Local Tech Wire

RESEARCH TRIANGLE PARK, N.C. – Storage technology firm (Nasdaq: NTAP) soared 18 percent to a 52-week high of $38.65 on Thursday after its strong earnings report Wednesday.

However, in a conference call with analysts, Chief Executive Officer Thomas Georgens expressed wariness about the future of the economy.

Could a “double dip” recession occur?

Here’s what Georgens said in response to a question from Ittai Kidron from Oppenheimer & Co. Inc, based on a transcript provided by SeekingAlpha:

“Tom, three times during your prepared remarks, you’ve mentioned something to the extent of should things turn around, turn back down south from an economic standpoint. Can you give us all the more clarity? I would assume that over the last two weeks, you’ve made a lot of phone calls to your people on the ground in Europe. What is it that you’re seeing over there? And is there any indication that the recovery that we’ve seen up until now is to stall?”


“I think that we don’t see anything in the horizon that you don’t read about in the papers everyday. I think that it clearly concerns about Europe. We have Wall Street Journal this week, talk about the potential of the double dip, and I think all of those are out there. And I’m not going to handicap the likelihood of them, but I think we need to be aware of them.

“As far as what we’re hearing from Europe, I think there’s two components of the story. Number one is I don’t see anybody backing away from the number even in dollar terms. On the other hand, it’s still early in the quarter and we’ll see how that plays out.

“But I think the big thing about Europe is, while we have some strong presence in a number of countries, we also have very, very small presence in a bunch of others that represent significant growth and share opportunities for us. In economies where we have very little market share, the macro doesn’t really matter that much, and that’s kind of my message to them and if they had a message to me.

“But right now, I think everybody’s reading the headlines, but people are still bullish about the business and ability to gain share. And the customers that we talked to that are going to drive the number are still relatively positive.

“So I think Europe is really two components. One is the local currency conversion, and where we’re going to go from $1.22 to $1.23, I don’t think anybody knows, and that’s clearly our estimates of that that’s factored into our guidance. And the other one is will actually be a reduction of demand. And I think in the latter category, at this point in time, we’re not seeing that yet.”

For the full transcript,

For LTW coverage of the

NetApp, which is based in California, has a major operation in RTP.

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