NetApp is headed for the cloud in a flash with its new hybrid, multicloud platform NetApp Keystone. The company hopes the move will help it blast past a bumpy start to its fiscal year that resulted in shares plummeting nearly 18% in late trading — to which the legacy storage vendor holds macroeconomic and execution issues to blame. 

NetApp executives say the company’s all-flash and hybrid storage arrays have been a burden on revenue. And so, the company is pivoting to a hybrid and multicloud architecture

“The hybrid, multi cloud is the de facto architecture of choice — either by hook or by crook — customers are going to end up in a hybrid cloud, multi cloud kind of world,” said Nancy Hart, NetApp's VP of marketing for private and hybrid cloud, DevOps, and cloud infrastructure.

Customers already use multiple clouds, and they want to be able to manage them from one place while using the tools and services native to each environment, Hart told SDxCentral.

To facilitate the migration to the cloud, NetApp is launching Keystone.

“Keystone is our gateway program for customers to transfer and transform IT and operate like a cloud everywhere,” said Hart. “And for us at NetApp, it’s really a recognition and understanding that cloud is as much a financial and operational paradigm as it is technology.”

The file system vendor claims that the Keystone recipe to please is as “simple as 1-2-3.”  According to the company, customers can consume NetApp systems and software on premises through cloud-like subscription models for a monthly fee with the ability to boost capacity and join the public cloud through NetApp's Data Fabric.

NetApp’s Data Fabric was updated in 2018 to integrate NetApp’s ONTAP data management and storage software to automatically tier on-premises data to the cloud for a fluid pool of resources that can be composed and recomposed as needed.

“Simple, flexible, affordable. Exactly what our customers have been asking for,” wrote James Whitemore, NetApp’s VP and interim CMO, in a blog post.

The Keystone launch is a checked-box for a NetApp that — following similar moves by Hewlett Packard Enterprise, Dell Technologies, and other companies — announced earlier this year it would be moving into consumption-based pricing to further make on-premises infrastructure more cloud-like.

The Sunnyvale, California-based company had a not-so-sunny summer as sales took a nose-dive in mid-2019, prompting full-year fiscal revenue projections to decline somewhere between 5% and 10% below previous expectations from its original forecast of nearly $6 billion.

“Investors should not rely on our previous full fiscal year 2020 guidance issued on May 22, 2019,” the company said in an issued statement. 

Revenue is expected to see a 17% drop compared to previously announced expectations, with income also falling more than 50%.

As the saying goes, “a poor craftsman blames his tools,” and in NetApp’s case — those not buying tools. Company executives pin some of the blame on recessionary fears among large companies. 

According to Goldman Sachs analyst Rod Hall, enterprise spending will continue to deteriorate and that could pose problems for several large tech stocks. “We believe that most of this weakness relates to a lack of business confidence at large enterprise driven by trade volatility as opposed to a broader macro slowdown,” he wrote. 

Despite the company’s financial difficulties, NetApp CEO George Kurian remains optimistic for the future.

“Our customer conversations indicate that our hybrid multicloud portfolio of solutions is the right one. We believe we can return to growth over time by prudently reallocating investments to expand sales coverage and accelerate our participation in the growing private cloud and cloud data services markets,” said Kurian.