HubStor added continuous data protection and version control to its cloud storage platform.
The continuous data protection (CDP) provides agentless monitoring of specific file system directories to detect new files and capture them, according to Canadian-based HubStor. Uses include backup with a short recovery point objective (RPO) or as a write-once read-many archive for compliance.
Enabling the CDP is a checkbox option with no additional charge or software to deploy it. The default timeframe is 30 seconds.
HubStor, which provides cloud-based data management software, had customers who wanted a “very short” RPO, said co-founder and CEO Geoff Bourgeois. The product previously could run scheduled scans every 30 minutes.
Version control, also a checkbox, goes hand-in-hand with continuous data protection. HubStor introduced version control now because CDP can produce many versions, Bourgeois said.
As HubStor captures incremental changes, the product builds out a version history for each file. Point-in-time awareness in the cloud enables an organization to restore data at a known healthy time, for example the moment before a ransomware attack hit.
Over time, an organization can prune its versions and phase them out — for example through a setting of one version per month — which can help “control the storage growth in the cloud,” Bourgeois said.
HubStor at ‘a neat stage’
HubStor, founded in 2015, claims nearly 100 customers and expects to hit the century mark by the end of the year.
“We’re at a neat stage in the company’s history,” Bourgeois said, noting HubStor does not have any venture capital funding and does not carry debt, making money through a consumption-based business model.
Typical customers are medium to large enterprises, with hundreds of terabytes under management. Customers are starting to get into the multi-petabyte range, as a new one is moving 5 PB into HubStor, Bourgeois said.
HubStor is closely tied to Microsoft and uses Azure for its back end. Its software-as-a-service approach provides a fully managed product for customers, Bourgeois said.
In addition to backup and recovery, HubStor offers tiering and retention capabilities.
KUKA, a global robotics manufacturing and implementation company, had a lifecycle problem with its file retention. It had nearly 75 TB of archived data with retention requirements.
After looking at a few vendors, including Nasuni and NetApp, KUKA found that HubStor handled archive tiering the best, said systems administrator Troy Dieter.
Since implementing HubStor six months ago, KUKA has recouped about 60 TB of SAN storage. That data is tiered and stored in HubStor’s tenant, Dieter said. Both HubStor and Veeam helped KUKA shift off of tape for archiving.
KUKA uses the search feature often. The company has about 75 million files just in archives, so being able to search quickly is valuable.
Dieter said he would demo the new CDP and version control features, but noted that he is satisfied with his company’s use of Veeam for backup.
“I’m eager to see what they’ve built in for their backup and retention,” he said of HubStor.
Dieter said a user experience refresh in the HubStor Connector Service — the storage transit agent — would be helpful, as it can get a little confusing.
HubStor aims to add continuous data protection support for Office 365 in early 2019, as customers require short RPOs for that data, Bourgeois said. Version control settings are available for Office 365.
Bourgeois said Veeam and SkyKick offer similar technologies and HubStor also sees startups Cohesity and Rubrik competing for some similar deals. HubStor has a leg up because of its consumption pricing model, with nothing owed upfront, Bourgeois said.
Dell EMC on Thursday reported nearly $4 billion in storage revenue in its most recent quarter, marking its third consecutive positive earnings in storage. But executives refrained from sharing high-fives, noting “we have work to do” to boost Dell EMC midrange storage and recapture lost market share.
Storage market leader Dell EMC is part of Dell Technologies Infrastructure Solutions Group (ISG), which also includes Dell networking and server hardware. ISG generated nearly $9 billion in revenue, up 19%, mostly driven by a 30 percent growth in sales of 14G Dell PowerEdge storage servers and networking gear to $5.1 billion.
Last quarter, Dell EMC storage revenue increased 6%, less than half the 13% in the prior quarter. For the first quarter, Dell EMC storage grew 10%.
“Quite frankly, we would have liked to have seen higher growth in storage this quarter, but we do believe we have taken the right actions to drive meaningful long-term improvements in the storage business,” Dell CFO Tom Sweet said.
