As EMC reports moderate growth for its last quarter, with revenue up 9 percent year-over-year, the storage company revealed it wants to acquire a majority stake in VCE, a joint venture formed with Cisco.
EMC reported $6 billion in revenue for the third quarter of its 2014 fiscal year, just shy of where Wall Street expected the company's income to land.
"EMC's continued momentum is evidence that our strategy and execution are working," stated Joe Tucci, EMC chairman and CEO. "Our strategically aligned businesses -- EMC Information Infrastructure, VMware, Pivotal and RSA -- are well-positioned to capitalize on the massive IT market opportunity in front of us. From my conversations with customers, it's clear that we have the right best-of-breed technologies in cloud, mobile, Big Data and security, and offer a level of choice and flexibility second-to-none."
EMC's weighty portfolio of successfully acquired companies has made it the subject of ongoing shearing talks, but the company continues finding ways to avert hostile takeovers and keep its beloved holdings under its umbrella. EMC's latest acquisition move is to buy up a large portion of Cisco's stake in VCE, a company that delivers virtual computing solutions.
EMC's majority stake in VCE adds a fourth sector, cloud computing, to its diverse services lineup of data computing, virtualization and data management. Cisco will retain a 10 percent share in VCE.
"We hope the board and management team at EMC is evaluating the right ownership structure / a potential spin off of VMware as this topic remains at the epicenter of CEinvestor frustration and activism around the EMC story," stated FBR Capital Markets analyst Daniel Ives.
There was talk at one point that HP, which just announced it will split into two companies, would merge with EMC. But shareholders on both sides were uncomfortable with the idea of joining EMC and HP, resulting in the deterioration of merger talks.
EMC standing by its assertions that the company is best served by letting each of its holding operate autonomously.
"EMC's solid third-quarter performance was in line with our expectations, as customers continue to seek strong and well-equipped partners to help them achieve their new IT goals, assembling a leading portfolio of technology assets over several years - that enable customers to use cloud, mobile, Big Data and security technologies to create competitive advantage," stated David Goulden, CEO of EMC Information Infrastructure.
