ) (850 ) Issuances of debt, net of issuance costs 1,240 - - Repayments and extinguishment of debt (400 ) - (250 ) Dividends paid (424 ) (416 ) (432 ) Other financing activities, net (3 ) (1 ) (5 ) Net cash used in financing activities (828 ) (1,344 ) (1,513 ) **Current (2026):** Proceeds from issuance of common stock under employee stock award plans 103 108 100 Payments for taxes related to net share settlement of stock awards (137 ) (199 ) (127 ) Repurchase of common stock (950 ) (1,150 ) (900 ) Issuances of debt, net of issuance costs - 1,240 - Repayments and extinguishment of debt (750 ) (400 ) - Dividends paid (413 ) (424 ) (416 ) Other financing activities, net - (3 ) (1 ) Net cash used in financing activities (2,147 ) (828 ) (1,344 ) --- ## Modified: Key Uncertainties **Key changes:** - Reworded sentence: "Additionally, changes in business practices, such as those related to sales returns or marketing programs, 48 48 may introduce new forms of variable consideration, as well as more complexity and uncertainty in the estimation process." - Added sentence: "Goodwill and Purchased Intangible AssetsWe allocate the purchase price of acquisitions to identifiable assets acquired and liabilities assumed at their acquisition date fair values based on established valuation techniques." - Added sentence: "Goodwill represents the residual value as of the acquisition date, which in most cases is measured as the excess of the purchase consideration transferred over the net of the acquisition date fair values of the assets acquired and liabilities assumed.The carrying values of purchased intangible assets are reviewed whenever events and circumstances indicate that the net book value of an asset may not be recovered through expected future cash flows from its use and eventual disposition." - Added sentence: "We periodically review the estimated remaining useful lives of our intangible assets." - Added sentence: "This review may result in impairment charges or shortened useful lives, resulting in charges to our consolidated statements of income.We review goodwill for impairment annually and whenever events or changes in circumstances indicate the carrying amount of one of our reporting units may exceed its fair value." **Prior (2025):**  We evaluate whether products and services promised in our contracts with customers are distinct performance obligations that should be accounted for separately versus together.  In certain contracts, the determination of our distinct performance obligations requires significant judgment. As our business and offerings to customers change over time, the products and services we determine to be distinct performance obligations may change. Such changes may adversely impact the amount of revenue and gross margin we report in a particular period.  In determining the transaction price of our contracts, we estimate variable consideration based on the expected value, primarily relying on our history. In certain situations, we may also use the most likely amount as the basis of our estimate.  We may have insufficient relevant historical data or other information to arrive at an accurate estimate of variable consideration using either the "expected value" or "most likely amount" method. Additionally, changes in business practices, such as those related to sales returns or marketing programs, may introduce new forms of variable consideration, as well as more complexity and uncertainty in the estimation process. 48 48  In contracts with multiple performance obligations, we establish SSPs based on the price at which products and services are sold separately. If SSPs are not observable through past transactions, we estimate them by maximizing the use of observable inputs including pricing strategy, market data, internally-approved pricing guidelines related to the performance obligations and other observable inputs.  As our business and offerings evolve over time, modifications to our pricing and discounting methodologies, changes in the scope and nature of product and service offerings and/or changes in customer segmentation may result in a lack of consistency, making it difficult to establish and/or maintain SSPs. Changes in SSPs could result in different and unanticipated allocations of revenue in contracts with multiple performance obligations. These factors, among others, may adversely impact the amount of revenue and gross margin we report in a particular period. Inventory Valuation and Purchase Order AccrualsInventories consist primarily of purchased components and finished goods and are stated at the lower of cost or net realizable value, which approximates actual cost on a first-in, first-out basis. A provision is recorded when inventory is determined to be in excess of anticipated demand or obsolete in order to adjust inventory to its estimated realizable value. The following are the key estimates and assumptions and corresponding uncertainties for estimating the value of our inventories: Key Estimates and Assumptions Key Uncertainties  We periodically perform an excess and obsolete analysis of our inventory. Inventories are written down based on excess and obsolete reserves determined primarily on assumptions about future demand forecasts and market conditions. At the point of the loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis.  Although we use our best estimates to forecast future product demand, any significant unanticipated changes in demand, including due to macroeconomic uncertainties, or obsolescence related to technological developments, new product introductions, customer requirements, competition or other factors could have a significant impact on the valuation of our inventory. If actual market conditions are less favorable than those projected, additional write-downs and other charges against earnings that adversely impact gross margins may be required. If actual market conditions are more favorable, we may realize higher gross profits in the period when the written-down inventory is sold. We are subject to a variety of environmental laws relating to the manufacture of our products. If there are changes to the current regulations, we may be required to make product design changes which may result in excess or obsolete inventory, which could adversely impact our operating results.  We make commitments to our third-party contract manufacturers and other suppliers to manage lead times and meet product forecasts and to other parties to purchase various key components used in the manufacture of our products. We establish accruals for estimated losses on non-cancelable purchase commitments when we believe it is probable that the components will not be utilized in future operations.  If the actual materials demand is significantly lower than our forecast, we may be required to increase our recorded liabilities for estimated losses on non-cancelable purchase commitments. Goodwill and Purchased Intangible AssetsWe allocate the purchase price of acquisitions to identifiable assets acquired and liabilities assumed at their acquisition date fair values based on established valuation techniques. Goodwill represents the residual value as of the acquisition date, which in most cases is measured as the excess of the purchase consideration transferred over the net of the acquisition date fair values of the assets acquired and liabilities assumed.The carrying values of purchased intangible assets are reviewed whenever events and circumstances indicate that the net book value of an asset may not be recovered through expected future cash flows from its use and eventual disposition. We periodically review the estimated remaining useful lives of our intangible assets. This review may result in impairment charges or shortened useful lives, resulting in charges to our consolidated statements of income.  In contracts with multiple performance obligations, we establish SSPs based on the price at which products and services are sold separately. If SSPs are not observable through past transactions, we estimate them by maximizing the use of observable inputs including pricing strategy, market data, internally-approved pricing guidelines related to the performance obligations and other observable inputs.  As our business and offerings evolve over time, modifications to our pricing and discounting methodologies, changes in the scope and nature of product and service offerings and/or changes in customer segmentation may result in a lack of consistency, making it difficult to establish and/or maintain SSPs. Changes in SSPs could result in different and unanticipated allocations of revenue in contracts with multiple performance obligations. These factors, among others, may adversely impact the amount of revenue and gross margin we report in a particular period. **Current (2026):**  We evaluate whether products and services promised in our contracts with customers are distinct performance obligations that should be accounted for separately versus together.  In certain contracts, the determination of our distinct performance obligations requires significant judgment. As our business and offerings to customers change over time, the products and services we determine to be distinct performance obligations may change. Such changes may adversely impact the amount of revenue and gross margin we report in a particular period.  In determining the transaction price of our contracts, we estimate variable consideration based on the expected value, primarily relying on our history. In certain situations, we may also use the most likely amount as the basis of our estimate.  We may have insufficient relevant historical data or other information to arrive at an accurate estimate of variable consideration using either the "expected value" or "most likely amount" method. Additionally, changes in business practices, such as those related to sales returns or marketing programs, 48 48 may introduce new forms of variable consideration, as well as more complexity and uncertainty in the estimation process.  In contracts with multiple performance obligations, we establish SSPs based on the price at which products and services are sold separately. If SSPs are not observable through past transactions, we estimate them by maximizing the use of observable inputs including pricing strategy, market data, internally-approved pricing guidelines related to the performance obligations and other observable inputs.  As our business and offerings evolve over time, modifications to our pricing and discounting methodologies, changes in the scope and nature of product and service offerings and/or changes in customer segmentation may result in a lack of consistency, making it difficult to establish and/or maintain SSPs. Changes in SSPs could result in different and unanticipated allocations of revenue in contracts with multiple performance obligations. These factors, among others, may adversely impact the amount of revenue and gross margin we report in a particular period. Goodwill and Purchased Intangible AssetsWe allocate the purchase price of acquisitions to identifiable assets acquired and liabilities assumed at their acquisition date fair values based on established valuation techniques. Goodwill represents the residual value as of the acquisition date, which in most cases is measured as the excess of the purchase consideration transferred over the net of the acquisition date fair values of the assets acquired and liabilities assumed.The carrying values of purchased intangible assets are reviewed whenever events and circumstances indicate that the net book value of an asset may not be recovered through expected future cash flows from its use and eventual disposition. We periodically review the estimated remaining useful lives of our intangible assets. This review may result in impairment charges or shortened useful lives, resulting in charges to our consolidated statements of income.We review goodwill for impairment annually and whenever events or changes in circumstances indicate the carrying amount of one of our reporting units may exceed its fair value. The provisions of the accounting standard for goodwill allow us to first assess qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test. For our annual goodwill impairment test in the fourth quarter of fiscal 2026, we performed a qualitative assessment of goodwill impairment by evaluating relevant factors to determine whether it is more likely than not that the fair value of each of our reporting units is less than their carrying values. As a result of the qualitative assessment, we determined the quantitative test was not necessary and there was no impairment of goodwill. may introduce new forms of variable consideration, as well as more complexity and uncertainty in the estimation process.  In contracts with multiple performance obligations, we establish SSPs based on the price at which products and services are sold separately. If SSPs are not observable through past transactions, we estimate them by maximizing the use of observable inputs including pricing strategy, market data, internally-approved pricing guidelines related to the performance obligations and other observable inputs.  As our business and offerings evolve over time, modifications to our pricing and discounting methodologies, changes in the scope and nature of product and service offerings and/or changes in customer segmentation may result in a lack of consistency, making it difficult to establish and/or maintain SSPs. Changes in SSPs could result in different and unanticipated allocations of revenue in contracts with multiple performance obligations. These factors, among others, may adversely impact the amount of revenue and gross margin we report in a particular period. --- ## Modified: Failure to comply with new and existing laws and regulations related to privacy, data protection, AI and information security could cause harm to our reputation, result in liability (including regulatory penalties and litigation), and adversely impact our business. **Key changes:** - Reworded sentence: "For example, since the GDPR became effective in 2018, the Court of Justice of the EU has issued rulings that have impacted how multinational companies must implement that law and the European Commission (EC) has published new regulatory requirements relating to cross-border data transfers." - Reworded sentence: "Other governments have adopted new privacy and data protection laws implementing similarly comprehensive regulatory frameworks." - Reworded sentence: "In addition, our reliance on third-party cloud providers also introduces data residency and data sovereignty risks, as data may be stored or processed in jurisdictions with differing or conflicting privacy and data protection requirements." - Reworded sentence: "Compliance with new and evolving laws and regulations, including further regulatory or judicial developments, may require significant changes to our business operations and additional investment, which could adversely affect our revenue and overall business." - Reworded sentence: "Additionally, we must ensure that our subcontractors and suppliers also comply with DORA requirements, further increasing the complexity and potential liability." **Prior (2025):** Our business is increasingly subject to regulation by various federal, state and international governmental agencies responsible for enacting and enforcing laws and regulations relating to privacy, data protection, and information security. For example, since the EU's General Data Protection Regulation became effective in 2018, the Court of Justice of the EU has issued rulings that have impacted how multinational companies must implement that law and the European Commission (EC) has published new regulatory 24 24 requirements relating to cross-border data transfers. NetApp relies on compliance methods such as Standard Contractual Clauses (SCCs) to transfer personal data of individuals located in the European Economic Area (EEA) to other countries. In June 2021, the EC imposed new SCC requirements which impose certain contractual and operational requirements on NetApp and its contracting parties, including requirements related to government access transparency, enhanced data subject rights, and broader third-party assessments to ensure safeguards necessary to protect personal data transferred from NetApp or its partners to countries outside the EEA, requiring NetApp to revise customer and vendor agreements. Other global governments have adopted new privacy and data protection laws implementing similarly comprehensive regulatory frameworks.The interpretation and application of many privacy, data protection, and information security laws and regulations, along with industry standards, are uncertain. These laws, regulations, or standards may be interpreted and applied in ways that are inconsistent with our data management practices or product features. Additionally, government certification requirements for products like ours may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications. Any failure, or perceived failure, by us or our business partners to comply with relevant laws, regulations, contractual commitments, required certifications, self-regulatory standards, or our policies could subject us to claims, investigations, sanctions, enforcement actions, disgorgement of profits, fines, damages, civil and criminal liability, penalties, or injunctions. As a technology provider, our customers expect us to demonstrate compliance with privacy, data protection, and information security laws and regulations. Our inability, or perceived inability, to do so may adversely impact sales of our products and services, especially to customers in highly regulated industries. We have invested resources in complying with new laws and regulations and may need to make additional significant changes to our business operations, which could adversely affect our revenue and overall business. Non-compliance could harm our reputation and brand, incur significant costs, materially affect our financial and operating results, and require modifications to our products or business practices.Our business could face stricter obligations, greater fines, and private causes of action under new privacy, data protection, and information security laws and regulations, including the GDPR, which provides for penalties of up to 20 million Euros or four percent of our total worldwide annual turnover of the preceding financial year (whichever is higher), the California Consumer Privacy Act, the California Privacy Rights Act, and other similar U.S. state-based regulations, as well as new and emerging privacy laws globally.As NetApp provides technology services to EU financial institutions, the Digital Operational Resilience Act (DORA) imposes financial and legal risks. These include compliance costs for enhancing cybersecurity, performing resilience testing, requiring comprehensive documentation, increased audits, and detailed reporting. Stricter contractual obligations will be imposed by financial institution clients, necessitating more robust incident reporting and data protection measures. Non-compliance could result in legal liabilities, suspension of services and reputational damage. Additionally, NetApp must ensure that its subcontractors and suppliers also comply with DORA requirements, further increasing the complexity and potential liability.If our products or services are defective, or are perceived to be defective, including as a result of improper use or maintenance, our operating results and customer relationships may be harmed.Our products and services are complex. We have experienced in the past, and expect to experience in the future, quality issues impacting certain products, and we could experience reliability issues with services we provide, including security vulnerabilities, software bugs, hardware failure in networked storage appliances, incompatibility issues with customer systems or other applications, performance deficiencies causing slow data retrieval or processing, firmware or software updates causing system instability, compliance with various product certifications, and data breaches due to flaws in the product design. Such quality and reliability issues may be due to, for example, our own designs or processes, the designs or processes of our suppliers, and/or flaws in third-party software used in our products. These types of risks are most acute when we are introducing new products. Quality or reliability issues have and could again in the future cause customers to experience outages or disruptions in service, data loss or data corruption. If we fail to remedy a product defect or flaw, we may experience a failure of a product line, temporary or permanent withdrawal from a product or market, damage to our reputation, loss of revenue, inventory costs or product reengineering expenses and higher ongoing warranty and service costs, and these occurrences could have a material impact on our gross margins, business and operating results. In addition, we exercise little control over how our customers use or maintain our products and services, and in some cases improper usage or maintenance could impair the performance of our products and services, which could lead to a perception of a quality or reliability issue. Customers may experience losses that may result from or are alleged to result from defects or flaws in our products and services, which could subject us to claims for damages, including consequential damages.Changes in regulations relating to our products or their components, or the manufacture, sourcing, distribution or use thereof, may harm our business, operating results, financial condition and cash flows.The laws and regulations governing the manufacturing, sourcing, distribution and use of our products have become increasingly complex and stringent. For example, in addition to various environmental laws relating to carbon emissions, the use and discharge of hazardous materials, and the use of certain minerals originating from identified conflict zones, many governments, including the U.S., requirements relating to cross-border data transfers. NetApp relies on compliance methods such as Standard Contractual Clauses (SCCs) to transfer personal data of individuals located in the European Economic Area (EEA) to other countries. In June 2021, the EC imposed new SCC requirements which impose certain contractual and operational requirements on NetApp and its contracting parties, including requirements related to government access transparency, enhanced data subject rights, and broader third-party assessments to ensure safeguards necessary to protect personal data transferred from NetApp or its partners to countries outside the EEA, requiring NetApp to revise customer and vendor agreements. Other global governments have adopted new privacy and data protection laws implementing similarly comprehensive regulatory frameworks. The interpretation and application of many privacy, data protection, and information security laws and regulations, along with industry standards, are uncertain. These laws, regulations, or standards may be interpreted and applied in ways that are inconsistent with our data management practices or product features. Additionally, government certification requirements for products like ours may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications. Any failure, or perceived failure, by us or our business partners to comply with relevant laws, regulations, contractual commitments, required certifications, self-regulatory standards, or our policies could subject us to claims, investigations, sanctions, enforcement actions, disgorgement of profits, fines, damages, civil and criminal liability, penalties, or injunctions. As a technology provider, our customers expect us to demonstrate compliance with privacy, data protection, and information security laws and regulations. Our inability, or perceived inability, to do so may adversely impact sales of our products and services, especially to customers in highly regulated industries. We have invested resources in complying with new laws and regulations and may need to make additional significant changes to our business operations, which could adversely affect our revenue and overall business. Non-compliance could harm our reputation and brand, incur significant costs, materially affect our financial and operating results, and require modifications to our products or business practices. Our business could face stricter obligations, greater fines, and private causes of action under new privacy, data protection, and information security laws and regulations, including the GDPR, which provides for penalties of up to 20 million Euros or four percent of our total worldwide annual turnover of the preceding financial year (whichever is higher), the California Consumer Privacy Act, the California Privacy Rights Act, and other similar U.S. state-based regulations, as well as new and emerging privacy laws globally. As NetApp provides technology services to EU financial institutions, the Digital Operational Resilience Act (DORA) imposes financial and legal risks. These include compliance costs for enhancing cybersecurity, performing resilience testing, requiring comprehensive documentation, increased audits, and detailed reporting. Stricter contractual obligations will be imposed by financial institution clients, necessitating more robust incident reporting and data protection measures. Non-compliance could result in legal liabilities, suspension of services and reputational damage. Additionally, NetApp must ensure that its subcontractors and suppliers also comply with DORA requirements, further increasing the complexity and potential liability. **Current (2026):** Our business is increasingly subject to regulation by various federal, state and international governmental agencies responsible for enacting and enforcing laws and regulations relating to privacy, data protection, and information security. For example, since the GDPR became effective in 2018, the Court of Justice of the EU has issued rulings that have impacted how multinational companies must implement that law and the European Commission (EC) has published new regulatory requirements relating to cross-border data transfers. NetApp relies on compliance methods such as Standard Contractual Clauses (SCCs) to transfer personal data of individuals located in the European Economic Area (EEA) to other countries. In June 2021, the EC imposed new SCC requirements which impose certain contractual and operational requirements on NetApp and its contracting parties, including requirements related to government access transparency, enhanced data subject rights, and broader third-party assessments to ensure safeguards necessary to protect personal data transferred from NetApp or its partners to countries outside the EEA, requiring NetApp to revise customer and vendor agreements. Other governments have adopted new privacy and data protection laws implementing similarly comprehensive regulatory frameworks. The interpretation and application of many privacy, data protection, and information security laws and regulations, along with industry standards, are uncertain. These laws, regulations, or standards may be interpreted and applied in ways that are inconsistent 25 25 with our data management practices or product features. Additionally, government certification requirements for products like ours may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications. Any failure, or perceived failure, by us or our business partners to comply with relevant laws, regulations, contractual commitments, required certifications, self-regulatory standards, or our policies could subject us to claims, investigations, sanctions, enforcement actions, disgorgement of profits, fines, damages, civil and criminal liability, penalties, or injunctions. In addition, our reliance on third-party cloud providers also introduces data residency and data sovereignty risks, as data may be stored or processed in jurisdictions with differing or conflicting privacy and data protection requirements. Changes in local data localization laws or government access demands directed at our cloud providers could require costly operational changes or restrict our ability to deliver services in certain markets.As a technology provider, our customers expect us to demonstrate compliance with privacy, data protection, and information security laws and regulations. Our inability, or perceived inability, to do so may adversely impact sales of our products and services, especially to customers in highly regulated industries. Compliance with new and evolving laws and regulations, including further regulatory or judicial developments, may require significant changes to our business operations and additional investment, which could adversely affect our revenue and overall business. Non-compliance could harm our reputation and brand, incur significant costs, materially affect our financial and operating results, and require modifications to our products or business practices.Our business could face stricter obligations, greater fines, and private causes of action under new privacy, data protection, and information security laws and regulations, including the GDPR, which provides for penalties of up to 20 million Euros or four percent of our total worldwide annual turnover of the preceding financial year (whichever is higher), the California Consumer Privacy Act, the California Privacy Rights Act, and a growing number of comprehensive privacy laws enacted by various U.S. states, many of which impose varying and potentially conflicting obligations, as well as new and emerging privacy laws globally. Regulatory enforcement of privacy, data protection, and information security laws have intensified globally, with regulators imposing increasingly significant fines and pursuing enforcement actions against technology companies. This trend increases the likelihood and potential magnitude of regulatory penalties for non-compliance.As we provide technology services to EU financial institutions, the Digital Operational Resilience Act (DORA) imposes financial and legal risks. These include compliance costs for enhancing cybersecurity, performing resilience testing, requiring comprehensive documentation, increased audits, and detailed reporting. Stricter contractual obligations will be imposed by financial institution clients, necessitating more robust incident reporting and data protection measures. Non-compliance could result in legal liabilities, suspension of services and reputational damage. Additionally, we must ensure that our subcontractors and suppliers also comply with DORA requirements, further increasing the complexity and potential liability. In addition, in the EU, various cyber resilience related laws (for example, the EU Cyber Resilience Act and the Network and Information