Dell EMC outpaced IBM, which reported a decline in storage revenue in its last earnings period, but lagged behind Pure Storage (34% year-over-year growth) and slightly behind NetApp (7% year-over-year increase).
Sweet said Dell EMC has set a target operating margin for ISG of 14% as part of a playbook to drive “a consistent, creaming-the-market trajectory that will allow us to recapture a fair amount of the share loss we experienced over the last number of years.”
Parent company Dell Technologies reported overall revenue of $22.5 billion for the quarter, up 15%, with a GAAP operating loss of $356 million. The Client Solutions Group, which includes client and consumer PCs, monitors and integrated software, contributed $10.9 billion, up 11%. The VMware segment chugged along at 15% growth, generating $2.2 billion, driven by a 17% jump in license revenue.
In a related matter, Dell said stockholders are expected to vote Dec. 11 on a complex buyback of its 81% stake in VMware. Dell picked up VMware when it acquired EMC.
The measure would return Dell to publicly traded status, without having to underwrite an initial public offering. Dell has proposed to convert its Class V tracking stock in VMware to Class C common stock, which would be publicly traded on the New York Stock Exchange under the ticker symbol “DELL.” If approved, trading is projected to start Dec. 28.
PowerMax, VxRail carry Dell EMC midrange storage
Growing the storage business has been a problem – particularly Dell EMC midrange storage – since the 2015 merger with EMC. Prior to this year’s first quarter, Dell EMC storage market share declined in 15 of the previous 16 quarters. The vendor is taking a two-pronged approach to “stabilize” storage and recapture lost market share, said Jeff Clarke, a Dell vice chairman of products and operations at ISG.
One part of the strategy involves getting newly hired salespeople up to speed, Clarke said. “We need more storage buyers and we are putting in the capacity in both our enterprise and commercial sales organizations to do so.
“The second linchpin (is) to improve the overall competitiveness of the product. We have done that over the last 14 months,” refreshing high-end PowerMax (formerly VMAX) all-flash arrays with NVMe and adding other performance enhancements.
Clarke said high-end, file-based and all-flash Dell EMC storage each grew by double digits, while VxRail hyper-converged infrastructure posted triple-digit growth and is poised to top $1 billion in 2018. Dell does not provide a breakdown of revenue by individual products.
The laggard was Dell EMC midrange storage, which Clarke said did not “grow to the degree we would have liked.” The midrange gear includes flagship all-flash Dell EMC Unity and SC Series (legacy Dell Compellent) arrays.
Overlapping midrange storage has been weighing on Dell EMC. After insisting repeatedly it had no intention to winnow down redundant systems, the company reversed field in September, forecasting a plan to combine engineering and launch new Dell EMC midrange storage in 2019.
Dell executives also dismissed concerns over Amazon Web Services’ announced plans to challenge legacy storage vendors by delivering racks of data center hardware for deployment on premises. Although Amazon’s announcement caught many in the industry off guard, Clarke said Dell EMC was not surprised by it.
“Not everything is going to (be stored in) a handful of public clouds. We’re seeing workloads repatriate to on-prem for cost reasons, security reasons, and performance reasons. And we think Dell Technologies is positioned quite nicely” to compete in this world.”
Actifio is looking to ride a DevOps wave to an initial public offering, but for now the data management vendor is concentrating on bolstering support of its customers and channel partners.
Actifio, based in Waltham, Mass., said the quarter that ended Oct. 31 was its largest third quarter ever.
CEO Ash Ashutosh, who founded the company in 2009, said he is happy with the growth rates, but stressed that the quality of the Actifio revenue is more important. Ashutosh said Actifio customers are not just using the vendor for data protection but also asking themselves, “What can I do with this data?”
Actifio, which helped create the term “copy data management” in its early days, now calls itself a data-as-a-service software provider. Actifio software provides backup and disaster recovery, plus data management capabilities such as DevOps and analytics. The vendor claims 52% of Actifio revenue is driven by products to boost DevOps, analytics and cyber-resilience initiatives. The DevOps process can result in a proliferation of data copies if not managed properly.
