Joe Tucci, EMC Chairman and CEO
EMC Corporation today reported record financial results for the second quarter of 2011. Strong worldwide customer demand for EMC’s information infrastructure and virtual infrastructure products and services, balanced growth and continued outstanding execution contributed to EMC achieving record second-quarter consolidated revenue and net income. The results were also highlighted by strong year-over-year percentage increases in non-GAAP operating and gross margins and all-time record consolidated quarterly revenue for EMC’s business operations outside of the United States.
Second-quarter consolidated revenue was $4.85 billion, an increase of 20% compared with the year-ago quarter. Second-quarter GAAP net income attributable to EMC increased 28% year over year to $546 million. Second-quarter GAAP earnings per weighted average diluted share increased 20% year over year to $0.24. Non-GAAP1 net income attributable to EMC for the second quarter was $793 million, an increase of 33% compared with the year-ago quarter. Second-quarter non-GAAP1 earnings per weighted average diluted share were $0.35, an increase of 25% year over year.
EMC achieved year-to-date operating cash flow of $2.2 billion and free cash flow2 of $1.6 billion. The company ended the second quarter with $9.5 billion in cash and investments.
Joe Tucci, EMC Chairman and Chief Executive Officer, said, “Our record-setting performance during the quarter was marked by balanced growth, solid execution and significant technology innovation as customers around the world continue to embrace EMC’s cloud computing and Big Data strategies. It is our firm belief that this strategy is well-placed and underpinned with winning products and services and strategic partners. We remain confident in our ability to continue delivering strong results this year and over the long term. Furthermore, we remain committed to investing heavily to extend our technology lead and help customers and service provider partners accelerate their IT and business model transformations.”
David Goulden, EMC Executive Vice President and Chief Financial Officer, said, “EMC’s second-quarter results are further evidence that our strategy is on target and that we continue to execute our financial 'triple play' – gaining market share, investing aggressively to take full advantage of the massive opportunities at the intersection of cloud computing and Big Data, and improving profitability. Our focus on providing technology and services that accelerate our customers’ journey to the cloud and enable them to leverage their data for more competitive advantage is resonating strongly in the market. Given the strong results we have achieved this year and the opportunity we see for the remainder of 2011, we are raising our financial outlook for the year. We now expect to exceed 2011 consolidated revenue of $19.8 billion, GAAP EPS of $1.07 and non-GAAP EPS of $1.48.”
Second-quarter highlights included double-digit revenue growth for EMC Information Storage business, which increased 19% year over year. EMC’s high-end EMC Symmetrix storage product portfolio, which includes the EMC Symmetrix VMAX, increased revenue 15% compared with the year-ago quarter, and EMC’s portfolio of mid-tier storage products3 grew revenue 27% year over year. Revenue from VMware, which is majority-owned by EMC, increased 37% and revenue from EMC’s RSA Information Security business grew 13% year over year. Additional second-quarter highlights included strong revenue growth for the EMC VNX unified storage and the company’s backup and recovery solutions. EMC saw increasing customer demand for its Big Data technologies – product revenue from EMC Isilon, EMC Atmos and EMC Greenplum each doubled year over year. Further second-quarter highlights included continued customer demand for EMC’s broad consulting and professional services portfolio.
Also during the quarter, VCE, the Virtual Computing Environment Company formed by Cisco and EMC with investments from VMware and Intel, experienced continued momentum as demand from customers for best-of-breed converged infrastructure through the Vblock Infrastructure Platform grew. VCE’s year-to-date revenue for 2011 has already exceeded its full-year 2010 revenue amount.
EMC’s consolidated second-quarter revenue from the United States reached $2.5 billion, an increase of 17% year over year, representing 52% of consolidated second-quarter revenue. Revenue from EMC’s business operations outside of the United States hit an all-time record $2.3 billion, an increase of 25% year over year, representing 48% of consolidated second-quarter revenue. Within this, revenue increased 20%, 34% and 43% year over year, respectively, in EMC’s Europe, Middle East and Africa; Asia Pacific and Japan; and Latin America regions.