EMC reports record revenue, higher profitability in third quarter.
Open systems storage revenue triples; Strong competitive
position leads to continued market share gains
EMC Corporation, the world's leading provider of intelligent information storage and retrieval technology, reported today that in the third quarter of 1996 it achieved all-time record quarterly revenue for the fourth consecutive quarter and a strong and improving overall financial performance.
EMC's record revenue of $551 million for the third quarter of 1996 was 16% above the $475 million posted in the third quarter of 1995. Net income of $90 million and earnings per share of $0.37 in the third quarter were up from the $85 million and $0.35 per share achieved in the year-earlier third quarter. Additionally, EMC continues to generate significant positive cash flow. In the past year, total cash and investments have almost doubled to $759 million at the end of the third quarter of 1996.
EMC's record quarterly revenue was highlighted by the explosive growth of the company's open systems storage business. Third-quarter revenue from this market was $183 million, triple the level achieved in the year-ago quarter.
"EMC had another very strong quarter in terms of both our financial performance and the broadening of our lead in the largest, fastest-growing and most profitable segments of the worldwide market for information storage systems," said Michael C. Ruettgers, EMC president and CEO. "We are on track to achieve our target of $750 million in 1996 revenue from open systems. Our competition in this market consists primarily of products that were designed as proprietary add-ons simply to leverage CPU revenue. Customers around the world increasingly are consolidating their server-based information on EMC's high-performance, scalable, flexible Symmetrix systems."
EMC's performance in the third quarter also reflected stronger-than-anticipated revenues in the IBM-compatible mainframe storage market during what is traditionally a seasonally weaker quarter. "Customer demand for EMC's intelligent storage solutions continues to rise, and we continue to gain market share at the expense of competitors in both the mainframe and open systems disk storage markets," said Ruettgers. "Our stronger-than-expected growth in revenues from IBM-compatible mainframe storage systems is further evidence of a trend we identified in the second quarter: the consolidation of vendors in this market is indeed causing customers to think twice before investing in a confusing array of disparate products from competitors."
During the third quarter, Oracle Corp., the world leader in database software, named EMC's Symmetrix 3000 open storage system as the storage solution for the development and testing of its next-generation relational database software -- the first independent storage platform ever designated as a testbed for Oracle's new releases. In addition, EMC and Hewlett-Packard expanded their reseller relationship; EMC announced a doubling in its Symmetrix Data Migration Services business; and FORTUNE magazine named EMC one of "America's 100 Fastest Growing Companies."
On Tuesday, October 22, in New York, EMC will introduce its newest products and technologies for enterprise and network storage. The products were developed under EMC's Intelligent Storage Architecture, enabling customers to continue to plan and implement information-centric strategies based on EMC's intelligent storage solutions.
EMC Corporation, based in Hopkinton, Massachusetts, is the world's leading supplier of enterprise-wide intelligent information storage and retrieval technology, designing systems for mainframe, open systems and midrange environments. The company has offices worldwide, trades on the New York Stock Exchange under the symbol EMC and is a member of the S&P 500 Index. For further information about EMC products and services, EMC's home page can be accessed at http://www.emc.com.
This release contains a forecast of future revenues and a prediction of new product announcement plans that are "forward-looking statements" under the Federal Securities Laws. Actual results could vary materially and there can be no assurance that these plans will be achieved. Factors that could cause actual results to vary materially include, but are not limited to: changes in business conditions, changes in EMC's sales strategy and product development plans, changes in the data storage marketplace, competition between EMC and other companies that are currently in the data storage market, or competition between EMC and other companies that may be entering the data storage market, product pricing pressures instituted by competitors, continued market acceptance of EMC's mainframe and open systems products, delays in the development of new technology, changes in customer buying patterns, 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.
EMC CORPORATION CONSOLIDATED STATEMENT OF OPERATIONS (in thousands except per share data) (unaudited) Three Months Ended Sept. 30, Sept. 30, 1996 1995 Revenues $ 550,754 $ 475,460 Net Income $ 90,347 $ 85,158 Earnings per share, fully diluted $ 0.37 $ 0.35 Shares, fully diluted 249,795 248,297 Nine Months Ended Sept. 30, Sept. 30, 1996 1995 Revenues $1,617,258 $1,402,129 Net Income $ 261,946 $ 264,718 Earnings per share, fully diluted $ 1.07 $ 1.09 Shares, fully diluted 249,287 247,957
CONTACT: EMC Corp.
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|Date:||Oct 17, 1996|
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