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Emulex Surges After Early Q2 Report

COSTA MESA, Calif. ( TheStreet) -- Emulex (ELX) shares surged in early trading Tuesday after the data storage maker announced preliminary second-quarter results above Wall Street's estimates.

The company announced its numbers after market close on Monday, predicting revenue between $107 million and $108 million, well above its previous guidance of $88 million to $92 million. Analysts surveyed by Thomson Reuters had predicted sales of $90.7 million.

Excluding items, Emulex expects earnings of 16 cents to 17 cents a share, up from its prior range of 10 cents to 12 cents and above analysts' estimates of 12 cents.

Investors responded positively to the new numbers, pushing Emulex's shares up $1.27, or 11.4%, to $12.41 despite a broader dip in tech stocks that saw the Nasdaq fall 0.76%.

Emulex has been getting plenty of analyst love recently. Paul Mansky of Cannacord Adams recently rated the stock as his top pick for 2010.

Last year, Emulex CEO Jim McCluney told TheStreet that the tech rebound is underway, spurred on by companies' cloud computing efforts.

The Silicon Valley firm, which makes storage adapters and embedded switches, already boasts a host of partners using its technology in their servers and storage systems, including IBM (IBM - Get Report), Dell (DELL), Hewlett-Packard (HPQ ), EMC (EMC), Cisco (CSCO - Get Report) and Sun (JAVA).

Although he did not reveal whether Emulex clinched any new OEM deals for its products, Emulex CEO Jim McCluney said in a statement released Monday that the company's sales are ramping up.

"We executed very well to deliver the December quarter results, which were driven by broad customer demand across both our Host Server Product and Embedded Storage Product lines," he explained. "I'm particularly pleased with the tangible benefits we are now seeing from our sales and marketing efforts over the past year to gain market share in Fibre Channel board level products, and this momentum has continued into the New Year."
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