Emulex Profit More Than Doubles
Emulex Corp., Costa Mesa maker of computer-circuitry cards that speed data transmission, said fiscal second-quarter sales and profit more than doubled as customers bought more gear to support Internet-generated data.
Net income rose to $19.4 million, or 25 cents a share, from $8.8 million, or 11 cents, a year earlier. Revenue for the three months ended Dec. 31 surged to $71.1 million from $33.6 million.
Emulex was expected to earn 18 cents a share in the second quarter, according to analysts surveyed by by First Call/Thomson Financial.
The results were disclosed after the close of regular trading in U.S. markets. The company’s shares rose as high as $109.13 after the report. The stock was off 6 cents to $97.13 before the earnings announcement. The shares have declined 14% from a record $112.75 on March 27.
Computer and storage-system makers such as EMC Corp., International Business Machines Corp. and Compaq Computer Corp. are snapping up Emulex products as Internet use by businesses boosts demand for data-storage space and quick access to information.
“IBM reported a good quarter yesterday for their Unix servers, and that is where Emulex’s products go,” Mark Kelleher, a First Albany Corp. analyst, said before the earnings release. He rates Emulex shares a “strong buy.”
Emulex chief financial officer Mike Rockenbach attributed the company’s strong showing for the quarter partly to the “insatiable demand for stored data and access to that data.”
The company’s prospects remain bullish, even with some level of uncertainty in the market for the next few quarters and signs of an economic slowdown, Rockenbach said.
“That’s not changing peoples’ use of the Internet, or their demands for wireless computing, or for streaming audio and video,” Rockenbach said. “All those things are creating a demand for storage.”
The company said it expects third-quarter earnings per share to be about 23 cents, up from its previous forecast of 19 cents. For the year, it expects earnings per share of 85 cents, higher than its previous forecast of 74 cents, said spokeswoman Robin Schnug.
The company said revenue may reach $295 million for the fiscal year ending in June, compared with the $284.4 million average estimate of analysts surveyed by IBES International Inc. For 2002, the company forecast $475 million in revenue, compared with analysts’ expectations of $442.8 million.
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Times staff writer Karen Alexander contributed to this report.
