EMC Corporation Slides on Soft Earnings Guidance

EMC met or beat every target in the first quarter -- except on full-year earnings guidance. That was enough to send EMC shares nearly 2% lower in pre-market action.

Apr 23, 2014 at 8:23AM

Image source: EMC.

Enterprise-class storage specialist EMC (NYSE:EMC) this morning reported results for the first quarter of fiscal year 2014. In pre-market trading, EMC share prices slipped 1.9% on the news.

EMC's sales grew 2% year-over-year to $5.5 billion. Non-GAAP earnings declined 10% to $0.35 per share.

Earnings were in line with analyst expectations, while sales edged past the Street view.

Looking ahead, EMC set full-year revenue guidance slightly above the current analyst consensus, but kept the official earnings target slightly below analysts' bottom-line projections.

Core storage products showed modest growth, and high-end storage systems reported lower revenue year-over-year. On the other hand, majority-owned virtual computing titan VMware (NYSE:VMW) delivered 16% revenue growth and cloud computing platform Pivotal grew 41% larger.

The emerging storage division at EMC saw 81% higher sales, driven by strong sales of enterprise-scale solid-state drives, Isilon deduplicated storage, and software-defined storage.

"EMC is at the threshold of expansive opportunity," said CFO David Goulden in a prepared statement. "With our strong foothold in Second Platform environments and some of the most exciting IT assets in the industry helping us propel customers to the Third Platform of IT, EMC is well positioned to meet our stated 2014 targets."

Anders Bylund has no position in any stocks mentioned. The Motley Fool recommends and owns shares of VMware. Try any of our Foolish newsletter services free for 30 days.

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