dailynews.yahoo.com
Wednesday May 9 3:24 PM ET
EMC CEO Backs 2001 Growth Forecast
By Tim McLaughlin
SOUTHBORO, Mass. (Reuters) - The chief executive of EMC Corp. (NYSE:EMC - news), the No. 1 data-storage firm, on Wednesday backed the company's forecast for more than 20 percent revenue growth this year and said information technology budgets at U.S. corporations are firming.
``We're seeing a firming of IT budgets throughout the United States,'' EMC CEO Joe Tucci told reporters after the company's annual meeting. ``We are seeing budgets get set.''
Tucci said corporate spending on data storage -- used for collecting digital information such as e-mail, online transactions and medical images -- is not a discretionary item.
He said the company's forecast has not changed since last month, when EMC (EMC.N) reported first-quarter revenue and profits that met its sharply lowered expectations.
``We're not backing off anything,'' Tucci said.
But after a decade of spectacular growth, EMC now is faced with a slowing economy and several rivals looking to steal market share in an industry estimated to have a $50 billion opportunity this year.
The data storage sector has become crowded in recent years because it is growing faster than other information technology segments, such as computer networking equipment.
EMC controls about 20 percent of the data storage market but will likely miss its long-stated goal of generating $12 billion in revenue this year.
More than 2,000 shareholders gathered at EMC's Southboro, Massachusetts plant about 40 miles (64 km) west of Boston on Wednesday to hear how the company will regain its stride.
EMC's stock is off about 34 percent during the past year, trading up 5 cents to $41.05 Wednesday afternoon on the New York Stock Exchange (news - web sites). The stocks in the Standard & Poor's 500 Index are off about 5 percent during that time.
EMC Executive Chairman Michael Ruettgers said EMC has not contracted any of the ``life-threatening diseases'' that have plagued other technology firms, such as lending customers money to buy equipment or allowing obsolete inventory to pile up.
Ruettgers and Tucci said EMC's future growth is heavily weighted toward selling storage products that collect information from computer networks and software that manages digital information.
EMC's revenue from networked information storage and software grew 158 percent and 73 percent, respectively, in the first quarter. |