As a private company, Actifio does not provide specific revenue amounts, but Ashutosh said the company will when the time is right. Actifio has long been considered a strong candidate for an initial public offering. Ashutosh said he thinks that will happen but does not have a date set.
“It’s a milestone in the journey,” Ashutosh said, but noted that it’s not something he spends too much time contemplating.
Ashutosh said an IPO won’t be a huge change because Actifio has been operating for nearly two years as if it were a public company. That operation includes financial diligence and making sure the company is ready for the long-haul.
“We want to be aligned with where the market is going,” Ashutosh said, and that direction includes the cloud and DevOps, two areas of recent focus for the company.
The vendor claims 18% of Actifio revenue comes from hybrid and multi-cloud adoption across Amazon, Microsoft, Google, IBM, Oracle, VMware and Alibaba public clouds.
Actifio pushes for channel investment, customer success
Last August, Actifio completed its second $100 million funding round in four years. With the funding, Ashutosh said the company is investing mainly in sales and marketing, plus some research and development.
The marketing push includes investing in channel partners. More than 90% of Actifio’s business comes from channel partners. The company has about 120 active partners worldwide. Ashutosh said it’s more important “having them successful” than having a large number.
Actifio has more than 400 employees, up from about 350 last year. Actifio claims 3,500 enterprise customers in 38 countries.
Ashutosh said the latest funding round increased Actifio’s valuation to $1.3 billion, up from $1 billion in 2014, when it last raised $100 million. Total Actifio funding is $307 million.
Actifio is also working to support newer clouds and use cases, Ashutosh said. In August, Actifio expanded its partnership with IBM. The new Cyber Incident Recovery from IBM, part of IBM Resiliency Orchestration 7.3, combines Actifio’s copy data management technology with IBM’s immutable storage, disaster recovery automation and reporting.
Ashutosh said he wants Actifio to focus on how its customers can be even more strategic with their use of data. The industry is shifting to focusing on how organizations can best use data and access it better. Ashutosh claims Actifio pioneered that approach years ago, and he’s pleased the Actifio revenue numbers are showing the fruits of their labor.
“I would rather be a mule to my customers,” Ashutosh said, “than a unicorn to my investors.”
For its AI product strategy, Dell EMC is pursuing the same approach it takes with other storage products. Namely, that it’s better to have multiples of similar storage gear than to leave a gap in the portfolio.
The latest Dell EMC AI offering is a scale-out reference architecture based on all-flash Isilon F800 NAS, resulting from an expanded partnership with supercomputer maker Nvidia.
Several major storage vendors are partnering with Nvidia to launch AI products, specifically Nvidia DGX-1 turnkey hardware appliances. If the new product rings a bell, that’s because it’s similar to the existing Dell EMC AI Ready Solution for Deep Learning, which combines Isilon F800 and Dell PowerEdge C4140 servers with four NVIDIA Tesla V100 GPUs. The difference here is the absence of the PowerEdge hardware.
The reference architecture gives enterprises experimenting with AI more flexibility, said Varun Chhabra, a Dell EMC senior director of marketing for unstructured storage products.
“Many of our customers are just starting out on their AI journey, and it’s important for us to support them wherever they are,” Chhabra said.
Isilion AI for massive clusters
The building block bundles one Isilon F800 fed by up to eight Nvidia DGX-1 graphics processing units. Each Isilon chassis contains four storage nodes, 60 high-performance SSDs, eight 40 Gigabit Ethernet connections and two Arista 7060CX2-32S network switches.
Dell EMC’s OneFS file system allows a cluster to scale to 144 Isilon nodes and 36 chassis, for up to 33 PB of raw flash. Dell EMC AI customers can mix in hybrid Isilon boxes to more than double the raw capacity at 68 PB.
DGX-1 servers draw power from eight integrated Tesla V100 GPUs configured as high-performance fabric mesh. The design is intended to sidestep bottlenecks caused by PCI Express-based interconnects.
