EARNINGS ALERT: AVGO, SNOW, HPE, FIVE, NTAP

**Sam Vadas** (0:00)
So, we've got NetApp crossing the wires right now. So Marley, I'll send things back over to you in Chicago.

**Marley Kayden** (0:04)
It is crossing the wire, Sam, and it is seeing a very swift move to the upside. We're already up more than 6.5%, so let's look at these numbers. First quarter EPS coming in at $2.58, significantly better than the 212 the street was looking for. Adjusted gross margins for the quarter at 70.6%, also better, a percent better than what the street was looking for. And net revenue is 2.03 billion. The street was looking for 1.83 billion. So a clear beat across important metrics here. As we look across their guidance for the current quarter, they're projecting revenue between 2.03 and 2.18 billion. The estimate was looking for 1.85. So at a minimum, it would be in line with this quarter, perhaps significantly better than this quarter, but better than the consensus by far. EPS for the current quarter, 254 to 264 The estimate was looking for $2.16.
That would be pretty much in line with what we have for this current quarter. Fiscal year, projecting revenue between 7.98 to 8.23 billion. That is up from a previous guide of 7.33 to 7.58 billion. They're projecting fiscal year EPS of $9.73 to $10.03 from a previous range of 870 to $9.
Also projecting their gross margins to be 68.1 to 69.1. That is a slight miss from the estimate of the net app that is looking for 69.3 % for the fiscal year. Doesn't seem to be affecting things too negatively though right now, Alex, as I'm looking across, we're still holding on to a 3.5 % gain for NetApp. So take me through what stands out to you here.

**Alex Coffey** (1:39)
Yeah, what stands out in the numbers that they actually gave, so not their forecast. I mean, what the story is is a really positive one. Better than expected margins, a comp sales beat or rather a net revenue beat that's significant. The EPS is expanded, of course, because of gross margins as well. You look at these numbers, this is a stock too. I think the fun part about this, we're about to hear from HPE. These are two companies that are very much alike, and you're seeing a read-through already to HPE before its numbers to the upside. So this is seen as something that could be industry wide, boost its full year EPS forecast despite missing on gross margins. So I think that this is both going to be seen by analysts as a conservative guide, but a strong guide at the same time. It leaves room for upside considering they just gave us margins of 70.6% and they guide for a midpoint that's in the mid 68%.
If they just continue with what they did for the first quarter, it's gonna be a pretty nice EPS beat throughout this year.

**Marley Kayden** (2:42)
Yeah, certainly. I mean, holding on to these gains, but giving back, we're only up about a percent right now. One more important metric from NetApp before we switch over to Five Below, their all-flash array net revenue, that's an important metric for this company, hit a record of $1.3 billion. That's up 47% year over year and their public cloud revenue also touched a record as well. So good numbers, perhaps an early read through for what we get from HPE, which we don't have yet, but we do have Five Below. So let's take a look at Five Below. Five Below also moving to the upside. We're up about 2.75% right now. Their EPS coming in at $1.68. That's beating the consensus that was about $1.40, and it's up more than 100% year over year. Their net sales for the quarter up close to 23% year over year to $1.261 billion. That's beating the estimates looking for $1.22. Comp sales surged 14%.
The estimate was looking for 10.6%.
Their gap diluted EPS was $3.99. Adjusted operating income coming in at $113.2 million. Adjusted net income is at $93.4 million. Their total store count reached $2,022. That's up 8.8% year over year with 52 net new stores opened in the quarter. They also raised their fiscal year net sales outlook to $5.63 billion to $5.71 billion from a previous range of $5.4 to $5.48. Their EPS guiding now between $9.83 and $10.31 from a previous range of $8.65 to $9.05. Comp sales guidance is now up 10% to 12% from a prior estimate of being up 9%.
For the current quarter, they are guiding for EPS of $1.00 and a penny to $1.13. The $0.87 was the consensus there and revenue of $1.2 to $1.23 billion. The consensus was looking for $1.15. They see comp sales being up 8% to 10%.