EMC revenue, profit defies economic woes

IDG News Service — Wed, 23 Jul 2008 10:30:48 -0700

EMC's revenue grew 18 percent in the second quarter ended June 30, a result the company attributed to massive growth in the data enterprises need to store.

The company brought in US$3.67 billion worldwide in the quarter, up from $3.12 billion a year earlier. Revenue even rose 10 percent in the U.S., defying the country's economic woes, while gaining more in all of EMC's other regions around the world. The results beat expectations of analysts, who had predicted revenue of $3.56 billion, according to a Thomson Financial survey.

"Despite continued economic uncertainty at the macro level, we believe spending on information infrastructure and virtual infrastructure technologies will continue to grow," said Joe Tucci, EMC's chairman, president and CEO, in a prepared statement.

The sales gains boosted EMC's profit as well, with net income reaching $377.5 million, or $0.18 per share, up from $334.4 million, or $0.16 per share, in last year's second quarter.

Information Storage, the company's largest business, saw revenue grow 14 percent to $2.87 billion. EMC said high points included midrange storage systems connected to Internet Protocol networks, as well as consulting and implementation. Meanwhile, the company's RSA security division had a 15 percent gain to $144 million, EMC said.

EMC derived a record 48 percent of its revenue from outside the U.S. in the quarter. The news was particularly good there, as both Asia-Pacific and Japan and Europe, Middle East and Africa had 27 percent gains in revenue from a year earlier. Latin America revenue grew 24 percent.

On Tuesday, VMware reported revenue growth of 54 percent from a year earlier, to $456 million. But that result fell slightly short of analysts' expectations.

The storage industry as a whole seems to be thriving despite economic weakness. Shipments of hard-disk drives hit 137 million units in the first quarter, up 21 percent from a year earlier, research company iSuppli said Tuesday.

Following the results, EMC's shares were up $1.24 to $13.70 in early afternoon trading Wednesday on the New York Stock Exchange.

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EMC revenue, profit defies economic woes