While NetApp’s quarterly results were better than expected and the cloud company raised its financial outlook for the current fiscal year, J.P. Morgan’s Samik Chatterjee isn’t impressed.

Late Thursday, NetApp, a provider of cloud storage and data-protection services, reported earnings of $1.94 a share for its third fiscal quarter, which ended on Jan. 26. The consensus call among analysts tracked by FactSet was for $1.69.

Revenue grew 5% to $1.61 billion, also beating the consensus call for $1.59 billion.

CEO George Kurian said that demand for artificial intelligence has attracted customers who are looking to deploy large-model training environments. On the other hand, he said, some customers are looking “to increase budget flexibility” because of higher interest rates and economic uncertainty.

The company expects an adjusted profit in the range of $1.73 to $1.83 per share in the current fourth quarter, while the consensus call among analysts had been for $1.73. For the full fiscal year, it is targeting profits between $6.40 and $6.50 a share, compared with a November forecast of up to $6.25 a share. The Wall Street consensus had been for $6.14 a share.

Despite the blowout results, J.P. Morgan’s Chatterjee, who moved to an Underweight or Sell equivalent rating in early January, kept his view largely intact. In a note on Friday, he wrote that he expects storage to be a lower priority for customers when it comes to spending on hardware in this cycle of investment in computing.

He is less upbeat about the outlook for earnings than Wall Street is in general. He forecasts NetApp will deliver $6.50 a share in fiscal 2025 profit, clocking only about 1% growth from a year ago relative to fiscal 2024, which ends in April. That compares with the consensus forecast of $6.59 a share. Management didn’t offer a forecast but said the company is “well-positioned.”

J.P. Morgan’s stock price target for 2024 is $95, up from $87. NetApp’s stock gained 24% to $110.04 on Friday, putting it on pace for the highest close and largest one-day increase in more than two decades. Other analysts are more optimistic. Susquehanna Financial Group’s Mehdi Hosseini has a Positive rating, the equivalent of a Buy. He said in a Friday research note that he expects the company to earn more than Wall Street expects in 2025 as the company benefits from the migration of trained AI models to the public cloud.

Hosseini raised his price target to $115 from $100.

A bit more than two-thirds of analysts rate the stock at Hold.