Each Nvidia DGX-1 GPU is rated to deliver a petaflop of processing speed. Dell EMC claims the Isilon F800-DGX combo supports millions of concurrent connections to ingest data at 540 Gbps.
Chhabra said customers in automotive, financial service and life sciences are using Dell EMC AI storage to meet an “insatiable demand” to inference and train data sets.
“The initial AI thrust for customers was ‘We need to get GPUs,’ so they’d buy a lot of servers and GPUs (to process data). Now customers realize there is a big role for shared storage to play in the AI space,” Chhabra said.
Dell EMC will provide product support, but customers buy the validated Isilon reference design through the channel. The product is available now.
While Amazon holds court at re:Invent in Las Vegas this week, hyper-converged pioneer Nutanix launched services that it hopes can eventually challenge the public cloud giant.
Nutanix used its European .NEXT conference in London this week to declare its Xi Services generally available, more than a year after first teasing Xi. Nutanix Tuesday evening officially launched Xi Leap for disaster recovery and Xi IoT for edge computing.
“The baby is born,” Nutanix CEO Dheeraj Pandey said in an interview from London. “After nine months of gestation.”
Make that 18 months since Nutanix first told the world about Xi at its 2017.NEXT conference in the U.S. Nutanix executives said Xi is now available Tuesday night while reporting earnings, exceeding expectations for last quarter’s revenue and this quarter’s forecast.
Pandey called Xi’s launch “a watershed moment” for Nutanix. “It’s been a couple of years of hard work,” he said of Xi development. “Going from a software company to a service provider is a big deal actually. The biggest value of being a service company is how we’re going to understand networking and security and migration, many things that we left to our current on-prem customers to figure out on their own. How do you do that on their behalf? But it’s a great on-ramp to hybrid clouds.”
Pandey said the early Nutanix Xi offerings mostly complement AWS and other public clouds such as Microsoft Azure and Google Cloud Platform, “for now.” Nutanix may be two years away from making a stiff challenge, but it is headed in that direction. At the same time, Amazon is moving into Nutanix’s turf with its newly launched Outposts that bring compute and storage into AWS customers’ data centers to enable hybrid clouds.
So far, the Xi Services apply to workloads running in customers’ data centers or the edge. The plan is to extend these services to applications running in public clouds.
The initial Xi services are designed to help enterprises make on-premises apps “cloud-ready,” Pandey said. Eventually, Nutanix plans to make all of its on-premises services available through Xi.
“As we get deeper into multi-cloud services, object storage, file storage, Apache Servers, it will be probably another 18 to 24 months before we go front and center against public cloud providers,” Pandey said. “But that being said, things like Azure Stack and VMware Cloud on AWS will definitely become competitive for us now.”
Nutanix revenue of $313 million for the quarter increased 14% from a year ago and three percent from the previous quarter. It also beat the high end of the company’s forecast by $3 million. Its software and support billings – reflecting its growing subscription base – came in at $351 million.
Nutanix lost $94.3 million in the quarter – compared to a $62.5 million loss a year ago – but finished the quarter with $965 million in cash. That’s up from $934 million the previous quarter. The vendor forecast revenue between $325 million and $335 million and billings between $410 million and $420 million this quarter. The revenue guidance was above financial analysts’ consensus expectation of $327 million.
Pandey said Dell EMC and Dell-owned VMware remain Nutanix’s stiffest hyper-converged competitors, although Dell EMC still sells Nutanix software as an option to its VMware-based Dell EMC vXRail appliances.
He said Nutanix has not seen meaningful competition from other large server and storage vendors who have moved into hyper-convergence such as Hewlett Packard Enterprise, Cisco and NetApp.
“This is an operating systems game, it’s not about hardware at all,” he said. “It’s about compute and storage and networking and security and Kubernetes, database virtualization, and desktop virtualization. It’s not just about, ‘We put storage on a server so we’re hyper-converged.’”
