Data storage vendor EMC has reported a loss of almost £700m in its
third quarter, the company's first loss in over 12 years.
The company's chairman, Mike Ruettgers, pointed to the IT spending
slowdown and the company's launch on 10 September of a new line of
its high-end Symmetrix Enterprise Storage systems and software as
an untimely blow to revenue.
"The next day, the world changed," Ruettgers said. "The focus of
many of our customers and employees turned to assisting those
affected by the tragedies."
But analysts have said that increased competition from vendors
including Compaq, Hitachi and IBM had also affected the company's
bottom line.
EMC's president and chief executive officer, Joe Tucci, said that
the redundancies and other cost-cutting measures announced in the
second quarter had achieved savings of $58m (£40m) in operating
expenses in the third quarter. The company also announced that it
would cut 4,000 jobs by the end of the year .
Once those cutbacks are complete, EMC's workforce will have been
reduced to 19,000 people.
"This is good progress, but it is not enough in the current
environment. We expect that our expanded cost cutting will yield
ongoing annual cost-savings of about $800m (£553m) by the middle of
next year," said Tucci.
EMC took a $825m (£571m) restructuring charge in the third quarter,
reporting total revenue of $1.21bn (£837,500m), 47% less than the
$2.3bn reported a year earlier.
Tucci said the 11 September attacks also highlighted the need for
business continuance solutions in addition to traditional disaster
recovery capabilities.
"EMC's longtime leadership in providing the highest levels of
business continuance has never been more relevant," he added.