EMC 4Q tops expectations

Jan. 2, 2002 4:43 p.m. PT

2 min read

EMC Corp. (NYSE: EMC) said Wednesday fourth quarter earnings were 34 cents a share, well ahead of First Call's prediction of 31 cents a share, on booming software sales.

Shares in the provider of enterprise storage systems, software and services closed at 120 Tuesday. The stock has been continually striking new highs, and recently acquired Softworks Inc. (Nasdaq: SWRX) in a cash transaction valued at about $192 million.

Net income for the fourth quarter was $377 million, or 34 cents a share, 38 percent higher than the 25 cents a share earned in the fourth quarter of 1998.

Revenue for the fourth quarter was $1.88 billion, up 21 percent from 1998's fourth quarter.

These results, and those for the fiscal year include the operations of Data General, which EMC bought in October. Results excluded a one-time acquisition-related charge of $224 million, or 15 cents a share recorded in the fourth quarter. Including the charge for the acquisition and integration of Data General, net income for the quarter was $207 million, or 19 cents a share.

For the fiscal year, EMC's revenue was $6.72 billion, 24 percent higher than 1998. Net income for the year was $1.18 billion, 50 percent higher than 1998. On a diluted basis, earnings per share were $1.07 for the year, compared with 73 cents a share for 1998. First Call had predicted the year's earnings o be $1.05 a share.

Growth was fueled by continued strength in EMC's software offerings as well as growth in market segments such as storage-area networks (SAN) and network-attached storage (NAS). Software revenue was $281 million in the fourth quarter, up 71 percent from 1998's fourth quarter, and making up 17 percent of EMC's total storage revenue. Storage revenue for the fourth quarter was $1.66 billion, up 27 percent from the fourth quarter of 1998.

For the full year, EMC achieved software revenue of $822 million, 85 percent higher than 1998.

Also during the quarter, EMC introduced its ControlCenter software to automate storage-related tasks; announced an extension of its alliance with Oracle Corp (Nasdaq: ORCL) and agreed to buy Softworks, Inc.