Improved customer demand boosts EMC earnings

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Improved customer demand boosts EMC earnings

Storage company EMC has attributed better-than-expected preliminary earnings for its fourth quarter to a rise in customer spending, particularly in the area of midrange storage arrays.

The company said its fourth-quarter revenue would be at least $1.47bn (£930m), exceeding its previous guidance of $1.26bn. Revenue for the fourth quarter last year was $1.51bn.

President and chief executive officer Joe Tucci said: "Demand was particularly strong for our new CX family of Clariion storage platforms."

EMC said it would still report a loss when it releases its complete results for the fourth quarter, its sixth straight quarterly loss, later this month. That loss reflects a $160mrestructuring charge related to job cuts it announced last year.

Clinton Vaughan, an analyst at Salomon Smith Barney Holdings, described EMC's news as "surprisingly strong". Vaughan said the sales could be attributed both to direct channels and a partnership agreement signed with Dell last year.

"We would believe these results support our thesis that EMC is on the road to recovery," he added.

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