During the earnings call, Pandey said, “the next 18, 24 months is going to be a lot of VMware, a lot of three-tier, maybe you see a little bit of Azure Stack … And over the course of the next six quarters maybe some Azure as well.”
Nutanix said its AHV hypervisor is now adopted on 38% of nodes running the Nutanix stack, up from 35% in the previous quarter. Pandey expects the adoption rate to increase because Xi services require AVH, even if customers stick with VMware hypervisors for their on-prem nodes.
“Without being too self-righteous we’re saying, ‘Look, we will actually support mix-mode customers where they’re running VMware on-prem and off-prem could be AHV,’” Pandey said. “We don’t go and shove AHV down their throat. If you’re happy with VMware, stay with it, because we can still sell a lot of data services and network services and compute services on top of it.”
Nutanix Xi Leap can protect any application running on Nutanix on-premises, Four cloud availability zones in the United States provide failover and failback. Another cloud zone is planned for the U.K. in early 2019. Customers can implement and manage Leap through Nutanix Prism software. Nutanix promises one-click DR testing, failover and failback for the subscription service.
Nutanix Xi IoT does not require Nutanix nodes to run. It consists of a SaaS control plane and an Edge platform that runs as a virtual machine on any hyper-converged system. Xi IoT connects to public clouds to protect data on the edge. The service will bill customers a monthly fee for edge instances with added fees for data services.
Sanmina Corp. subsidiary Newisys recently plunged into enterprise storage with an NVMe all-flash system. In a bid to extend its presence in storage, Newisys is now called Viking Enterprise Solutions, a re-branding that closely ties it to Sanmina sister subsidiary Viking Technology.
Viking Enterprise Solutions (VES) also introduced the NDS-41020 4U disk array. The JBOD (just a bunch of disk) platform allows vertical scaling with 102 SAS or SATA HDDs.
The vendor also released for the first time a set of application-specific software packages for high-performance computing, media and entertainment, and distributed RAID management.
Newisys was founded in 2000 as an OEM supplier of storage technology. Array vendors would take the Newisys hardware and add their own software and bezel.
Electronics manufacturing contractor Sanmina acquired Newisys in 2003 and operated it as a stealth engineering group until the August launch of the NSS-2556 NVMe array.
The VES branding reflects a wider range of capabilities that include branded hybrid storage, cold storage and high-capacity servers, said Dan Liddle, a vice president of marketing for the vendor’s servers and storage.
“Viking is the Sanmina brand for components, memory and SSDs. We’ve branched out in recent years and are broadening our brand and strategic portfolio,” Liddle said.
The VES NDS-41020 is geared for performance and availability, including field-replaceable units, hot-swapppable drives and two I/O modules, fans and power supplies. No components are active on the device’s midplane, which helps to eliminate any single failure point. The array can zone drives in four predefined zoning schema.
Liddle said customers can request customized VES arrays that integrate their preferred storage vendor’s operating system and other third-party software.
“The focus is around density, capacity and overall price per gigabyte,” Liddle said.
The VES roadmap includes hyper-converged infrastructure built with Viking memory hardware and also OEM gear from other major vendors, but Liddle did not give a timetable.
Pure Storage’s earnings report painted a sunny picture of revenues at the same time as the flash pioneer unveiled a cloudy focus on its product direction.
Pure beat Wall Street expectations with a strong quarter, and used its earnings call Monday night to outline a new set of hybrid cloud services.
First, the earnings. Pure’s revenue last quarter grew 34% to $373 million. Product revenue of $299 million increased 31% year-over-year. Pure also gave a higher forecast than expected, guiding revenue for this quarter of between $348 million and $446 million. It raised its full-year revenue forecast to between $1.376 billion and $1.384 billion for a midpoint of $1.38 billion, up $15 million from its previous guidance.
Pure still hasn’t turned the corner on profitability, losing $28.2 million in the quarter – a slight improvement over the $29.4 million it lost a year ago. But it has more than $1 billion in cash and investments, and remains in growth mode. The vendor added around 200 employees last quarter, bringing its total to 2,650 employees.
