EMC (NYSE:EMC) announced its second quarter results on July 18, reporting flat revenues over the prior year period at $6 billion.  The company did not hold an earnings conference call due to the pending acquisition acquisition by Dell. Consequently, EMC did not release detailed financial statements highlighting the Q2 results.
A Brief Summary Of Reported Financials
Consolidated net revenue for the June quarter stood at $6 billion, which was flat over Q2’15. In line with industry trends, EMC’s consolidated revenues of information infrastructure were down by around 5% y-o-y to $4.2 billion. Within information infrastructure, EMC’s all-flash array portfolio witnessed strong growth with a 100% year-over-year rise in revenues to around $500 million. According to the latest IDC data, EMC has been the market leader in terms of all-flash array sales over the last 6-8 quarters, commanding a 30% share in the market.   Over the past few quarters, EMC has witnessed higher revenue growth for its services as compared to product sales. In keeping with the trend, EMC observed massive demand for its Virtustream Enterprise Cloud services in the June quarter, with revenues increasing in triple digit percentages on a y-o-y basis. Similarly, Enterprise Hybrid Cloud Solution revenues also surged by 178% during the quarter.
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Outside of EMC’s core business, VMware (NYSE:VMW) and Pivotal continued to drive top line growth. VMware’s revenues were up by around 11% on a y-o-y basis to $1.7 billion. Pivotal’s cloud foundry and big data applications witnessed robust demand from both existing customers and new customers. Its consolidated revenues were up by 49% y-o-y to just under $100 million for the quarter. 
Shareholders Vote For Merger
Shortly after reporting VMware and EMC Q2 results, EMC held a special meeting for its shareholders to vote for or against the Dell merger. Around 98% of the voting shareholders voted in favor.  The deal will close at $24.05 in cash and 0.111 of a tracking stock (related to VMware) issued by Denali Holding Inc (parent company of Dell) per share for EMC.  The deal is expected to close in the third quarter. VMware’s stock price jumped by 10% following the affirmative news from the shareholders’ vote.
Earlier in the year, the U.S. Federal Trade Commission approved of the Dell-EMC merger, which was immediately followed by approval from the European Commission.  EMC and Dell are still awaiting approval from Chinese authorities since the merger could have an impact on Huawei, the current market leader in the data storage space in China.  Once the Chinese authorities approve the deal, the merger will go through – possibly as soon as this quarter.Notes:
- EMC Reports Second Quarter 2016 Results, EMC Press Release, July 2016 [↩] [↩]
- A tiny Violin plays as EMC tops all-flash array revenue chart, The Register, March 2016 [↩]
- Woah: NetApp is number two in the all-flash market, says IDC, The Register, June 2016 [↩]
- EMC Shareholders Vote Strongly In Favor Of Merger With Dell, EMC Press Release, July 2016 [↩]
- EMC CEO’s Letter to Shareholders, EMC Library, June 2016 [↩]
- Dell wins European approval for $67bn EMC takeover, BBC, February 2016 [↩]
- What Dell’s Deal for EMC Means for China Tech, Wall Street Journal, October 2015 [↩]