News & Events
EMC Reports Third-Quarter 2012 Financial Results
10/24/2012, 9:00AM ET
- Consolidated revenue up 6% year over year
- GAAP net income up 3% year over year; GAAP EPS up 4%
- Non-GAAP EPS up 7%, Non-GAAP EPS up 8%
- Operating cash flow up 12% year over year; Free cash flow up 16%
HOPKINTON, Mass.—October 24, 2012— EMC Corporation (NYSE:EMC) today reported financial results for the third quarter of 2012, highlighted by record third-quarter consolidated revenue, net income and EPS.
Third-quarter consolidated revenue was $5.28 billion, an increase of 6% compared with the year-ago quarter. Third-quarter GAAP net income attributable to EMC increased 3% year over year to $626 million. Third-quarter GAAP earnings per weighted average diluted share increased 4% year over year to $0.28. Non-GAAP1 net income attributable to EMC for the third quarter was $881 million, an increase of 7% compared with the year-ago quarter. Third-quarter non-GAAP1 earnings per weighted average diluted share were $0.40, an increase of 8% year over year.
During the third quarter, EMC generated operating cash flow of $1.44 billion and free cash flow2 of $1.14 billion, a year-over-year increase of 12% and 16%, respectively. Additionally, the company ended the quarter with $10.6 billion in cash and investments.
Joe Tucci, EMC Chairman and Chief Executive Officer, said, "EMC's third-quarter revenue and profit growth reflect the resiliency of our business in a more uncertain global economic environment. We remain very well positioned to capitalize on — and drive — the transformative trends of cloud computing, Big Data and trusted IT. These major waves of change in IT become increasingly more important to customers and partners as they navigate through a cyclical slowdown, look to gain maximum value from their investments, and focus on their longer-term IT and business transformations."
David Goulden, EMC President and Chief Operating Officer, said, "For the third quarter, EMC's business continued to grow faster than overall IT spending growth and we gained market share in what turned out to be a more cautionary environment than we expected heading into the quarter. We remain extremely confident in our strategy, best-of-breed product portfolio and solid operational and financial model. Going forward, we fully believe that EMC will continue to grow faster than our addressable markets and take share, reinvest for the future, and deliver earnings leverage for shareholders."
In the third quarter, revenue from EMC's networked storage platforms portfolio3, which includes EMC's high-end and mid-tier storage platform products, grew 2% year over year. Revenue from EMC's high-end Symmetrix storage product portfolio, which includes the company's VMAX systems family, increased 5% compared with the year-ago quarter. Revenue from the company's portfolio of mid-tier storage products4 was flat year over year.
Other third-quarter highlights included continued customer demand for EMC's Isilon scale-out NAS products and the company's Backup Recovery Systems (BRS) portfolio. Adoption of EMC's VSPEX reference architecture solutions also gained momentum and popularity among customers and with partners who have sold more than 300 VSPEX solutions since their launch in April 2012. Customers also continued to increasingly turn to EMC's Greenplum product portfolio to gain insight and value from Big Data. Revenue from EMC's RSA Information Security business increased 6% year over year, driven by continued customer requirements for trusted IT solutions. VMware (NYSE: VMW), the global leader in virtualization and cloud infrastructure, grew revenue 20% year over year. Additionally, EMC continued to experience solid demand for its broad portfolio of services to help customers accelerate their transition to cloud architectures and transform IT. Finally, VCE, formed by Cisco and EMC with investments from VMware and Intel, continued to gain traction in enterprise data centers and cloud service providers globally as demand for Vblock systems showed strong growth in the third quarter.
EMC's consolidated third-quarter revenue from the United States increased 8% year over year to $2.9 billion, representing 55% of consolidated third-quarter revenue. Revenue from EMC's business operations outside of the United States increased 4% year over year to $2.4 billion and represented 45% of consolidated third-quarter revenue.
For the complete press release, click here.
EMC Corporation is a global leader in enabling businesses and service providers to transform their operations and deliver IT as a service. Fundamental to this transformation is cloud computing. Through innovative products and services, EMC accelerates the journey to cloud computing, helping IT departments to store, manage, protect and analyze their most valuable asset — information — in a more agile, trusted and cost-efficient way. Additional information about EMC can be found at www.EMC.com.
1Items excluded from the non-GAAP results for the third quarters of 2012 and 2011 are amounts relating to stock-based compensation expense, intangible asset amortization, restructuring and acquisition-related charges and the amortization of VMware's capitalized software from prior periods. See attached schedules for GAAP to non-GAAP reconciliations.
2Free cash flow is a non-GAAP financial measure which is defined as net cash provided by operating activities, less additions to property, plant and equipment and capitalized software development costs. See attached schedules for a reconciliation of net cash provided by operating activities to free cash flow for the three and nine months ended September 30, 2012 and 2011.
3EMC's networked storage platforms include EMC Symmetrix, EMC VNX, EMC CLARiiON, EMC Celerra, EMC Centera, EMC Data Domain, EMC Isilon, EMC Avamar and EMC Atmos hardware and software products.
4EMC's mid-tier storage products include EMC VNX, EMC CLARiiON, EMC Celerra, EMC Centera, EMC Data Domain, EMC Isilon, EMC Avamar and EMC Atmos hardware and software products.