VISUALIZATION

HOPKINTON, MA -- EMC Corporation (NYSE:EMC) today reported fourth quarter and full fiscal year results for 2001. The results included a 25% sequential revenue increase in the fourth quarter compared with the third quarter of 2001, strong performance in strategic growth areas such as networked information storage, software and services, and significant operating improvements. Total consolidated revenue for the fourth quarter was $1.51 billion, 25% higher than the $1.21 billion reported in the third quarter of 2001. Net loss for the fourth quarter was $70 million or $.03 per diluted share, compared with a third-quarter 2001 net loss of $945 million or $.43 per diluted share (a loss of $.12 per diluted share or $270 million, excluding a third-quarter after-tax restructuring charge). Total consolidated revenue for the year-ago fourth quarter was $2.62 billion and net income was $563 million or $0.25 per diluted share. Total consolidated revenue for the year was $7.09 billion, 20% lower than 2000. Net loss for the year was $508 million or $.23 per diluted share (including a third-quarter after-tax restructuring charge of $675 million or $.31 per share). Net income for the year 2000 was $1.78 billion or $.79 per diluted share. EMC's fourth-quarter performance included double-digit sequential growth in all major product areas and in its major geographies. Fourth-quarter results were extremely strong in the fastest-growing market segments, including 52% sequential revenue growth in networked information storage (SAN and NAS deployments), 45% sequential revenue growth in information storage software, and 15% sequential revenue growth in information storage services. Joe Tucci, EMC's President and CEO, said, "It's great to finish the year with momentum. Last year was painful for the entire technology sector, and it forced EMC to become a better company in many respects. In the fourth quarter we executed superbly on the cost side of the equation, saw solid improvement on the revenue side and launched our most important software initiative ever. The October introduction of AutoIS (Automated Information Storage) marked the beginning of the next major wave of storage automation, simplification and openness for our customers. The groundswell of early customer response to AutoIS is resulting in the fastest ramp-up in our history for new software products. Customers like Target Corporation, CNA, and Sun America are examples of leading companies who quickly recognized that AutoIS can help them lower their costs and ease the management of all their information." "We will continue to extend our lead in the segments that are growing the fastest and clearly represent the future of information storage: networked storage, software, and services," said Tucci. "It's clear we extended our leadership in those segments during the fourth quarter and for the full year, and our technology strengths are extremely well suited to the ways customers are increasingly managing their information. We are delivering what customers need most today: networked storage and consolidation, open management software, business continuity solutions and lower total cost of ownership." Bill Teuber, EMC's Executive Vice President and Chief Financial Officer, said, "We launched a three-pronged attack in the fourth quarter to improve operational efficiency. We aligned our workforce to address both the new economic reality and the opportunity ahead, enhanced the efficiency of the organization through new systems and processes, and lowered inventories. We reduced costs ahead of our own schedule, improved margins and achieved higher customer satisfaction levels. Our cash and investments increased to $5.1 billion at the end of the year, now representing more than 50% of total assets, with virtually no debt. We expect continued progress in 2002." For the full year 2001, EMC's revenue from networked information storage grew 26% compared with 2000, reaching $2.68 billion. The most recent projections from IDC indicate that EMC's 2001 market share in networked information storage (SAN and NAS) was 39%, exceeding the combined revenues of the next three vendors. Revenue from information storage software grew 9% in 2001 compared with 2000, reaching a record $1.56 billion and building on EMC's market-leading position in storage management software. EMC's major investments in customer and professional services also continued to pay off in 2001, as services revenue for the full year reached a record $972 million, 59% higher than 2000. Tucci added, "We expect that more than two-thirds of the world's storage configurations will be networked by 2005, and our 6,000-person global services organization, combined with our growing partner network, is well positioned to lead the rapid customer transition from direct-attached storage to simpler, more efficient networked storage infrastructures."