Pure claims more than 300 new customers last quarter, running its total to more than 5,450 customers. Pure president Ken Hatfield said more than two-thirds of the shipments in the quarter included NVMe flash.
Matt Kixmoeller, Pure VP of product management, said the vendor is “on track to ship the final piece of the puzzle with NVMe over Fabrics this year.”
So Pure has a good grasp on the flash market, which is now the underpinning of primary storage. Now it will focus on cloud.
“Customers are increasingly voicing a clear demand for a hybrid cloud, but the reality today is that there is a cloud divide and nowhere is that more evident than at the storage layer,” Pure Storage CEO Charlie Giancarlo said. “On-prem and cloud data services vary widely, making it difficult to build applications that can be run everywhere and requiring that our customers make a technology choice between on-prem and the cloud. We believe it shouldn’t be that way.”
Pure used the earnings call to officially launch Cloud Data Services to run Pure storage on Amazon Web Services. The data services include Cloud Block Store, Cloud Snap and StorReduce.
Cloud Block Store is based on the vendor’s Purity operating system running natively in Amazon Web Services. CBS enables snapshots, replication and de-duplication of data created in web scale applications.
CloudSnap copies snapshots from Pure’s FlashArray into Amazon S3 for data backup and application migration. StorReduce software, which comes from Pure’s August $25 million acquisition of startup StoreReduce, dedupes data stored on Pure’s FlashBlade systems for unstructured data and sends it into AWS.
With customers already using FlashBlade as a backup target for fast backup and restores, Pure refers to StorReduce running on FlashBlade as “flash-to-flash-to cloud” data protection.
CloudSnap is generally available while CBS and StorReduce are in limited public beta. StorReduce is expected to be generally available in the first half of 2019 with CBS following later next year.
Pure is hardly the only storage vendor to embrace the cloud. NetApp for one has a similar strategy of enabling its on-premises storage features to also run in public clouds.
Giancarlo said Pure’s differentiator is, “this was purpose built for the cloud from Day One. In terms of the Cloud Block Storage, that’s our software running natively on AWS infrastructure. And then flash-to-flash-to-cloud, that’s a unique offering … low cost long-term storage plus rapid recovery …”
Pure executives said sales of the two-year-old FlashBlade platform were strong, especially with cloud providers. However, they did not break out FlashBlade revenue from FlashArray revenue. They did make it clear FlashBlade is a big piece of the Pure hybrid cloud strategy, particularly for backup and restore.
Giancarlo said cloud partner Amazon “was very excited for the ability to dedupe backup data directly onto a FlashBlade platform.”
The Kaseya backup line is growing, following the company’s acquisitions of two data protection vendors. Now Kaseya is adding a program that guarantees customers to managed service providers.
In 2018, the IT management firm acquired cloud-to-cloud backup vendor Spanning and backup and recovery provider Unitrends. Both Spanning and Unitrends continue to operate as a stand-alone independent business unit within Kaseya, which is based in New York City.
Spanning, which backs up data stored in SaaS applications such as Office 365, Salesforce and G Suite, is a quickly surging part of Kaseya business.
“The Office 365 market is on fire,” said Kaseya CEO Fred Voccola.
Kaseya acquired Spanning in October. At the same time, it also launched Kaseya Office 365 Backup powered by Spanning.
On the Unitrends front, Voccola said Kaseya uses Unitrends technology throughout its product offerings.
“IT is getting more complex than it’s ever been. It’s great technology and it’s also easy,” Voccola said of Unitrends.
Kaseya backup offering a ‘Done Deal’
Kaseya backup is aiming to make the customer acquisition process easier for managed service providers (MSPs) with a new “Done Deal” program that officially launched this month.
The program contractually commits Kaseya to provide a paying customer to the MSP within 90 days.
Voccola said many MSP leaders struggle with sales and marketing.
“Very rarely are they professionally trained, go-to-market executives,” he said.
