The Hopkinton, Mass.-based company reported revenue of $5.5 billion, an increase of 2% on the same period last year and above analysts' estimates of $5.43 billion.
Excluding items, EMC earned 35 cents a share on net income of $728 million, down from 39 cents a share in the prior year's quarter and net income of $850 million; earnings were in line with Wall Street's estimate. EMC's earnings exceeded the company's guidance by a penny a share.
Investors, however, were underwhelmed by EMC's earnings outlook, pushing the firm's shares down 3.18% to $25.91 in premarket trading on Wednesday.For fiscal 2014, EMC expects sales of $24.58 billion and earnings of $1.90 a share. Analysts surveyed by Yahoo! Finance are looking for revenue of $24.51 billion and earnings of $1.94 a share. EMC generated $1.3 billion in operating cash flow and $946 million in free cash flow during the quarter, ending the first quarter with $15.3 billion in cash and investments. Revenue from EMC's Information Infrastructure business, however, declined 3% year over year, although the company's Emerging Storage revenue climbed 81% over the same period and its Pivotal big data business enjoyed 41% growth. Revenue from EMC's VMware (VMW) subsidiary gained 16% from the prior year's quarter.
The company announced a work force restructuring effort earlier this year. "EMC is at the threshold of expansive opportunity," wrote EMC Chief Financial Officer David Goulden, in a statement, "While planned business practice changes had a negative impact on year-over-year revenue and EPS growth in the quarter, we are very confident we are on the right track with our Federation model and technologies." EMC has been touting its "Federated" business model as a way to boost revenue by tapping into enterprise IT and business needs. This includes the company's Information Infrastructure division, virtualization specialist VMware and its Pivotal technology. -- Written by James Rogers in New York. Follow @jamesjrogers >Contact by Email.
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