Market Overview

NetApp Thailand Data Centre Capitalization

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NetApp’s company growth outlook in its 2013 current revenue expects to further capitalize and grow by 50% this year investing in Thailand, in the data centre industry. For Asia Banking, NetApp will host the upcoming Bank of America Merrill Lynch Technology Conference on June 5.  NetApp expects to outpace the overall storage industry growth.

Weera Areeratanasak, country manager of NetApp Thailand, stated "This is our biggest investment in Thailand in four years." NetApp’s investment in Thailand will go towards hiring staff, expanding a local office and setting up a demonstration centre for new technologies. NetApp revenue growth trails the industry average of 18.0%. Since the same quarter one year prior, revenues slightly increased by 4.1%. Net operating cash flow has increased to $365.10 million or 35.62% when compared to the same quarter last year. NetApp has improved earnings per share by 34.4%.

According to IDC Asia/Pacific, Worldwide external disk storage systems factory revenues posted year-over-year growth of 7.1%, totaling just under $6.0 billion, in the first quarter of 2012 (1Q12), according to the International Data Corporation (IDC) Worldwide Quarterly Disk Storage Systems Tracker. The 31 analysts offering 12-month price forecasts for NetApp Inc. have a median target of 40.00, with a high estimate of 48.25 and a low estimate of 32.00. The median estimate represents a +17.08% increase from the last price of 34.17. NetApp has a market cap of $12.31 billion.

NetApp continuously innovates. New products include: NetApp E-Series platform, NetApp OnCommand™ management software. NetApp acquisitions include Engenio and Akorri Networks Inc. Partnerships include Internet Thailand (INET) and Avnet. In addition, NetApp collaborates with technology leaders such as Cisco to provide FlexPod™ Data Center ROI solutions that supports VMware, Citrix, Microsoft and SAP applications in the cloud.

More organisations invest in data centres to increase their efficiency by avoiding operating disruptions. NetApp has a multi-source strategy for Thailand. It is crucial for the enterprise IT department to update, analyze and develop a data centre plan to execute for the software. Choosing the right storage platform for the shared infrastructure is a critical and strategic decision. NetApp’s strategy is to build a successful cloud is to look to the best-of-breed solutions and cloud integrators to architect the right cloud business strategy in the organizations’ cloud revolution.

NetApp will serve all segments with its 50% revenue growth. According to IDC, For the quarter, the total disk storage systems market posted just under $8.0 billion in revenues, representing 6.8% growth from the prior year's first quarter. Total disk storage systems capacity shipped reached 6,037 petabytes, growing 20.8% year over year. NetApp has more than 60 new customers from key industries, including Japanese businesses, such as manufacturing, energy, financial services and telecommunications. NetApp’s strategy to help customers build Future-Ready IT for Thailand.

Competition

Hewlett-Packard Company (NYSE: HPQ) plans to cut an estimated 29,000 jobs, or about 10 percent of the workforce, over the next two years. HP derived over 17 percent of its second quarter revenue from sales of printers, copiers and related services. The has billions in failed acquisitions in 2012. The challenges across HP's portfolio and massive downsizing initiatives during this critical transition period will leave HP less relevant over the next 12-18 months.

This month, Hewlett-Packard pitched new hard to replicate architectures for hyperscale data centers. Competitors will attack HP for its new solutions. These data centers will be infrastructures of the cloud. The plan is to sell cartridges in systems that are processor agnostic. Hewlett-Packard’s HP ProCurve data center business includes switches for data centers, management software and HP ProCurve ONE, which optimizes HP’s corporate applications infrastructure.

EMC Corporation (NYSE: EMC) company reported full-year revenue for 2012 of $21.7 billion, a 9 percent growth over 2011. Fourth quarter net income was up 4.6 percent to $869.9 million, or 39 cents a share from a year ago. In 2013, EMC said that it expects revenues to once again grow at 8 percent, to $23.5 billion.

EMC data center’s will have to scale, but scale could be a challenge. A winning architectural approach is still too nascent to tell as enterprises continue to build out their data centers. EMC’s Data Center Consolidation enables its customers to align data center infrastructure with business needs while improving asset utilization, lowering capital. The company has been gaining traction in its capabilities it built, growth and data center assets.

NetApp’s  investment for the company will be the highest budget in Southeast Asia and will benefit the data centre industry in Thailand. NetApp’s peers and competitors include: Fiserv Inc, Total System Services Inc and FactSet Research Systems Inc. Many investors have questioned investing in Thailand, however good companies are able to survive downturns and be resilient afterwards. The demand for hyperscale data centres is expanding. Mobile data traffic in Thailand has grown by 30% annually. In a Bloomberg Markets ranking, Thailand is second only to China among the world’s best emerging markets for investors. The company has been strong in net income, revenue growth, operations, expanding profit margins and growth in earnings per share. The company has a P/E ratio of 24.8, above the S&P 500 P/E ratio of 17.7. Shares are up 1.8% year to date as of April 4.

NetApp is a leading vendor of innovative storage and data management solutions that help organizations around the world store, manage, protect, and retain one of their most precious assets: their data.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Markets

 

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