EMC profit, revenue soar on storage and VMware

Its fourth-quarter and 2010 results were strong across major product lines

Surging revenue from storage, security and virtualization brought record financial results at EMC in the fourth quarter, the company reported Tuesday.

EMC's consolidated revenue rose 19 per cent to a record US$4.9 billion, while earnings increased 53 per cent to $0.29 per share. The results came one day after EMC's majority-owned subsidiary VMware reported its profit roughly doubled and revenue rose 37 per cent in the same quarter.

The VMware business led in EMC's revenue gains, while the company's RSA security division posted a 28 per cent revenue gain for the quarter. In EMC's core storage business, the midtier product lines, including Clariion, Celerra and Data Domain, saw the greatest sales growth at 23 per cent. The high-end Symmetrix portfolio had sales up 19 per cent.

EMC Chairman and CEO Joe Tucci attributed the strong results to overall trends in IT, including the rapid growth in data storage requirements.

Revenue in the U.S., which represented just over half of the company's business, grew 20 per cent in the quarter. Growth in Europe, the Middle East and Africa was slower at 16 per cent, while the Asia-Pacific and Japan region increased 30 per cent. Latin American revenue rose 34 per cent.

The company's reported profit of $0.42 per share, not counting one-time items, slightly exceeded the $0.41 consensus estimate of analysts polled by Thomson Reuters. The company also beat analysts' revenue estimate of $4.78 billion.

Full-year consolidated revenue for 2010 also reached a record, rising 21 per cent from 2009 to hit $17 billion. Earnings per share for the year were $0.88.

For 2011, EMC said it expects revenue of $19.6 billion and earnings per share of $1.07.

Stephen Lawson covers mobile, storage and networking technologies for The IDG News Service. Follow Stephen on Twitter at @sdlawsonmedia. Stephen's e-mail address is stephen_lawson@idg.com

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Stephen Lawson

IDG News Service
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