Systems Directive 2) have been enacted and will be applied in phases. These frameworks essentially oblige those doing business in the EU to implement robust cybersecurity standards with respect to the products and services they provide. The EU has also enacted a comprehensive law regulating the development and use of AI systems, the EU AI Act, which came into force on August 1, 2024, and will generally become fully applicable after a two-year transitional period, with certain obligations taking effect at a later time. The EU AI Act imposes enhanced requirements on certain "high-risk" AI systems, including obligations relating to risk management, data governance, documentation, human oversight and conformity assessments, and also establishes transparency obligations that apply to a broad range of AI systems. Beyond the EU, other jurisdictions are enacting or proposing AI-specific legislation and regulatory frameworks, including in the United States at both the federal and state level, and in other international markets. These emerging requirements may impose additional or conflicting obligations on our development and deployment of AI technologies, increasing compliance complexity and cost. All of these regulations require ongoing and significant investment in compliance infrastructure, and non-compliance could result in substantial fines, operational disruptions, loss of customer contracts, and reputational harm.If our products or services are defective, or are perceived to be defective, including as a result of improper use or maintenance, our operating results and customer relationships may be harmed.Our products and services are complex. We have experienced in the past, and expect to experience in the future, quality issues impacting certain products, and reliability issues with services we provide, including security vulnerabilities, software bugs, hardware failure in networked storage appliances, incompatibility issues with customer systems or other applications, performance deficiencies causing slow data retrieval or processing, firmware or software updates causing system instability, compliance with various product certifications, and data breaches due to flaws in the product design. Such quality and reliability issues may be caused by our own designs or processes, the designs or processes of our suppliers, and/or flaws in third-party software used in our products, or other reasons. These types of risks are most acute when we are introducing new products. Quality or reliability issues have and could again in the future cause customers to experience outages or disruptions in service, data loss or data corruption. If we fail to remedy a product defect or flaw, we may experience a failure of a product line, temporary or permanent withdrawal from a product or market, damage to our reputation, loss of revenue, inventory costs or product reengineering expenses and higher ongoing warranty and service costs, and these occurrences could have a material impact on our gross margins, business and operating results. In addition, we exercise little control over how our customers use or maintain our products and services, and in some cases improper usage or with our data management practices or product features. Additionally, government certification requirements for products like ours may change and, in doing so, restrict our ability to sell into the government sector until we have attained revised certifications. Any failure, or perceived failure, by us or our business partners to comply with relevant laws, regulations, contractual commitments, required certifications, self-regulatory standards, or our policies could subject us to claims, investigations, sanctions, enforcement actions, disgorgement of profits, fines, damages, civil and criminal liability, penalties, or injunctions. In addition, our reliance on third-party cloud providers also introduces data residency and data sovereignty risks, as data may be stored or processed in jurisdictions with differing or conflicting privacy and data protection requirements. Changes in local data localization laws or government access demands directed at our cloud providers could require costly operational changes or restrict our ability to deliver services in certain markets. As a technology provider, our customers expect us to demonstrate compliance with privacy, data protection, and information security laws and regulations. Our inability, or perceived inability, to do so may adversely impact sales of our products and services, especially to customers in highly regulated industries. Compliance with new and evolving laws and regulations, including further regulatory or judicial developments, may require significant changes to our business operations and additional investment, which could adversely affect our revenue and overall business. Non-compliance could harm our reputation and brand, incur significant costs, materially affect our financial and operating results, and require modifications to our products or business practices. Our business could face stricter obligations, greater fines, and private causes of action under new privacy, data protection, and information security laws and regulations, including the GDPR, which provides for penalties of up to 20 million Euros or four percent of our total worldwide annual turnover of the preceding financial year (whichever is higher), the California Consumer Privacy Act, the California Privacy Rights Act, and a growing number of comprehensive privacy laws enacted by various U.S. states, many of which impose varying and potentially conflicting obligations, as well as new and emerging privacy laws globally. Regulatory enforcement of privacy, data protection, and information security laws have intensified globally, with regulators imposing increasingly significant fines and pursuing enforcement actions against technology companies. This trend increases the likelihood and potential magnitude of regulatory penalties for non-compliance. As we provide technology services to EU financial institutions, the Digital Operational Resilience Act (DORA) imposes financial and legal risks. These include compliance costs for enhancing cybersecurity, performing resilience testing, requiring comprehensive documentation, increased audits, and detailed reporting. Stricter contractual obligations will be imposed by financial institution clients, necessitating more robust incident reporting and data protection measures. Non-compliance could result in legal liabilities, suspension of services and reputational damage. Additionally, we must ensure that our subcontractors and suppliers also comply with DORA requirements, further increasing the complexity and potential liability. In addition, in the EU, various cyber resilience related laws (for example, the EU Cyber Resilience Act and the Network and Information Systems Directive 2) have been enacted and will be applied in phases. These frameworks essentially oblige those doing business in the EU to implement robust cybersecurity standards with respect to the products and services they provide. The EU has also enacted a comprehensive law regulating the development and use of AI systems, the EU AI Act, which came into force on August 1, 2024, and will generally become fully applicable after a two-year transitional period, with certain obligations taking effect at a later time. The EU AI Act imposes enhanced requirements on certain "high-risk" AI systems, including obligations relating to risk management, data governance, documentation, human oversight and conformity assessments, and also establishes transparency obligations that apply to a broad range of AI systems. Beyond the EU, other jurisdictions are enacting or proposing AI-specific legislation and regulatory frameworks, including in the United States at both the federal and state level, and in other international markets. These emerging requirements may impose additional or conflicting obligations on our development and deployment of AI technologies, increasing compliance complexity and cost. All of these regulations require ongoing and significant investment in compliance infrastructure, and non-compliance could result in substantial fines, operational disruptions, loss of customer contracts, and reputational harm. --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "% Change Sales and marketing expenses $ 1,869 $ 1,865 - % $ 1,828 2 % Sales and marketing expenses consist primarily of compensation costs, commissions, outside services, facilities and IT support costs, advertising and marketing promotional expense and travel and entertainment expense." - Reworded sentence: "Research and Development (in millions, except percentages): Year Ended" **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: Increasing competition or industry consolidation could harm our business, operating results, financial condition and cash flows. **Key changes:** - Reworded sentence: "We face competition from many companies, including established public companies, newer public companies focused on flash storage, and new market entrants targeting the AI opportunity." - Reworded sentence: "Customer demand continues to be influenced by cloud adoption, digital transformation initiatives, cybersecurity requirements, and increasing use of artificial intelligence and data-driven applications, driving significant changes in storage architectures and solution requirements." - Reworded sentence: "The long-term potential and competitiveness of emerging vendors remain uncertain." - Reworded sentence: "Changes in customer requirements or increased industry consolidation could result in stronger competitors who are better able to compete against us." **Prior (2025):** Our markets are highly competitive, fragmented, and characterized by rapidly changing technology. We face competition from many companies, including established public companies, newer public companies with a strong focus on flash storage, and new market entrants targeting opportunities in GenAI and application data management for Kubernetes. Some competitors offer a broad range of IT products and services (full-stack vendors), while others offer a more limited set. Technology trends, such as GenAI, hosted or public cloud storage, software as a service (SaaS), IT as a service, and flash storage are driving significant changes in storage architectures and solution requirements. Cloud service providers offer storage on demand without requiring capital expenditure, which meets rapidly evolving business needs and has altered the competitive landscape. Competitors may develop new technologies, products, or services ahead of us or establish new business models, more flexible purchase models, or disruptive technologies. By extending our offerings in flash, cloud storage, converged infrastructure, and block storage, and GenAI, we are entering new segments and facing competition from both traditional competitors and emerging competitors. The long-term potential and competitiveness of emerging vendors remains uncertain. New competitors or alliances among existing competitors could emerge and quickly gain significant market share or buying power. Changes in customer requirements or increased industry consolidation could result in stronger competitors better able to compete. Additionally, current and potential competitors may establish cooperative relationships among themselves or with third parties, including some of our partners or suppliers. For additional information regarding our competitors, see the section entitled "Competition" contained in Part I, Item 1 - Business of this Annual Report on Form 10-K. **Current (2026):** Our markets are highly competitive, fragmented, and characterized by rapidly changing technology. We face competition from many companies, including established public companies, newer public companies focused on flash storage, and new market entrants targeting the AI opportunity. Some competitors offer a broad range of IT products and services (full-stack vendors), while others offer a more limited set. Customer demand continues to be influenced by cloud adoption, digital transformation initiatives, cybersecurity requirements, and increasing use of artificial intelligence and data-driven applications, driving significant changes in storage architectures and solution requirements. The emergence of artificial intelligence workloads has introduced additional competitive dynamics, particularly in areas related to data readiness, performance, scalability, and integration with compute and cloud ecosystems. Additionally, cloud service providers offer storage on demand without requiring capital expenditure, which meets rapidly evolving business needs and has altered the competitive landscape. We also face competition from alternative architectures or approaches that may reduce or eliminate demand for some of our offerings. Competitors may develop new technologies, products, or services ahead of us or establish new business models, more flexible purchase models, or disruptive technologies. By extending our offerings in flash, cloud storage, converged infrastructure, and block storage, and GenAI, we are entering new segments and facing competition from both traditional competitors and emerging competitors. The long-term potential and competitiveness of emerging vendors remain uncertain. New competitors or alliances among existing competitors could emerge and quickly gain significant market share or buying power. Changes in customer requirements or increased industry consolidation could result in stronger competitors who are better able to compete against us. Additionally, current and potential competitors may establish cooperative relationships among themselves or with third parties, including some of our partners or suppliers. For additional information regarding our competitors, see the section entitled "Competition" contained in Part I, Item 1 - Business of this Annual Report on Form 10-K. --- ## Modified: INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA **Key changes:** - Reworded sentence: "Consolidated Balance Sheets Consolidated Balance Sheets 54 Consolidated Statements of Income Consolidated Statements of Income 55 Consolidated Statements of Comprehensive Income Consolidated Statements of Comprehensive Income 56 Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows 57 Consolidated Statements of Stockholders' Equity Consolidated Statements of Stockholders' Equity 58 Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements 59 Reports of Independent Registered Public Accounting Firm (PCAOB ID No." - Reworded sentence: "34 34 ) 86 53 53 NETAPP, INC.CONSOLIDATED BALANCE SHEETS(In millions, except par value) April 24, 2026 April 25, 2025 ASSETS Current assets: Cash and cash equivalents $ 2,070 $ 2,742 Short-term investments 1,514 1,104 Accounts receivable 1,286 1,246 Inventories 198 186 Other current assets 708 573 Total current assets 5,776 5,851 Property and equipment, net 592 563 Goodwill 2,772 2,723 Purchased intangible assets, net 22 43 Other non-current assets 1,582 1,643 Total assets $ 10,744 $ 10,823 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 550 $ 511 Accrued expenses 1,151 1,122 Current portion of long-term debt - 750 Short-term deferred revenue 2,320 2,279 Total current liabilities 4,021 4,662 Long-term debt 2,487 2,485 Other long-term liabilities 360 379 Long-term deferred revenue 2,525 2,257 Total liabilities 9,393 9,783 Commitments and contingencies (Note 16) Stockholders' equity: Preferred stock, $0.001 par value, 5 shares authorized; no shares issued or outstanding as of April 24, 2026 or April 25, 2025 - - Common stock and additional paid-in capital, $0.001 par value, 885 shares authorized; 196 and 201 shares issued and outstanding as of April 24, 2026 and April 25, 2025, respectively 1,209 1,106 Retained earnings 153 - Accumulated other comprehensive loss (11 ) (66 ) Total stockholders' equity 1,351 1,040 Total liabilities and stockholders' equity $ 10,744 $ 10,823 See accompanying notes to consolidated financial statements." **Prior (2025):** Consolidated Balance Sheets Consolidated Balance Sheets 55 Consolidated Statements of Income Consolidated Statements of Income 56 Consolidated Statements of Comprehensive Income Consolidated Statements of Comprehensive Income 57 Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows 58 Consolidated Statements of Stockholders' Equity Consolidated Statements of Stockholders' Equity 59 Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements 60 Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 34) Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 34 34 ) 89 54 54 NETAPP, INC.CONSOLIDATED BALANCE SHEETS(In millions, except par value) April 25, 2025 April 26,2024 ASSETS Current assets: Cash and cash equivalents $ 2,742 $ 1,903 Short-term investments 1,104 1,349 Accounts receivable 1,246 1,007 Inventories 186 186 Other current assets 573 452 Total current assets 5,851 4,897 Property and equipment, net 563 604 Goodwill 2,723 2,759 Purchased intangible assets, net 43 124 Other non-current assets 1,643 1,503 Total assets $ 10,823 $ 9,887 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 511 $ 517 Accrued expenses 1,122 1,013 Current portion of long-term debt 750 400 Short-term deferred revenue and financed unearned services revenue 2,279 2,176 Total current liabilities 4,662 4,106 Long-term debt 2,485 1,992 Other long-term liabilities 379 585 Long-term deferred revenue and financed unearned services revenue 2,257 2,058 Total liabilities 9,783 8,741 Commitments and contingencies (Note 17) Stockholders' equity: Preferred stock, $0.001 par value, 5 shares authorized; no shares issued or outstanding as of April 25, 2025 or April 26, 2024 - - Common stock and additional paid-in capital, $0.001 par value, 885 shares authorized; 201 and 206 shares issued and outstanding as of April 25, 2025 and April 26, 2024, respectively 1,106 997 Retained earnings - 208 Accumulated other comprehensive loss (66 ) (59 ) Total stockholders' equity 1,040 1,146 Total liabilities and stockholders' equity $ 10,823 $ 9,887 See accompanying notes to consolidated financial statements. **Current (2026):** Consolidated Balance Sheets Consolidated Balance Sheets 54 Consolidated Statements of Income Consolidated Statements of Income 55 Consolidated Statements of Comprehensive Income Consolidated Statements of Comprehensive Income 56 Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows 57 Consolidated Statements of Stockholders' Equity Consolidated Statements of Stockholders' Equity 58 Notes to Consolidated Financial Statements Notes to Consolidated Financial Statements 59 Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 34) Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 34 34 ) 86 53 53 NETAPP, INC.CONSOLIDATED BALANCE SHEETS(In millions, except par value) April 24, 2026 April 25, 2025 ASSETS Current assets: Cash and cash equivalents $ 2,070 $ 2,742 Short-term investments 1,514 1,104 Accounts receivable 1,286 1,246 Inventories 198 186 Other current assets 708 573 Total current assets 5,776 5,851 Property and equipment, net 592 563 Goodwill 2,772 2,723 Purchased intangible assets, net 22 43 Other non-current assets 1,582 1,643 Total assets $ 10,744 $ 10,823 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 550 $ 511 Accrued expenses 1,151 1,122 Current portion of long-term debt - 750 Short-term deferred revenue 2,320 2,279 Total current liabilities 4,021 4,662 Long-term debt 2,487 2,485 Other long-term liabilities 360 379 Long-term deferred revenue 2,525 2,257 Total liabilities 9,393 9,783 Commitments and contingencies (Note 16) Stockholders' equity: Preferred stock, $0.001 par value, 5 shares authorized; no shares issued or outstanding as of April 24, 2026 or April 25, 2025 - - Common stock and additional paid-in capital, $0.001 par value, 885 shares authorized; 196 and 201 shares issued and outstanding as of April 24, 2026 and April 25, 2025, respectively 1,209 1,106 Retained earnings 153 - Accumulated other comprehensive loss (11 ) (66 ) Total stockholders' equity 1,351 1,040 Total liabilities and stockholders' equity $ 10,744 $ 10,823 See accompanying notes to consolidated financial statements. --- ## Modified: Recent Accounting Pronouncements Not Yet Adopted **Key changes:** - Reworded sentence: "In September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software." - Removed sentence: "In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes." - Removed sentence: "This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted." - Removed sentence: "The amendment should be applied on a prospective basis while retrospective application is permitted." - Removed sentence: "We are currently evaluating the effect of this pronouncement on our income tax disclosures." **Prior (2025):** In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure of the nature of expenses included in the income statement. The standard requires disclosures about specific types of expenses included in the expense captions presented in the income statement as well as disclosures about selling expenses. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The requirements should be applied on a prospective basis while retrospective application is permitted. We are currently evaluating the effect of this pronouncement on our disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes. This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment should be applied on a prospective basis while retrospective application is permitted. We are currently evaluating the effect of this pronouncement on our income tax disclosures. **Current (2026):** In September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The ASU simplifies the capitalization guidance by removing all references to prescriptive and sequential software development stages (referred to as "project stages") throughout ASC 350-40. The ASU is effective for annual periods beginning after December 15, 2027, with early adoption permitted. Adoption of this ASU can be applied prospectively; or following a modified transition approach that is based on the status of each project and whether software costs were capitalized before adoption; or retrospectively. We are currently evaluating the effect of this pronouncement on our consolidated financial statements and disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure of the nature of expenses included in the income statement. The standard requires disclosures about specific types of expenses included in the expense captions presented in the income statement as well as disclosures about selling expenses. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The requirements should be applied on a prospective basis while retrospective application is permitted. We are currently evaluating the effect of this pronouncement on our disclosures. --- ## Modified: Net income per share: **Key changes:** - Reworded sentence: "Basic $ 6.41 $ 5.81 $ 4.74 Diluted $ 6.35 $ 5.67 $ 4.63" **Prior (2025):** Basic $ 5.81 $ 4.74 $ 5.87 Diluted $ 5.67 $ 4.63 $ 5.79 **Current (2026):** Basic $ 6.41 $ 5.81 $ 4.74 Diluted $ 6.35 $ 5.67 $ 4.63 --- ## Modified: Income before income taxes **Key changes:** - Reworded sentence: "1,648 1,383 1,263 Provision for income taxes 372 197 277 Net income $ 1,276 $ 1,186 $ 986" **Prior (2025):** 21 20 17 Provision (benefit) for income taxes 3 4 (3 ) Net income 18 % 16 % 20 % Percentages may not add due to rounding **Current (2026):** 24 21 20 Provision for income taxes 5 3 4 Net income 18 % 18 % 16 % Percentages may not add due to rounding --- ## Modified: We could be subject to additional income tax liabilities. **Key changes:** - Reworded sentence: "Our effective tax rate is influenced by a variety of factors, many of which are outside of our control, including fluctuations in our earnings and financial results in the various countries and states in which we do business, changes to the tax laws in such jurisdictions and the outcome of income tax audits." - Reworded sentence: "For example, in July 2025, the One Big Beautiful Bill Act was enacted, which introduced significant changes to U.S." - Reworded sentence: "We operate in jurisdictions that participate in the BEPS inclusive framework (Inclusive Framework), which is implementing measures such as the global minimum tax framework known as Pillar Two and standardized profit requirements for baseline marketing and distribution activities under Amount B of Pillar One." **Prior (2025):** Our effective tax rate is influenced by a variety of factors, many of which are outside of our control. These factors include among other things, fluctuations in our earnings and financial results in the various countries and states in which we do business, changes to 28 28 the tax laws in such jurisdictions and the outcome of income tax audits. Changes to any of these factors could materially impact our operating results, financial condition and cash flows. We receive significant tax benefits from sales to our non-U.S. customers. These benefits are contingent upon existing tax laws and regulations in the U.S. and in the countries in which our international operations are located. Future changes in domestic or international tax laws and regulations or a change in how we manage our international operations could adversely affect our ability to continue realizing these tax benefits. Many countries around the world are beginning to implement legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development's Base Erosion and Profit Shifting Project (BEPS) recommendation and related action plans that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules and nexus-based tax incentive practices. As a result, many of these changes, if enacted in whole or in part, could increase our worldwide effective tax rate and harm our operating results, financial condition, and cash flows. Implementation of the BEPS inclusive framework (Inclusive Framework), including potential incremental taxes under a new global minimum tax framework known as Pillar Two, is effective in most jurisdictions for fiscal years beginning on or after January 1, 2024. We are currently subject to Pillar Two rules starting in our fiscal year 2025 and could potentially be subject to additional taxes under the Inclusive Framework. Amount B under Pillar One of the Inclusive Framework is related to standardized returns for baseline marketing and distribution activities. Amount B is applicable to NetApp beginning in fiscal 2026 and we could be subject to higher controlled profit requirements for some of our global distribution entities which could increase our global tax burden. Our effective tax rate could also be adversely affected by changes in tax laws and regulations and interpretations of such laws and regulations, which in turn would negatively impact our earnings and cash and cash equivalent balances we currently maintain. Additionally, our effective tax rate could also be adversely affected if there is a change in international operations, our tax structure and how our operations are managed and structured, and as a result, we could experience harm to our operating results and financial condition. We continue to evaluate the impacts of changes in tax laws and regulations on our business. We are routinely subject to income tax audits in the U.S. and several foreign tax jurisdictions. If the ultimate determination of income taxes or at-source withholding taxes assessed under these audits results in amounts in excess of the tax provision we have recorded or reserved for, our operating results, financial condition and cash flows could be adversely affected.We may not be able to maintain appropriate internal financial reporting controls and procedures.We cannot be assured that significant deficiencies or material weaknesses in our internal control over financial reporting will not exist in the future. Any failure to maintain or implement required new or improved controls, or any difficulties we encounter in their implementation, including in connection with our new ERP system, could result in significant deficiencies or material weaknesses, cause us to fail to timely meet our periodic reporting obligations, or result in material misstatements in our financial statements. Any such failure could also adversely affect the results of periodic management evaluations and annual auditor attestation reports regarding disclosure controls and the effectiveness of our internal control over financial reporting required under the Sarbanes-Oxley Act and the rules promulgated thereunder. The existence of a material weakness could result in errors in our financial statements that could result in a restatement of financial statements, cause us to fail to timely meet our reporting obligations, or cause investors to lose confidence in our reported financial information, which could cause a decline in the market price of our stock and we could be subject to sanctions or investigations by the SEC or other regulatory authorities including equivalent foreign authorities. Further, irrespective of the controls that we adopt, we cannot be assured that we will not experience fraudulent financial reporting in the future, including earnings mismanagement, recording fictitious revenues, improper asset valuation, understating liabilities or expenses, inadequate disclosure, reserve manipulation, misuse of judgments in financial reporting, concealing fraud or illegal activities, information tampering, and insider trading based on non-public information about the Company's financials. the tax laws in such jurisdictions and the outcome of income tax audits. Changes to any of these factors could materially impact our operating results, financial condition and cash flows. We receive significant tax benefits from sales to our non-U.S. customers. These benefits are contingent upon existing tax laws and regulations in the U.S. and in the countries in which our international operations are located. Future changes in domestic or international tax laws and regulations or a change in how we manage our international operations could adversely affect our ability to continue realizing these tax benefits. Many countries around the world are beginning to implement legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development's Base Erosion and Profit Shifting Project (BEPS) recommendation and related action plans that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules and nexus-based tax incentive practices. As a result, many of these changes, if enacted in whole or in part, could increase our worldwide effective tax rate and harm our operating results, financial condition, and cash flows. Implementation of the BEPS inclusive framework (Inclusive Framework), including potential incremental taxes under a new global minimum tax framework known as Pillar Two, is effective in most jurisdictions for fiscal years beginning on or after