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NetApp To Cut 900 People

Activist shareholder Elliott Management, believed to own a little less than 5% of the company, wants a change in the board

NetApp, which is under pressure from activist shareholder Elliott Management to shape up and return value, said Tuesday that it’s going to can 900 people to spiff up its financials, 400 less that the 1,300 that Piper Jaffray estimated last week.

It’s also going to start paying a 15-cent-a-share dividend and buy back more shares than it meant to.

Although the plan is unlikely to satisfy Elliott, NetApp increased it stock repurchase plan by $1.5 billion to $3 billion over three years.

Elliott is believed to own a little less than 5% of the company and wants a change in the board. It figures NetApp’s technology hasn’t kept up with the times.

NetApp’s sales and profits are dropping. It said its sales will be $1.48 billion-$1.58 billion in its fiscal Q1 against analyst estimates of $1.60 billion, returning 45-50 cents a share, at least three cents shy of Wall Street projections.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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