EMC: 'We expect IT spending to improve'
As the storage giant reports earnings in line with expectations, Chief Executive Joe Tucci is the latest tech executive to call a bottom to the current IT-spending slump.
This was originally posted at ZDNet's Between the Lines.
EMC Chief Executive Joe Tucci on Thursday said the storage giant expects technology spending in the second half of the fiscal year to improve, and it noted that the worst is largely over.
Tucci's comments came amid EMC's earnings, which met expectations. In a statement, Tucci said:
As we look to the balance of 2009, we believe the global IT-spending environment has reached, or is very near, the bottom. We expect IT spending to improve in the second half of 2009, as customers will have better budget visibility, be further through their own restructuring programs, and broader stimulus packages should be under way.
With these comments, EMC becomes the latest company to call a bottom. Intel and Nokia are among the others noting that the worst may be over. EMC's "best guess" is that 2009 global IT spending will decline in the "very-high-single-digit to very-low-double-digit range, compared with 2008." Second-quarter IT spending will be flat with the first quarter, it predicted, and then improve.
EMC reported first-quarter net income of $194.1 million, or 10 cents a share, on revenue of $3.15 billion. Non-GAAP net income was $323.7 million, or 16 cents a share, down from $460 million, or 22 cents a share, a year ago, but in line with Wall Street estimates.
The company noted that it is aiming to save $100 million in 2009, and it expects to cut its infrastructure costs by $450 million relative to 2008.