January 1, 2024. We are currently subject to Pillar Two rules starting in our fiscal year 2025 and could potentially be subject to additional taxes under the Inclusive Framework. Amount B under Pillar One of the Inclusive Framework is related to standardized returns for baseline marketing and distribution activities. Amount B is applicable to NetApp beginning in fiscal 2026 and we could be subject to higher controlled profit requirements for some of our global distribution entities which could increase our global tax burden. Our effective tax rate could also be adversely affected by changes in tax laws and regulations and interpretations of such laws and regulations, which in turn would negatively impact our earnings and cash and cash equivalent balances we currently maintain. Additionally, our effective tax rate could also be adversely affected if there is a change in international operations, our tax structure and how our operations are managed and structured, and as a result, we could experience harm to our operating results and financial condition. We continue to evaluate the impacts of changes in tax laws and regulations on our business. We are routinely subject to income tax audits in the U.S. and several foreign tax jurisdictions. If the ultimate determination of income taxes or at-source withholding taxes assessed under these audits results in amounts in excess of the tax provision we have recorded or reserved for, our operating results, financial condition and cash flows could be adversely affected. **Current (2026):** Our effective tax rate is influenced by a variety of factors, many of which are outside of our control, including fluctuations in our earnings and financial results in the various countries and states in which we do business, changes to the tax laws in such jurisdictions and the outcome of income tax audits. Changes to any of these factors could materially impact our operating results, financial condition and cash flows. We receive significant tax benefits from sales to our non-U.S. customers. These benefits are contingent upon existing tax laws and regulations in the U.S. and in the countries in which our international operations are located. For example, in July 2025, the One Big Beautiful Bill Act was enacted, which introduced significant changes to U.S. tax law, including permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions including the immediate expensing of United States research and development expenditures. Future changes in domestic or international tax laws and regulations or a change in how we manage and structure our international operations could adversely affect our ability to continue realizing these tax benefits. More broadly, our effective tax rate could also be adversely affected by changes in, or reinterpretations of, applicable tax laws and regulations, which could result in higher tax liabilities on our pre-tax income and cash balances. Changes in how we manage and structure our business and operations could similarly expose us to additional tax obligations. Any of the foregoing could harm our operating results and financial condition. We continue to evaluate the impacts of changes in tax laws and regulations on our business. Many countries around the world are beginning to implement legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development's Base Erosion and Profit Shifting Project (BEPS) recommendation and related action plans that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules and nexus-based tax incentive practices. We operate in jurisdictions that participate in the BEPS inclusive framework (Inclusive Framework), which is implementing measures such as the global minimum tax framework known as Pillar Two and standardized profit requirements for baseline marketing and distribution activities under Amount B of Pillar One. These rules, along with the continued expansion of the Inclusive Framework to additional jurisdictions or any changes to the scope or requirements of these frameworks, could increase our worldwide effective tax rate and adversely affect our operating results, financial condition, and cash flows. We are routinely subject to income tax audits in the U.S. and several foreign tax jurisdictions. If the ultimate determination of income taxes or at-source withholding taxes assessed under these audits results in amounts in excess of the tax provision we have recorded or reserved for, our operating results, financial condition and cash flows could be adversely affected. --- ## Modified: 2. Recent Accounting Pronouncements **Key changes:** - Reworded sentence: "Recent Accounting Pronouncements Not Yet AdoptedIn September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software." - Reworded sentence: "We are currently evaluating the effect of this pronouncement on our disclosures." **Prior (2025):** Recent Accounting Pronouncements Not Yet AdoptedIn November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure of the nature of expenses included in the income statement. The standard requires disclosures about specific types of expenses included in the expense captions presented in the income statement as well as disclosures about selling expenses. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The requirements should be applied on a prospective basis while retrospective application is permitted. We are currently evaluating the effect of this pronouncement on our disclosures.In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes. This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment should be applied on a prospective basis while retrospective application is permitted. We are currently evaluating the effect of this pronouncement on our income tax disclosures. Recently Adopted Accounting PronouncementIn November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires disclosure of incremental segment information on an annual and interim basis. We adopted this standard for our annual period beginning fiscal year 2025 on a retrospective basis to all periods presented. The adoption of this standard did not result in a significant change to our consolidated financial statement disclosures. See Note 15 - Segment, Geographic, and Significant Customer Information of the Notes to Consolidated Financial Statements for our reportable segment disclosures. **Current (2026):** Recent Accounting Pronouncements Not Yet AdoptedIn September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The ASU simplifies the capitalization guidance by removing all references to prescriptive and sequential software development stages (referred to as "project stages") throughout ASC 350-40. The ASU is effective for annual periods beginning after December 15, 2027, with early adoption permitted. Adoption of this ASU can be applied prospectively; or following a modified transition approach that is based on the status of each project and whether software costs were capitalized before adoption; or retrospectively. We are currently evaluating the effect of this pronouncement on our consolidated financial statements and disclosures.In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure of the nature of expenses included in the income statement. The standard requires disclosures about specific types of expenses included in the expense captions presented in the income statement as well as disclosures about selling expenses. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The requirements should be applied on a prospective basis while retrospective application is permitted. We are currently evaluating the effect of this pronouncement on our disclosures. Recently Adopted Accounting PronouncementIn December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes. This includes the disclosure of specific categories and greater disaggregation within the income tax rate reconciliation as well as disclosure of disaggregated income taxes paid by significant jurisdiction. This ASU is effective for fiscal years beginning after December 15, 2024. We adopted the standard on a prospective basis for fiscal 2026. See Note 12 - Income Taxes for further information. --- ## Modified: Operating expenses: **Key changes:** - Reworded sentence: "Sales and marketing 27 28 29 Research and development 14 15 16 General and administrative 5 5 5 Restructuring charges - 1 1 Acquisition-related expense - - - Total operating expenses 47 50 51" **Prior (2025):** Sales and marketing 28 29 29 Research and development 15 16 15 General and administrative 5 5 4 Restructuring charges 1 1 2 Acquisition-related expense - - - Total operating expenses 50 51 50 **Current (2026):** Sales and marketing 27 28 29 Research and development 14 15 16 General and administrative 5 5 5 Restructuring charges - 1 1 Acquisition-related expense - - - Total operating expenses 47 50 51 --- ## Modified: Material Capital Expenditure Requirements **Key changes:** - Reworded sentence: "We expect to fund our capital expenditures, including our commitments related to facilities, equipment, operating leases and internal-use software development projects for at least the next 12 months through existing cash, cash equivalents, investments and cash generated from operations." **Prior (2025):** We expect to fund our capital expenditures, including our commitments related to facilities, equipment, operating leases and internal-use software development projects over the next few years through existing cash, cash equivalents, investments and cash generated from operations. The timing and amount of our capital requirements cannot be precisely determined and will depend on a number of factors, including future demand for products, changes in the network storage industry, hiring plans and our decisions related to the financing of our facilities and equipment requirements. We anticipate capital expenditures for fiscal 2026 to be between $175 million and $225 million. **Current (2026):** We expect to fund our capital expenditures, including our commitments related to facilities, equipment, operating leases and internal-use software development projects for at least the next 12 months through existing cash, cash equivalents, investments and cash generated from operations. The timing and amount of our capital requirements cannot be precisely determined and will depend on a number of factors, including future demand for products, changes in the enterprise storage and data management industry, hiring plans and our decisions related to the financing of our facilities and equipment requirements. --- ## Modified: If our products or services are defective, or are perceived to be defective, including as a result of improper use or maintenance, our operating results and customer relationships may be harmed. **Key changes:** - Reworded sentence: "Our products and services are complex." - Reworded sentence: "As the laws and regulations governing our products continue to expand and change, our costs are likely to rise, and failure to comply with any such laws and regulations could subject us to business interruptions, litigation risks, and reputational harm.Any violation of U.S." - Reworded sentence: "In addition, a failure to obtain and defend our trademark registrations may impede our marketing and branding efforts and competitive position." - Reworded sentence: "In addition, the laws of some foreign countries do not protect proprietary rights to the maintenance could impair the performance of our products and services, which could lead to a perception of a quality or reliability issue." **Prior (2025):** The laws and regulations governing the manufacturing, sourcing, distribution and use of our products have become increasingly complex and stringent. For example, in addition to various environmental laws relating to carbon emissions, the use and discharge of hazardous materials, and the use of certain minerals originating from identified conflict zones, many governments, including the U.S., 25 25 the United Kingdom, and Australia, have adopted regulations to address the risk of human trafficking in supply chains, which govern how workers are recruited and managed. We incur costs to comply with these requirements. Given the complexity of our supply chain, we may face reputational harm if our customers or other stakeholders conclude that we are unable to verify sufficiently the origins of the minerals used in the products we sell or the actions of our suppliers with respect to workers. As the laws and regulations governing our products continue to expand and change, our costs are likely to rise, and the failure to comply with any such laws and regulations could subject us to business interruptions, litigation risks and reputational harm.Any violation of U.S. export control laws and other laws affecting the countries in which our products and services may be sold, distributed, or delivered could have a material and adverse effect on our business, operating results, financial condition and cash flows.Due to the global nature of our business, we are subject to import and export restrictions and regulations, including the Export Administration Regulations administered by the Commerce Department's Bureau of Industry and Security (BIS) and the trade and economic sanctions regulations administered by the Treasury Department's Office of Foreign Assets Control (OFAC). The U.S., through the BIS and OFAC, places restrictions on the sale or export of certain products and services to certain countries, entities, and persons, including most recently to Russia, Belarus and regions of Ukraine. These regulations have caused us to temporarily stop selling or servicing our products temporarily in restricted areas. Violators of export control and sanctions laws may be subject to significant penalties, which may include significant monetary fines, criminal proceedings against them and their officers and employees, a denial of export privileges, and suspension or debarment from selling products to the federal government. Our products could be diverted by third parties (including potentially our channel partners) to countries or end users under sanctions / embargo orders, despite our precautions.If we were ever found to have violated U.S. export control laws or any trade-related laws or regulations, even if inadvertent or without our knowledge, we may be subject to various penalties available under the laws, any of which could have a material and adverse impact on our business, operating results and financial condition. Even if we were not found to have violated such laws, the political and media scrutiny surrounding any governmental investigation of us could cause us significant expense and reputational harm. Such collateral consequences could have a material adverse impact on our business, operating results, financial condition and cash flows.Our failure to protect our intellectual property could harm our business, operating results, financial condition and cash flows.Our success depends significantly upon developing, maintaining and protecting our proprietary technology. We rely on a combination of patents, copyrights, trademarks, trade secrets, confidentiality procedures and contractual provisions with employees, resellers, strategic partners and customers, to protect our proprietary rights. We currently have multiple U.S. and international patent applications pending and multiple U.S. and international patents issued. The pending applications may not be approved, and our existing and future patents may be challenged. If such challenges are brought, the patents may be invalidated. We may not be able to develop proprietary products or technologies that are patentable, and patents issued to us may not provide us with any competitive advantages and may be challenged by third parties. Further, the patents of others may materially and adversely affect our ability to do business. In addition, a failure to obtain and defend our trademark registrations may impede our marketing and branding efforts and competitive condition. Litigation may be necessary to protect our proprietary technology. Any such litigation may be time-consuming and costly. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or obtain and use information that we regard as proprietary. In addition, the laws of some foreign countries do not protect proprietary rights to as great an extent as do the laws of the U.S. Our means of protecting our proprietary rights may not be adequate or our competitors may independently develop similar technology, duplicate our products, or design around patents issued to us or other intellectual property rights of ours. There is persistent risk that some individuals will improperly take our intellectual property after terminating their employment or other engagements with us, which could lead to intellectual property leakage to competitors and a loss of our competitive advantages.We may be found to infringe on intellectual property rights of others.We compete in markets in which intellectual property infringement claims arise in the normal course of business. Third parties have, from time to time, asserted intellectual property-related claims against us, including claims for alleged patent infringement brought by non-practicing entities. Such claims may be made against our products and services, our customers' use of our products and services, or a combination of our products and third-party products. We also may be subject to claims and indemnification obligations from customers and resellers with respect to third-party intellectual property rights pursuant to our agreements with them. If we refuse to indemnify or defend such claims, even in situations in which the third-party's allegations are meritless, then customers and resellers may refuse to do business with us. the United Kingdom, and Australia, have adopted regulations to address the risk of human trafficking in supply chains, which govern how workers are recruited and managed. We incur costs to comply with these requirements. Given the complexity of our supply chain, we may face reputational harm if our customers or other stakeholders conclude that we are unable to verify sufficiently the origins of the minerals used in the products we sell or the actions of our suppliers with respect to workers. As the laws and regulations governing our products continue to expand and change, our costs are likely to rise, and the failure to comply with any such laws and regulations could subject us to business interruptions, litigation risks and reputational harm. **Current (2026):** Our products and services are complex. We have experienced in the past, and expect to experience in the future, quality issues impacting certain products, and reliability issues with services we provide, including security vulnerabilities, software bugs, hardware failure in networked storage appliances, incompatibility issues with customer systems or other applications, performance deficiencies causing slow data retrieval or processing, firmware or software updates causing system instability, compliance with various product certifications, and data breaches due to flaws in the product design. Such quality and reliability issues may be caused by our own designs or processes, the designs or processes of our suppliers, and/or flaws in third-party software used in our products, or other reasons. These types of risks are most acute when we are introducing new products. Quality or reliability issues have and could again in the future cause customers to experience outages or disruptions in service, data loss or data corruption. If we fail to remedy a product defect or flaw, we may experience a failure of a product line, temporary or permanent withdrawal from a product or market, damage to our reputation, loss of revenue, inventory costs or product reengineering expenses and higher ongoing warranty and service costs, and these occurrences could have a material impact on our gross margins, business and operating results. In addition, we exercise little control over how our customers use or maintain our products and services, and in some cases improper usage or 26 26 maintenance could impair the performance of our products and services, which could lead to a perception of a quality or reliability issue. Customers have experienced, and may in the future experience, losses that result from or are alleged to result from defects or flaws in our products and services, and we have been, and may in the future be, subjected to claims for damages, including consequential damages.Changes in regulations relating to our products or their components, or the manufacture, sourcing, distribution or use thereof, may harm our business, operating results, financial condition and cash flows.The laws and regulations governing the manufacturing, sourcing, distribution and use of our products have become increasingly complex and stringent and costly to comply with. For example, in addition to various environmental laws relating to carbon emissions, the use and discharge of hazardous materials, and the use of certain minerals originating from identified conflict zones, many governments, including the U.S., the United Kingdom, and Australia, have adopted regulations to address the risk of human trafficking in supply chains, which govern how workers are recruited and managed. Given the complexity of our supply chain, we may face reputational harm if our customers or other stakeholders conclude that we are unable to verify sufficiently the origins of the minerals used in the products we sell or the actions of our suppliers with respect to workers. As the laws and regulations governing our products continue to expand and change, our costs are likely to rise, and failure to comply with any such laws and regulations could subject us to business interruptions, litigation risks, and reputational harm.Any violation of U.S. or international customs or export control laws and other laws affecting the countries in which our products and services may be sold, distributed, or delivered could have a material adverse effect on our business, operating results, financial condition and cash flows.Due to the global nature of our business, we are subject to customs and export restrictions and regulations, including the Export Administration Regulations administered by the Commerce Department's Bureau of Industry and Security (BIS), customs regulations overseen by U.S. Customs and Border Protection, and the trade and economic sanctions regulations administered by the Treasury Department's Office of Foreign Assets Control (OFAC). The U.S., through the BIS and OFAC, places restrictions on the sale or export of certain products, technology and services to certain countries, entities, and persons. These regulations have caused us to stop selling or servicing our products to entities, parties, and regions designated as restricted by the authorities. In addition, the U.S. has continued to expand and refine export controls, in particular with respect to China, as well as related to semiconductors and other critical technologies. We are also subject to the customs and export control laws and regulations of other jurisdictions in which we operate or sell our products and services. These laws may impose additional compliance obligations, restrict the sale or distribution of our products and services in certain markets, and may conflict with the U.S. laws. Changes in any of these laws, whether in the U.S. or internationally, may occur with limited advance notice, and may increase our operating costs or limit the products or services we are able to sell or how we sell them in certain geographies.Violators of export control and sanctions laws may be subject to significant penalties, which may include significant monetary fines, criminal proceedings against them and their officers and employees, a denial of export privileges, and under U.S. law, suspension or debarment from selling products to the U.S. federal government. Our products could be diverted by third parties (including potentially our channel partners) to countries or end users under sanctions or embargo orders, despite our precautions.If we were ever found to have violated U.S. or international export control laws or any trade-related laws or regulations, even if inadvertent or without our knowledge, we may be subject to various penalties available under the laws, any of which could have a material and adverse impact on our business, operating results and financial condition. Even if we were not found to have violated such laws, the political and media scrutiny surrounding any governmental investigation of us could cause us significant expense and reputational harm. Such collateral consequences could have a material adverse impact on our business, operating results, financial condition and cash flows.Our failure to protect our intellectual property could harm our business, operating results, financial condition and cash flows.Our success depends significantly upon developing, maintaining and protecting our proprietary technology. We rely on a combination of patents, copyrights, trademarks, trade secrets, confidentiality procedures and contractual provisions with employees, resellers, strategic partners and customers, to protect our proprietary rights. We currently have multiple U.S. and international patent applications pending and multiple U.S. and international patents issued. The pending applications may not be approved, and our existing and future patents may be challenged. If such challenges are brought, the patents may be invalidated. We may not be able to develop proprietary products or technologies that are patentable, and patents issued to us may not provide us with any competitive advantages and may be challenged by third parties. Further, the patents of others may materially and adversely affect our ability to do business. In addition, a failure to obtain and defend our trademark registrations may impede our marketing and branding efforts and competitive position. Litigation may be necessary to protect our proprietary technology, which may be time-consuming and costly. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or obtain and use information that we regard as proprietary. In addition, the laws of some foreign countries do not protect proprietary rights to the maintenance could impair the performance of our products and services, which could lead to a perception of a quality or reliability issue. Customers have experienced, and may in the future experience, losses that result from or are alleged to result from defects or flaws in our products and services, and we have been, and may in the future be, subjected to claims for damages, including consequential damages. --- ## Modified: Our failure to protect our intellectual property could harm our business, operating results, financial condition and cash flows. **Key changes:** - Reworded sentence: "Our success depends significantly upon developing, maintaining and protecting our proprietary technology." - Reworded sentence: "If we refuse to indemnify or defend such claims, even in situations in which the third-party's allegations are meritless, then customers and resellers may refuse to do business with us.Patent litigation is particularly common in our industry, and we expect infringement claims to continue to increase as the number of products and competitors in our industry segment grows and the functionality of products in different industry segments overlaps." - Reworded sentence: "If a court determined that our products infringe, we could be required to pay significant monetary damages and be subject to non-monetary relief that could cause product shipment delays, require us to redesign our products, affect our ability to supply or service our customers, or require us to enter into compulsory royalty or licensing agreements." - Reworded sentence: "If we fail to adequately manage our use of third-party software, we may be subject to copyright infringement or other third-party claims." - Reworded sentence: "Each of the foregoing could result in a loss of intellectual property rights, increased costs, damage to our reputation, or a loss of revenue.In addition, many of our products use open-source software, which generally does not provide any warranty or contractual protection and may be susceptible to compromise and supply-chain attacks by threat actors." **Prior (2025):** We compete in markets in which intellectual property infringement claims arise in the normal course of business. Third parties have, from time to time, asserted intellectual property-related claims against us, including claims for alleged patent infringement brought by non-practicing entities. Such claims may be made against our products and services, our customers' use of our products and services, or a combination of our products and third-party products. We also may be subject to claims and indemnification obligations from customers and resellers with respect to third-party intellectual property rights pursuant to our agreements with them. If we refuse to indemnify or defend such claims, even in situations in which the third-party's allegations are meritless, then customers and resellers may refuse to do business with us. 26 26 Patent litigation is particularly common in our industry. We have been, and continue to be, in active patent litigations with non-practicing entities. There is no guarantee that, in patent or other types of intellectual property litigation, we will prevail at trial or be able to settle at a reasonable cost. If a judge or jury were to find that our products infringe, we could be required to pay significant monetary damages and be subject to an injunction that could cause product shipment delays, require us to redesign our products, affect our ability to supply or service our customers, and/or require us to enter into compulsory royalty or licensing agreements. We expect that companies in the enterprise storage and data management, and cloud storage, operational and workload services markets will increasingly be subject to infringement claims as the number of products and competitors in our industry segment grows and the functionality of products in different industry segments overlaps. Any such claims, and any such infringement claims discussed above, could be time consuming, result in costly litigation, cause suspension of product shipments or product shipment delays, require us to redesign our products, or require us to enter into royalty or licensing agreements, any of which could materially and adversely affect our operating results, financial condition and cash flows. Such royalty or licensing agreements, if required, may not be available on terms acceptable to us or at all. We rely on software from third parties, and a failure to properly manage our use of third-party software could result in increased costs or loss of revenue. Many of our products are designed to include software licensed from third parties. Such