My last article reported on the virtualization vendors’ fourth quarter results, and this post reports on news from the storage industry. My sources are Cleveland Research and individual company reports from CRC and FactSet Estimates.
First, let me present some year over year numbers from Dell EMC, NetApp, HP, Pure, Nimble, and, finally, Nutanix. These year over year numbers give us a better understanding of how the storage world is doing.
First on the list is Dell EMC. Starting back in 2010, EMC reported earnings of $12.6 billion. 2011 came around, and EMC reported earnings of $14.8 billion, a 17% increase for the year over year. In 2012, EMC reported earnings of $15.6 billion, a 5% increase from the previous year. In 2013, EMC’s reported earnings totaled $16.2 billion, a 4% increase from the previous year. 2014’s reported earnings totaled $16.5 billion, which was a 2% increase from the previous year. 2015 was a little better, with reported earnings of $17.2 billion, a 4% increase from the previous year. In 2016, reported earnings dropped to $16.8, a 2% decrease from the previous year. Finally, 2017’s estimated earnings are expected to be around $17.3 billion, an expected 3% increase over 2016.
Next on the list is NetApp. In 2010, NetApp’s reported earnings were $4.7 billion, followed by $6.0 billion in 2011, a 26% increase over the previous year. Its 2012 reported earnings were $6.3 billion, a 5% increase from the previous year. 2013 brought a modest increase, with earnings reported at $6.3 billion, a 1% increase from the previous year. Things have slowed down for NetApp since then. 2014’s earnings were reported at $6.2 billion, a 3% decrease from the previous year. 2015 reported earnings were $5.7 billion, an 8% decrease from the previous year. For 2016, NetApp’s reported earnings were $5.4 billion, a 5% decrease from the previous year. NetApp believes that 2017 will be a much better year, with estimated earnings around $5.5 billion, a 3% increase over 2016.
Next up is HP. In 2010, HP reported earnings of $3.8 billion, rising to $4.1 billion in 2011, a 3% increase from the previous year. From 2012 on out, HP’s earning reports have been dropping. 2012 reported earnings were $3.7 billion, a 7% decrease from the previous year. 2013 continued the decline, with earnings reported at $3.5 billion, a 5% decrease from the previous year. 2014 reported earnings were $3.3 billion, which was a 5% decrease. 2015 earnings were reported as $3.0 billion, an 8% decrease, and in 2016, its reported earnings were $2.9 billion, a 6% decrease from the previous year. Estimates for 2017 are not much better at $2.7 billion, an estimated 5% decrease from 2016.
Dell EMC, NetApp, and HP are the only storage vendors on my list with a track record going all the way back to 2010. From the results, we can see that 2011 was the best year for all of the vendors, and that they all started slowing down from there on out. Dell EMC appears to be the only one on the list that is keeping its head above water. It would appear that the “established” vendors are struggling, and here is one reason why.
Pure Storage had its first reported earnings in 2015 of $440 million and followed that up in 2016 with revenue reported at $728 million, a 65% increase from the previous year. The estimates for 2017 are $991 million, a 36% increase from 2016.
Nimble Storage’s first reported earnings, back in 2013, of $126 million, were followed up in 2014 with $288 million, an 81% increase from the previous year. 2015 earnings were reported at $322 million, a 42% increase from the previous year. 2016 earnings were $402 million, a 25% increase, with estimates expected to be around $490 million, a 22% increase, for 2017.
Last on the list is Nutanix, and in terms of earnings growth, this company is on fire. First earnings were reported in 2015 at $323 million, followed up in 2016 with earnings of $604, an 87% increase from 2015. Estimates for 2017 are $855 million, a 42% increase over 2016.
It seems that the “establishment” storage vendors are in a decline, and the new kids on the block are really taking off. HPE seems to understand that it needs some kind of change, and it has invested $1 billion to acquire Nimble at $12.50 per share. HPE will assume payouts totaling $200 million for unvested Nimble equity awards. HPE has suggested that the acquisition will add to its flexibility in flash environments and will future-proof the HPE roadmap for the next generation of storage technology.