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Posted on 10/03/2002 2:44:39 PM PDT by Willie Green
For education and discussion only. Not for commercial use.
HOPKINTON, Mass. (Reuters) - Data storage company EMC Corp. on Thursday reported a preliminary quarterly loss and revenue that were worse than expected and said it would cut 1,350 jobs due to dismal spending on technology.
EMC also said it no longer expected to return to profits for the second half of the year because technology spending has dried up as companies worry about their own profits.
"The IT (information technology) spending environment continues to be brutal. In fact, it got even worse at the very end of the quarter. Our third quarter was on track until late September," EMC Chief Executive Joe Tucci said in a statement.
EMC's weaker-than-expected third quarter comes at a time when bad news for the technology sector is mounting.
Advanced Micro Devices, which makes chips used in personal computers, said on Wednesday its third-quarter sales would fall short. Last month computer services company EDS Corp. warned its results would be a fraction of its prior expectations.
EMC reported a preliminary third-quarter loss of 2 cents per share, compared with analyst expectations for a loss of 1 cent per share, according to Thomson First Call. That compares with a loss of 12 cents per share a year earlier.
The company reported preliminary revenues of $1.25 billion, also below analyst expectations, which were for revenues of $1.4 billion, according to First Call. That was up from revenue of $1.21 billion a year earlier.
EMC said that it would cut about 1,350 jobs, or about 7 percent of its work force, bringing total employees to about 17,000 by early next year.
In July, Tucci said he was comfortable with analyst's third-quarter estimates for EMC, which hadn't changed since.
Demand for storage hardware sky-rocketed during the technology boom of the 1990s and EMC's earnings soared, but the market dried up as customers decided they had enough storage capacity to meet their data needs.
We have a huge world wide support structure in place. 24x7 customer support including on-call technical support teams. We also have a huge number of Systems Engineers in the field to go onsite for harware issues and Regional Tech Support people that go onsite to address issues with software.
If a customer is down, we move like lightning and do whatever is necessary to get them up and running at any hour of day or night. This includes shipping replacement systems immediately anywhere in the world they are needed.
This requires a large number of people to keep this type of suport going...and the customers love it. Or so they tell me. It's just that IT spending is at a standstill, mostly. We're still number 1.
You've worked here?
I will piss on their grave.
Ah, now there's an intelligent, adult response.
Thanks. I don't understand the socialist comment by "the gillman@blacklagoon.com".
The culture here is to treat everyone with the respect they deserve. No one is taking my paycheck and donating it to those that make less.
Only bigots believe that treating someone with respect even though they are different is socialism.
I'm sorry that you have less than fond memories of your contact with EMC2. I've been here for 2 years exactly and though I do see some personality conflicts, the atmosphere is quite good in general. There have been a number of changes in the upper personnel that have been a move towards that end.
You are always going to run into a$$holes no matter where you go. And you are correct about ignoring the worst of them. But if I had the kind of experience I believe you are intimating, (Moshé?) I wouldn't have to stand for it. I would have the weight of the Company behind me if I chose not to ignore it. I have recently seen one very valuable, highly skilled employee get booted because someone decided not to ignore it. It simply isn't tolerated here these days, nor should it. And I don't like the smell of socialism any more than you, but this ain't it.
Perhaps you were in a different position being in a consulting position. That may have been a source of irritation to someone. Who knows. All I know is that I've worked for some real sh!thole companies and this one is far above most. Just my humble opinion.
Cheers.
(big sarcasm alert)
My prediction: More layoffs to come in 4th Quarter. Standby for 7% unemployment by January 2003. Word to the wise: If you have a job, and you're not saving your money like Scrooge, you are a FOOL.
I just did a search on the lca database on EMC. http://www.zazona.com/LCA-Data/. Why did EMC get 3,249 H-1B Visa's in 2001? This is a very typical pattern. Hire thousands of foreigners on H-1B visa and then have a lay off and get rid of Americans. Does the comment make sense now?
No, it doesn't. The layoffs that EMC2 had to bring about the last 2 times were worldwide.
Of all the layoffs combined, only about 25% of them were for personnel in this country. The rest were in other countries. In 2001 there were a total of 4360 people laid off. Of those, approximately 1100 were in the United States. And the majority were not technical positions that would be filled by people entering on H-1B visas. Most were in overlapping field positions including Sales and Professional Services. As a matter of fact, Engineering and Technical Support departments were left largely untouched.
Did your research indicate how many of those employees here on H-1B visas were laid off? Or did it indicate what salaries are/were paid to those employees on H-1B visas? I can assure you they are commensurate with salaries paid to "Americans" like me.
What OKSooner said; it makes perfect sense.
An H1B employee is basically an indentured servant for the term (6 years IIRC) of the visa. Makes for a very manageable, hard-working employee, albeit one generally with limited English skills.
This is unusual. Most companies have their stuff manufactured by a contract manufacturer like Flextronics, Celestica, Jabil, Solectron, or Sanmina.
H-1B's very seldom get laid off. According to the law a company is required to still pay them for the remainder of their contract. Why would a company hire over 3,000 H-1B's is 2001 just to lay them off in 2002? This makes no business sense at all. Salaries are not the issue. American workers are AVAILABLE to fill these positions, there are thousands of unemployed American engineers and IT workers that could have filled the poisons that were given to foreigners.
I'm sorry, but I had to laugh out loud at this comment.
As one of EMC's former customers, EMC's policies towards us was to ride roughshod over us, our storage, our storage policies and otherwise treat us so badly that we took our business elsewhere. The pricing on the technically inferior product that EMC was selling was more than 2x their competition (HDS for example.)
While we weren't one of EMC's largest customers in the area, when we dumped EMC it sent shock waves through EMC and in fact some of EMC's other customers.
Having been threatened with legal action against me by EMC for telling their other customers (who've solicited my opinions of the technology, I didn't approach them) why we switched - I will personally attest to EMC's brash, abrasive and abusive practices towards it's (now) former customers.
It'll be a cold day in hell before I allow an EMC storage unit in any of our offices around the world. And yes, I'm the person who makes that decision in the company I work for. I can make that statement with 100% confidence.
From your lips to God's ear. I'm just surprised it hasn't hit 7% or more already. I have so many friends in IT who are out of work right now. I've never seen it this bad in IT. Every one of my friends in the Telecommunications industry is out of work. About half of them who are LAN administrators are out of work - the other half can feel the layoffs coming. It sure doesn't look like this is going to turn around anytime soon.
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