EMC Plans to Lay Off 1,000
Storage market leader EMC Corp. said late Friday that it plans to cut 1,000 jobs and take a charge of about $80 million, but is also raising its revenue target for the fourth quarter.
The layoffs are intended to eliminate redundant job functions, but company officials said that they still expect to see an overall increase in the number of employees in 2006.
The $80 million charge is related to severance costs and other charges stemming from the layoffs. The company has almost 23,000 employees currently.
EMC will report its fourth-quarter earnings on Jan 24, and officials on Friday raised their revenue estimate for the quarter to between $2.70 billion and $2.71 billion. For fiscal 2005, the Hopkinton, Mass., company expects to report revenue of about $9.65 billion.
EMC spent much of 2005 digesting several acquisitionsincluding the $275 million purchase of Captiva Software Corp.and has also been affected by storage prices that have leveled off, and in some cases dropped of late.
Company officials acknowledged the challenges, but said they were prepared to meet them.
"The best companies preserve their leadership by looking out to the horizon and making adjustments today to position themselves for shifts in customers expectations and market dynamics," EMC President and CEO Joe Tucci said in a statement.
"Our business model and organizational structure continue to evolve as we integrate new acquisitions, expand into new markets and address more of our customers information infrastructure needs."
The job cuts will be complete by the end of 2006, the company said.
Despite the hurdles, the fourth quarter of 2005 will be EMCs tenth consecutive quarter of double-digit revenue growth.
The layoffs come a day after EMC announced a deal to buy grid computing heavyweight Acxiom Corp. for $30 million.
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