Unitrends MSP CEO Mike Sanders added: “They have an opportunity to get in front of new customers, which is the single most difficult thing MSPs go through.”
Voccola would not publicly disclose details about how Kaseya gets the customers to MSPs. Kaseya, though, plans on providing 3,000 customers over the next year. A typical customer is an SMB looking to work with an MSP, Voccola said.
The Unitrends and Kaseya backup program is out in North America as well as part of the Europe, Middle East and Africa (EMEA) market. Kaseya is looking to launch it in more of EMEA and beyond in 2019.
“I’ve never seen a program receive as much enthusiasm as this,” Voccola said.
Kaseya claims about 15,000 MSP customers.
Kaseya and Unitrends look ahead
Sanders said that while there is a lot of synergy between Unitrends and Kaseya, Unitrends’ independence from its owner is a major reason why the integration is going smoothly.
“You hear a lot of acquisition stories that don’t go this way,” Sanders said.
Unitrends is looking to use Kaseya technology more in its product set. It’s also looking for more opportunities like the Done Deal program. Sanders said he has a couple of product ideas and anticipates announcements over the next few months.
Kaseya’s acquisition of Unitrends brought together remote monitoring and management, endpoint management, network monitoring and management, professional services automation, security, and backup and disaster recovery. The Kaseya backup acquisition was similar to the 2017 merger of IT management provider Autotask and data protection vendor Datto.
Sanders referred to Datto as his company’s biggest competition.
Edwin Yuen, senior analyst at Enterprise Strategy Group, said that while the convergence of data protection and data management has been a key trend lately, it’s starting to go a step further.
“Data protection is now becoming part of systems’ management as a whole,” Yuen said.
That includes security, compliance, backup and recovery all working together, and an overall better understanding of applications and systems.
“That’s something you’ll see more,” Yuen said.
Voccola said in the next year he anticipates Kaseya will make several more acquisitions.
NetApp beat its guidance and analysts’ expectations for last quarter’s revenue and income, and also exceeded expectations for technology buzzwords used during its earnings call.
“Our opportunity is framed by the data-driven digital transformation of business and defined by major technology transitions, led by cloud, IoT and artificial intelligence,” CEO George Kurian said during NetApp’s earnings call Wednesday. “The adoption of hybrid multi-cloud environments is changing how modern IT infrastructures are built and consumed, and NetApp is at the heart of these transitions.”
Kurian hit almost all the technology hot areas, but that was the point. Extending the vendor’s message from last month’s NetApp Insight, Kurian positioned the NetApp Data Fabric as a bridge from on-premises flash to edge and cloud storage. He said NetApp made strides in all areas, although all-flash growth slowed and its hyper-converged private cloud product does not yet have enough revenue to break out.
NetApp revenue of $1.52 billion grew 7% year-over-year and its product revenue of $913 million increased 11% over last year. The vendor’s financial health is sound. NetApp’s income of $241 million increased from $174 million in the same quarter last year, and it finished the quarter with $4.3 billion in cash. NetApp revenue has grown at least 7% for five straight quarters, and the vendor has shown a profit in four of those quarters.
Yet NetApp’s guidance indicates a slowdown in growth coming this quarter. The midway point of its revenue forecast of $1.55 billion and $1.65 billion implies only a four percent year-over-year increase. NetApp CFO Ron Pasek pointed to several “headwinds” impacting that guidance, including currency rates, interest rates, and trade disputes with China.
“We’re just generally cautious trying to maintain our track record of providing clear guidance and meeting or beating it,” Kurian said. “I don’t think there is anything that you should read into it that shows less confidence.”
Here is where NetApp stands in its main product areas of flash, cloud and hyper-convergence:
NetApp reported 29% revenue growth from all-flash systems, including its flagship All-Flash FAS arrays as well as its E Series and SolidFire storage (including NetApp HCI). That’s down from 50% year-over-year growth in the previous quarter. Kurian said NetApp has not dropped pricing in reaction to the lower cost of NAND.
