What happened

Shares of NetApp (NASDAQ:NTAP) have cratered today, down by 22% as of 11:45 a.m. EDT, after the hybrid cloud specialist reported preliminary fiscal first-quarter earnings results. The company also slashed its fiscal 2020 outlook.

So what

Fiscal first-quarter revenue is expected to be in the range of $1.22 billion to $1.23 billion, missing the guidance that NetApp previously provided that called for approximately $1.32 billion to $1.47 billion in sales. Analysts were modeling for $1.38 billion in revenue. Adjusted earnings per share should be $0.55 to $0.60, below NetApp's outlook of $0.78 to $0.86, and missing the consensus estimate of $0.82 per share in adjusted profits.

Red chart going down

Image source: Getty Images.

"While we are disappointed that our preliminary results for the first quarter are lower than we had previously anticipated, we remain confident in our long-term strategy and the health of our business model," CEO George Kurian said in a statement. "Our customer conversations indicate that our hybrid multicloud portfolio of solutions is the right one."

Now what

NetApp also reduced its forecast for full-year fiscal 2020. The company had previously expected net revenue to grow "at the low-end of mid-single-digit range," but now believes sales will decline by 5% to 10%. NetApp warned investors not to rely on the guidance issued in May but has not yet updated other aspects of its outlook like gross or operating margins.

Finalized results will be released on Aug. 14.