Emulex: trends continue to look good
By Michael Baron, CBS.MarketWatch.com
Last Update: 4:44 PM ET Jan 10, 2000
NEW YORK (CBS.MW) - Emulex President and Chief Executive Paul Folino said Wednesday that the Costa Mesa, Calif., provider of network connectivity products still doesn't expect any slowdown in information technology to affect business in the first half of 2001.
"Storage remains a priority within IT spending," Folino told attendees of the Needham Growth Conference in New York. "I think it's fair to say we've got good visibility over the next few quarters. The trends have looked good and they continue to look good."
Shares rose 8.6 percent on the day to $77.63.
Emulex (EMLX: news, msgs) is expected to turn a profit of $14.3 million, or 18 cents a share, on revenue of $66.7 million in the December quarter, according to Needham research.
In a break-out session following the Emulex presentation, Folino was asked about manufacturing capacity. He declined to comment specifically on the Emulex's plans but did say he doesn't expect component shortages to be a problem in the March or June reporting periods.
Also during the break-out session, Mike Rockenbach, the company's chief financial officer, said Emulex would continue to target long-term operating margins of 28 to 30 percent, even in light of its Dec. 8 agreement to acquire privately-held Giganet for $645 million in stock. At that time, Emulex boosted its guidance for its fiscal year ending in July.
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