Feeds

EMC sees expenses rise again

More cutbacks to come, despite record revenue

Securing Web Applications Made Simple and Scalable

EMC continued its run of financial good form in the fourth quarter, and rode a tax payday and higher system sales to beat its own and most analysts' expectations.

The storage monster's profits were buoyed by the $76.7m tax gain to a GAAP net income of $389m, or $0.18 per share. Revenue for Q4 hit $3.22bn. A year earlier, revenue was 18.6 per cent lower and profits were $148.3m, or $0.06 per share.

EMC took a hit to its operating income though, which fell to $298.3m from $420.7m a year earlier. The firm incurred one-off charges from slashing 1,700 jobs this quarter, which with restructuring shaved $0.06 from the earnings per share.

In fact, EMC recorded a drop in operating income for every quarter in 2006 compared to the corresponding periods a year ago. Rising expenses led CEO Joe Tucci to allude to more cutbacks in 2007 once the integration of new security division RSA is further along.

The firm plans to become "where information lives" by buying a bunch of software firms is yet to convince some, with RSA's $2.1bn ticket price still looking high to many on revenues of $114m, albeit up 26 per cent.

The market for storage hardware continues to be the main justification for Tucci's claim the firm is on the "short list of the world's elite information technology suppliers". The midrange Clariion series grew sales by 17.9 per cent over the year, contrasting with higher-end Symmetrix system's weedy 3.6 per cent increase.

The fiscal year clocked in at just under $11.2bn, with income reaching $1.22bn, or $0.54 per share on a GAAP basis. EMC said it expects a 14 per cent increase in sales in 2007 to at least $12.7bn.

EMC's statement and full results are here. ®

The Essential Guide to IT Transformation

More from The Register

next story
Manic malware Mayhem spreads through Linux, FreeBSD web servers
And how Google could cripple infection rate in a second
EU's top data cops to meet Google, Microsoft et al over 'right to be forgotten'
Plan to hammer out 'coherent' guidelines. Good luck chaps!
US judge: YES, cops or feds so can slurp an ENTIRE Gmail account
Crooks don't have folders labelled 'drug records', opines NY beak
FLAPE – the next BIG THING in storage
Find cold data with flash, transmit it from tape
Seagate chances ARM with NAS boxes for the SOHO crowd
There's an Atom-powered offering, too
Intel teaches Oracle how to become the latest and greatest Xeon Whisperer
E7-8895 v2 chips are best of the bunch, and with firmware-unlocked speed control
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Mobile application security vulnerability report
The alarming realities regarding the sheer number of applications vulnerable to attack, and the most common and easily addressable vulnerability errors.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.