third-party software includes software licensed from commercial suppliers and software licensed under public or open-source licenses. We have internal processes to manage our use of such third-party software. However, if we fail to adequately manage our use of third-party software, then we may be subject to copyright infringement or other third-party claims. If we are non-compliant with a license for commercial software, then we may be required to pay penalties or undergo costly audits pursuant to the license agreement. In the case of open-source software licensed under certain "copyleft" licenses, the license itself may require, or a court-imposed remedy for non-compliant use of the open-source software may require, that proprietary portions of our own software be publicly disclosed or licensed. Additionally, contract proposals, negotiations and software proposals are complex and frequently involve lengthy bidding and selection processes. We may not be able to negotiate extensions to our current third-party licenses when due for renewal or continue to secure such licenses under commercially reasonable terms. Each of the foregoing could result in a loss of intellectual property rights, increased costs, damage to our reputation and/or a loss of revenue.In addition, many of our products use open-source software. Such open-source software generally does not provide any warranty or contractual protection and may be susceptible to compromise and supply-chain attacks by threat actors. Further, open-source software or third-party software may contain vulnerabilities, which may or may not be known at the time of our inclusion of the software in a product. If a vulnerability in such software is successfully exploited, we could be subject to damages including remediation costs, reputational damage, and lost revenues. Our failure to adjust to emerging standards may harm our business.Emerging standards may adversely affect the UNIX®, Windows® and World Wide Web server markets upon which we depend. For example, we provide our open access data retention solutions to customers within the financial services, healthcare, pharmaceutical and government market segments, industries that are subject to various evolving governmental regulations, certifications and controls with respect to data access, reliability and permanence in the U.S. and in the other countries in which we operate. If our products do not meet and continue to comply with these evolving governmental regulations in this regard, customers in these market and geographical segments will not purchase our products, and we may not be able to expand our product offerings in these market and geographical segments at the rates which we have forecasted.Risks Related to Our SecuritiesOur stock price is subject to volatility.Our stock price is subject to changes in recommendations or earnings estimates by financial analysts, changes in investors' or analysts' valuation measures for our stock, changes in our capital structure, including issuance of additional debt, changes in our credit ratings, our ability to pay dividends and to continue to execute our stock repurchase program as planned and market trends and economic volatility unrelated to our performance. If we fail to meet any investor expectations related to dividends and/or stock repurchases, the market price of our stock could decline significantly, and could have a material adverse impact on investor confidence. Additionally, price volatility of our stock over a given period may cause the average price at which we repurchase our own stock to exceed the stock's market price at a given point in time.Furthermore, speculation in the press or investment community about our strategic position, financial condition, results of operations or business can cause changes in our stock price. These factors, as well as general economic and political conditions and the timing of announcements in the public market regarding new products or services, product enhancements or technological Patent litigation is particularly common in our industry. We have been, and continue to be, in active patent litigations with non-practicing entities. There is no guarantee that, in patent or other types of intellectual property litigation, we will prevail at trial or be able to settle at a reasonable cost. If a judge or jury were to find that our products infringe, we could be required to pay significant monetary damages and be subject to an injunction that could cause product shipment delays, require us to redesign our products, affect our ability to supply or service our customers, and/or require us to enter into compulsory royalty or licensing agreements. We expect that companies in the enterprise storage and data management, and cloud storage, operational and workload services markets will increasingly be subject to infringement claims as the number of products and competitors in our industry segment grows and the functionality of products in different industry segments overlaps. Any such claims, and any such infringement claims discussed above, could be time consuming, result in costly litigation, cause suspension of product shipments or product shipment delays, require us to redesign our products, or require us to enter into royalty or licensing agreements, any of which could materially and adversely affect our operating results, financial condition and cash flows. Such royalty or licensing agreements, if required, may not be available on terms acceptable to us or at all. **Current (2026):** Our success depends significantly upon developing, maintaining and protecting our proprietary technology. We rely on a combination of patents, copyrights, trademarks, trade secrets, confidentiality procedures and contractual provisions with employees, resellers, strategic partners and customers, to protect our proprietary rights. We currently have multiple U.S. and international patent applications pending and multiple U.S. and international patents issued. The pending applications may not be approved, and our existing and future patents may be challenged. If such challenges are brought, the patents may be invalidated. We may not be able to develop proprietary products or technologies that are patentable, and patents issued to us may not provide us with any competitive advantages and may be challenged by third parties. Further, the patents of others may materially and adversely affect our ability to do business. In addition, a failure to obtain and defend our trademark registrations may impede our marketing and branding efforts and competitive position. Litigation may be necessary to protect our proprietary technology, which may be time-consuming and costly. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or obtain and use information that we regard as proprietary. In addition, the laws of some foreign countries do not protect proprietary rights to the 27 27 same extent as the U.S. Our means of protecting our proprietary rights may not be adequate or our competitors may independently develop similar technology, duplicate our products, or design around patents issued to us or other intellectual property rights of ours. Individuals may improperly take our intellectual property after terminating their employment or other engagements with us, which could lead to intellectual property leakage to competitors and a loss of our competitive advantages.We may be found to infringe on intellectual property rights of others.We compete in markets in which intellectual property infringement claims arise in the normal course of business. Third parties have, from time to time, asserted intellectual property-related claims against us, including claims for alleged patent infringement brought by non-practicing entities. Such claims may be made against our products and services, our customers' use of our products and services, or a combination of our products and third-party products. We also may be subject to claims and indemnification obligations from customers and resellers with respect to third-party intellectual property rights pursuant to our agreements with them. If we refuse to indemnify or defend such claims, even in situations in which the third-party's allegations are meritless, then customers and resellers may refuse to do business with us.Patent litigation is particularly common in our industry, and we expect infringement claims to continue to increase as the number of products and competitors in our industry segment grows and the functionality of products in different industry segments overlaps. We have been, and continue to be, in active patent litigations with non-practicing entities. There is no guarantee that, in patent or other types of intellectual property litigation, we will prevail at trial or be able to settle at a reasonable cost. If a court determined that our products infringe, we could be required to pay significant monetary damages and be subject to non-monetary relief that could cause product shipment delays, require us to redesign our products, affect our ability to supply or service our customers, or require us to enter into compulsory royalty or licensing agreements. Any such claims could be time-consuming, result in costly litigation, and could materially and adversely affect our operating results, financial condition and cash flows. In addition, such royalty or licensing agreements, if required, may not be available on terms acceptable to us or at all.We rely on software from third parties and open-source software, and a failure to properly manage our use of such software could result in increased costs or loss of revenue. Many of our products are designed to include software licensed from third parties. Such third-party software includes software licensed from commercial suppliers and software licensed under public or open-source licenses. If we fail to adequately manage our use of third-party software, we may be subject to copyright infringement or other third-party claims. If we are non-compliant with a license for commercial software, we may be required to pay penalties or undergo costly audits pursuant to the license agreement. In the case of open-source software licensed under certain "copyleft" licenses, the license itself may require, or a court-imposed remedy for non-compliant use of the open-source software may require, that proprietary portions of our own software be publicly disclosed or licensed. Additionally, contract proposals, negotiations and software proposals are complex and frequently involve lengthy bidding and selection processes. We may not be able to negotiate extensions to our current third-party licenses when due for renewal or continue to secure such licenses under commercially reasonable terms. Each of the foregoing could result in a loss of intellectual property rights, increased costs, damage to our reputation, or a loss of revenue.In addition, many of our products use open-source software, which generally does not provide any warranty or contractual protection and may be susceptible to compromise and supply-chain attacks by threat actors. Further, open-source or third-party software may contain vulnerabilities, which may or may not be known at the time of our inclusion of the software in a product. If a vulnerability in such software is successfully exploited, we could be subject to damages including remediation costs, reputational damage, or lost revenue. Our failure to adjust to emerging standards may harm our business.Emerging standards may adversely affect the UNIX®, Windows® and World Wide Web server markets upon which we depend. For example, we provide our open access data retention solutions to customers within the financial services, healthcare, pharmaceutical and government market segments, industries that are subject to various evolving governmental regulations, certifications and controls with respect to data access, reliability and permanence in the U.S. and in the other countries in which we operate. If our products do not meet and continue to comply with these evolving governmental regulations, customers in these market and geographical segments may not purchase our products, and we may not be able to expand our product offerings in these market and geographical segments at the rates which we forecasted.Risks Related to Our SecuritiesOur stock price is subject to volatility.Our stock price is subject to changes in recommendations or earnings estimates by financial analysts, changes in investors' or analysts' valuation measures for our stock, changes in our capital structure, including issuance of additional debt, changes in our credit same extent as the U.S. Our means of protecting our proprietary rights may not be adequate or our competitors may independently develop similar technology, duplicate our products, or design around patents issued to us or other intellectual property rights of ours. Individuals may improperly take our intellectual property after terminating their employment or other engagements with us, which could lead to intellectual property leakage to competitors and a loss of our competitive advantages. --- ## Modified: Restructuring Events **Key changes:** - Reworded sentence: "During fiscal 2026, we executed a restructuring plan and recognized expenses totaling $21 million consisting primarily of employee severance-related costs related to the current year and prior year plans." **Prior (2025):** During fiscal 2025, we executed several restructuring plans and recognized expenses totaling $83 million consisting primarily of employee severance-related costs. **Current (2026):** During fiscal 2026, we executed a restructuring plan and recognized expenses totaling $21 million consisting primarily of employee severance-related costs related to the current year and prior year plans. --- ## Modified: Cash flows from investing activities: **Key changes:** - Reworded sentence: "Purchases of investments (2,758 ) (1,782 ) (2,635 ) Maturities, sales and collections of investments 2,346 2,027 2,055 Purchases of property and equipment (198 ) (168 ) (155 ) Other investing activities, net 15 70 - Net cash (used in) provided by investing activities (595 ) 147 (735 )" **Prior (2025):** Purchases of investments (1,782 ) (2,635 ) (1,269 ) Maturities, sales and collections of investments 2,027 2,055 550 Purchases of property and equipment (168 ) (155 ) (239 ) Acquisition of businesses, net of cash acquired - - (491 ) Other investing activities, net 70 - 59 Net cash provided by (used in) investing activities 147 (735 ) (1,390 ) **Current (2026):** Purchases of investments (2,758 ) (1,782 ) (2,635 ) Maturities, sales and collections of investments 2,346 2,027 2,055 Purchases of property and equipment (198 ) (168 ) (155 ) Other investing activities, net 15 70 - Net cash (used in) provided by investing activities (595 ) 147 (735 ) --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "% Change Research and development expenses $ 991 $ 1,012 (2 )% $ 1,029 (2 )% Research and development expenses consist primarily of compensation costs, facilities and IT support costs, depreciation, equipment and software related costs, prototypes, non-recurring engineering charges and other outside services costs." - Reworded sentence: "General and Administrative (in millions, except percentages): Year Ended" **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: Comprehensive income **Key changes:** - Reworded sentence: "$ 1,331 $ 1,179 $ 978 See accompanying notes to consolidated financial statements." **Prior (2025):** $ 1,179 $ 978 $ 1,267 See accompanying notes to consolidated financial statements. 57 57 NETAPP, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions) Year Ended April 25, 2025 April 26, 2024 April 28, 2023 Cash flows from operating activities: Net income $ 1,186 $ 986 $ 1,274 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 243 255 248 Non-cash operating lease cost 41 45 52 Stock-based compensation 386 357 312 Deferred income taxes (100 ) 53 (606 ) Other items, net - (13 ) (67 ) Changes in assets and liabilities, net of acquisitions of businesses: Accounts receivable (219 ) (33 ) 260 Inventories (1 ) (18 ) 37 Other operating assets (87 ) (62 ) (63 ) Accounts payable (8 ) 123 (207 ) Accrued expenses 62 113 (103 ) Deferred revenue and financed unearned services revenue 208 (14 ) 46 Long-term taxes payable (207 ) (106 ) (76 ) Other operating liabilities 2 (1 ) - Net cash provided by operating activities 1,506 1,685 1,107 Cash flows from investing activities: Purchases of investments (1,782 ) (2,635 ) (1,269 ) Maturities, sales and collections of investments 2,027 2,055 550 Purchases of property and equipment (168 ) (155 ) (239 ) Acquisition of businesses, net of cash acquired - - (491 ) Other investing activities, net 70 - 59 Net cash provided by (used in) investing activities 147 (735 ) (1,390 ) Cash flows from financing activities: Proceeds from issuance of common stock under employee stock award plans 108 100 108 Payments for taxes related to net share settlement of stock awards (199 ) (127 ) (84 ) Repurchase of common stock (1,150 ) (900 ) (850 ) Issuances of debt, net of issuance costs 1,240 - - Repayments and extinguishment of debt (400 ) - (250 ) Dividends paid (424 ) (416 ) (432 ) Other financing activities, net (3 ) (1 ) (5 ) Net cash used in financing activities (828 ) (1,344 ) (1,513 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 15 (19 ) (1 ) Net change in cash, cash equivalents and restricted cash 840 (413 ) (1,797 ) Cash, cash equivalents and restricted cash: Beginning of period 1,909 2,322 4,119 End of period $ 2,749 $ 1,909 $ 2,322 See accompanying notes to consolidated financial statements. **Current (2026):** $ 1,331 $ 1,179 $ 978 See accompanying notes to consolidated financial statements. 56 56 NETAPP, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions) Year Ended April 24, 2026 April 25, 2025 April 26, 2024 Cash flows from operating activities: Net income $ 1,276 $ 1,186 $ 986 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 200 243 255 Non-cash operating lease cost 42 41 45 Stock-based compensation 382 386 357 Deferred income taxes 135 (100 ) 53 Other items, net 55 - (13 ) Changes in assets and liabilities: Accounts receivable (36 ) (219 ) (33 ) Inventories (12 ) (1 ) (18 ) Other operating assets (248 ) (87 ) (62 ) Accounts payable 31 (8 ) 123 Accrued expenses (23 ) 62 113 Deferred revenue 281 208 (14 ) Long-term taxes payable (7 ) (207 ) (106 ) Other operating liabilities (9 ) 2 (1 ) Net cash provided by operating activities 2,067 1,506 1,685 Cash flows from investing activities: Purchases of investments (2,758 ) (1,782 ) (2,635 ) Maturities, sales and collections of investments 2,346 2,027 2,055 Purchases of property and equipment (198 ) (168 ) (155 ) Other investing activities, net 15 70 - Net cash (used in) provided by investing activities (595 ) 147 (735 ) Cash flows from financing activities: Proceeds from issuance of common stock under employee stock award plans 103 108 100 Payments for taxes related to net share settlement of stock awards (137 ) (199 ) (127 ) Repurchase of common stock (950 ) (1,150 ) (900 ) Issuances of debt, net of issuance costs - 1,240 - Repayments and extinguishment of debt (750 ) (400 ) - Dividends paid (413 ) (424 ) (416 ) Other financing activities, net - (3 ) (1 ) Net cash used in financing activities (2,147 ) (828 ) (1,344 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 1 15 (19 ) Net change in cash, cash equivalents and restricted cash (674 ) 840 (413 ) Cash, cash equivalents and restricted cash: Beginning of period 2,749 1,909 2,322 End of period $ 2,075 $ 2,749 $ 1,909 See accompanying notes to consolidated financial statements. --- ## Modified: Cost of revenues: **Key changes:** - Reworded sentence: "Cost of product 1,401 1,284 1,137 Cost of services 625 675 698 Total cost of revenues 2,026 1,959 1,835 Gross profit 4,899 4,613 4,433" **Prior (2025):** Cost of product 1,284 1,137 1,517 Cost of services 675 698 636 Total cost of revenues 1,959 1,835 2,153 Gross profit 4,613 4,433 4,209 **Current (2026):** Cost of product 1,401 1,284 1,137 Cost of services 625 675 698 Total cost of revenues 2,026 1,959 1,835 Gross profit 4,899 4,613 4,433 --- ## Modified: Provision for Income Taxes (in millions, except percentages): **Key changes:** - Reworded sentence: "Our provision for income taxes and effective tax rates were as follows: Year Ended" **Prior (2025):** Our provision (benefit) for income taxes and effective tax rates were as follows: **Current (2026):** Our provision for income taxes and effective tax rates were as follows: Year Ended --- ## Modified: Fiscal 2025 **Key changes:** - Reworded sentence: "High Low High Low First Quarter $ 110.32 $ 86.70 $ 135.01 $ 100.24 Second Quarter $ 126.66 $ 100.56 $ 134.37 $ 112.87 Third Quarter $ 119.72 $ 93.69 $ 135.45 $ 112.86 Fourth Quarter $ 113.78 $ 94.46 $ 127.78 $ 71.84 Holders As of May 28, 2026, there were 387 holders of record of our common stock." - Reworded sentence: "The graph and related information shall not be deemed "soliciting material" or be deemed to be "filed" with the SEC, nor shall such information be incorporated by reference into any past or future filing with the SEC, except to the extent that such filing specifically states that such graph and related information are incorporated by reference into such filing." **Prior (2025):** High Low High Low First Quarter $ 135.01 $ 100.24 $ 80.53 $ 61.54 Second Quarter $ 134.37 $ 112.87 $ 80.02 $ 71.25 Third Quarter $ 135.45 $ 112.86 $ 91.76 $ 70.82 Fourth Quarter $ 127.78 $ 71.84 $ 112.48 $ 83.80 Holders As of May 29, 2025 there were 403 holders of record of our common stock. Dividends The Company paid cash dividends of $0.52 per outstanding common share in each quarter of fiscal 2025 for an aggregate of $424 million and $0.50 per outstanding common share in each quarter of fiscal 2024 and fiscal 2023 for an aggregate of $416 million and $432 million, respectively. In the first quarter of fiscal 2026, the Company declared a cash dividend of $0.52 per share of common stock, payable on July 23, 2025 to shareholders of record as of the close of business on July 3, 2025. 32 32 Performance GraphThe following graph shows a comparison of cumulative total shareholder return, calculated on a dividend reinvested basis, of an investment of $100 for the Company, the S&P 500 Index, the S&P 500 Information Technology Index and the S&P 1500 Technology Hardware & Equipment Index for the five years ended April 25, 2025. The comparisons in the graphs below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. The graph and related information shall not be deemed "soliciting material" or be deemed to be "filed" with the SEC, nor shall such information be incorporated by reference into any past or future filing with the SEC, except to the extent that such filing specifically states that such graph and related information are incorporated by reference into such filing.COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURNAmong NetApp, Inc., the S&P 500 Index, the S&P 500 Information Technology Index and the S&P 1500 Technology Hardware & Equipment Index* *$100 invested on April 24, 2020 in stock or index, including reinvestment of dividends. Data points are the last day of each fiscal year for the Company's common stock and each of the indexes. April 2020 April 2021 April 2022 April 2023 April 2024 April 2025 NetApp, Inc. $ 100.00 $ 179.71 $ 180.39 $ 159.78 $ 263.63 $ 234.64 S&P 500 Index $ 100.00 $ 149.89 $ 150.21 $ 154.21 $ 191.56 $ 210.35 S&P 500 Information Technology Index $ 100.00 $ 159.07 $ 162.08 $ 175.17 $ 245.24 $ 272.40 S&P 1500 Technology Hardware & Equipment Index $ 100.00 $ 177.82 $ 202.33 $ 214.81 $ 227.56 $ 271.36 We believe that a number of factors may cause the market price of our common stock to fluctuate significantly. See Item 1A. - Risk Factors. **Current (2026):** High Low High Low First Quarter $ 110.32 $ 86.70 $ 135.01 $ 100.24 Second Quarter $ 126.66 $ 100.56 $ 134.37 $ 112.87 Third Quarter $ 119.72 $ 93.69 $ 135.45 $ 112.86 Fourth Quarter $ 113.78 $ 94.46 $ 127.78 $ 71.84 Holders As of May 28, 2026, there were 387 holders of record of our common stock. Dividends The Company paid cash dividends of $0.52 per outstanding common share in each quarter of fiscal 2026 and fiscal 2025 for an aggregate of $413 million and $424 million, respectively, and paid cash dividends of $0.50 per outstanding common share in each quarter of fiscal 2024 for an aggregate of $416 million. On May 21, 2026, the Company declared a cash dividend of $0.52 per share of common stock, payable on July 29, 2026 to shareholders of record as of the close of business on July 10, 2026. Decisions regarding future dividends are within the discretion of our Board of Directors, and depend on a number of factors, including, general business and economic conditions, and other factors which are discussed in the "Risk Factors" in Item 1A of this Annual Report on Form 10-K. 33 33 Performance GraphThe following graph shows a comparison of cumulative total shareholder return, calculated on a dividend reinvested basis, of an investment of $100 for the Company, the S&P 500 Index, the S&P 500 Information Technology Index and the S&P 1500 Technology Hardware & Equipment Index for the five years ended April 24, 2026. The comparisons in the graphs below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. The graph and related information shall not be deemed "soliciting material" or be deemed to be "filed" with the SEC, nor shall such information be incorporated by reference into any past or future filing with the SEC, except to the extent that such filing specifically states that such graph and related information are incorporated by reference into such filing. April 2021 April 2022 April 2023 April 2024 April 2025 April 2026 NetApp, Inc. $ 100.00 $ 100.38 $ 88.91 $ 146.70 $ 130.57 $ 163.57 S&P 500 Index $ 100.00 $ 100.21 $ 102.88 $ 127.80 $ 140.33 $ 184.25 S&P 500 Information Technology Index $ 100.00 $ 101.89 $ 110.13 $ 154.18 $ 171.25 $ 260.29 S&P 1500 Technology Hardware & Equipment Index $ 100.00 $ 113.78 $ 120.80 $ 127.97 $ 152.61 $ 234.04 We believe that a number of factors may cause the market price of our common stock to fluctuate significantly. See Item 1A. - Risk Factors. --- ## Modified: Senior Notes Repayment **Key changes:** - Reworded sentence: "On June 23, 2025, upon maturity, we repaid the 1.875% Senior Notes due June 2025 for an aggregate amount of $757 million, comprised of the principal and unpaid interest." - Reworded sentence: "Fiscal years 2026, 2025 and 2024, which ended on April 24, 2026, April 25, 2025 and April 26, 2024, respectively, are all 52-week years, with 13 weeks in each of their quarters." **Prior (2025):** In March 2025, we issued $625 million aggregate principal amount of 5.50% Senior Notes due 2032 and $625 million aggregate principal amount of 5.70% Senior Notes due 2035, for which we received total proceeds of $1.24 billion, net of discount and issuance costs. 37 37 Results of OperationsOur fiscal year is reported on a 52- or 53-week year that ends on the last Friday in April. An additional week is included in the first fiscal quarter approximately every six years to realign fiscal months with calendar months. Fiscal years 2025, 2024 and 2023, which ended on April 25, 2025, April 26, 2024 and April 28, 2023, respectively, are all 52-week years, with 13 weeks in each of their quarters. Unless otherwise stated, references to particular years, quarters, months and periods refer to our fiscal years ended in April and the associated quarters, months and periods of those fiscal years.The following table sets forth certain Consolidated Statements of Income data as a percentage of net revenues for the periods indicated: Fiscal Year 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 Cost of revenues: Cost of product 20 18 24 Cost of services 10 11 10 Gross profit 70 71 66 Operating expenses: Sales and marketing 28 29 29 Research and development 15 16 15 General and administrative 5 5 4 Restructuring charges 1 1 2 Acquisition-related expense - - - Total operating expenses 50 51 50 Income from operations 20 19 16 Other income, net 1 1 1 Income before income taxes 21 20 17 Provision (benefit) for income taxes 3 4 (3 ) Net income 18 % 16 % 20 % Percentages may not add due to roundingDiscussion and Analysis of Results of OperationsNet Revenues (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change Net revenues $ 6,572 $ 6,268 5 % $ 6,362 (1 )% The increase in net revenues for fiscal 2025 compared to fiscal 2024 was due to an increase in both product revenues and services revenues. Product revenues as a percentage of net revenues increased by approximately one percentage point in fiscal 2025 compared to fiscal 2024, while services revenues as a percentage of net revenues decreased by approximately one percentage point.The decrease in net revenues for fiscal 2024 compared to fiscal 2023 was due to a decrease in product revenues partially offset by an increase in services revenues. Product revenues as a percentage of net revenues decreased by approximately three percentage points in fiscal 2024 compared to fiscal 2023, while services revenues as a percentage of net revenues increased by approximately three percentage points.Sales through our indirect channels represented 78%, 76% and 78% of net revenues in fiscal 2025, 2024 and 2023, respectively.The following customers, each of which is a distributor, accounted for 10% or more of net revenues: **Current (2026):** On June 23, 2025, upon maturity, we repaid the 1.875% Senior Notes due June 2025 for an aggregate amount of $757 million, comprised of the principal and unpaid interest. 