EMC’s Q3 profits setto meet expectations

EMC Corporation, the world’s third-largest maker of computer data-storage systems, expects to meet its forecast for Q3 profits, up to 4c a share on an estimated sales rise to between $1.45 billion and $1.5bn.

Second-half sales will grow by an unspecified percentage in the ‘mid-teens’ and gross margin will widen to 48% by the end of 2004, EMC said in a statement.

Chief executive Joe Tucci is rebuilding profit after losses in 2002 and 2001 followed record net income of $1.78bn in 2000. He is pushing sales of more profitable software and services.

“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 our customers’ information, from creation and use to archive and disposal. We believe information lifecycle management will drive the next major wave of EMC’s growth,” he said.

Addressing more than 300 investors, analysts and members of the media in New York, Mr Tucci and his executives outlined EMC’s strategy, presented its annual report and provided business outlook.

EMC shares rose 22c to $10.75 in New York Stock Exchange composite trading, having gained 71% this year.

EMC said in July that gross margin this quarter is expected to be “relatively similar” to Q2’s 43.5%. Last year, EMC had third-quarter net income of $21.3m, or 1c a share, on sales of $1.26bn.