Hardware
EMC Shares Climb Despite Tepid Outlook
James Rogers
10/22/08 - 10:17 AM EDT
Storage specialist EMC (EMC Quote) said its fourth-quarter results may come in at the low end of Wall Street's estimates, highlighting the uncertainty that's hanging over tech spending.
The storage giant, which reported its third-quarter results early Wednesday, is projecting fourth-quarter revenue of $4 billion and earnings of 23 cents to 24 cents a share. Excluding items, the company estimates earnings between 30 cents and 31 cents.
Analysts had estimated fourth-quarter revenue of $4.14 billion and earnings of 24 cents.
EMC's profit dropped 17% in its third quarter compared with the same period last year, although the company's revenue rose 13%, boosted by strong sales of storage outside the U.S.
The company said third-quarter net income dropped to $411 million, or 20 cents a share, from $492.9 million, or 23 cents a year, a year earlier. Excluding items, including a gain from the sale of VMware (VMW Quote) shares in the prior year, EMC earned $528 million, or 25 cents a share.
The company's revenue rose to $3.7 billion from $3.3 billion, although this came in just below the consensus estimate. Analysts had predicted revenue of $3.73 billion and earnings of 19 cents a share.
Joe Tucci, the EMC chief executive, acknowledged "the backdrop of a tough global economy" in a statement, but added a note of bullishness. "Even with a challenging economic environment ahead, we remain confident and well positioned to compete effectively," he said.