Still, it wasn't enough for EMC to be optimistic about the coming year, offering guidance below analysts' estimates for 2013 revenue. As a result, similar to some of its IT brethren, EMC saw its stock slide more than 8 percent on the news (along with VMware's day-earlier gloomy 2013 projection) before recovering half of that lost value late in the day.
For the full year 2012, EMC took in $21.7 billion, a 9 percent increase over last year, and earned $2.7 billion, for an 11 percent jump year over year. The company closed the year with $11.4 billion in cash on hand.
Viewed from a product perspective, networked storage and Symmetrix high-end storage revenue grew 6 percent, while mid-tier storage, including EMC’s Isilon scale out NAS products, was up 5 percent, according to the company.
“In Q4, we accelerated our growth rate from Q3 by more than two percentage points and achieved our first $6 billion plus quarter,” said Joe Tucci, EMC chairman and chief executive, in an earnings call. From a vertical’s perspective, EMC’s growth came from service providers, financial services, telecomm and the media and entertainment industries with lower growth in the public sector and manufacturing, he said.
As for 2013’s outlook, Tucci said: “It is pretty easy to starve IT a bit for a while. But if you really truly believe, as most companies do, that IT is the root, inversely it’s impossible to get productivity gains or innovation these days without IT. You can’t starve it for too long.” He called 2012 a “year of uncertainty and caution,” which may linger into 2013 amid “more of a kind of cautious optimism out there, which is an improvement.”
Here are a few takeaways from EMC’s Q4 performance:
- EMC’s surge provider partner program now numbers 60 members who offer more than 325 cloud surges powered by EMC infrastructure. Revenue from these service provider partners jumped some 70 percent from Q4 last year.
- The company will increase its stock buyback to $1 billion in 2013.
- For 2013, the company expects revenue to grow at about 8 percent to $23.5 billion and per-share earnings to grow faster than revenue to $1.85 per share. Analysts estimated sales of $23.63 billion for the year.
- Morel than 50 percent of EMC’s storage revenue goes through channel partners. The company’s focus for 2013 is to help partners be more productive.
- In the two quarters since EMC’s VSPEX launch, partners have sold more than 1,300 VSPEX systems, which EMC contends makes it the fastest-growing reference architecture in the market.
One day prior to releasing its Q4 results, EMC named Vic Bhagat, a 30-year IT veteran with 20 years at General Electric (NYSE: GE) and a recent stint at Accenture (NYSE: CAN), as its new chief information officer (CIO) and corporate services executive vice president.
Bhagat replaces Sanjay Mirchandani, who is moving to support the EMC/VMware (NYSE: VMW) Pivotal Initiative and other roles within EMC. Bhagat is tasked with handling EMC’s Information Technology, Global Centers of Excellence, Global Business Services and Indirect Procurement organizations, reporting to Howard Elias, EMC Global Enterprise services president and chief operating officer (COO).
“Vic's ability to lead large-scale transformative initiatives, his tenure and accomplishments as a true change agent, and his deep international experience will be instrumental as we continue to build on the central role these organizations play in helping customers transform their IT through cloud computing, transform their businesses through Big Data and do so in a safe and trusted way,” said Elias.
At Accenture, Bhagat contributed to its Big Data analytics practice for Natural Resources. At GE, he served as CIO for GE’s Aviation Services, Global Growth and Operations, CNBC, Corporate, and India and Southeast Asia operations.