38 38 Results of OperationsOur fiscal year is reported on a 52- or 53-week year that ends on the last Friday in April. An additional week is included in the first fiscal quarter approximately every six years to realign fiscal months with calendar months. Fiscal years 2026, 2025 and 2024, which ended on April 24, 2026, April 25, 2025 and April 26, 2024, respectively, are all 52-week years, with 13 weeks in each of their quarters. Unless otherwise stated, references to particular years, quarters, months and periods refer to our fiscal years ended in April and the associated quarters, months and periods of those fiscal years.The following table sets forth certain consolidated statements of income data as a percentage of net revenues for the periods indicated: Year Ended April 24, 2026 April 25, 2025 April 26, 2024 Revenues: Product 46 % 46 % 45 % Services 54 54 55 Net revenues 100 100 100 Cost of revenues: Cost of product 20 20 18 Cost of services 9 10 11 Gross profit 71 70 71 Operating expenses: Sales and marketing 27 28 29 Research and development 14 15 16 General and administrative 5 5 5 Restructuring charges - 1 1 Acquisition-related expense - - - Total operating expenses 47 50 51 Income from operations 24 20 19 Other (expense) income, net - 1 1 Income before income taxes 24 21 20 Provision for income taxes 5 3 4 Net income 18 % 18 % 16 % Percentages may not add due to roundingDiscussion and Analysis of Results of OperationsNet Revenues (in millions, except percentages): Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change Net revenues $ 6,925 $ 6,572 5 % $ 6,268 5 % The increase in net revenues for fiscal 2026 compared to fiscal 2025 was due to an increase in both product revenues and services revenues. Product and services revenues as a percentage of net revenues remained relatively flat in fiscal 2026 as compared to fiscal 2025. Fluctuations in foreign currency exchange rates favorably impacted net revenues percentage growth year-over-year by two percentage points.The increase in net revenues for fiscal 2025 compared to fiscal 2024 was due to an increase in both product revenues and services revenues. Product revenues as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, while services revenues as a percentage of net revenues decreased by one percentage point. --- ## Modified: Services revenues **Key changes:** - Reworded sentence: "$ 3,731 $ 3,532 6 % $ 3,419 3 % Support 2,636 2,512 5 % 2,488 1 % Professional and other services 407 355 15 % 320 11 % Public cloud 688 665 3 % 611 9 % Hybrid Cloud Hybrid Cloud services revenues are derived from the sale of: (1) support, which includes both hardware and software support contracts (the latter of which entitle customers to receive unspecified product upgrades and enhancements, bug fixes and patch releases), and (2) professional and other services, which include customer education and training." **Prior (2025):** $ 3,532 $ 3,419 3 % $ 3,313 3 % Support 2,512 2,488 1 % 2,419 3 % Professional and other services 355 320 11 % 319 - % Public cloud 665 611 9 % 575 6 % Hybrid Cloud Hybrid Cloud services revenues are derived from the sale of: (1) support, which includes both hardware and software support contracts (the latter of which entitle customers to receive unspecified product upgrades and enhancements, bug fixes and patch releases), and (2) professional and other services, which include customer education and training. Support revenues increased marginally in fiscal 2025 compared to fiscal 2024 and increased in fiscal 2024 compared to fiscal 2023 as a result of a higher aggregate support contract value for our installed base. Professional and other services revenues increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in revenues from our Keystone storage-as-a-service offering and remained relatively flat in fiscal 2024 compared to fiscal 2023. Public Cloud 39 39 Public Cloud revenues are derived from the sale of public cloud offerings delivered primarily as-a-service, which include cloud storage, data services and operational services.Public Cloud revenues increased in fiscal 2025 and fiscal 2024 compared to the respective prior years primarily due to customer demand for NetApp's diversified cloud offerings, coupled with overall growth in the cloud market.Revenues by Geographic Area: Fiscal Year 2025 2024 2023 United States, Canada and Latin America (Americas) 51 % 51 % 51 % Europe, Middle East and Africa (EMEA) 34 % 34 % 34 % Asia Pacific (APAC) 15 % 15 % 15 % Percentages may not add due to rounding Americas revenues consist of sales to Americas commercial and United States (U.S.) public sector markets. Demand across geographies was relatively consistent for each fiscal year presented.Cost of RevenuesOur cost of revenues consists of: (1) cost of product revenues, composed of (a) cost of Hybrid Cloud product revenues, which includes the costs of manufacturing and shipping our products, inventory write-downs, and warranty costs, and (b) unallocated cost of product revenues, which includes stock-based compensation and amortization of intangibles, and;(2) cost of services revenues, composed of (a) cost of support revenues, which includes the costs of providing support activities for hardware and software support, global support partnership programs, and third party royalty costs, (b) cost of professional and other services revenues, (c) cost of public cloud revenues, constituting the cost of providing our Public Cloud offerings which includes depreciation and amortization expense and third party datacenter fees, and (d) unallocated cost of services revenues, which includes stock-based compensation and amortization of intangibles. Cost of Product Revenues (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change Cost of product revenues $ 1,284 $ 1,137 13 % $ 1,517 (25 )% Hybrid Cloud 1,278 1,131 13 % 1,511 (25 )% Unallocated 6 6 - % 6 - % Hybrid CloudCost of Hybrid Cloud product revenues represented 42%, 40% and 50% of Hybrid Cloud product revenues in fiscal 2025, 2024 and 2023, respectively. Materials costs represented 89%, 88% and 94% of cost of Hybrid Cloud product revenues in fiscal 2025, 2024 and 2023, respectively.Materials costs increased by $140 million in fiscal 2025 compared to fiscal 2024 primarily reflecting the increase in product revenues.Hybrid Cloud product gross margins decreased by approximately two percentage points in fiscal 2025 compared to fiscal 2024 primarily due to higher component costs.Materials costs decreased by $418 million in fiscal 2024 compared to fiscal 2023 reflecting lower component and freight costs as a result of supply chain improvements. Materials costs were also impacted by the decrease in product revenues in fiscal 2024.Hybrid Cloud product gross margins increased by approximately ten percentage points in fiscal 2024 compared to fiscal 2023 primarily due to lower component and freight costs.Unallocated Public Cloud revenues are derived from the sale of public cloud offerings delivered primarily as-a-service, which include cloud storage, data services and operational services. Public Cloud revenues increased in fiscal 2025 and fiscal 2024 compared to the respective prior years primarily due to customer demand for NetApp's diversified cloud offerings, coupled with overall growth in the cloud market. **Current (2026):** $ 3,731 $ 3,532 6 % $ 3,419 3 % Support 2,636 2,512 5 % 2,488 1 % Professional and other services 407 355 15 % 320 11 % Public cloud 688 665 3 % 611 9 % Hybrid Cloud Hybrid Cloud services revenues are derived from the sale of: (1) support, which includes both hardware and software support contracts (the latter of which entitle customers to receive unspecified product upgrades and enhancements, bug fixes and patch releases), and (2) professional and other services, which include customer education and training. Support revenues increased in fiscal 2026 compared to fiscal 2025 primarily due to a higher aggregate support contract value for our installed base and the favorable impact from foreign exchange rate fluctuations. Support revenues increased marginally in fiscal 2025 compared to fiscal 2024. Professional and other services revenues increased in fiscal 2026 and fiscal 2025 compared to the respective prior years primarily reflecting higher revenues from our Keystone Storage-as-a-Service offering. Public Cloud Public Cloud revenues are derived from the sale of public cloud offerings delivered primarily as-a-service, which include cloud storage, data services and operational services. Public Cloud revenues increased in fiscal 2026 and fiscal 2025 compared to the respective prior years primarily due to higher customer demand, driven by NetApp's diversified cloud offerings and overall growth in the cloud market. The smaller increase in fiscal 2026 reflects the loss of revenue from our Spot by NetApp business which we sold in the fourth quarter of fiscal 2025. 40 40 Hybrid Cloud Segment Net Revenues by Storage Category (in millions, except percentages):The following table presents Hybrid Cloud segment net revenues by storage category for the periods indicated: Year Ended April 24, 2026 April 25, 2025 April 26, 2024 Hybrid Cloud segment net revenues $ 6,237 $ 5,907 $ 5,657 All-flash revenues as a percentage of Hybrid Cloud segment net revenues 67 % 64 % 58 % Hybrid-flash and other revenues as a percentage of Hybrid Cloud segment net revenues 33 % 36 % 42 % Percentages may not add due to roundingThe increases in all-flash revenues (comprised of all-flash product and related service revenues) as a percentage of total Hybrid Cloud segment net revenues for fiscal 2026 and fiscal 2025 as compared to the respective prior years reflect growing customer demand for our all-flash storage solutions, aided by all-flash market expansion. Net Revenues by Geographic Area: Year Ended April 24, 2026 April 25, 2025 April 26, 2024 United States, Canada and Latin America (Americas) 51 % 51 % 51 % Americas Commercial 41 % 40 % 40 % U.S. Public Sector 10 % 11 % 11 % Europe, Middle East and Africa (EMEA) 34 % 34 % 34 % Asia Pacific (APAC) 15 % 15 % 15 % Percentages may not add due to roundingSales to United States (U.S.) public sector markets includes revenue from the U.S. federal government and U.S. state governments, local municipalities and education institutions. Demand across geographies was relatively consistent for each fiscal year presented.Cost of RevenuesOur cost of revenues consists of: (1) cost of product revenues, composed of (a) cost of Hybrid Cloud product revenues, which includes the costs of manufacturing and shipping our products, inventory write-downs, and warranty costs, and (b) unallocated cost of product revenues, which includes stock-based compensation, and;(2) cost of services revenues, composed of (a) cost of support revenues, which includes the costs of providing support activities for hardware and software support, global support partnership programs, and third-party royalty costs, (b) cost of professional and other services revenues, constituting the cost of delivering such services which includes depreciation expense, (c) cost of public cloud revenues, constituting the cost of providing our Public Cloud offerings which includes depreciation and amortization expense and third-party datacenter fees, and (d) unallocated cost of services revenues, which includes stock-based compensation and amortization of intangibles. Cost of Product Revenues (in millions, except percentages): Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change Cost of product revenues $ 1,401 $ 1,284 9 % $ 1,137 13 % Hybrid Cloud 1,395 1,278 9 % 1,131 13 % Unallocated 6 6 - % 6 - % --- ## Modified: Cost of services revenues **Key changes:** - Reworded sentence: "$ 625 $ 675 (7 )% $ 698 (3 )% Support 198 197 1 % 195 1 % Professional and other services 281 261 8 % 243 7 % Public cloud 113 165 (32 )% 203 (19 )% Unallocated 33 52 (37 )% 57 (9 )% Hybrid Cloud Cost of Hybrid Cloud services revenues, which are composed of the costs of support and professional and other services, increased in fiscal 2026 and fiscal 2025 compared to the respective prior years reflecting the increase in Hybrid Cloud services revenues." - Reworded sentence: "Included in compensation costs are salaries, benefits, other compensation-related costs, stock-based compensation expense and employee incentive compensation plan costs.Total compensation costs included in sales and marketing, research and development and general and administrative expenses remained relatively flat in fiscal 2026, 2025 and 2024." **Prior (2025):** Sales and Marketing, Research and Development and General and Administrative Expenses Sales and marketing, research and development, and general and administrative expenses for fiscal 2025 totaled $3,188 million, or 49% of net revenues, representing a decrease of one percentage point compared to fiscal 2024. Sales and marketing, research and development, and general and administrative expenses for fiscal 2024 totaled $3,165 million, or 50% of net revenues, representing an increase of two percentage points compared to fiscal 2023. Compensation costs represent the largest component of operating expenses. Included in compensation costs are salaries, benefits, other compensation-related costs, stock-based compensation expense and employee incentive compensation plan costs. Total compensation costs included in sales and marketing, research and development and general and administrative expenses in fiscal 2025 were relatively flat compared to fiscal 2024. Total compensation costs included in sales and marketing, research and development and general and administrative expenses increased by $115 million, or 6%, during fiscal 2024 compared to fiscal 2023, primarily due to higher incentive compensation expense 41 41 reflecting higher operating performance against goals. The increase was partially offset by lower salaries expense, reflecting a decrease in average headcount of 7%.Sales and Marketing (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change Sales and marketing expenses $ 1,865 $ 1,828 2 % $ 1,829 - % Sales and marketing expenses consist primarily of compensation costs, commissions, outside services, facilities and IT support costs, advertising and marketing promotional expense and travel and entertainment expense. The increase in sales and marketing expenses in fiscal 2025 compared to fiscal 2024 was primarily due to an increase in sales commission expenses.All primary components of sales and marketing expenses were relatively consistent in fiscal 2024 compared to fiscal 2023.Research and Development (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change Research and development expenses $ 1,012 $ 1,029 (2 )% $ 956 8 % Research and development expenses consist primarily of compensation costs, facilities and IT support costs, depreciation, equipment and software related costs, prototypes, non-recurring engineering charges and other outside services costs. The decrease in research and development expenses in fiscal 2025 compared to fiscal 2024 was primarily due to lower compensation costs.The increase in research and development expenses in fiscal 2024 compared to fiscal 2023 was primarily due to higher compensation costs, attributable to higher incentive compensation expense and stock-based compensation expense, partially offset by lower salaries expense, reflecting a decrease in average headcount of 5%. General and Administrative (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change General and administrative expenses $ 311 $ 308 1 % $ 265 16 % General and administrative expenses consist primarily of compensation costs, professional and corporate legal fees, outside services and facilities and IT support costs. General and administrative expenses remained relatively flat in fiscal 2025 compared to fiscal 2024.The increase in general and administrative expenses in fiscal 2024 compared to fiscal 2023 was attributable to increases in all components of compensation costs, but predominately incentive compensation expense. Professional and legal fees and outside services expense was also slightly higher in fiscal 2024 due to higher spending on certain business transformation projects. Restructuring Charges (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change Restructuring charges $ 83 $ 44 89 % $ 120 (63 )% reflecting higher operating performance against goals. The increase was partially offset by lower salaries expense, reflecting a decrease in average headcount of 7%. Sales and Marketing (in millions, except percentages): **Current (2026):** $ 625 $ 675 (7 )% $ 698 (3 )% Support 198 197 1 % 195 1 % Professional and other services 281 261 8 % 243 7 % Public cloud 113 165 (32 )% 203 (19 )% Unallocated 33 52 (37 )% 57 (9 )% Hybrid Cloud Cost of Hybrid Cloud services revenues, which are composed of the costs of support and professional and other services, increased in fiscal 2026 and fiscal 2025 compared to the respective prior years reflecting the increase in Hybrid Cloud services revenues. Cost of Hybrid Cloud services revenues represented 16% of Hybrid Cloud services revenues in fiscal 2026, 2025 and 2024. Hybrid Cloud support gross margins were similar in fiscal 2026, fiscal 2025 and fiscal 2024. Hybrid Cloud professional and other services gross margins increased by five percentage points in fiscal 2026 compared to fiscal 2025 and by two percentage points in fiscal 2025 compared to fiscal 2024 primarily due to the mix of services provided in each year. Public Cloud Cost of Public Cloud revenues decreased, while Public Cloud gross margins increased by eight percentage points, in fiscal 2026 and fiscal 2025 compared to the respective prior years. These fluctuations were due to cost optimization that included a decrease in fixed assets depreciation, and the mix of offerings provided which was impacted by the sale of our Spot by NetApp business in the fourth quarter of fiscal 2025. Unallocated Unallocated cost of services revenues decreased in fiscal 2026 and fiscal 2025 compared to the respective prior years due to the derecognition of certain intangible assets resulting from the sale of our Spot by NetApp business during the fourth quarter of fiscal 2025. 42 42 Operating ExpensesSales and Marketing, Research and Development and General and Administrative ExpensesSales and marketing, research and development, and general and administrative expenses for fiscal 2026 totaled $3,204 million, or 46% of net revenues, representing a decrease of three percentage points compared to fiscal 2025, primarily due to an increase in net revenues. While fluctuations in foreign currency exchange rates favorably impacted net revenues in fiscal 2026 compared to fiscal 2025, they adversely impacted sales and marketing, research and development and general and administrative expenses.Sales and marketing, research and development, and general and administrative expenses for fiscal 2025 totaled $3,188 million, or 49% of net revenues, representing a decrease of one percentage point compared to fiscal 2024. Compensation costs represent the largest component of operating expenses. Included in compensation costs are salaries, benefits, other compensation-related costs, stock-based compensation expense and employee incentive compensation plan costs.Total compensation costs included in sales and marketing, research and development and general and administrative expenses remained relatively flat in fiscal 2026, 2025 and 2024. Sales and Marketing (in millions, except percentages): Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change Sales and marketing expenses $ 1,869 $ 1,865 - % $ 1,828 2 % Sales and marketing expenses consist primarily of compensation costs, commissions, outside services, facilities and IT support costs, advertising and marketing promotional expense and travel and entertainment expense. Sales and marketing expenses in fiscal 2026 were relatively flat compared to fiscal 2025. The increase in sales and marketing expenses in fiscal 2025 compared to fiscal 2024 was primarily due to an increase in sales commission expenses.Research and Development (in millions, except percentages): Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change Research and development expenses $ 991 $ 1,012 (2 )% $ 1,029 (2 )% Research and development expenses consist primarily of compensation costs, facilities and IT support costs, depreciation, equipment and software related costs, prototypes, non-recurring engineering charges and other outside services costs. The decrease in research and development expenses in fiscal 2026 compared to fiscal 2025 was primarily attributable to lower compensation costs and lower spend on engineering projects. The decrease in research and development expenses in fiscal 2025 compared to fiscal 2024 was primarily due to lower compensation costs.General and Administrative (in millions, except percentages): Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change General and administrative expenses $ 344 $ 311 11 % $ 308 1 % General and administrative expenses consist primarily of compensation costs, professional and corporate legal fees, outside services and facilities and IT support costs. The increase in general and administrative expenses in fiscal 2026 compared to fiscal 2025 was primarily due to increases in all components of compensation costs, predominately salaries and stock-based compensation expense, and higher spend on professional services. General and administrative expenses remained relatively flat in fiscal 2025 compared to fiscal 2024. --- ## Modified: April 25, 2025 **Key changes:** - Reworded sentence: "Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues." **Prior (2025):** Deferred revenue and financed unearned services revenue $ 4,536 $ 4,234 36 36 •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues.•Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues.•Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues.•Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year.•Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above.Stock Repurchase Program and Dividend ActivityDuring fiscal 2025, we repurchased 10.2 million shares of our common stock at an average price of $112.55 per share, for an aggregate purchase price of $1.2 billion. We also declared aggregate cash dividends of $2.08 per share in fiscal 2025, for which we paid a total of $424 million.Restructuring EventsDuring fiscal 2025, we executed several restructuring plans and recognized expenses totaling $83 million consisting primarily of employee severance-related costs. Senior Notes IssuanceIn March 2025, we issued $625 million aggregate principal amount of 5.50% Senior Notes due 2032 and $625 million aggregate principal amount of 5.70% Senior Notes due 2035, for which we received total proceeds of $1.24 billion, net of discount and issuance costs. •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. •Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. **Current (2026):** Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. •Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. --- ## Modified: IncomeClassifications **Key changes:** - Reworded sentence: "Developed technology $ 11 $ 28 $ 34 Cost of revenues Customer contracts/relationships 10 19 22 Operating expenses Other purchased intangibles - - 1 Operating expenses Total $ 21 $ 47 $ 57 As of April 24, 2026, future amortization expense related to purchased intangible assets is as follows (in millions): As of April 24, 2026, future amortization expense related to purchased intangible assets is as follows (in millions):" **Prior (2025):** Developed technology $ 28 $ 34 $ 42 Cost of revenues Customer contracts/relationships 19 22 24 Operating expenses Other purchased intangibles - 1 2 Operating expenses Total $ 47 $ 57 $ 68 As of April 25, 2025, future amortization expense related to purchased intangible assets is as follows (in millions): Fiscal Year Amount 2026 $ 21 2027 21 2028 1 2029 - Total $ 43 As of April 25, 2025, future amortization expense related to purchased intangible assets is as follows (in millions): **Current (2026):** Developed technology $ 11 $ 28 $ 34 Cost of revenues Customer contracts/relationships 10 19 22 Operating expenses Other purchased intangibles - - 1 Operating expenses Total $ 21 $ 47 $ 57 As of April 24, 2026, future amortization expense related to purchased intangible assets is as follows (in millions): As of April 24, 2026, future amortization expense related to purchased intangible assets is as follows (in millions): --- ## Modified: Cost of product revenues **Key changes:** - Reworded sentence: "$ 1,401 $ 1,284 9 % $ 1,137 13 % Hybrid Cloud 1,395 1,278 9 % 1,131 13 % Unallocated 6 6 - % 6 - % 41 41 Hybrid CloudCost of Hybrid Cloud product revenues represented 44%, 42% and 40% of Hybrid Cloud product revenues in fiscal 2026, 2025 and 2024, respectively." - Reworded sentence: "Hybrid Cloud product gross margins decreased by two percentage points in fiscal 2026 compared to fiscal 2025 primarily due to higher component costs, partially offset by the favorable impact from a multi-year enterprise agreement." **Prior (2025):** $ 1,284 $ 1,137 13 % $ 1,517 (25 )% Hybrid Cloud 1,278 1,131 13 % 1,511 (25 )% Unallocated 6 6 - % 6 - % Hybrid Cloud Cost of Hybrid Cloud product revenues represented 42%, 40% and 50% of Hybrid Cloud product revenues in fiscal 2025, 2024 and 2023, respectively. Materials costs represented 89%, 88% and 94% of cost of Hybrid Cloud product revenues in fiscal 2025, 2024 and 2023, respectively. Materials costs increased by $140 million in fiscal 2025 compared to fiscal 2024 primarily reflecting the increase in product revenues. Hybrid Cloud product gross margins decreased by approximately two percentage points in fiscal 2025 compared to fiscal 2024 primarily due to higher component costs. Materials costs decreased by $418 million in fiscal 2024 compared to fiscal 2023 reflecting lower component and freight costs as a result of supply chain improvements. Materials costs were also impacted by the decrease in product revenues in fiscal 2024. Hybrid Cloud product gross margins increased by approximately ten percentage points in fiscal 2024 compared to fiscal 2023 primarily due to lower component and freight costs. Unallocated 40 40 Unallocated cost of product revenues were consistent for each fiscal year presented.Cost of Services Revenues (in millions, except percentages): Fiscal Year 2025 2024 % Change 2023 % Change Cost of services revenues $ 675 $ 698 (3 )% $ 636 10 % Support 197 195 1 % 181 8 % Professional and other services 261 243 7 % 211 15 % Public cloud 165 203 (19 )% 184 10 % Unallocated 52 57 (9 )% 60 (5 )% Hybrid Cloud Cost of Hybrid Cloud services revenues, which are composed of the costs of support and professional and other services, increased in fiscal 2025 and fiscal 2024 compared to the respective prior years reflecting the increase in Hybrid Cloud services revenues. Cost of Hybrid Cloud services revenues represented 16%, 16% and 14% of Hybrid Cloud services revenues in fiscal 2025, 2024 and 2023, respectively.Hybrid Cloud support gross margins were similar in fiscal 2025, fiscal 2024 and fiscal 2023. Hybrid Cloud professional and other services gross margins increased by approximately two percentage points in fiscal 2025 compared to fiscal 2024 while they decreased by approximately ten percentage points in fiscal 2024 compared to fiscal 2023 primarily due to the mix of services provided.Public CloudCost of Public Cloud revenues decreased in fiscal 2025 compared to fiscal 2024, while Public Cloud gross margins increased by eight percentage points in fiscal 2025 compared to fiscal 2024. The decrease in cost of Public Cloud revenues and improved gross margins was due to cost optimization that included a decrease in fixed assets depreciation and the mix of offerings provided.Cost of Public Cloud revenues increased in fiscal 2024 compared to fiscal 2023, reflecting the increase in Public Cloud revenues. Public Cloud gross margins decreased by one percentage point in fiscal 2024 compared to fiscal 2023 primarily due to the mix of offerings provided.Unallocated Unallocated cost of services revenues decreased in fiscal 2025 compared to fiscal 2024 due to the derecognition of certain intangible assets as a result of the sale of our cloud optimization and management software business known as Spot by NetApp during the fourth quarter of fiscal 2025. Unallocated cost of services revenues decreased in fiscal 2024 compared to fiscal 2023 due to certain intangible assets becoming fully amortized during the first quarter of fiscal 2024. Operating ExpensesSales and Marketing, Research and Development and General and Administrative ExpensesSales and marketing, research and development, and general and administrative expenses for fiscal 2025 totaled $3,188 million, or 49% of net revenues, representing a decrease of one percentage point compared to fiscal 2024. Sales and marketing, research and development, and general and administrative expenses for fiscal 2024 totaled $3,165 million, or 50% of net revenues, representing an increase of two percentage points compared to fiscal 2023.Compensation costs represent the largest component of operating expenses. Included in compensation costs are salaries, benefits, other compensation-related costs, stock-based compensation expense and employee incentive compensation plan costs.Total compensation costs included in sales and marketing, research and development and general and administrative expenses in fiscal 2025 were relatively flat compared to fiscal 2024.Total compensation costs included in sales and marketing, research and development and general and administrative expenses increased by $115 million, or 6%, during fiscal 2024 compared to fiscal 2023, primarily due to higher incentive compensation expense Unallocated cost of product revenues were consistent for each fiscal year presented. **Current (2026):** $ 1,401 $ 1,284 9 % $ 1,137 13 % Hybrid Cloud 1,395 1,278 9 % 1,131 13 % Unallocated 6 6 - % 6 - % 41 41 Hybrid CloudCost of Hybrid Cloud product revenues represented 44%, 42% and 40% of Hybrid Cloud product revenues in fiscal 2026, 2025 and 2024, respectively. Materials costs represented 91%, 89% and 88% of cost of Hybrid Cloud product revenues in fiscal 2026, 2025 and 2024, respectively.Materials costs increased by $126 million in fiscal 2026 compared to fiscal 2025 primarily reflecting the increase in product revenues and higher component costs. Materials costs increased by $140 million in fiscal 2025 compared to fiscal 2024 primarily reflecting the increase in product revenues.Hybrid Cloud product gross margins decreased by two percentage points in fiscal 2026 compared to fiscal 2025 primarily due to higher component costs, partially offset by the favorable impact from a multi-year enterprise agreement. Hybrid Cloud product gross margins decreased by two percentage points in fiscal 2025 compared to fiscal 2024 primarily due to higher component costs.In response to rising component costs, we raised our prices in the fourth quarter of fiscal 2026, which we expect to support product gross margins in early fiscal 2027. We expect to continue adjusting our pricing as necessary to align with any significant changes in component costs.UnallocatedUnallocated cost of product revenues were consistent for each fiscal year presented.Cost of Services Revenues (in millions, except percentages): Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change Cost of services revenues $ 625 $ 675 (7 )% $ 698 (3 )% Support 198 197 1 % 195 1 % Professional and other services 281 261 8 % 243 7 % Public cloud 113 165 (32 )% 203 (19 )% Unallocated 33 52 (37 )% 57 (9 )% Hybrid CloudCost of Hybrid Cloud services revenues, which are composed of the costs of support and professional and other services, increased in fiscal 2026 and fiscal 2025 compared to the respective prior years reflecting the increase in Hybrid Cloud services revenues. Cost of Hybrid Cloud services revenues represented 16% of Hybrid Cloud services revenues in fiscal 2026, 2025 and 2024.Hybrid Cloud support gross margins were similar in fiscal 2026, fiscal 2025 and fiscal 2024. Hybrid Cloud professional and other services gross margins increased by five percentage points in fiscal 2026 compared to fiscal 2025 and by two percentage points in fiscal 2025 compared to fiscal 2024 primarily due to the mix of services provided in each year. Public CloudCost of Public Cloud revenues decreased, while Public Cloud gross margins increased by eight percentage points, in fiscal 2026 and fiscal 2025 compared to the respective prior years. These fluctuations were due to cost optimization that included a decrease in fixed assets depreciation, and the mix of offerings provided which was impacted by the sale of our Spot by NetApp business in the fourth quarter of fiscal 2025.Unallocated Unallocated cost of services revenues decreased in fiscal 2026 and fiscal 2025 compared to the respective prior years due to the derecognition of certain intangible assets resulting from the sale of our Spot by NetApp business during the fourth quarter of fiscal 2025. Hybrid Cloud Cost of Hybrid Cloud product revenues represented 44%, 42% and 40% of Hybrid Cloud product revenues in fiscal 2026, 2025 and 2024, respectively. Materials costs represented 91%, 89% and 88% of cost of Hybrid Cloud product revenues in fiscal 2026, 2025 and 2024, respectively. Materials costs increased by $126 million in fiscal 2026 compared to fiscal 2025 primarily reflecting the increase in product revenues and higher component costs. Materials costs increased by $140 million in fiscal 2025 compared to fiscal 2024 primarily reflecting the increase in product revenues. Hybrid Cloud product gross margins decreased by two percentage points in fiscal 2026 compared to fiscal 2025 primarily due to higher component costs, partially offset by the favorable impact from a multi-year enterprise agreement. Hybrid Cloud product gross margins decreased by two percentage points in fiscal 2025 compared to fiscal 2024 primarily due to higher component costs. In response to rising component costs, we raised our prices in the fourth quarter of fiscal 2026, which we expect to support product gross margins in early fiscal 2027. We expect to continue adjusting our pricing as necessary to align with any significant changes in component costs. Unallocated Unallocated cost of product revenues were consistent for each fiscal year presented. --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "% Change Net revenues $ 6,925 $ 6,572 5 % $ 6,268 5 % The increase in net revenues for fiscal 2026 compared to fiscal 2025 was due to an increase in both product revenues and services revenues." **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: Recently Adopted Accounting Pronouncement **Key changes:** - Reworded sentence: "In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes." - Reworded sentence: "General macroeconomic uncertainty has led to an increase in market volatility, however, management believes that the financial institutions that hold our cash, cash equivalents and investments are financially sound and, accordingly, are subject to minimal credit risk." **Prior (2025):** In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires disclosure of incremental segment information on an annual and interim basis. We adopted this standard for our annual period beginning fiscal year 2025 on a retrospective basis to all periods presented. The adoption of this standard did not result in a significant change to our consolidated financial statement disclosures. See Note 15 - Segment, Geographic, and Significant Customer Information of the Notes to Consolidated Financial Statements for our reportable segment disclosures. 