EMC Reports Record Revenue

HOPKINTON, Mass. -- EMC Corporation (NYSE:EMC), the world leader in information infrastructure solutions, today reported all-time record revenue and strong profit growth for the fourth quarter and full fiscal year 2006. EMC's 14th consecutive quarter of double-digit year-over-year revenue growth was highlighted by better-than-expected revenue and profit performance.

Total consolidated revenue for the fourth quarter was a record $3.215 billion, 19% higher than the $2.710 billion for the fourth quarter of 2005 and $55 million more than the fourth-quarter revenue forecast provided by EMC in October 2006.

GAAP net income for the fourth quarter of 2006 was $389 million or $0.18 per diluted share, which includes a $0.06 per share restructuring charge, a$0.05 per share tax benefit related to prior years and a $0.02 per share tax benefit related to the first three quarters of 2006. Excluding these items, net income for the fourth quarter of 2006 was $0.17 per share, $0.02 higher than the fourth quarter forecast provided by EMC in October 2006. GAAP reported fourth-quarter net income for 2005 was $148 million or $0.06 per diluted share.

Total consolidated revenue for EMC's full 2006 fiscal year was a record$11.155 billion, 15% higher than the $9.664 billion reported for the full2005 fiscal year.

GAAP net income for 2006 was $1.22 billion or $0.54 per diluted share.Excluding special items discussed below diluted earnings per share for 2006 also was $0.54. GAAP reported net income for 2005 was $1.13 billion or $0.47 per diluted share. Adjusting for special items in both years, and had stock options been expensed in 2005, diluted earnings per share would have increased 35% to $0.54 in 2006 from the $0.40 diluted earnings per share in 2005.Joe Tucci, EMC Chairman, President and Chief Executive Officer, said, "EMC had another record quarter and a solid finish to 2006. We have now delivered strong, double-digit revenue growth for four straight years and we are well positioned to do it again in 2007."

"EMC has clearly joined the short list of the world's elite information technology suppliers that organizations around the world choose to partner with to drive their business," Tucci continued. "We have focused our entire company on information infrastructure, enabling our customers to put their information to work and better leverage its value. We begin 2007 with the technology portfolio, the strategy and, most importantly, the trust of our customers to help them solve their most pressing issues and gain an even greater share of our $60 billion market opportunity."

During the fourth quarter, EMC achieved double-digit revenue growth across its systems, software and services offerings, and across all four of its major geographies. EMC systems revenue grew 12%; software license and maintenance revenue increased 27%; and professional services, systems maintenance and other services revenue increased 20% compared with the fourth quarter of 2005. Quarterly revenue from North America was up 18%; revenues from Europe, Middle East and Africa grew 22%; revenue from Latin America increased 14%; and revenue from the Asia Pacific and Japan region returned to double-digit growth, increasing 13% compared with the fourth quarter of 2005.

EMC completed the fourth quarter with $5.6 billion in cash and investments.In 2006 the company spent approximately $3.8 billion to purchase 302 million EMC shares and to redeem $125 million in convertible debt.

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