EMC Corporation Reports Highest-Ever Quarterly Revenue and Earnings.HOPKINTON Hopkinton is the name of several towns in the United States:
Revenue and Net Income Growth Exceed 30% For Fifth Consecutive Quarter; Sales of Enterprise Storage Software Surge 140% EMC Corporation EMC Corporation (NYSE: EMC) is an American Fortune 500 and S&P 500 manufacturer of software and systems for information management and storage. It is headquartered in Hopkinton, Massachusetts, USA. , the world's leading supplier of enterprise storage systems and software, today reported record company results for the second quarter of 1998. Revenue for the second quarter was $952 million, up 33% from the second quarter of 1997. Net income for the quarter was $189 million, up 47% compared with the second quarter of 1997. On a diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, earnings per share were $0.36 in the quarter, up 44% compared with the $0.25 per share of the year-ago quarter. Revenue from EMC's growing portfolio of enterprise storage software products surged 140% compared with the second quarter of 1997, to $98 million. Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. C. Ruettgers, EMC (1) (EMC Corporation, Hopkinton, MA, www.emc.com) The leading supplier of storage products for midrange computers and mainframes. Founded in 1979 by Richard J. Egan and Roger Marino, EMC has developed advanced storage and retrieval technologies for the world's largest companies. President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said, "The accelerated growth and profitability levels we began to see a year ago have clearly been established. The second quarter marked our fifth consecutive quarter of year-over-year growth exceeding 30% in both revenue and net income. EMC's success is the result of years of investment in the information protection, management and sharing technology that all organizations require to harness and leverage their expanding volumes of data. The growth and market acceptance of EMC Enterprise Storage across all of today's popular computing computing - computer environments continues to outpace out·pace tr.v. out·paced, out·pac·ing, out·pac·es To surpass or outdo (another), as in speed, growth, or performance. outpace Verb [-pacing, all other storage suppliers in this expanding market." "The explosive growth of our software business, which exceeded 10% of our total revenue in the second quarter, continues to make EMC one of the fastest-growing major software companies in the world," Ruettgers continued. "Sharply increased demand for EMC Enterprise Storage software solutions supports our expectation that customers around the world would have a tremendous need for advanced solutions to protect, manage and share their critical information, regardless of its origin. In particular, our software growth during the quarter was led by Symmetrix Remote Data Facility (SRDF SRDF Symmetrix Remote Data Facility SRDF Symmetric Remote Data Facility ), EMC TimeFinder, EMC Data Manager (EDM (Engineering Data Management) An information system that maintains the details of all engineering data while the product is in the design and concept phase. This includes geometry and changes to geometry. See PLM. EDM - Electronic Data Management ), and the recently introduced EMC PowerPath PowerPath is EMC Corporation's multi-path management software for storage networks. It is server-resident software that manages a server's use of multiple paths to a storage device. software." Revenue from Symmetrix Enterprise Storage systems with Fibre Channel connectivity exceeded $170 million for the second quarter. "We have now shipped about $500 million in Symmetrix Enterprise Storage systems with Fibre Channel connectivity in less than a year," Ruettgers noted. "While others have described the market for Fibre Channel as developing slowly, we have found the opposite to be true. The increased distance and speed enabled by linking servers and storage systems using Fibre Channel are helping EMC customers - particularly in the Windows NT (Windows New Technology) A 32-bit operating system from Microsoft for Intel x86 CPUs. NT is the core technology in Windows 2000 and Windows XP (see Windows). Available in separate client and server versions, it includes built-in networking and preemptive multitasking. environment - to deploy EMC Enterprise Storage Networks, which combine the benefits of distributed computing (1) The use of multiple computers networked throughout a wide geographical area, or the world via the Internet, in order to solve a single problem. See grid computing. (2) The use of multiple computers in an enterprise rather than one centralized system. and consolidated information. We believe this trend will accelerate overall demand for Windows NT in mission-critical applications." Highlights of the second quarter included EMC's introduction of the world's largest capacity storage systems - Symmetrix 5700 and Symmetrix 3700 systems, capable of holding six terabytes of information; EMC Data Manager (EDM) Symmetrix Path, the world's fastest Enterprise Storage backup solution for Windows NT; and the world's first Fibre Channel hub connectivity for heterogeneous Not the same. Contrast with homogeneous. heterogeneous - Composed of unrelated parts, different in kind. Often used in the context of distributed systems that may be running different operating systems or network protocols (a heterogeneous network). servers. EMC also shipped its 1,000th EMC TimeFinder license before the product's first birthday, and surpassed the one-petabyte milestone (1,000 terabytes) in total data moved using its industry-leading Symmetrix Data Migration Services (SDMS SDMS - A query language. ). Also during the quarter, EMC acquired French professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. firm Groupe MCI (1) (Media Control Interface) A high-level programming interface from Microsoft and IBM for controlling multimedia devices. It provides commands and functions to open, play and close the device. (2) (Microwave Communications Inc. ; announced the expansion of its reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. relationship with Hewlett Hewlett may refer to: People with the surname Hewlett:
emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. presence by opening the newest EMC subsidiary in Spain and signing UK-based ICL (International Computers Ltd., London) The former name of Fujitsu Services, the European-centered arm of the global Fujitsu Group and one of the leading IT services companies in Europe, the Middle East and Africa. to a new reseller agreement; and formed a technical alliance with enterprise application software provider PeopleSoft. EMC Corporation, a Fortune 500 company based in Hopkinton, Massachusetts Hopkinton is a town located in southwestern Middlesex County, Massachusetts, about 40 km (26.4 mi) from Boston. It is one of nine towns that are part of the region known as MetroWest. The population was 13,346 at the 2000 census. , is the world's technology and market leader in the rapidly growing market for intelligent enterprise storage systems, software and services. The company's products store, retrieve, manage, protect and share information from all major computing environments, including UNIX UNIX Operating system for digital computers, developed by Ken Thompson of Bell Laboratories in 1969. It was initially designed for a single user (the name was a pun on the earlier operating system Multics). , Windows NT and mainframe platforms. The company has offices worldwide, trades on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the symbol EMC, and is a component of the S&P 500 Index. For further information about EMC and its storage solutions, EMC's corporate web site can be accessed at http://www.EMC.com. This release contains statements about market growth that are "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " under the Federal Securities Laws. Actual results could vary materially. Factors that could cause actual results to vary materially include, but are not limited to: component quality and availability, transition to new products, the uneven pattern of quarterly results, changes in business conditions, changes in EMC's sales strategy and product development plans, changes in the data storage marketplace, competition in the data storage market, competitive pricing pressures, continued market acceptance of EMC's products, delays in the development of new technology, changes in customer buying patterns, Year 2000 issues, one-time events and other important factors disclosed previously and from time to time in EMC's filings at the U. S. Securities and Exchange Commission. -0-
EMC CORPORATION
Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
June 30, June 30,
1998 1997
Revenues:
Net sales $ 918,822 $ 694,511
Service and rental 33,180 18,950
952,002 713,461
Costs and expenses:
Cost of sales and service 467,480 384,545
Research and development 74,228 53,446
Selling, general and
administrative 177,353 114,640
Operating income 232,941 160,830
Investment income 23,954 17,412
Interest expense (4,999) (4,640)
Other income/(expense), net 765 (369)
Income before taxes 252,661 173,233
Income tax provision 63,165 44,434
Net income $ 189,496 $ 128,799
Net income per weighted
average share, basic $ 0.38 $ 0.26
Net income per weighted
average share, diluted $ 0.36 $ 0.25
Weighted average shares,
basic 498,648 492,477
Weighted average shares,
diluted 537,550 527,899
As a % of total revenue:
Gross margin 50.9% 46.1%
Selling, general and administrative 18.6% 16.1%
Research and development 7.8% 7.5%
Operating income 24.5% 22.5%
Net income 19.9% 18.1%
EMC CORPORATION
Consolidated Statements of Income
(in thousands except per share amounts)
(unaudited)
Six Months Ended
June 30, June 30,
1998 1997
Revenues:
Net sales $ 1,724,755 $ 1,295,411
Service and rental 55,598 36,487
1,780,353 1,331,898
Cost and expenses:
Cost of sales and service 898,616 720,530
Research and development 139,903 101,537
Selling, general, and
administrative 330,849 212,264
Operating income 410,985 297,567
Investment income 46,461 29,096
Interest expense (9,729) (6,042)
Other income/(expense), net (236) 1,728
Income before taxes 447,481 322,349
Provision for income taxes 111,870 82,682
Net income $ 335,611 $ 239,667
Net income per weighted average
share, basic $ 0.67 $ 0.49
Net income per weighted average
share, diluted $ 0.64 $ 0.47
Weighted average shares, basic 497,944 492,037
Weighted average shares, diluted 536,431 518,826
As a % of total revenue:
Gross margin 49.5% 45.9%
Selling, general and administrative 18.6% 15.9%
Research and development 7.9% 7.6%
Operating income 23.1% 22.3%
Net income 18.9% 18.0%
EMC CORPORATION
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
June 30, December 31,
1998 1997
Assets:
Cash and investments 1,867,590 1,650,633
Receivables 814,076 788,869
Inventories 480,856 404,660
Property and equipment 487,668 396,511
Other assets 313,009 249,436
Total assets $3,963,199 $3,490,109
Liabilities and equity:
Current liabilities 600,940 505,870
Deferred income taxes 44,464 45,353
Long-term obligations:
Convertible subordinated notes 517,500 517,500
Other long-term liabilities 36,292 45,085
Stockholders' equity 2,764,003 2,376,301
Total liabilities and equity $3,963,199 $3,490,109
-0- CONTACT: EMC Corporation Mark Fredrickson, 508-435-1000 X77137 fredrickson_mark@emc.com |
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