EMC has reported second-quarter 2014 financial results, including record second-quarter revenue of $5,9-billion – an increase of 5% year-over-year.
GAAP net income attributable to EMC was $589-million and GAAP earnings per weighted average diluted share was $0.28. Non-GAAP1 net income attributable to EMC was $882-million and non-GAAP1 earnings per weighted
average diluted share was $0.43.
EMC generated $1,3-billion in operating cash flow and $930-million in free cash flow in the second quarter – up 2% and 10% year-over-year, respectively. EMC ended the quarter with $14,6-billion in cash and investments. The company repurchased approximately $600-million worth of its common stock in the second quarter and returned approximately $200-million to shareholders via a quarterly dividend.
In addition, EMC’s Board of Directors has approved an acceleration of EMC’s share buyback plan for 2014 from $2-billion to $3-billion. Including the accelerated buyback and EMC’s increased dividend (announced in the first quarter of 2014), EMC expects to return more than $7-billion to shareholders over the course of 2013 and 2014.
Joe Tucci, EMC chairman and CEO, says: “Our industry and customers are in the midst of a massively disruptive and transformational shift, and the pace of change is accelerating. EMC detected it early on, put the right strategy in place and is executing well. New customers are coming to EMC for the first time, and existing customers are investing more heavily, because of our expanded capabilities across EMC Information Infrastructure, VMware and Pivotal.
“As a result, we have no doubt that EMC and our customers and shareholders will emerge among the primary beneficiaries of this transformation.”
David Goulden, CEO of EMC Information Infrastructure and EMC’s chief financial officer, says: “EMC performance in Q2 was solid and on track, with good performance from each of our major business units. We are at the threshold of expansive opportunity and remain confident about the rest of the year, as evidenced by the accelerated buyback program.
“Our market leadership, healthy partner ecosystem and cutting-edge technologies all support a strategy that deeply resonates with customers.”
EMC Information Infrastructure business revenue was up 1% year-over-year. Excluding the High-end Storage business3, Information Storage revenue grew 7% year-over-year – which is faster than the industry growth rate.
Emerging Storage4 revenue grew 52% year-over-year, based on demand for technologies such as the EMC XtremIO all-flash storage array, EMC ViPR software-defined storage and EMC Isilon scale-out storage.
EMC has established clear leadership in the all-flash array market with XtremIO, surpassing a $300-million annualised demand run rate5 in its second full quarter of availability. ViPR adoption continues with the number of customers doubling in the second quarter compared to the first quarter of 2014. Data Domain had another strong quarter and the Data Protection Suite achieved very strong double-digit revenue growth both sequentially and year-over-year.
RSA Information Security revenue grew 6% year-over-year, with Security Analytics and Archer each up over 20% in the second quarter. VCE had another strong quarter as demand for VCE Vblock systems once again showed very strong year-over-year growth.
Pivotal grew revenue 29% year-over-year. The proliferation of Cloud Foundry as the industry’s standard for open-source PaaS continues to flourish. Attendance at the second annual Cloud Foundry Summit held in the second quarter more than doubled.
VMware continues to see growth with revenue up 17% year-over-year. VMware remains focused on delivering virtualisation technologies to propel its three strategic initiatives including software-defined data centres, hybrid cloud and end-user computing.