3. Concentration of RiskFinancial instruments that potentially subject us to concentrations of credit risk consist primarily of cash, cash equivalents, investments, foreign currency exchange contracts and accounts receivable. We maintain the majority of our cash and cash equivalents with several major financial institutions where the deposits exceed federally insured limits. Cash equivalents and short-term investments consist primarily of money market funds, U.S. Treasury and government debt securities and certificates of deposit, all of which are considered high investment grade. Our policy is to limit the amount of credit exposure through diversification and investment in highly rated securities. We further mitigate concentrations of credit risk in our investments by limiting our investments in the debt securities of a single issuer and by diversifying risk across geographies and type of issuer. General macroeconomic uncertainty has led to an increase in market volatility, however, management believes that the financial institutions that hold our cash, cash equivalents and investments are financially sound and, accordingly, are subject to minimal credit risk.By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. The counterparties to these contracts are major multinational commercial banks, and we do not expect any losses as a result of counterparty defaults. **Current (2026):** In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes. This includes the disclosure of specific categories and greater disaggregation within the income tax rate reconciliation as well as disclosure of disaggregated income taxes paid by significant jurisdiction. This ASU is effective for fiscal years beginning after December 15, 2024. We adopted the standard on a prospective basis for fiscal 2026. See Note 12 - Income Taxes for further information. 3. Concentration of RiskFinancial instruments that potentially subject us to concentrations of credit risk consist primarily of cash, cash equivalents, investments, foreign currency exchange contracts and accounts receivable. We maintain the majority of our cash and cash equivalents with several major financial institutions where the deposits exceed federally insured limits. Cash equivalents and short-term investments consist primarily of money market funds, U.S. Treasury and government debt securities and certificates of deposit, all of which are considered high investment grade. Our policy is to limit the amount of credit exposure through diversification and investment in highly rated securities. We further mitigate concentrations of credit risk in our investments by limiting our investments in the debt securities of a single issuer and by diversifying risk across geographies and type of issuer. General macroeconomic uncertainty has led to an increase in market volatility, however, management believes that the financial institutions that hold our cash, cash equivalents and investments are financially sound and, accordingly, are subject to minimal credit risk. --- ## Modified: Total liabilities **Key changes:** - Reworded sentence: "9,393 9,783 Commitments and contingencies (Note 16) Commitments and contingencies (Note 16) Commitments and contingencies (Note 16) Commitments and contingencies (Note 16) Stockholders' equity: Preferred stock, $0.001 par value, 5 shares authorized; no shares issued or outstanding as of April 24, 2026 or April 25, 2025 - - Common stock and additional paid-in capital, $0.001 par value, 885 shares authorized; 196 and 201 shares issued and outstanding as of April 24, 2026 and April 25, 2025, respectively 1,209 1,106 Retained earnings 153 - Accumulated other comprehensive loss (11 ) (66 )" **Prior (2025):** 9,783 8,741 Commitments and contingencies (Note 17) Commitments and contingencies (Note 17) Commitments and contingencies (Note 17) Commitments and contingencies (Note 17) Stockholders' equity: Preferred stock, $0.001 par value, 5 shares authorized; no shares issued or outstanding as of April 25, 2025 or April 26, 2024 - - Common stock and additional paid-in capital, $0.001 par value, 885 shares authorized; 201 and 206 shares issued and outstanding as of April 25, 2025 and April 26, 2024, respectively 1,106 997 Retained earnings - 208 Accumulated other comprehensive loss (66 ) (59 ) **Current (2026):** 9,393 9,783 Commitments and contingencies (Note 16) Commitments and contingencies (Note 16) Commitments and contingencies (Note 16) Commitments and contingencies (Note 16) Stockholders' equity: Preferred stock, $0.001 par value, 5 shares authorized; no shares issued or outstanding as of April 24, 2026 or April 25, 2025 - - Common stock and additional paid-in capital, $0.001 par value, 885 shares authorized; 196 and 201 shares issued and outstanding as of April 24, 2026 and April 25, 2025, respectively 1,209 1,106 Retained earnings 153 - Accumulated other comprehensive loss (11 ) (66 ) --- ## Modified: Other (Expense) Income, Net (in millions, except percentages) **Key changes:** - Reworded sentence: "The components of other (expense) income, net were as follows: Year Ended" **Prior (2025):** The components of other income, net were as follows: **Current (2026):** The components of other (expense) income, net were as follows: Year Ended --- ## Modified: Cash flows from operating activities: **Key changes:** - Reworded sentence: "Net income $ 1,276 $ 1,186 $ 986 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 200 243 255 Non-cash operating lease cost 42 41 45 Stock-based compensation 382 386 357 Deferred income taxes 135 (100 ) 53 Other items, net 55 - (13 ) Changes in assets and liabilities: Accounts receivable (36 ) (219 ) (33 ) Inventories (12 ) (1 ) (18 ) Other operating assets (248 ) (87 ) (62 ) Accounts payable 31 (8 ) 123 Accrued expenses (23 ) 62 113 Deferred revenue 281 208 (14 ) Long-term taxes payable (7 ) (207 ) (106 ) Other operating liabilities (9 ) 2 (1 ) Net cash provided by operating activities 2,067 1,506 1,685" **Prior (2025):** Net income $ 1,186 $ 986 $ 1,274 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 243 255 248 Non-cash operating lease cost 41 45 52 Stock-based compensation 386 357 312 Deferred income taxes (100 ) 53 (606 ) Other items, net - (13 ) (67 ) Changes in assets and liabilities, net of acquisitions of businesses: Accounts receivable (219 ) (33 ) 260 Inventories (1 ) (18 ) 37 Other operating assets (87 ) (62 ) (63 ) Accounts payable (8 ) 123 (207 ) Accrued expenses 62 113 (103 ) Deferred revenue and financed unearned services revenue 208 (14 ) 46 Long-term taxes payable (207 ) (106 ) (76 ) Other operating liabilities 2 (1 ) - Net cash provided by operating activities 1,506 1,685 1,107 **Current (2026):** Net income $ 1,276 $ 1,186 $ 986 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 200 243 255 Non-cash operating lease cost 42 41 45 Stock-based compensation 382 386 357 Deferred income taxes 135 (100 ) 53 Other items, net 55 - (13 ) Changes in assets and liabilities: Accounts receivable (36 ) (219 ) (33 ) Inventories (12 ) (1 ) (18 ) Other operating assets (248 ) (87 ) (62 ) Accounts payable 31 (8 ) 123 Accrued expenses (23 ) 62 113 Deferred revenue 281 208 (14 ) Long-term taxes payable (7 ) (207 ) (106 ) Other operating liabilities (9 ) 2 (1 ) Net cash provided by operating activities 2,067 1,506 1,685 --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "United States, Canada and Latin America (Americas) 51 % 51 % 51 % Americas Commercial 41 % 40 % 40 % U.S." **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: Amortization **Key changes:** - Reworded sentence: "Assets Developed technology $ 55 $ (44 ) $ 11 $ 55 $ (33 ) $ 22 Customer contracts/relationships 50 (39 ) 11 50 (29 ) 21 Other purchased intangibles 2 (2 ) - 2 (2 ) - Total purchased intangible assets $ 107 $ (85 ) $ 22 $ 107 $ (64 ) $ 43 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 24, 2026 April 25, 2025 April 26, 2024 IncomeClassifications Developed technology $ 11 $ 28 $ 34 Cost of revenues Customer contracts/relationships 10 19 22 Operating expenses Other purchased intangibles - - 1 Operating expenses Total $ 21 $ 47 $ 57 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended" **Prior (2025):** Assets Developed technology $ 55 $ (33 ) $ 22 $ 179 $ (108 ) $ 71 Customer contracts/relationships 50 (29 ) 21 114 (62 ) 52 Other purchased intangibles 2 (2 ) - 6 (5 ) 1 Total purchased intangible assets $ 107 $ (64 ) $ 43 $ 299 $ (175 ) $ 124 During fiscal 2025, we retired $25 million of fully amortized intangible assets. We also derecognized certain intangible assets, net in connection with the sale of our Spot by NetApp business. See "Gains/losses on the sale or derecognition of assets" section contained in Note 6 - Supplemental Financial Information for additional information related to this derecognition. Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 25, 2025 April 26, 2024 April 28, 2023 IncomeClassifications Developed technology $ 28 $ 34 $ 42 Cost of revenues Customer contracts/relationships 19 22 24 Operating expenses Other purchased intangibles - 1 2 Operating expenses Total $ 47 $ 57 $ 68 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended **Current (2026):** Assets Developed technology $ 55 $ (44 ) $ 11 $ 55 $ (33 ) $ 22 Customer contracts/relationships 50 (39 ) 11 50 (29 ) 21 Other purchased intangibles 2 (2 ) - 2 (2 ) - Total purchased intangible assets $ 107 $ (85 ) $ 22 $ 107 $ (64 ) $ 43 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 24, 2026 April 25, 2025 April 26, 2024 IncomeClassifications Developed technology $ 11 $ 28 $ 34 Cost of revenues Customer contracts/relationships 10 19 22 Operating expenses Other purchased intangibles - - 1 Operating expenses Total $ 21 $ 47 $ 57 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended --- ## Modified: LIABILITIES AND STOCKHOLDERS' EQUITY **Key changes:** - Reworded sentence: "Current liabilities: Accounts payable $ 550 $ 511 Accrued expenses 1,151 1,122 Current portion of long-term debt - 750 Short-term deferred revenue 2,320 2,279 Total current liabilities 4,021 4,662 Long-term debt 2,487 2,485 Other long-term liabilities 360 379 Long-term deferred revenue 2,525 2,257" **Prior (2025):** Current liabilities: Accounts payable $ 511 $ 517 Accrued expenses 1,122 1,013 Current portion of long-term debt 750 400 Short-term deferred revenue and financed unearned services revenue 2,279 2,176 Total current liabilities 4,662 4,106 Long-term debt 2,485 1,992 Other long-term liabilities 379 585 Long-term deferred revenue and financed unearned services revenue 2,257 2,058 **Current (2026):** Current liabilities: Accounts payable $ 550 $ 511 Accrued expenses 1,151 1,122 Current portion of long-term debt - 750 Short-term deferred revenue 2,320 2,279 Total current liabilities 4,021 4,662 Long-term debt 2,487 2,485 Other long-term liabilities 360 379 Long-term deferred revenue 2,525 2,257 --- ## Modified: 3. Concentration of Risk **Key changes:** - Reworded sentence: "64 64 By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts." - Reworded sentence: "Goodwill and Purchased Intangible Assets, NetGoodwill activity by reportable segment is summarized as follows (in millions): Hybrid Cloud Public Cloud Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment." - Added sentence: "By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts." - Added sentence: "The counterparties to these contracts are major multinational commercial banks, and we do not expect any losses as a result of counterparty defaults." - Reworded sentence: "Goodwill and Purchased Intangible Assets, NetGoodwill activity by reportable segment is summarized as follows (in millions): Hybrid Cloud Public Cloud Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment." **Prior (2025):** Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash, cash equivalents, investments, foreign currency exchange contracts and accounts receivable. We maintain the majority of our cash and cash equivalents with several major financial institutions where the deposits exceed federally insured limits. Cash equivalents and short-term investments consist primarily of money market funds, U.S. Treasury and government debt securities and certificates of deposit, all of which are considered high investment grade. Our policy is to limit the amount of credit exposure through diversification and investment in highly rated securities. We further mitigate concentrations of credit risk in our investments by limiting our investments in the debt securities of a single issuer and by diversifying risk across geographies and type of issuer. General macroeconomic uncertainty has led to an increase in market volatility, however, management believes that the financial institutions that hold our cash, cash equivalents and investments are financially sound and, accordingly, are subject to minimal credit risk. By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. The counterparties to these contracts are major multinational commercial banks, and we do not expect any losses as a result of counterparty defaults. 65 65 We sell our products primarily to large organizations in different industries and geographies. We do not require collateral or other security to support accounts receivable. In addition, we maintain an allowance for potential credit losses. To reduce credit risk, we perform ongoing credit evaluations on our customers' financial condition. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends and other information, including the expected impact of macroeconomic disruptions, and, to date, such losses have been within management's expectations. Concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers who are dispersed across many geographic regions.There are no concentrations of business transacted with a particular market that would severely impact our business in the near term. However, we rely on a limited number of suppliers for certain key components and a few key contract manufacturers to manufacture most of our products; any disruption, or termination of these arrangements could materially adversely affect our operating results.4. Business Combinations Fiscal 2023 Acquisition Instaclustr AcquisitionOn May 20, 2022, we acquired all the outstanding shares of privately-held Instaclustr US Holding, Inc. (Instaclustr) for $498 million. Instaclustr is a leading platform provider of fully managed open-source database, pipeline and workflow applications delivered as-a-service.The acquisition-date values of the assets acquired and liabilities assumed are as follows (in millions): Amount Cash $ 4 Intangible assets 107 Goodwill 413 Other assets 19 Total assets acquired 543 Liabilities assumed (45 ) Total purchase price $ 498 The components of the intangible assets acquired were as follows (in millions, except useful life): Amount Estimated useful life(years) Developed technology $ 55 5 Customer contracts/relationships 50 5 Trade name 2 3 Total intangible assets $ 107 The acquired net assets and assumed debt of Instaclustr were recorded at their estimated values. We determined the estimated values with the assistance of valuations and appraisals performed by third party specialists and estimates made by management. We expect to realize revenue synergies and anticipate opportunities for growth through the ability to leverage additional future products and capabilities. These factors, among others, contributed to a purchase price in excess of the estimated value of its identifiable net assets acquired, and as a result, we have recorded goodwill in connection with the acquisition. The goodwill is not deductible for income tax purposes. The results of operations related to the acquisition of Instaclustr have been included in our consolidated statements of income from the acquisition date. Pro forma results of operations have not been presented because the impact from the acquisition was not material to our consolidated results of operations. We sell our products primarily to large organizations in different industries and geographies. We do not require collateral or other security to support accounts receivable. In addition, we maintain an allowance for potential credit losses. To reduce credit risk, we perform ongoing credit evaluations on our customers' financial condition. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends and other information, including the expected impact of macroeconomic disruptions, and, to date, such losses have been within management's expectations. Concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers who are dispersed across many geographic regions.There are no concentrations of business transacted with a particular market that would severely impact our business in the near term. However, we rely on a limited number of suppliers for certain key components and a few key contract manufacturers to manufacture most of our products; any disruption, or termination of these arrangements could materially adversely affect our operating results. We sell our products primarily to large organizations in different industries and geographies. We do not require collateral or other security to support accounts receivable. In addition, we maintain an allowance for potential credit losses. To reduce credit risk, we perform ongoing credit evaluations on our customers' financial condition. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends and other information, including the expected impact of macroeconomic disruptions, and, to date, such losses have been within management's expectations. Concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers who are dispersed across many geographic regions. There are no concentrations of business transacted with a particular market that would severely impact our business in the near term. However, we rely on a limited number of suppliers for certain key components and a few key contract manufacturers to manufacture most of our products; any disruption, or termination of these arrangements could materially adversely affect our operating results. 4. Business Combinations Fiscal 2023 Acquisition Instaclustr AcquisitionOn May 20, 2022, we acquired all the outstanding shares of privately-held Instaclustr US Holding, Inc. (Instaclustr) for $498 million. Instaclustr is a leading platform provider of fully managed open-source database, pipeline and workflow applications delivered as-a-service.The acquisition-date values of the assets acquired and liabilities assumed are as follows (in millions): Amount Cash $ 4 Intangible assets 107 Goodwill 413 Other assets 19 Total assets acquired 543 Liabilities assumed (45 ) Total purchase price $ 498 The components of the intangible assets acquired were as follows (in millions, except useful life): Amount Estimated useful life(years) Developed technology $ 55 5 Customer contracts/relationships 50 5 Trade name 2 3 Total intangible assets $ 107 The acquired net assets and assumed debt of Instaclustr were recorded at their estimated values. We determined the estimated values with the assistance of valuations and appraisals performed by third party specialists and estimates made by management. We expect to realize revenue synergies and anticipate opportunities for growth through the ability to leverage additional future products and capabilities. These factors, among others, contributed to a purchase price in excess of the estimated value of its identifiable net assets acquired, and as a result, we have recorded goodwill in connection with the acquisition. The goodwill is not deductible for income tax purposes. The results of operations related to the acquisition of Instaclustr have been included in our consolidated statements of income from the acquisition date. Pro forma results of operations have not been presented because the impact from the acquisition was not material to our consolidated results of operations. **Current (2026):** Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash, cash equivalents, investments, foreign currency exchange contracts and accounts receivable. We maintain the majority of our cash and cash equivalents with several major financial institutions where the deposits exceed federally insured limits. Cash equivalents and short-term investments consist primarily of money market funds, U.S. Treasury and government debt securities and certificates of deposit, all of which are considered high investment grade. Our policy is to limit the amount of credit exposure through diversification and investment in highly rated securities. We further mitigate concentrations of credit risk in our investments by limiting our investments in the debt securities of a single issuer and by diversifying risk across geographies and type of issuer. General macroeconomic uncertainty has led to an increase in market volatility, however, management believes that the financial institutions that hold our cash, cash equivalents and investments are financially sound and, accordingly, are subject to minimal credit risk. 64 64 By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. The counterparties to these contracts are major multinational commercial banks, and we do not expect any losses as a result of counterparty defaults.We sell our products primarily to large organizations in different industries and geographies. We do not require collateral or other security to support accounts receivable. In addition, we maintain an allowance for potential credit losses. To reduce credit risk, we perform ongoing credit evaluations on our customers' financial condition. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends and other information, including the expected impact of macroeconomic disruptions, and, to date, such losses have been within management's expectations. Concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers who are dispersed across many geographic regions.There are no concentrations of business transacted with a particular market that would severely impact our business in the near term. However, we rely on a limited number of suppliers for certain key components and a few key contract manufacturers to manufacture most of our products; any disruption, or termination of these arrangements could materially adversely affect our operating results.4. Goodwill and Purchased Intangible Assets, NetGoodwill activity by reportable segment is summarized as follows (in millions): Hybrid Cloud Public Cloud Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment. See "Gains/losses on the sale or derecognition of assets" section contained in Note 5 - Supplemental Financial Information for additional information related to this derecognition. Purchased intangible assets, net are summarized below (in millions): April 24, 2026 April 25, 2025 Gross Accumulated Net Gross Accumulated Net Assets Amortization Assets Assets Amortization Assets Developed technology $ 55 $ (44 ) $ 11 $ 55 $ (33 ) $ 22 Customer contracts/relationships 50 (39 ) 11 50 (29 ) 21 Other purchased intangibles 2 (2 ) - 2 (2 ) - Total purchased intangible assets $ 107 $ (85 ) $ 22 $ 107 $ (64 ) $ 43 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 24, 2026 April 25, 2025 April 26, 2024 IncomeClassifications Developed technology $ 11 $ 28 $ 34 Cost of revenues Customer contracts/relationships 10 19 22 Operating expenses Other purchased intangibles - - 1 Operating expenses Total $ 21 $ 47 $ 57 As of April 24, 2026, future amortization expense related to purchased intangible assets is as follows (in millions): By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. The counterparties to these contracts are major multinational commercial banks, and we do not expect any losses as a result of counterparty defaults.We sell our products primarily to large organizations in different industries and geographies. We do not require collateral or other security to support accounts receivable. In addition, we maintain an allowance for potential credit losses. To reduce credit risk, we perform ongoing credit evaluations on our customers' financial condition. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends and other information, including the expected impact of macroeconomic disruptions, and, to date, such losses have been within management's expectations. Concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers who are dispersed across many geographic regions.There are no concentrations of business transacted with a particular market that would severely impact our business in the near term. However, we rely on a limited number of suppliers for certain key components and a few key contract manufacturers to manufacture most of our products; any disruption, or termination of these arrangements could materially adversely affect our operating results. By entering into foreign currency exchange contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. The counterparties to these contracts are major multinational commercial banks, and we do not expect any losses as a result of counterparty defaults. We sell our products primarily to large organizations in different industries and geographies. We do not require collateral or other security to support accounts receivable. In addition, we maintain an allowance for potential credit losses. To reduce credit risk, we perform ongoing credit evaluations on our customers' financial condition. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends and other information, including the expected impact of macroeconomic disruptions, and, to date, such losses have been within management's expectations. Concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers who are dispersed across many geographic regions. There are no concentrations of business transacted with a particular market that would severely impact our business in the near term. However, we rely on a limited number of suppliers for certain key components and a few key contract manufacturers to manufacture most of our products; any disruption, or termination of these arrangements could materially adversely affect our operating results. 4. Goodwill and Purchased Intangible Assets, NetGoodwill activity by reportable segment is summarized as follows (in millions): Hybrid Cloud Public Cloud Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment. See "Gains/losses on the sale or derecognition of assets" section contained in Note 5 - Supplemental Financial Information for additional information related to this derecognition. Purchased intangible assets, net are summarized below (in millions): April 24, 2026 April 25, 2025 Gross Accumulated Net Gross Accumulated Net Assets Amortization Assets Assets Amortization Assets Developed technology $ 55 $ (44 ) $ 11 $ 55 $ (33 ) $ 22 Customer contracts/relationships 50 (39 ) 11 50 (29 ) 21 Other purchased intangibles 2 (2 ) - 2 (2 ) - Total purchased intangible assets $ 107 $ (85 ) $ 22 $ 107 $ (64 ) $ 43 Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 24, 2026 April 25, 2025 April 26, 2024 IncomeClassifications Developed technology $ 11 $ 28 $ 34 Cost of revenues Customer contracts/relationships 10 19 22 Operating expenses Other purchased intangibles - - 1 Operating expenses Total $ 21 $ 47 $ 57 As of April 24, 2026, future amortization expense related to purchased intangible assets is as follows (in millions): --- ## Modified: Public Cloud **Key changes:** - Reworded sentence: "Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment." **Prior (2025):** Developed technology $ 55 5 5 Customer contracts/relationships 50 5 5 Trade name 2 3 3 Total intangible assets $ 107 The acquired net assets and assumed debt of Instaclustr were recorded at their estimated values. We determined the estimated values with the assistance of valuations and appraisals performed by third party specialists and estimates made by management. We expect to realize revenue synergies and anticipate opportunities for growth through the ability to leverage additional future products and capabilities. These factors, among others, contributed to a purchase price in excess of the estimated value of its identifiable net assets acquired, and as a result, we have recorded goodwill in connection with the acquisition. The goodwill is not deductible for income tax purposes. The results of operations related to the acquisition of Instaclustr have been included in our consolidated statements of income from the acquisition date. Pro forma results of operations have not been presented because the impact from the acquisition was not material to our consolidated results of operations. 