Updated from 10:30 a.m. EST

Strong demand for hardware and software helped storage giant EMC ( EMC) boost fourth-quarter net income by nearly 46%, the company's sixth consecutive quarter of double-digit profit growth.

Total revenue for the quarter was $2.36 billion, 27% higher than the corresponding quarter last year, EMC reported before the opening bell Tuesday.

Net income grew 45.6% to $321 million, or 13 cents per diluted share, from $220 million or 9 cents per diluted share, a year ago. Analysts polled by Reuters were expecting a 12-cent profit on sales of $2.28 billion.

However, there was some concern that the gross margin of 52% did not reflect the strength of EMC's spate of acquisition in the last two years. Baird analyst Daniel J. Renouard, for example, said he expected an additional 62 basis points, which he called "modestly disappointing." (His company does not have an investment banking relationship with EMC.)

The possibility of a disk drive shortage during the first half of the year also apparently worried some investors. As a result, the stock has been trading moderately lower all day; in recent action, shares were off 19 cents, or 1.9%, to $12.65.

Core EMC revenue in the fourth quarter of 2004, which excludes revenue related to EMC's Dantz, Documentum, Legato and VMware acquisitions, grew 19% compared with the fourth quarter of 2003. CEO Joe Tucci said "most of the heavy lifting need to integrate the acquisitions is over."

Is EMC ready to pause, or is it actively looking for more acquisitions? "I don't have my hunting boots on," Tucci said during an interview. "But if the right opportunity happened to come along, we'd consider it."

Looking forward, the Hopkinton, Mass., company expects an EPS profit of 10 cents or 11 cents, with revenue ranging from $2.23 billion to $2.25 billion. Analysts were predicting a profit of 10 cents with revenue of $2.15 billion.

Tucci said he believes that IT spending this year will be fairly similar to 2004, meaning a growth of 4% to 5%, but EMC's revenue will grow faster, he said. The company told investors to expect growth of 14% to 16% in 2005. Diluted earnings per share will likely range from 47 cents to 51 cents, he said.

A First Call survey was expecting earnings of 49 cents a share on revenue of $9.4 billion.

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