EMC Corporation, a leader in information storage, outlined its strategy for growth and continued leadership and reviewed its recent achievements at the company's annual financial analyst meeting, providing its outlook for improved revenue growth and gross margins through the end of 2004.
Joe Tucci, EMC President and CEO, said, "EMC created enterprise storage, connected the enterprise with networked storage and introduced automation to manage the vast amounts of information on storage networks. EMC is bringing our experience to bear on the challenge of intelligently managing all of our customers' information, from creation and use to archive and disposal. We believe this information life cycle management will drive the next major wave of EMC's growth."
"Over the past 12 months," Tucci continued, "our rollout of automated networked storage solutions for high-end, mid-tier and entry-level customers has positioned EMC as the company with the world's most comprehensive set of products and services for realizing the promise of true information life cycle management."
Addressing more than 300 investors, analysts and members of the news media, Tucci and members of EMC's executive team articulated EMC's strategy, presented its annual progress report and provided additional business outlook.
Dave Donatelli, executive vice president, Storage Platforms Operations, reviewed the delivery, over the past 12 months, of new best-in-class storage platforms for high-end, mid-tier and entry-level requirements that allow customers to match the appropriate storage solutions to their required service levels and extract maximum value at every cost point in the information life cycle. EMC will continue to drive operational efficiencies throughout the platform development cycle. EMC is creating competitive advantage through faster product delivery at lower introduction costs with increased functionality and world-class quality, enabling the company to grow its current advantage in existing markets and expand into new market opportunities.
Mark Lewis, executive vice president, Open Software Operations, detailed how EMC's open software strategy will enable customers to realize the benefits of information life cycle management. Lewis charted the success of EMC's efforts over the past year to deliver products to manage and automate networked storage environments and described how the combination of specialized storage platforms, automation through management software, transparent infrastructure software and the optimizing effects of information management software enable information life cycle management. Lewis articulated how customers can migrate to an information life cycle management infrastructure, starting with automated networked storage, and ultimately driving towards a policy-driven, cradle-to-grave management approach across customers' entire application environment.
David Goulden, executive vice president, Marketing and New Business Development, detailed the alignment of EMC's go-to-market strategy with its focus on information life cycle management. Goulden cited EMC's 10,000-strong global sales and services organization, complemented by partners, and their roles in augmenting EMC's market-leading presence in the world's largest accounts with rapid market-share growth in selling to mid-sized and smaller companies. Services is a key component, he noted, pointing to EMC's 30 percent year-over-year growth in storage services revenue in the first half of 2003 as evidence of the industry-wide demand for storage-focused expertise. Goulden also outlined the depth and breadth of EMC's partnerships with other technology and service leaders and its distribution strategy for its growing portfolio of multiplatform software. EMC is deploying specialized open software sales teams to maximize the adoption of EMC software in EMC and non-EMC environments.
Bill Teuber, executive vice president and chief financial officer, outlined EMC's current business model, including its significantly lowered cost structure and strong financial position, and provided its business outlook through the end of 2004. Specifically:
- EMC expects its revenue growth rate to be in the mid-teens for the second half of 2003 and Fiscal Year 2004, compared to the prior comparable periods.
- EMC expects its gross margins will continue to improve to 48 percent or greater by the fourth quarter of 2004. However, gross margins may fluctuate from quarter to quarter based on varying rates of revenue growth.
- EMC reaffirmed that it is on track to be profitable for each of the remaining quarters in 2003 and to meet its previously stated expectations for the third quarter of 2003.
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