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EMC Reports 23% Increase in First-Quarter Profit; Achieves 11% Growth in Quarterly Revenue
Published Apr 26, 2012
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EMC Corporation (NYSE:EMC) today reported strong financial results for the first quarter of 2012, marking the company’s ninth consecutive quarter of achieving year-over-year double-digit growth for consolidated revenue, net income and EPS.
First-quarter consolidated revenue was $5.1 billion, an increase of 11% compared with the year-ago quarter. First-quarter GAAP net income attributable to EMC increased 23% year over year to $587 million. First-quarter GAAP earnings per weighted average diluted share increased 29% year over year to $0.27. Non-GAAP1 net income attributable to EMC for the first quarter was $818 million, an increase of 17% compared with the year-ago quarter. First-quarter non-GAAP1 earnings per weighted average diluted share were $0.37, an increase of 19% year over year.
During the first quarter, EMC generated operating cash flow of $1.7 billion and free cash flow2 of $1.4 billion, increases of 49% and 67% year over year, respectively. Additionally, the company significantly expanded GAAP and non-GAAP gross margin and operating margin percentages on a year-over-year basis, and ended the quarter with $10.9 billion in cash and investments.
Joe Tucci, EMC Chairman and Chief Executive Officer, said, “We are in a time of unprecedented IT and business transformation, propelled by the benefits of cloud computing, Big Data and trust. EMC is off to a strong start to 2012 and is exceptionally well-positioned to help customers take advantage of these major transformational shifts. We have never been more excited about what this great technology company can accomplish and look forward to helping our customers drive maximum value from their IT investments in the years ahead.”
David Goulden, EMC Executive Vice President and Chief Financial Officer, said, “EMC’s solid first-quarter results are ongoing proof that we are executing on our strategy and on track to deliver our ‘triple play’ – simultaneously taking market share, reinvesting for growth and delivering improved earnings this year. Based upon our strong start to the year and our opportunity, we now have greater confidence in our ability to meet and potentially exceed our 2012 financial goals for consolidated revenue, non-GAAP EPS and free cash flow. Additionally, with continued steady execution, we are well on our way to achieving the financial potential of 2014 consolidated revenue of over $28 billion, which represents compound annual revenue growth of at least 13% from 2010 and non-GAAP EPS growth even greater than this.”
First-Quarter Highlights
First-quarter highlights included strong customer demand for EMC’s market-leading mid-tier storage products portfolio3, which increased revenue 26% year over year. The company’s Isilon scale-out NAS business nearly doubled its revenue year over year, and its VNX unified storage family, Backup Recovery Systems (BRS) portfolio, and Greenplum portfolio each delivered strong year-over-year revenue growth. Also during the quarter, EMC’s RSA Information Security business increased revenue 19% year over year and revenue from VMware (NYSE: VMW), the global leader in virtualization and cloud infrastructure, grew 25% year over year. Additionally, EMC continued to experience strong customer demand for its broad portfolio of services to help customers accelerate to the cloud. Finally, VCE, the Virtual Computing Environment Company formed by Cisco and EMC with investments from VMware and Intel, continued its momentum as customer adoption of Vblock Converged Infrastructure Platforms increased significantly on a year-over-year basis.
EMC’s consolidated first-quarter revenue from the United States increased 11% year over year to $2.6 billion, representing 52% of consolidated first-quarter revenue. Revenue from EMC’s business operations outside of the United States increased 10% year over year to $2.5 billion and represented 48% of consolidated first-quarter revenue. Within this, revenue in EMC’s Asia Pacific and Japan region reached an all-time record level, growing 20% year over year. EMC’s Europe, Middle East and Africa region grew revenue 6% year over year and EMC’s Latin America region grew revenue 20% year over year.
About EMC
EMC Corporation is a global leader in enabling businesses and service providers to transform their operations and deliver IT as a service. Fundamental to this transformation is cloud computing. Through innovative products and services, EMC accelerates the journey to cloud computing, helping IT departments to store, manage, protect and analyze their most valuable asset — information — in a more agile, trusted and cost-efficient way. Additional information about EMC can be found at www.EMC.com.
1 Items excluded from the non-GAAP results for the first quarters of 2012 and 2011 are amounts relating to stock-based compensation expense, intangible asset amortization, restructuring and acquisition-related charges and amortization of VMware’s capitalized software from prior periods. See attached schedules for GAAP to non-GAAP reconciliations.
2 Free cash flow is a non-GAAP financial measure which is defined as net cash provided by operating activities, less additions to property, plant and equipment and capitalized software development costs. See attached schedules for a reconciliation of net cash provided by operating activities to free cash flow for the three months ended March 31, 2012 and 2011.
3 EMC’s mid-tier storage products include EMC VNX, EMC CLARiiON, EMC Celerra, EMC Centera, EMC Data Domain, EMC Isilon, EMC Avamar and EMC Atmos hardware and software products.
EMC, Atmos, Avamar, Celerra, Centera, CLARiiON, Data Domain, Greenplum, Isilon, RSA, Vblock, and VNX are either registered trademarks or trademarks of EMC Corporation in the United States and/or other countries. VMware is a registered trademark or trademark of VMware, Inc. in the United States and/or other countries. All other trademarks used are the property of their respective owners.
Posted by
VMD - [Virtual Marketing Department]
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