66 66 5. Goodwill and Purchased Intangible Assets, NetGoodwill activity is summarized as follows (in millions): Amount Balance as of April 28, 2023 $ 2,759 Additions - Balance as of April 26, 2024 2,759 Additions - Derecognition (36 ) Balance as of April 25, 2025 $ 2,723 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment. See "Gains/losses on the sale or derecognition of assets" section contained in Note 6 - Supplemental Financial Information for additional information related to this derecognition.Goodwill by reportable segment as of April 25, 2025 is as follows (in millions): Amount Hybrid Cloud $ 1,714 Public Cloud 1,009 Total goodwill $ 2,723 Purchased intangible assets, net are summarized below (in millions): April 25, 2025 April 26, 2024 Gross Accumulated Net Gross Accumulated Net Assets Amortization Assets Assets Amortization Assets Developed technology $ 55 $ (33 ) $ 22 $ 179 $ (108 ) $ 71 Customer contracts/relationships 50 (29 ) 21 114 (62 ) 52 Other purchased intangibles 2 (2 ) - 6 (5 ) 1 Total purchased intangible assets $ 107 $ (64 ) $ 43 $ 299 $ (175 ) $ 124 During fiscal 2025, we retired $25 million of fully amortized intangible assets. We also derecognized certain intangible assets, net in connection with the sale of our Spot by NetApp business. See "Gains/losses on the sale or derecognition of assets" section contained in Note 6 - Supplemental Financial Information for additional information related to this derecognition.Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 25, 2025 April 26, 2024 April 28, 2023 IncomeClassifications Developed technology $ 28 $ 34 $ 42 Cost of revenues Customer contracts/relationships 19 22 24 Operating expenses Other purchased intangibles - 1 2 Operating expenses Total $ 47 $ 57 $ 68 As of April 25, 2025, future amortization expense related to purchased intangible assets is as follows (in millions): Fiscal Year Amount 2026 $ 21 2027 21 2028 1 2029 - Total $ 43 5. Goodwill and Purchased Intangible Assets, NetGoodwill activity is summarized as follows (in millions): Amount Balance as of April 28, 2023 $ 2,759 Additions - Balance as of April 26, 2024 2,759 Additions - Derecognition (36 ) Balance as of April 25, 2025 $ 2,723 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment. See "Gains/losses on the sale or derecognition of assets" section contained in Note 6 - Supplemental Financial Information for additional information related to this derecognition.Goodwill by reportable segment as of April 25, 2025 is as follows (in millions): Amount Hybrid Cloud $ 1,714 Public Cloud 1,009 Total goodwill $ 2,723 Purchased intangible assets, net are summarized below (in millions): April 25, 2025 April 26, 2024 Gross Accumulated Net Gross Accumulated Net Assets Amortization Assets Assets Amortization Assets Developed technology $ 55 $ (33 ) $ 22 $ 179 $ (108 ) $ 71 Customer contracts/relationships 50 (29 ) 21 114 (62 ) 52 Other purchased intangibles 2 (2 ) - 6 (5 ) 1 Total purchased intangible assets $ 107 $ (64 ) $ 43 $ 299 $ (175 ) $ 124 During fiscal 2025, we retired $25 million of fully amortized intangible assets. We also derecognized certain intangible assets, net in connection with the sale of our Spot by NetApp business. See "Gains/losses on the sale or derecognition of assets" section contained in Note 6 - Supplemental Financial Information for additional information related to this derecognition.Amortization expense for purchased intangible assets is summarized below (in millions): Year Ended Statements of April 25, 2025 April 26, 2024 April 28, 2023 IncomeClassifications Developed technology $ 28 $ 34 $ 42 Cost of revenues Customer contracts/relationships 19 22 24 Operating expenses Other purchased intangibles - 1 2 Operating expenses Total $ 47 $ 57 $ 68 As of April 25, 2025, future amortization expense related to purchased intangible assets is as follows (in millions): Fiscal Year Amount 2026 $ 21 2027 21 2028 1 2029 - Total $ 43 **Current (2026):** Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment. See "Gains/losses on the sale or derecognition of assets" section contained in Note 5 - Supplemental Financial Information for additional information related to this derecognition. Purchased intangible assets, net are summarized below (in millions): April 24, 2026 April 25, 2025 Gross Accumulated Net Gross Accumulated Net Assets Amortization Assets Assets Amortization Assets Developed technology $ 55 $ (44 ) $ 11 $ 55 $ (33 ) $ 22 Customer contracts/relationships 50 (39 ) 11 50 (29 ) 21 Other purchased intangibles 2 (2 ) - 2 (2 ) - Total purchased intangible assets $ 107 $ (85 ) $ 22 $ 107 $ (64 ) $ 43 Purchased intangible assets, net are summarized below (in millions): --- ## Modified: Total liabilities and stockholders' equity **Key changes:** - Reworded sentence: "$ 10,744 $ 10,823 See accompanying notes to consolidated financial statements." **Prior (2025):** $ 10,823 $ 9,887 See accompanying notes to consolidated financial statements. 55 55 NETAPP, INC.CONSOLIDATED STATEMENTS OF INCOME(In millions, except per share amounts) Year Ended April 25, 2025 April 26, 2024 April 28, 2023 Revenues: Product $ 3,040 $ 2,849 $ 3,049 Services 3,532 3,419 3,313 Net revenues 6,572 6,268 6,362 Cost of revenues: Cost of product 1,284 1,137 1,517 Cost of services 675 698 636 Total cost of revenues 1,959 1,835 2,153 Gross profit 4,613 4,433 4,209 Operating expenses: Sales and marketing 1,865 1,828 1,829 Research and development 1,012 1,029 956 General and administrative 311 308 265 Restructuring charges 83 44 120 Acquisition-related expense 5 10 21 Total operating expenses 3,276 3,219 3,191 Income from operations 1,337 1,214 1,018 Other income, net 46 49 48 Income before income taxes 1,383 1,263 1,066 Provision (benefit) for income taxes 197 277 (208 ) Net income $ 1,186 $ 986 $ 1,274 Net income per share: Basic $ 5.81 $ 4.74 $ 5.87 Diluted $ 5.67 $ 4.63 $ 5.79 Shares used in net income per share calculations: Basic 204 208 217 Diluted 209 213 220 See accompanying notes to consolidated financial statements. **Current (2026):** $ 10,744 $ 10,823 See accompanying notes to consolidated financial statements. 54 54 NETAPP, INC.CONSOLIDATED STATEMENTS OF INCOME(In millions, except per share amounts) Year Ended April 24, 2026 April 25, 2025 April 26, 2024 Revenues: Product $ 3,194 $ 3,040 $ 2,849 Services 3,731 3,532 3,419 Net revenues 6,925 6,572 6,268 Cost of revenues: Cost of product 1,401 1,284 1,137 Cost of services 625 675 698 Total cost of revenues 2,026 1,959 1,835 Gross profit 4,899 4,613 4,433 Operating expenses: Sales and marketing 1,869 1,865 1,828 Research and development 991 1,012 1,029 General and administrative 344 311 308 Restructuring charges 21 83 44 Acquisition-related expense - 5 10 Total operating expenses 3,225 3,276 3,219 Income from operations 1,674 1,337 1,214 Other (expense) income, net (26 ) 46 49 Income before income taxes 1,648 1,383 1,263 Provision for income taxes 372 197 277 Net income $ 1,276 $ 1,186 $ 986 Net income per share: Basic $ 6.41 $ 5.81 $ 4.74 Diluted $ 6.35 $ 5.67 $ 4.63 Shares used in net income per share calculations: Basic 199 204 208 Diluted 201 209 213 See accompanying notes to consolidated financial statements. --- ## Modified: (Dollars in millions) **Key changes:** - Reworded sentence: "January 24, 2026 - February 20, 2026 599 $ 100.33 389,407 $ 642 February 21, 2026 - March 20, 2026 634 $ 100.30 390,041 $ 579 March 21, 2026 - April 24, 2026 749 $ 102.33 390,790 $ 502 Total 1,982 $ 101.07 In May 2003, our Board of Directors approved a stock repurchase program." - Reworded sentence: "On May 21, 2026, our Board of Directors authorized the repurchase of an additional $1.0 billion of our common stock." - Reworded sentence: "- Risk Factors are hereby incorporated into the discussion by reference.Executive OverviewOur Company NetApp is a global leader in Intelligent Data Infrastructure, empowering organizations to realize the full potential of their data in a rapidly evolving digital world." - Reworded sentence: "These services are generally available on the leading public clouds, including AWS, Microsoft Azure, and Google Cloud.Global Business EnvironmentSupply ChainInflationary pressures and supply chain constraints have impacted our operations beginning in the second half of fiscal 2026." **Prior (2025):** January 25, 2025 - February 21, 2025 248 $ 121.03 379,256 $ 572 February 22, 2025 - March 21, 2025 246 $ 101.53 379,502 $ 547 March 22, 2025 - April 25, 2025 2,314 $ 84.28 381,816 $ 352 Total 2,808 $ 89.03 In May 2003, our Board of Directors approved a stock repurchase program. As of April 25, 2025, our Board of Directors had authorized the repurchase of up to $17.1 billion of our common stock, and on May 22, 2025, authorized an additional $1.1 billion. Since inception of the program through April 25, 2025, we repurchased a total of 382 million shares of our common stock for an aggregate purchase price of $16.8 billion. Under this program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. 34 34 Item 6. [Reserved] Item 6. [Reserved] 35 35 Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe following discussion of our financial condition and results of operations should be read together with the financial statements and the accompanying notes set forth under Part II, Item 8. - Financial Statements and Supplementary Data. The following discussion also contains trend information and other forward-looking statements that involve a number of risks and uncertainties. The Risk Factors set forth in Part I, Item 1A. - Risk Factors are hereby incorporated into the discussion by reference.Executive OverviewOur Company NetApp helps customers make their data infrastructure more seamless, more dynamic, and higher performing. We were incorporated in 1992, are headquartered in San Jose, California, and provide a full range of enterprise-class software, systems and services that customers use to transform their data infrastructures across data types, workloads, and environments to realize business possibilities.We leverage over thirty years of innovation to make data infrastructure intelligent. Our unified data storage solutions deliver flexible, simplified, and silo-free infrastructure. Our active data management capabilities focus on security, compliance, and sustainability, while our adaptive operations enhance performance, efficiency, and productivity. Our extensive portfolio integrates hybrid and multi-cloud environments, addressing key customer priorities such as modernizing legacy systems, enhancing resilience against ransomware, and developing scalable, high-performance data pipelines for artificial intelligence (AI) workloads.NetApp empowers customers to harness their data for accelerated innovation, improved operations, and competitive advantage. Our unified data storage solutions provide the flexibility to consistently and easily store any data type and support any workload. As the only enterprise-grade storage service natively embedded in the world's largest clouds, we power data across Amazon AWS, Microsoft Azure, and Google Cloud. Our integrated data services enable active data management, security, protection, governance, and sustainability. Additionally, our operational services support adaptive operations across infrastructure, applications, and teams. Together with our Hybrid Cloud products, these services enable customers to construct a seamless, intelligent data infrastructure across hybrid multi-cloud environments.Our operations are organized into two segments: Hybrid Cloud and Public Cloud.Hybrid Cloud offers a unified data storage portfolio of storage management and infrastructure solutions that helps customers modernize their data centers. Our Hybrid Cloud portfolio accommodates both structured and unstructured data with unified storage optimized for flash, disk, and cloud storage, capable of handling data-intensive workloads and applications. Hybrid Cloud includes software, hardware, and related support, along with professional and other services.Public Cloud offers a portfolio of products delivered primarily as-a-service, including related support. This portfolio includes cloud storage, data services, and operational services. These services are generally available on the leading public clouds, including Amazon AWS, Microsoft Azure, and Google Cloud.Financial Results and Key Performance Metrics OverviewThe following table provides an overview of key financial metrics for each of the last three fiscal years (in millions, except per share amounts and percentages): Year Ended April 25, 2025 April 26, 2024 April 28, 2023 Net revenues $ 6,572 $ 6,268 $ 6,362 Gross profit $ 4,613 $ 4,433 $ 4,209 Gross margin 70 % 71 % 66 % Income from operations $ 1,337 $ 1,214 $ 1,018 Income from operations as a percentage of net revenues 20 % 19 % 16 % Provision (benefit) for income taxes $ 197 $ 277 $ (208 ) Net income $ 1,186 $ 986 $ 1,274 Diluted net income per share $ 5.67 $ 4.63 $ 5.79 Net cash provided by operating activities $ 1,506 $ 1,685 $ 1,107 April 25, 2025 April 26,2024 Deferred revenue and financed unearned services revenue $ 4,536 $ 4,234 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion of our financial condition and results of operations should be read together with the financial statements and the accompanying notes set forth under Part II, Item 8. - Financial Statements and Supplementary Data. The following discussion also contains trend information and other forward-looking statements that involve a number of risks and uncertainties. The Risk Factors set forth in Part I, Item 1A. - Risk Factors are hereby incorporated into the discussion by reference. **Current (2026):** January 24, 2026 - February 20, 2026 599 $ 100.33 389,407 $ 642 February 21, 2026 - March 20, 2026 634 $ 100.30 390,041 $ 579 March 21, 2026 - April 24, 2026 749 $ 102.33 390,790 $ 502 Total 1,982 $ 101.07 In May 2003, our Board of Directors approved a stock repurchase program. Under this program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. On May 21, 2026, our Board of Directors authorized the repurchase of an additional $1.0 billion of our common stock. For further information, see Note 9 - Stockholders' Equity of the Notes to Consolidated Financial Statements included in Part II, Item 8. 35 35 Item 6. [Reserved] Item 6. [Reserved] 36 36 Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe following discussion of our financial condition and results of operations should be read together with the financial statements and the accompanying notes set forth under Part II, Item 8. - Financial Statements and Supplementary Data. The following discussion also contains trend information and other forward-looking statements that involve a number of risks and uncertainties. The Risk Factors set forth in Part I, Item 1A. - Risk Factors are hereby incorporated into the discussion by reference.Executive OverviewOur Company NetApp is a global leader in Intelligent Data Infrastructure, empowering organizations to realize the full potential of their data in a rapidly evolving digital world. Headquartered in San Jose, California, and serving customers in approximately 150 countries, NetApp delivers innovative solutions that enable seamless data management, protection, and mobility across on-premises, hybrid, and multi-cloud environments.Our flagship ONTAP® data management software, together with a comprehensive portfolio of all-flash, hybrid-flash, and cloud-native offerings, forms the foundation for customers' digital transformation initiatives. NetApp's deep integration with all major public cloud providers - AWS, Microsoft Azure, and Google Cloud - enables our customers to run critical workloads anywhere, with consistent performance, security, and governance.NetApp's strategic focus is on modernizing data infrastructure, enabling resilient and secure operations, optimizing cloud strategies, and accelerating artificial intelligence (AI) adoption. Through continued investment in innovation, we have expanded our portfolio to include advanced AI-ready infrastructure, Storage-as-a-Service (Keystone), and robust cyber resilience solutions. Our partnerships with leading technology companies and a global ecosystem of channel partners further extend our reach and solution capabilities.Our operations are organized into two segments: Hybrid Cloud and Public Cloud.Hybrid Cloud offers a unified data storage portfolio of storage management and infrastructure solutions that helps customers modernize their data centers. Our Hybrid Cloud portfolio accommodates both structured and unstructured data with unified storage optimized for flash, disk, and cloud storage, capable of handling data-intensive workloads and applications. Hybrid Cloud includes software, hardware, and related support, along with professional and other services.Public Cloud offers a portfolio of products delivered primarily as-a-service, including related support. This portfolio includes cloud storage, data services, and operational services. These services are generally available on the leading public clouds, including AWS, Microsoft Azure, and Google Cloud.Global Business EnvironmentSupply ChainInflationary pressures and supply chain constraints have impacted our operations beginning in the second half of fiscal 2026. We have experienced increased costs for memory and other components, which have affected our gross margins, and we expect costs will remain elevated, or continue to increase, in the near term. Additionally, the tight supply environment for specific products, which is anticipated to persist, could pose challenges in meeting customer demand for those products.To address these challenges, we have implemented several strategic actions:•We raised our pricing in the fourth quarter of fiscal 2026, in line with market trends. We expect to continue adjusting prices as necessary to offset rising costs and remain aligned with the market. While we aim to match supplier costs with our pricing to customers, we recognize the need to give customers time to adjust to these changes.•We are leveraging our relationships with multiple suppliers where available to enable component availability and manage costs effectively. This strategy helps us maintain competitive positions in the market from a pricing standpoint. Our history of successful supplier management positions us well to navigate these challenges.•We continue to offer a wide range of solutions to meet various customer needs and priorities. This includes competitive storage options, all-flash solutions, hybrid-flash solutions, public cloud solutions, and our Keystone Storage-as-a-Service offering. By providing diverse options, we aim to align with our customers' budget priorities and deliver the best value offerings. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion of our financial condition and results of operations should be read together with the financial statements and the accompanying notes set forth under Part II, Item 8. - Financial Statements and Supplementary Data. The following discussion also contains trend information and other forward-looking statements that involve a number of risks and uncertainties. The Risk Factors set forth in Part I, Item 1A. - Risk Factors are hereby incorporated into the discussion by reference. --- ## Modified: Operating expenses: **Key changes:** - Reworded sentence: "Sales and marketing 1,869 1,865 1,828 Research and development 991 1,012 1,029 General and administrative 344 311 308 Restructuring charges 21 83 44 Acquisition-related expense - 5 10 Total operating expenses 3,225 3,276 3,219" **Prior (2025):** Sales and marketing 28 29 29 Research and development 15 16 15 General and administrative 5 5 4 Restructuring charges 1 1 2 Acquisition-related expense - - - Total operating expenses 50 51 50 **Current (2026):** Sales and marketing 27 28 29 Research and development 14 15 16 General and administrative 5 5 5 Restructuring charges - 1 1 Acquisition-related expense - - - Total operating expenses 47 50 51 --- ## Modified: Our business could be materially and adversely affected as a result of natural disasters, terrorist acts or other catastrophic events. **Key changes:** - Reworded sentence: "We depend on the ability of our personnel, inventory, equipment and products to move reasonably unimpeded around the world." - Reworded sentence: "If such disruptions result in cancellations of customer orders or 29 29 contribute to a general decrease in economic activity or corporate spending on IT, or directly impact our marketing, manufacturing, financial and logistics functions, or impair our ability to meet our customer demands, our operating results and financial condition could be materially adversely affected." **Prior (2025):** We depend on the ability of our personnel, inventories, equipment and products to move reasonably unimpeded around the world. Any political, military, terrorism, global trade, world health or other issue that hinders this movement or restricts the import or export of materials could lead to significant business disruptions. For example, the COVID-19 pandemic impeded the mobility of our personnel, inventories, equipment and products and disrupted our business operations. Furthermore, any economic failure or other material disruption caused by natural disasters, including fires, floods, droughts, hurricanes, tornadoes, earthquakes, and volcanoes; power or water loss or shortages; environmental disasters; telecommunications or business information systems failures or break-ins and similar events could also adversely affect our ability to conduct business. As a result of climate change, we expect the frequency and impact of such natural disasters or other material disruptions to increase. If such disruptions result in cancellations of customer orders or contribute to a general decrease in economic activity or corporate spending on IT, or directly impact our marketing, manufacturing, financial and logistics functions, or impair our ability to meet our customer demands, our operating results and financial condition could be materially adversely affected. Our headquarters is located in Northern California, an area susceptible to earthquakes and wildfires. If any significant disaster were to occur there, our ability to operate our business and our operating results, financial condition and cash flows could be adversely impacted. **Current (2026):** We depend on the ability of our personnel, inventory, equipment and products to move reasonably unimpeded around the world. Any political, military, terrorism, global trade, pandemic, widespread health or other issue that hinders this movement or restricts the import or export of materials could lead to significant business disruptions. Furthermore, any economic failure or other material disruption caused by natural disasters, including fires, floods, droughts, hurricanes, tornadoes, earthquakes, and volcanoes; power or water loss or shortages; environmental disasters; telecommunications or business information systems failures or break-ins and similar events could also adversely affect our ability to conduct business. As a result of climate change, we expect the frequency and impact of such natural disasters or other material disruptions to increase. If such disruptions result in cancellations of customer orders or 29 29 contribute to a general decrease in economic activity or corporate spending on IT, or directly impact our marketing, manufacturing, financial and logistics functions, or impair our ability to meet our customer demands, our operating results and financial condition could be materially adversely affected. Our headquarters is located in Northern California, an area susceptible to earthquakes and wildfires. If any significant disaster were to occur there, our ability to operate our business and our operating results, financial condition and cash flows could be adversely impacted.We could be subject to additional income tax liabilities. Our effective tax rate is influenced by a variety of factors, many of which are outside of our control, including fluctuations in our earnings and financial results in the various countries and states in which we do business, changes to the tax laws in such jurisdictions and the outcome of income tax audits. Changes to any of these factors could materially impact our operating results, financial condition and cash flows. We receive significant tax benefits from sales to our non-U.S. customers. These benefits are contingent upon existing tax laws and regulations in the U.S. and in the countries in which our international operations are located. For example, in July 2025, the One Big Beautiful Bill Act was enacted, which introduced significant changes to U.S. tax law, including permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions including the immediate expensing of United States research and development expenditures. Future changes in domestic or international tax laws and regulations or a change in how we manage and structure our international operations could adversely affect our ability to continue realizing these tax benefits. More broadly, our effective tax rate could also be adversely affected by changes in, or reinterpretations of, applicable tax laws and regulations, which could result in higher tax liabilities on our pre-tax income and cash balances. Changes in how we manage and structure our business and operations could similarly expose us to additional tax obligations. Any of the foregoing could harm our operating results and financial condition. We continue to evaluate the impacts of changes in tax laws and regulations on our business.Many countries around the world are beginning to implement legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development's Base Erosion and Profit Shifting Project (BEPS) recommendation and related action plans that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules and nexus-based tax incentive practices. We operate in jurisdictions that participate in the BEPS inclusive framework (Inclusive Framework), which is implementing measures such as the global minimum tax framework known as Pillar Two and standardized profit requirements for baseline marketing and distribution activities under Amount B of Pillar One. These rules, along with the continued expansion of the Inclusive Framework to additional jurisdictions or any changes to the scope or requirements of these frameworks, could increase our worldwide effective tax rate and adversely affect our operating results, financial condition, and cash flows. We are routinely subject to income tax audits in the U.S. and several foreign tax jurisdictions. If the ultimate determination of income taxes or at-source withholding taxes assessed under these audits results in amounts in excess of the tax provision we have recorded or reserved for, our operating results, financial condition and cash flows could be adversely affected.We may not be able to maintain appropriate internal financial reporting controls and procedures.Any failure to maintain or implement required new or improved controls, or any difficulties we encounter in their implementation, including in connection with our ERP system, could result in significant deficiencies or material weaknesses in our internal control over financial reporting, cause us to fail to timely meet our periodic reporting obligations, or result in material misstatements in our financial statements. Any such failure could also adversely affect the results of periodic management evaluations and annual auditor attestation reports regarding disclosure controls and the effectiveness of our internal control over financial reporting required under the Sarbanes-Oxley Act and the rules promulgated thereunder. The existence of a material weakness could result in errors in our financial statements that could result in a restatement of financial statements, cause us to fail to timely meet our reporting obligations, or cause investors to lose confidence in our reported financial information, which could cause a decline in the market price of our stock and we could be subject to sanctions or investigations by the SEC or other regulatory authorities including equivalent foreign authorities. Further, irrespective of the controls that we adopt, we cannot be assured that we will not experience fraudulent financial reporting in the future. contribute to a general decrease in economic activity or corporate spending on IT, or directly impact our marketing, manufacturing, financial and logistics functions, or impair our ability to meet our customer demands, our operating results and financial condition could be materially adversely affected. Our headquarters is located in Northern California, an area susceptible to earthquakes and wildfires. If any significant disaster were to occur there, our ability to operate our business and our operating results, financial condition and cash flows could be adversely impacted. --- ## Modified: 4. Goodwill and Purchased Intangible Assets, Net **Key changes:** - Reworded sentence: "Goodwill activity by reportable segment is summarized as follows (in millions): Hybrid Cloud Public Cloud Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 Goodwill activity by reportable segment is summarized as follows (in millions):" **Prior (2025):** Goodwill activity is summarized as follows (in millions): Amount Balance as of April 28, 2023 $ 2,759 Additions - Balance as of April 26, 2024 2,759 Additions - Derecognition (36 ) Balance as of April 25, 2025 $ 2,723 Goodwill activity is summarized as follows (in millions): Amount Balance as of April 28, 2023 $ 2,759 Additions - Balance as of April 26, 2024 2,759 Additions - Derecognition (36 ) Balance as of April 25, 2025 $ 2,723 During fiscal 2025, we derecognized a portion of the Public Cloud goodwill in connection with the sale of our cloud