UPDATE: EMC Financial Chief: Worst Of Recession Over For IT Cos
09 9월 2009 - 7:45PM
Dow Jones News
EMC Corp. (EMC) believes the worst of the global recession is
over for information-technology companies as the pressure on
clients' budgets is easing, the U.S.-based storage-equipment
maker's chief financial officer said Wednesday.
But, "we are not predicting any rapid recovery," David Goulden
told Dow Jones Newswires. "It'll be slow and steady, and the
recovery will create some opportunities in 2010."
Goulden was in Bangalore for the inauguration of EMC's new
facility and to announce its strategy in India.
Information-technology companies have been hurt by the global
economic slowdown as their customers shelved projects and cut
technology spending.
However, with recent economic data indicating the worst may be
over, and some major global companies starting to give new orders,
IT service providers are breathing easier.
"I am expecting stronger (IT) spending in the second half than
in the first half" of 2009, Goulden said. "Corporate IT spending is
on an upward path."
But, the U.S. economy isn't "yet out of the woods," he said.
"What we have seen is stabilization. I don't think it is getting
any worse."
In July, Hopkinton, Mass.-based EMC said it has "better
visibility and more confidence in the second half of 2009."
At the time, the company forecast earnings of 82 cents a share
on revenue of $13.8 billion in 2009 after considering its planned
acquisition of Data Domain Inc. (DDUP). For the third quarter, it
forecast revenue to rise 2%-3% from the second quarter's $3.26
billion.
The U.S. is recovering faster than Europe, Goulden said.
John Mollen, executive vice president of human resources at EMC,
said he expects Europe to likely show signs of recovery in the
middle of 2010.
Mollen said EMC isn't looking at further job cuts.
In January, the company had said it was cutting 2,400 jobs to
save $350 million. Then in April, it offered a 5% pay cut to
employees in return of five days of leave.
As much as 85% of its employees had opted for the pay cut. The
pay cut will be rolled back Jan. 1, Mollen said.
Goulden described the Asia Pacific as the fastest-growing market
for the company and India and China as "big growing markets." The
Asia Pacific "is a market with lower share (for the company) than
the U.S. and Europe, so we have potential to gain market share
there."
He declined to comment on a Wall Street Journal report last week
which cited people briefed on the plan as saying EMC and Cisco
Systems Inc. (CSCO) are in talks to form a new joint venture to
provide technology services.
EMC said in a statement it plans to invest $1.5 billion in its
India operations from 2010 to 2014 - three times more than its
investments in the past five years.
"India offers tremendous opportunities in innovation and market
potential," Goulden said in the statement.
EMC uses its Indian facilities mainly for software research and
development and to service products sold worldwide.
-By Dhanya Thoppil and Romit Guha, Dow Jones Newswires;
91-9900181471; romit.guha@dowjones.com