EMC's revenue jumps in first quarter

The data storage company reports higher growth and income in the first quarter of fiscal 2004, boosted by its recent software acquisitions.

Data storage company EMC on Thursday reported a jump in both profit and revenue for the first quarter.

The company's revenue for the three months that ended March 31 was $1.87 billion, up 35 percent from $1.38 billion for the same period a year ago. Net income was $139.8 million, or 6 cents per share, up from $35 million, or 2 cents per share, for the first quarter last year. EMC said income in the 2004 quarter included a charge of 1 cent per share primarily related to its acquisition of VMware and other restructuring charges. The revenue growth is the highest in the past three years, the company said.

EMC's new software businesses contributed significantly to the jump in revenue. Documentum, acquired by the storage maker in December, added more than 100 new customers in the first quarter, and Legato, which was absorbed in October, added 300 new customers, EMC said.

For the current quarter, EMC expects revenue of between $1.95 billion and $1.97 billion, and earnings per share of 8 cents.

"The outlook is positive," said Omar Al-Midani, an analyst with Schwab Soundview Capital Markets, adding that the company's financial targets seem conservative. EMC's results, he said, show that corporate spending on technology is not weakening, though it's not yet surging, either.

"Storage is a priority item in IT budgets, and so what I would say is it sounds like the pickup in the enterprise is there," Al-Midani said.

Reuters contributed to this report.
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