EMC Reports Second Quarter 2014 Financial Results 

EMC Corporation has reported second-quarter 2014 financial results, including record second-quarter revenue of $5.9 billion, an increase of 5% year over year. GAAP net income attributable to EMC was $589 million and GAAP earnings per weighted average diluted share was $0.28. Non-GAAP net income attributable to EMC was $882 million and non-GAAP earnings per weighted average diluted share was $0.43.

EMC generated $1.3 billion in operating cash flow and $930 million in free cash flow in the second quarter – up 2% and 10% year over year, respectively. EMC ended the quarter with $14.6 billion in cash and investments. The company repurchased approximately $600 million worth of its common stock in the second quarter and returned approximately $200 million to shareholders via a quarterly dividend.

In addition, EMC's Board of Directors has approved an acceleration of EMC's share buyback plan for 2014 from $2 billion to $3 billion. Including the accelerated buyback and EMC's increased dividend (announced in the first quarter of 2014), EMC expects to return more than $7 billion to shareholders over the course of 2013 and 2014.

Joe Tucci, EMC Chairman and Chief Executive Officer, said, “Our industry and customers are in the midst of a massively disruptive and transformational shift, and the pace of change is accelerating. EMC detected it early on, put the right strategy in place and is executing well. New customers are coming to EMC for the first time, and existing customers are investing more heavily, because of our expanded capabilities across EMC Information Infrastructure, VMware and Pivotal. As a result, we have no doubt that EMC and our customers and shareholders will emerge among the primary beneficiaries of this transformation.”

David Goulden, CEO of EMC Information Infrastructure and EMC's Chief Financial Officer, said, “EMC performance in Q2 was solid and on track, with good performance from each of our major business units. We are at the threshold of expansive opportunity and remain confident about the rest of the year, as evidenced by the accelerated buyback program. Our market leadership, healthy partner ecosystem and cutting-edge technologies all support a strategy that deeply resonates with customers.”

Second Quarter Highlights

• EMC Information Infrastructure business revenue was up 1% year over year. Excluding the High-end Storage business, Information Storage revenue grew 7% year over year – which is faster than the industry growth rate. Emerging Storage revenue grew 52% year over year, based on demand for technologies such as the EMC XtremIO all-flash storage array, EMC ViPR software-defined storage and EMC Isilon scale-out storage. EMC has established clear leadership in the all-flash array market with XtremIO, surpassing a $300 million annualized demand run rate in its second full quarter of availability. ViPR adoption continues with the number of customers doubling in the second quarter compared to the first quarter of 2014. Data Domain had another strong quarter and the Data Protection Suite achieved very strong double-digit revenue growth both sequentially and year over year. RSA Information Security revenue grew 6% year over year, with Security Analytics and Archer each up over 20% in the second quarter. VCE had another strong quarter as demand for VCE Vblock systems once again showed very strong year over year growth.
• Pivotal grew revenue 29% year over year. The proliferation of Cloud Foundry as the industry's standard for open-source PaaS continues to flourish. Attendance at the second annual Cloud Foundry Summit held in the second quarter more than doubled.
• VMware continues to see growth with revenue up 17% year over year. VMware remains focused on delivering virtualization technologies to propel its three strategic initiatives including Software-Defined Data Centers, hybrid cloud and end-user computing.

Global Highlights

EMC's consolidated second-quarter revenue from the United States was up 3% year over year at $3.1 billion, representing 52% of consolidated second-quarter revenue.  Revenue from EMC's business operations outside of the United States increased 7% year over year to $2.8 billion representing 48% of consolidated second-quarter revenue. Within this, revenue from EMC's Europe, Middle East and Africa region grew 12% year over year and revenue from EMC's Latin America region grew 14% year over year. Revenue from the BRIC+13 markets grew 5% year over year.