EMC Reports Continued Growth Acceleration
for Record Fourth Quarter and Year
50% Revenue Growth in Information Storage, 49% Increase in Net Income
Highlighted By Rising Demand for EMC Networked Storage Systems and Software
Hopkinton, Mass. - Tuesday, January 23, 2001
EMC Corporation (NYSE:EMC) today reported
that revenue growth continued to accelerate and net income increased
49% for the fourth quarter of 2000, as organizations around the
world invest aggressively in networked information infrastructures
from the world leader in information storage.
Information storage revenue for the fourth quarter grew 50% compared
with the fourth quarter of 1999 to $2.5 billion. This accelerated
quarterly growth was achieved by strong performance across all geographies
and major product areas, including more than 250% year-to-year revenue
growth in networked information storage systems and 72% year-to-year
revenue growth in software. Information storage-related revenue
represented 95% of EMC's total consolidated revenue during the quarter.
Total consolidated results for the fourth quarter and the full 2000 fiscal year represented all-time record performance for EMC. Total revenue for the fourth quarter was $2.62 billion, 40% higher than the fourth quarter of 1999. Net income for the fourth quarter was $563 million, up 49% compared with the fourth quarter of 1999 (excluding a one-time acquisition-related restructuring charge taken in the fourth quarter of 1999). On a diluted basis, earnings per share were $0.25 in the quarter, 47% higher than the fourth quarter of 1999 (adjusted for a 2-for-1 stock split effective June 2, 2000; and excluding the 1999 charge).
For the full 2000 fiscal year, EMC's total revenue was $8.87 billion, up 32% over 1999. Net income for the full 2000 fiscal year was $1.78 billion, up 51% over 1999 (excluding the 1999 charge). On a diluted basis, earnings per share were $0.79 for the year, compared with $0.54 for 1999 (adjusted for the June 2, 2000, stock split; and excluding the 1999 charge).
Mike Ruettgers, EMC's Executive Chairman, said, "We closed
an extraordinary year with a bang - four straight quarters of accelerating
growth rates, and our highest quarterly storage growth rate in nearly
six years. It's clear we gained share in every major segment of
our addressable market, and our competitive lead has never been
stronger. Customers are investing in EMC solutions in record numbers
because our complete networked information storage infrastructures
are by far the most interoperable, functionally rich, scalable and
reliable solutions available."
"We said at the start of 2000 that information, and access
to it, had become the currency of the global economy," Ruettgers
continued. "As I look at the dynamics of EMC's 2000 performance,
that premise becomes even more apparent. Daily life today is a trail
of digital transactions for each and every one of us, transcending
socio-economic, industry or geographic boundaries. The simple acts
of using a telephone or an ATM, buying groceries, or sending mail
create more digital information, every minute of every day. The
consistent growth of EMC's information storage business reflects
the way we live today. Speculation over the effects of slowing economic
growth on U.S. IT spending should not blur the fact that, in every
industry and in every economic mood, information is where competitive
advantage lies. And EMC is where information lives."
The quarter featured strength across all geographies and industries. The investments EMC has made internationally continue to pay off, with international revenue representing 41% of EMC's total in the fourth quarter and 39% for the year. The superior fourth-quarter international results were highlighted by a 134% year-to-year increase in Asia Pacific storage revenue and a 54% year-to-year increase in EMEA (Europe, Middle East and Africa) storage revenue.
Revenue from networked information storage systems grew more than 250% to $770 million in the fourth quarter, compared with $214 million in the year-ago period, as EMC further widened its lead in deploying SAN (storage area network) and NAS (network-attached storage) environments. For the year, EMC shipped $2.1 billion in networked information storage. Software revenue grew 72% to $483 million in the fourth quarter. For the year, software revenue was $1.44 billion, up 75% compared with 1999.
EMC's balance sheet also continued to strengthen, with cash and investments increasing to $4.75 billion at the end of the quarter.
Other highlights of the quarter included the introduction of EMC
CLARiiON® IP4700 networked storage systems and EMC Celerra™
with HighRoad™ software, extending the reach of the world's
most trusted information storage technology by bringing NAS and
SANs into a unified network; the acquisition of CrosStor Software,
a leader in high-performance software for networked storage systems;
the formation of the xSPerience™ Provider Program, a tiered
service, support and consultation program that enables service providers
to fully leverage EMC technology to achieve their business goals;
EMC's #1 ranking by customers ahead of all other storage providers
in six different categories in a major independent survey conducted
by InformationWeek; and EMC's ranking among "The 100
Best Places To Work" by FORTUNE Magazine.
EMC Corporation (NYSE:EMC) is the world leader in information storage systems, software, networks and services, providing the information infrastructure for a connected world. Information about EMC's products and services can be found at http://www.emc.com.
EMC, CLARiiON and CrosStor are registered trademarks, and Celerra, HighRoad and xSPerience Provider Program are trademarks of EMC Corporation. Other trademarks are the property of their respective owners.This release contains "forward-looking statements" as defined under the Federal Securities Laws. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) component quality and availability; (ii) rapid technological and market change and the transition to new products; (iii) competitive factors, including but not limited to pricing pressures, in the computer storage and server markets; (iv) the relative and varying rates of product price and component cost declines; (v) economic trends in various geographic markets and fluctuating currency exchange rates; (vi) the ability to attract and retain highly qualified employees; (vii) the uneven pattern of quarterly sales; (viii) risks associated with strategic investments and acquisitions; (ix) the Company's ability to execute on its plans; and (x) other one-time events and other important factors disclosed previously and from time to time in EMC's filings with the U.S. Securities and Exchange Commission.
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