Kurian said, despite a sharp growth in all-flash systems, NetApp still sells a mix of hybrid arrays that include hard disk drives. All-flash arrays remain around 14% of NetApp’s installed base, the same total as the previous quarter.
“We still have a small percentage of our installed base on all-flash arrays, so there is plenty of headroom,” Kurian said.
Kurian said customers are moving to NVMe drives but it’s still early for NVMe over Fabrics, which he called “the truly strategic part of the NVMe roadmap. It will take time to adopt, like any new storage protocol.”
Kurian said hybrid arrays using flash for performance in combination with high-capacity hard disk drives “will continue to be an ongoing percentage of our business for as long as I can see.”
Cloud data services
NetApp launched a bevy of cloud-related storage products at Insight. Kurian said NetApp is in the early stages of selling to hyperscale data centers but has seen early success with Cloud Volumes OnTap for application developers.
“Our unique differentiator is cloud integration,” Kurian said. “Our entire portfolio is made stronger by the Data Fabric and our ability to support a hybrid multi-cloud environment.”
NetApp claimed $27 million in revenue from monthly recurring cloud data services. That was a 35% increase from the previous quarter.
NetApp still isn’t breaking out its HCI revenue, about a year after entering that market. But Kurian said he is happy with NetApp HCI’s success so far. He said NetApp’s HCI approach of selling storage and compute in separate nodes instead of in one chassis is working. NetApp positions HCI as a private cloud building block that connects to public clouds in a hybrid setup.
Pasek said the company runs into traditional HCI players Nutanix and VMware in most hyper-converged deals.
“I think that we are seeing more new competitors as we attack the hyper-converged market,” Kurian said. “So, we are expanding our competitive assault on hyper-converged market.”
ClearSky Data today scored $20 million in funding and a partnership with Equinix to expand coverage for its managed storage services.
New investor Pear Tree Partners participated in the funding round, with previous investors General Catalyst, Highland Capital Partners and Polaris Partners joining. Another investor, described by ClearSky as “a market-leading technology provider,” also participated but asked not to be identified. The funding brings ClearSky’s total to $59 million.””
ClearSky Data launched in late 2015 with a managed service that uses on-premises appliances for hot data, its Points of Presence (POP) data centers for warm data and public clouds for data protection.
The vendor has since expanded its technology offerings. In 2017 it added automated backup and disaster recovery services. ClearSky followed with a NAS service for file data and support for object storage through VMware Cloud on AWS this year.
ClearSky founder and CEO Ellen Rubin said the funding as well the Equinix partnership will accelerate its expansion of POP locations. ClearSky has POP sites in Boston, New York, Chicago and Ashburn, Virginia. Rubin said the goal is to triple that total and cover the entire United States within the next year.
“Our goal is to expand westward,” she said.
Geographic expansion is crucial because ClearSky Data caches warm data at POP within 120 miles of customer sites.
Rubin said ClearSky has around 35 employees, and she expects to double sales, marketing and customer support staff with the funding.
“We’re looking for ways to be more accessible and in more places in short order,” she said.
The Equinix deal will also help ClearSky’s expansion. ClearSky uses Equinix data centers for its Ashburn and Chicago POP sites, but now will integrate its technology on Platform Equinix interconnected global data centers.
“We’ve been a customer of Equinix. This is a deeper level integration,” Rubin said. “They feel and we feel enterprise customers are looking to have more services that build a nice balance of what’s going on at the customer data center or at the edge. Connectivity from the data center to the edge is still hard. We’re a data management layer, and it’s always the data that’s hard.”
Rubin said ClearSky’s revenue for the first half of 2018 doubled the full-year 2017 revenue. She expects revenue in the second half of 2108 to also at least double 2017 revenue. She won’t say how many customers ClearSky has, but the provider lists Partners HealthCare, Massachusetts General Hospital, Nuance Communications and Unitas Global as customers.
Rubin said some of those companies use ClearSky for all their backup and disaster recovery needs, while some large organizations turn specific workloads over to the cloud storage startup.