NetApp, Inc.

Good afternoon, ladies and gentlemen. Welcome to the NetApp Q4 and fiscal year 2021 earnings call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions will be given at that time. I would now like to turn the call over to Chris Newton, Vice President, Investor Relations.

Thank you for joining us. With me today are our CEO, George Kurian, and CFO, Mike Berry. This call is being webcast live and will be available for replay on our website at NetApp.com. During today's call, we will make forward-looking statements and projections with respect to our financial outlook and future prospects, such as our guidance for the first quarter and fiscal year 2022, our expectations regarding future revenue profitability and shareholder returns, and our ability to continue overall growth, gain market share, and scale our cloud business. all of which involve risk and uncertainty. We disclaim any obligation to update our forward-looking statements and projections. Actual results may differ materially for a variety of reasons, including macroeconomic and market conditions, such as the continuing impact and uneven recovery of the COVID-19 pandemic and the IT capital spending environment, as well as our ability to gain share in the storage market, grow our cloud business, and generate greater cash flow. Please also refer to the documents we file from time to time with the SEC and available on our website, specifically our most recent forms 10Q and 10K, including in the management's discussion and analysis of financial condition and results of operations and risk factor sections. During the call, all financial measures presented will be non-GAAP unless otherwise indicated. Reconciliations of GAAP to non-GAAP estimates are posted on our website. I'll now turn the call over to George.

Thanks, Chris. Good afternoon, everyone. Thank you for joining us today. Before we get started, I want to take a minute to acknowledge that it's been over a year that we have all been working remotely. I'm encouraged by the public health and economic improvements in many parts of the world, but the recovery is uneven. As you know, we have a large team in India. Our thoughts are with them as they deal with a distressing surge in COVID cases. Thank you to the entire NetApp team for your dedication, focus, and execution throughout this challenging year. Now to the results of the quarter. We delivered strong fourth quarter results, capping off a solid year of growth. Our results were all above our Q4 guidance ranges. I am most excited by the return of product revenue to growth the strength of our public cloud ARR, and an all-time high free cash flow. Our performance was broad-based as certain verticals, the U.S., and parts of Europe and Asia are recovering faster than many expected. Cloud and digital transformation initiatives have been accelerated by the pandemic, and companies look to NetApp to support these key initiatives. Going into FY21, we had two clear priorities, returning to growth in our storage business, powered by share gains from our industry leading file block and object software, and scaling our highly differentiated public cloud services business. As I reflect on the past year, I'm proud of what we've achieved during a globally challenging period. We remain focused in executing our strategy and extending our innovation. In Q4, product revenue grew 6% and our all-flash array business grew 11% year over year. Based on our growth, I am confident that we have gained share in the storage and all-flash market. We advanced our hybrid cloud portfolio with the introduction of ONTAP 9.9 and Astra. This innovation will support continued product revenue growth and share gains through fiscal year 22. Additionally, we continue to make good progress with Keystone with many new wins, including our largest ever Keystone deal. We are reaching more customers than ever before with our public cloud business. Over the course of fiscal year 21, We added approximately 1,500 new to NetApp customers with public cloud services and grew our total cloud customer count by 137% from Q4 fiscal year 20. In addition to adding new cloud customers, existing cloud customers are expanding their spend with us. Our dollar-based net revenue retention rate increased to 252% in the fourth quarter. Cloud Volumes, Cloud Insights, and Spot all performed well in the quarter, driving our public cloud services ARR to $301 million exiting fiscal year 21, an increase of 171% year over year. As we have said repeatedly, our cloud strategy strongly advantages NetApp. I'll use a customer example to illustrate how cloud helps us to acquire new customers and drive growth in our on-premises solutions. As a part of its digital transformation strategy, a leading car manufacturer decided to migrate workloads from its on-premises data centers to the Azure cloud. Despite never having used NetApp previously, the customer chose NetApp Cloud Volumes to host its file-based data and NetApp Cloud Sync to rapidly move data from its Dell EMC systems to the cloud. In addition to delivering a high-performance data store in the cloud, Cloud Volumes provides out-of-the-box cross-region replication of production data to a secondary cloud environment, high availability to meet the service level requirements of critical applications, and cost savings through automatic tiering to Azure Blob Storage. Because of the breadth and depth of the value NetApp delivered, the customer is now looking to deploy a hybrid cloud environment and plans to use NetApp on premises, as well as increase its NetApp usage in the public cloud. As I noted earlier, the pandemic accelerated and elevated the importance of customers' cloud and digital transformation initiatives. We expect that this trend will be ongoing and that NetApp will continue to benefit from it. Customers appreciate the value we bring as a cloud-led, data-centric software company to simplify and modernize existing data centers to quickly and confidently deploy applications, and to securely manage data on the public cloud. We have long been recognized for our industry-leading enterprise data management technology. Our cloud solutions drive further differentiation, expand our addressable market, and enable us to reach new customers. We began our cloud journey seven years ago with the introduction of Cloud ONTAP, Now, cloud volume is on tap. Our initial focus was to leverage the cloud to deliver backup and disaster recovery services to our install base. We saw that enterprises wanted to move workloads to the cloud. To address that need, we began working with the leading cloud providers to deliver cloud volume service, a fully managed service with the application certifications required to support mission-critical production workloads in the cloud. We then recognized the opportunity to expand beyond storage management and optimization to infrastructure monitoring and compute management and optimization services, which led to the development of Cloud Insights and the acquisition of Spot. These services, Cloud Volumes, Cloud Insights, and Spot are now the primary growth engines of our public cloud services business. They are well established for enterprise applications, and we are taking each of them into the cloud native world, further expanding our market opportunity. NetApp Astra offers application-aware data management that protects, moves, and manages data-rich Kubernetes workloads. Spot Ocean automates cloud infrastructure for containers, automatically scaling compute resources to maximize utilization and availability while minimizing costs. Cloud Insights for Kubernetes provides simplified infrastructure monitoring to quickly identify performance issues and resource constraints. Together, our public cloud services give our customers and especially their cloud ops and DevOps teams, a robust suite of multi-cloud infrastructure management services. We plan to press our advantage here by focusing our efforts on enhancing our go-to-market activities, deepening our cloud partnerships, and delivering best-in-class organic and inorganic innovations. We intend to leverage our deep infrastructure expertise and our credibility with the cloud providers to expand our multi-cloud infrastructure management services. My confidence in our ability to reach our goal of $1 billion in public cloud ARR in fiscal year 25 is further enhanced by the strength and uniqueness of our cloud services position. Our focused execution last year has set us up well for fiscal year 22. We have returned to growth. We're gaining share in key storage markets. And our public cloud services are at a scale where they are positively impacting total company billing and revenue growth. Our momentum underscores our value to customers in a hybrid multi-cloud world. In fiscal year 22, we plan to accelerate our public cloud services and continue to grow our hybrid cloud business. I am excited about the year ahead and confident in our ability to deliver top line growth by supporting our customers on their cloud and digital transformation journey. Before I turn it over to Mike to walk through our financial results, I want to take a moment to thank Brad Anderson, who let us know that he intends to retire at the end of fiscal year 22. Brad has been instrumental in leading the maturation of our hybrid cloud group, and we will continue to leverage his leadership and expertise this year. We are actively engaged in identifying a successor to ensure a smooth transition. With that, I'll turn it over to Mike.