optimization and management software business known as Spot by NetApp, which formed part of our Public Cloud reportable segment. See "Gains/losses on the sale or derecognition of assets" section contained in Note 6 - Supplemental Financial Information for additional information related to this derecognition. Goodwill by reportable segment as of April 25, 2025 is as follows (in millions): Amount Hybrid Cloud $ 1,714 Public Cloud 1,009 Total goodwill $ 2,723 Goodwill by reportable segment as of April 25, 2025 is as follows (in millions): Amount Hybrid Cloud $ 1,714 Public Cloud 1,009 Total goodwill $ 2,723 Purchased intangible assets, net are summarized below (in millions): April 25, 2025 April 26, 2024 Gross Accumulated Net Gross Accumulated Net Assets Amortization Assets Assets Amortization Assets Developed technology $ 55 $ (33 ) $ 22 $ 179 $ (108 ) $ 71 Customer contracts/relationships 50 (29 ) 21 114 (62 ) 52 Other purchased intangibles 2 (2 ) - 6 (5 ) 1 Total purchased intangible assets $ 107 $ (64 ) $ 43 $ 299 $ (175 ) $ 124 Purchased intangible assets, net are summarized below (in millions): **Current (2026):** Goodwill activity by reportable segment is summarized as follows (in millions): Hybrid Cloud Public Cloud Total Balance as of April 26, 2024 $ 1,714 $ 1,045 $ 2,759 Derecognition - (36 ) (36 ) Balance as of April 25, 2025 1,714 1,009 2,723 Impact of foreign currency translation - 49 49 Balance as of April 24, 2026 $ 1,714 $ 1,058 $ 2,772 Goodwill activity by reportable segment is summarized as follows (in millions): --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "% Change General and administrative expenses $ 344 $ 311 11 % $ 308 1 % General and administrative expenses consist primarily of compensation costs, professional and corporate legal fees, outside services and facilities and IT support costs." - Reworded sentence: "See Note 11 - Restructuring Charges of the Notes to Consolidated Financial Statements included in Part II, Item 8 for more details regarding our restructuring plans.Other (Expense) Income, Net (in millions, except percentages)The components of other (expense) income, net were as follows: Year Ended April 24, 2026 April 25, 2025 % Change April 26, 2024 % Change Interest income $ 113 $ 112 1 % $ 112 - % Interest expense (109 ) (64 ) 70 % (64 ) - % Other, net (30 ) (2 ) NM 1 NM Total $ (26 ) $ 46 (157 )% $ 49 (6 )% NM - Not MeaningfulInterest income in fiscal 2026 was relatively flat compared to fiscal 2025." **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: Our Company **Key changes:** - Reworded sentence: "NetApp is a global leader in Intelligent Data Infrastructure, empowering organizations to realize the full potential of their data in a rapidly evolving digital world." - Reworded sentence: "These services are generally available on the leading public clouds, including AWS, Microsoft Azure, and Google Cloud." **Prior (2025):** NetApp helps customers make their data infrastructure more seamless, more dynamic, and higher performing. We were incorporated in 1992, are headquartered in San Jose, California, and provide a full range of enterprise-class software, systems and services that customers use to transform their data infrastructures across data types, workloads, and environments to realize business possibilities. We leverage over thirty years of innovation to make data infrastructure intelligent. Our unified data storage solutions deliver flexible, simplified, and silo-free infrastructure. Our active data management capabilities focus on security, compliance, and sustainability, while our adaptive operations enhance performance, efficiency, and productivity. Our extensive portfolio integrates hybrid and multi-cloud environments, addressing key customer priorities such as modernizing legacy systems, enhancing resilience against ransomware, and developing scalable, high-performance data pipelines for artificial intelligence (AI) workloads. NetApp empowers customers to harness their data for accelerated innovation, improved operations, and competitive advantage. Our unified data storage solutions provide the flexibility to consistently and easily store any data type and support any workload. As the only enterprise-grade storage service natively embedded in the world's largest clouds, we power data across Amazon AWS, Microsoft Azure, and Google Cloud. Our integrated data services enable active data management, security, protection, governance, and sustainability. Additionally, our operational services support adaptive operations across infrastructure, applications, and teams. Together with our Hybrid Cloud products, these services enable customers to construct a seamless, intelligent data infrastructure across hybrid multi-cloud environments. Our operations are organized into two segments: Hybrid Cloud and Public Cloud. Hybrid Cloud offers a unified data storage portfolio of storage management and infrastructure solutions that helps customers modernize their data centers. Our Hybrid Cloud portfolio accommodates both structured and unstructured data with unified storage optimized for flash, disk, and cloud storage, capable of handling data-intensive workloads and applications. Hybrid Cloud includes software, hardware, and related support, along with professional and other services. Public Cloud offers a portfolio of products delivered primarily as-a-service, including related support. This portfolio includes cloud storage, data services, and operational services. These services are generally available on the leading public clouds, including Amazon AWS, Microsoft Azure, and Google Cloud. **Current (2026):** NetApp is a global leader in Intelligent Data Infrastructure, empowering organizations to realize the full potential of their data in a rapidly evolving digital world. Headquartered in San Jose, California, and serving customers in approximately 150 countries, NetApp delivers innovative solutions that enable seamless data management, protection, and mobility across on-premises, hybrid, and multi-cloud environments. Our flagship ONTAP® data management software, together with a comprehensive portfolio of all-flash, hybrid-flash, and cloud-native offerings, forms the foundation for customers' digital transformation initiatives. NetApp's deep integration with all major public cloud providers - AWS, Microsoft Azure, and Google Cloud - enables our customers to run critical workloads anywhere, with consistent performance, security, and governance. NetApp's strategic focus is on modernizing data infrastructure, enabling resilient and secure operations, optimizing cloud strategies, and accelerating artificial intelligence (AI) adoption. Through continued investment in innovation, we have expanded our portfolio to include advanced AI-ready infrastructure, Storage-as-a-Service (Keystone), and robust cyber resilience solutions. Our partnerships with leading technology companies and a global ecosystem of channel partners further extend our reach and solution capabilities. Our operations are organized into two segments: Hybrid Cloud and Public Cloud. Hybrid Cloud offers a unified data storage portfolio of storage management and infrastructure solutions that helps customers modernize their data centers. Our Hybrid Cloud portfolio accommodates both structured and unstructured data with unified storage optimized for flash, disk, and cloud storage, capable of handling data-intensive workloads and applications. Hybrid Cloud includes software, hardware, and related support, along with professional and other services. Public Cloud offers a portfolio of products delivered primarily as-a-service, including related support. This portfolio includes cloud storage, data services, and operational services. These services are generally available on the leading public clouds, including AWS, Microsoft Azure, and Google Cloud. --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "% Change Product revenues $ 3,194 $ 3,040 5 % $ 2,849 7 % Hybrid Cloud Product revenues are derived through the sale of our Hybrid Cloud solutions and consist of sales of configured all-flash array systems (including AFF A-Series and AFF C-Series with capacity flash) and hybrid systems (including FAS), which are bundled hardware and software products, as well as add-on flash, disk and/or hybrid storage and related OS, StorageGrid, OEM products and add-on optional software." **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: Performance Graph **Key changes:** - Reworded sentence: "The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend reinvested basis, of an investment of $100 for the Company, the S&P 500 Index, the S&P 500 Information Technology Index and the S&P 1500 Technology Hardware & Equipment Index for the five years ended April 24, 2026." - Added sentence: "On May 21, 2026, our Board of Directors authorized the repurchase of an additional $1.0 billion of our common stock." - Added sentence: "For further information, see Note 9 - Stockholders' Equity of the Notes to Consolidated Financial Statements included in Part II, Item 8." **Prior (2025):** *$100 invested on April 24, 2020 in stock or index, including reinvestment of dividends. Data points are the last day of each fiscal year for the Company's common stock and each of the indexes. April 2020 April 2021 April 2022 April 2023 April 2024 April 2025 NetApp, Inc. $ 100.00 $ 179.71 $ 180.39 $ 159.78 $ 263.63 $ 234.64 S&P 500 Index $ 100.00 $ 149.89 $ 150.21 $ 154.21 $ 191.56 $ 210.35 S&P 500 Information Technology Index $ 100.00 $ 159.07 $ 162.08 $ 175.17 $ 245.24 $ 272.40 S&P 1500 Technology Hardware & Equipment Index $ 100.00 $ 177.82 $ 202.33 $ 214.81 $ 227.56 $ 271.36 We believe that a number of factors may cause the market price of our common stock to fluctuate significantly. See Item 1A. - Risk Factors. 33 33 Purchases of Equity Securities by the Issuer and Affiliated PurchasersThe following table provides information with respect to the shares of common stock repurchased by us during the three months ended April 25, 2025: Total Number of Shares Approximate Dollar Value Total Number Average Purchased as Part of of Shares That May Yet of Shares Price Paid Publicly Announced Be Purchased Under The Period Purchased per Share Program Repurchase Program (Shares in thousands) (Shares in thousands) (Dollars in millions) January 25, 2025 - February 21, 2025 248 $ 121.03 379,256 $ 572 February 22, 2025 - March 21, 2025 246 $ 101.53 379,502 $ 547 March 22, 2025 - April 25, 2025 2,314 $ 84.28 381,816 $ 352 Total 2,808 $ 89.03 In May 2003, our Board of Directors approved a stock repurchase program. As of April 25, 2025, our Board of Directors had authorized the repurchase of up to $17.1 billion of our common stock, and on May 22, 2025, authorized an additional $1.1 billion. Since inception of the program through April 25, 2025, we repurchased a total of 382 million shares of our common stock for an aggregate purchase price of $16.8 billion. Under this program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. **Current (2026):** The following graph shows a comparison of cumulative total shareholder return, calculated on a dividend reinvested basis, of an investment of $100 for the Company, the S&P 500 Index, the S&P 500 Information Technology Index and the S&P 1500 Technology Hardware & Equipment Index for the five years ended April 24, 2026. The comparisons in the graphs below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. The graph and related information shall not be deemed "soliciting material" or be deemed to be "filed" with the SEC, nor shall such information be incorporated by reference into any past or future filing with the SEC, except to the extent that such filing specifically states that such graph and related information are incorporated by reference into such filing. April 2021 April 2022 April 2023 April 2024 April 2025 April 2026 NetApp, Inc. $ 100.00 $ 100.38 $ 88.91 $ 146.70 $ 130.57 $ 163.57 S&P 500 Index $ 100.00 $ 100.21 $ 102.88 $ 127.80 $ 140.33 $ 184.25 S&P 500 Information Technology Index $ 100.00 $ 101.89 $ 110.13 $ 154.18 $ 171.25 $ 260.29 S&P 1500 Technology Hardware & Equipment Index $ 100.00 $ 113.78 $ 120.80 $ 127.97 $ 152.61 $ 234.04 We believe that a number of factors may cause the market price of our common stock to fluctuate significantly. See Item 1A. - Risk Factors. 34 34 Purchases of Equity Securities by the Issuer and Affiliated PurchasersThe following table provides information with respect to the shares of common stock repurchased by us during the three months ended April 24, 2026: Total Number of Shares Approximate Dollar Value Total Number Average Purchased as Part of of Shares That May Yet of Shares Price Paid Publicly Announced Be Purchased Under The Period Purchased per Share Program Repurchase Program (Shares in thousands) (Shares in thousands) (Dollars in millions) January 24, 2026 - February 20, 2026 599 $ 100.33 389,407 $ 642 February 21, 2026 - March 20, 2026 634 $ 100.30 390,041 $ 579 March 21, 2026 - April 24, 2026 749 $ 102.33 390,790 $ 502 Total 1,982 $ 101.07 In May 2003, our Board of Directors approved a stock repurchase program. Under this program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. On May 21, 2026, our Board of Directors authorized the repurchase of an additional $1.0 billion of our common stock. For further information, see Note 9 - Stockholders' Equity of the Notes to Consolidated Financial Statements included in Part II, Item 8. --- ## Modified: Dividends and Stock Repurchase Program **Key changes:** - Reworded sentence: "On May 21, 2026, we declared a cash dividend of $0.52 per share of common stock, payable on July 29, 2026 to holders of record as of the close of business on July 10, 2026." - Reworded sentence: "An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably could have been used, and if changes in the estimate that are reasonably possible could materially impact the financial statements." - Reworded sentence: "Additionally, changes in business practices, such as those related to sales returns or marketing programs, Under our common stock repurchase program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management." **Prior (2025):** While most of our arrangements for sales include short-term payment terms, from time to time we provide long-term financing to creditworthy customers. We have generally sold receivables financed through these arrangements on a non-recourse basis to third party financing institutions within 10 days of the contracts' dates of execution, and we classify the proceeds from these sales as cash flows from operating activities in our consolidated statements of cash flows. We account for the sales of these receivables as "true sales" as defined in the accounting standards on transfers of financial assets, as we are considered to have surrendered control of these financing receivables. We sold $65 million and $67 million of receivables during fiscal 2025 and 2024, respectively. In addition, we enter into arrangements with leasing companies for the sale of our hardware systems products. These leasing companies, in turn, lease our products to end-users. The leasing companies generally have no recourse to us in the event of default by the end-user. Some of the leasing arrangements described above have been financed on a recourse basis through third-party financing institutions. Under the terms of recourse leases, which are generally three years or less, we remain liable for the aggregate unpaid remaining lease payments to the third-party leasing companies in the event of end-user customer default. These arrangements are generally collateralized by a security interest in the underlying assets. As of April 25, 2025 and April 26, 2024, the aggregate amount 47 47 by which such contingencies exceeded the associated liabilities was not significant. To date, we have not experienced significant losses under our lease financing programs or other financing arrangements.We have entered into service contracts with certain of our end-user customers that are supported by third-party financing arrangements. If a service contract is terminated as a result of our non-performance under the contract or our failure to comply with the terms of the financing arrangement, we could, under certain circumstances, be required to acquire certain assets related to the service contract or to pay the aggregate unpaid payments under such arrangements. As of April 25, 2025, we have not been required to make any payments under these arrangements, and we believe the likelihood of having to acquire a material amount of assets or make payments under these arrangements is remote. The portion of the financial arrangement that represents unearned services revenue is included in deferred revenue and financed unearned services revenue in our consolidated balance sheets. Legal ContingenciesWe are subject to various legal proceedings and claims which arise in the normal course of business. See further details on such matters in Note 17 - Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8. Critical Accounting Policies and EstimatesOur consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP), which require management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues and expenses, and the disclosure of contingent assets and liabilities. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. We believe that the accounting estimates employed and the resulting balances are reasonable; however, actual results may differ from these estimates and such differences may be material.The summary of significant accounting policies is included in Note 1 - Description of Business and Significant Accounting Policies of the Notes to Consolidated Financial Statements included in Part II, Item 8. An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably could have been used, or if changes in the estimate that are reasonably possible could materially impact the financial statements. The accounting policies described below reflect the significant judgments, estimates and assumptions used in the preparation of the consolidated financial statements.Revenue RecognitionOur contracts with customers often include the transfer of multiple products and services to the customer. In determining the amount and timing of revenue recognition, we assess which products and services are distinct performance obligations and allocate the transaction price, which may include fixed and/or variable amounts, among each performance obligation on a relative standalone selling price (SSP) basis. The following are the key estimates and assumptions and corresponding uncertainties included in this approach: Key Estimates and Assumptions Key Uncertainties  We evaluate whether products and services promised in our contracts with customers are distinct performance obligations that should be accounted for separately versus together.  In certain contracts, the determination of our distinct performance obligations requires significant judgment. As our business and offerings to customers change over time, the products and services we determine to be distinct performance obligations may change. Such changes may adversely impact the amount of revenue and gross margin we report in a particular period.  In determining the transaction price of our contracts, we estimate variable consideration based on the expected value, primarily relying on our history. In certain situations, we may also use the most likely amount as the basis of our estimate.  We may have insufficient relevant historical data or other information to arrive at an accurate estimate of variable consideration using either the "expected value" or "most likely amount" method. Additionally, changes in business practices, such as those related to sales returns or marketing programs, may introduce new forms of variable consideration, as well as more complexity and uncertainty in the estimation process. by which such contingencies exceeded the associated liabilities was not significant. To date, we have not experienced significant losses under our lease financing programs or other financing arrangements. We have entered into service contracts with certain of our end-user customers that are supported by third-party financing arrangements. If a service contract is terminated as a result of our non-performance under the contract or our failure to comply with the terms of the financing arrangement, we could, under certain circumstances, be required to acquire certain assets related to the service contract or to pay the aggregate unpaid payments under such arrangements. As of April 25, 2025, we have not been required to make any payments under these arrangements, and we believe the likelihood of having to acquire a material amount of assets or make payments under these arrangements is remote. The portion of the financial arrangement that represents unearned services revenue is included in deferred revenue and financed unearned services revenue in our consolidated balance sheets. **Current (2026):** On May 21, 2026, we declared a cash dividend of $0.52 per share of common stock, payable on July 29, 2026 to holders of record as of the close of business on July 10, 2026. 47 47 Under our common stock repurchase program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. As of April 24, 2026, the remaining authorized amount for stock repurchases under this program was $0.5 billion. On May 21, 2026 our Board of Directors authorized the repurchase of an additional $1.0 billion of our common stock.Purchase CommitmentsIn the ordinary course of business, we make commitments to third-party contract manufacturers and component suppliers to manage manufacturer lead times and meet product forecasts, and to other parties, to purchase various key components used in the manufacture of our products. In addition, we have open purchase orders and contractual obligations associated with our ordinary course of business for which we have not yet received goods or services. These off-balance sheet purchase commitments totaled $1.4 billion at April 24, 2026, of which $1.1 billion is due in fiscal 2027, with the remainder due thereafter.Legal ContingenciesWe are subject to various legal proceedings and claims which arise in the normal course of business. See further details on such matters in Note 16 - Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8. Critical Accounting EstimatesOur consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP), which require management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues and expenses, and the disclosure of contingent assets and liabilities. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. We believe that the accounting estimates employed and the resulting balances are reasonable; however, actual results may differ from these estimates and such differences may be material.The summary of significant accounting policies is included in Note 1 - Description of Business and Significant Accounting Policies of the Notes to Consolidated Financial Statements included in Part II, Item 8. An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably could have been used, and if changes in the estimate that are reasonably possible could materially impact the financial statements. The accounting policies described below reflect the significant judgments, estimates and assumptions used in the preparation of the consolidated financial statements.Revenue RecognitionOur contracts with customers often include the transfer of multiple products and services to the customer. In determining the amount and timing of revenue recognition, we assess which products and services are distinct performance obligations and allocate the transaction price, which may include fixed and/or variable amounts, among each performance obligation on a relative standalone selling price (SSP) basis. The following are the key estimates and assumptions and corresponding uncertainties included in this approach: Key Estimates and Assumptions Key Uncertainties  We evaluate whether products and services promised in our contracts with customers are distinct performance obligations that should be accounted for separately versus together.  In certain contracts, the determination of our distinct performance obligations requires significant judgment. As our business and offerings to customers change over time, the products and services we determine to be distinct performance obligations may change. Such changes may adversely impact the amount of revenue and gross margin we report in a particular period.  In determining the transaction price of our contracts, we estimate variable consideration based on the expected value, primarily relying on our history. In certain situations, we may also use the most likely amount as the basis of our estimate.  We may have insufficient relevant historical data or other information to arrive at an accurate estimate of variable consideration using either the "expected value" or "most likely amount" method. Additionally, changes in business practices, such as those related to sales returns or marketing programs, Under our common stock repurchase program, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by our management. The stock repurchase program may be suspended or discontinued at any time. As of April 24, 2026, the remaining authorized amount for stock repurchases under this program was $0.5 billion. On May 21, 2026 our Board of Directors authorized the repurchase of an additional $1.0 billion of our common stock. --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "Revenues: Product 46 % 46 % 45 % Services 54 54 55 Net revenues 100 100 100" **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "% Change Interest income $ 113 $ 112 1 % $ 112 - % Interest expense (109 ) (64 ) 70 % (64 ) - % Other, net (30 ) (2 ) NM 1 NM Total $ (26 ) $ 46 (157 )% $ 49 (6 )% NM - Not Meaningful Interest income in fiscal 2026 was relatively flat compared to fiscal 2025." **Prior (2025):** 2025 2024 2023 Revenues: Product 46 % 45 % 48 % Services 54 55 52 Net revenues 100 100 100 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: April 26, 2024 **Key changes:** - Reworded sentence: "Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685" **Prior (2025):** Net revenues $ 6,572 $ 6,268 $ 6,362 Gross profit $ 4,613 $ 4,433 $ 4,209 Gross margin 70 % 71 % 66 % Income from operations $ 1,337 $ 1,214 $ 1,018 Income from operations as a percentage of net revenues 20 % 19 % 16 % Provision (benefit) for income taxes $ 197 $ 277 $ (208 ) Net income $ 1,186 $ 986 $ 1,274 Diluted net income per share $ 5.67 $ 4.63 $ 5.79 Net cash provided by operating activities $ 1,506 $ 1,685 $ 1,107 **Current (2026):** Net revenues $ 6,925 $ 6,572 $ 6,268 Gross profit $ 4,899 $ 4,613 $ 4,433 Gross margin 71 % 70 % 71 % Income from operations $ 1,674 $ 1,337 $ 1,214 Income from operations as a percentage of net revenues 24 % 20 % 19 % Provision for income taxes $ 372 $ 197 $ 277 Net income $ 1,276 $ 1,186 $ 986 Diluted net income per share $ 6.35 $ 5.67 $ 4.63 Net cash provided by operating activities $ 2,067 $ 1,506 $ 1,685 --- ## Modified: April 25, 2025 **Key changes:** - Reworded sentence: "ASSETS Current assets: Cash and cash equivalents $ 2,070 $ 2,742 Short-term investments 1,514 1,104 Accounts receivable 1,286 1,246 Inventories 198 186 Other current assets 708 573 Total current assets 5,776 5,851 Property and equipment, net 592 563 Goodwill 2,772 2,723 Purchased intangible assets, net 22 43 Other non-current assets 1,582 1,643" **Prior (2025):** Deferred revenue and financed unearned services revenue $ 4,536 $ 4,234 36 36 •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues.•Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues.•Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues.•Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year.•Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above.Stock Repurchase Program and Dividend ActivityDuring fiscal 2025, we repurchased 10.2 million shares of our common stock at an average price of $112.55 per share, for an aggregate purchase price of $1.2 billion. We also declared aggregate cash dividends of $2.08 per share in fiscal 2025, for which we paid a total of $424 million.Restructuring EventsDuring fiscal 2025, we executed several restructuring plans and recognized expenses totaling $83 million consisting primarily of employee severance-related costs. Senior Notes IssuanceIn March 2025, we issued $625 million aggregate principal amount of 5.50% Senior Notes due 2032 and $625 million aggregate principal amount of 5.70% Senior Notes due 2035, for which we received total proceeds of $1.24 billion, net of discount and issuance costs. •Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased approximately 5% in fiscal 2025 compared to fiscal 2024, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. Gross margin: Our gross margin decreased less than one percentage point in fiscal 2025 compared to fiscal 2024, due to the decrease in gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by one percentage point in fiscal 2025 compared to fiscal 2024, primarily due to higher net revenues. •Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. Provision (benefit) for income taxes: Our provision for income taxes decreased in fiscal 2025 compared to fiscal 2024 primarily as a result of differences in discrete tax impacts in each year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2025 compared to fiscal 2024 reflect the factors discussed above. **Current (2026):** Deferred revenue $ 4,845 $ 4,536 •Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. Net revenues: Our net revenues increased 5% in fiscal 2026 compared to fiscal 2025, due to increases in both product revenues and services revenues. •Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. Gross margin: Our gross margin increased less than one percentage point in fiscal 2026 compared to fiscal 2025, due to the increase in gross margins on services revenues, partially offset by lower gross margins on product revenues. •Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. Income from operations as a percentage of net revenues: Our income from operations as a percentage of net revenues increased by four percentage points in fiscal 2026 compared to fiscal 2025, primarily due to higher net revenues. •Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. Provision for income taxes: Our provision for income taxes increased in fiscal 2026 compared to fiscal 2025 primarily due to benefits related to the Internal Revenue Service ("IRS") examination of our fiscal 2018 and 2019 U.S. income tax returns in the prior year. •Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. Net income and Diluted net income per share: The increase in both net income and diluted net income per share in fiscal 2026 compared to fiscal 2025 reflect the factors discussed above. --- *Data sourced from SEC EDGAR. Last updated 2026-06-07.*