HOPKINTON, Mass. - July 24, 2012 -
EMC Corporation (NYSE:EMC) today reported strong financial results for the second quarter of 2012, marking the company's 10th consecutive quarter of double-digit year-over-year growth for consolidated revenue, GAAP net income, and GAAP and non-GAAP EPS. EMC expects to achieve its full-year 2012 goals for consolidated revenue, non-GAAP EPS and free cash flow.
Second-quarter consolidated revenue was $5.31 billion, an increase of 10% compared with the year-ago quarter. Second-quarter GAAP net income attributable to EMC increased 19% year over year to $650 million. Second-quarter GAAP earnings per weighted average diluted share increased 21% year over year to $0.29. Second-quarter non-GAAP1 earnings per weighted average diluted share were $0.39, an increase of 11% year over year.
During the second quarter, EMC generated operating cash flow of $1.24 billion and free cash flow2 of $958 million, a year-over-year increase of 16% and 36%, respectively. Additionally, the company expanded GAAP and non-GAAP gross margin and operating margin percentages on a year-over-year basis, and ended the quarter with $10.9 billion in cash and investments.
Joe Tucci, EMC Chairman and Chief Executive Officer, said, "I am very pleased with EMC's execution and record second-quarter financial performance. We are seeing a transformation in the IT industry unlike anything we have seen before. Organizations are moving quickly to adopt cloud computing and take advantage of both the efficiency and agility that comes with running IT-as-a-Service. Customers are also looking to deploy a new generation of Big Data applications to gain competitive advantage and differentiate their businesses. And they demand that all this be done in a secure and trusted way. EMC is widely recognized as a leader and driver of this transformation."
David Goulden, EMC President and Chief Operating Officer, said, "The business we have built is at the intersection of three of the most transformative waves in the history of IT – cloud computing, Big Data and trust. We have grown EMC profitably, expanded our portfolio of products and services into new markets, and established our reputation for quality and providing customers with the very best total experience in the industry. Looking ahead, we remain on track to deliver our 'triple play' – simultaneously taking market share, reinvesting for growth and delivering improved earnings – and are well positioned for our next major phase of growth."
In the second quarter, revenue from EMC's Information Storage business increased 7% year over year. Within this, revenue from EMC's networked storage platforms portfolio3, which includes EMC's high-end and mid-tier storage platform products, grew 7% year over year. Revenue from EMC's high-end Symmetrix storage product portfolio increased 3% compared with the year-ago quarter, and revenue from the company's portfolio of mid-tier storage products4 increased 10% year over year, the result of year-over-year growth across EMC's major mid-tier product lines.
Second-quarter highlights included continued customer demand for EMC's Isilon scale-out NAS portfolio, VNX unified storage family, Backup Recovery Systems (BRS) portfolio, and VMAX systems family. Customers also continued to increasingly turn to EMC's Greenplum portfolio to gain greater insight and value from their data. Second-quarter revenue from EMC's RSA Information Security business increased 13% year over year and revenue from VMware (NYSE: VMW), the global leader in virtualization and cloud infrastructure, grew 22% year over year. Additionally, EMC continued to experience strong customer demand for its broad portfolio of services to help customers transform their IT and business. Finally, Vblock Converged Infrastructure Platforms from VCE – the Virtual Computing Environment Company formed by Cisco and EMC with investments from VMware and Intel – also gained traction in enterprise data centers and with cloud service providers as demand continued to show very strong growth in the second quarter.
EMC's consolidated second-quarter revenue from the United States increased 14% year over year to $2.9 billion, representing 54% of consolidated second-quarter revenue. Revenue from EMC's business operations outside of the United States increased 5% year over year to $2.5 billion and represented 46% of consolidated second-quarter revenue.
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. These statements do not give effect to the potential impact of mergers, acquisitions, divestitures or business combinations that have not been announced or closed as of the date hereof. These statements supersede all prior statements made by EMC regarding 2012 financial results.
All dollar amounts and percentages set forth below should be considered to be approximations.
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