Europe is star performer for EMC as sales soar

Q1 sales in Europe up eight per cent annually as all other regions post flat or falling revenue

Europe was the golden child for EMC in the first quarter as all but one country in the region posted an annual sales spike around the eight per cent mark.

EMC's European business as a whole saw revenue grow annually by eight per cent in Q1, while sales across all other global regions were either flat or down over the same period.

The storage giant's chief executive Joe Tucci said he was extremely pleased with Europe's performance, bar that of just one country which failed to keep up with the strong growth.

"We're actually very pleased obviously with what happened in Europe," he said in an earnings call transcribed by Seeking Alpha.

"We had the strength across almost every single market in Europe during the quarter. Only one country – and I am not going to call out single countries by name – didn't show a decent growth. So everybody was up around that eight per cent average. We do think it is good execution."

Revenue in EMC's North American business remained flat while that in the APJ and Latin America regions slumped two per cent and 11 per cent respectively. EMC's sales in the BRIC markets dropped annually by one per cent.

The strong European performance was enough to see the firm's overall sales surpass analysts' expectations.

For the three months to 31 March, EMC's sales rose two per cent to $5.5bn (£3.28bn), topping Wall Street expectations of $5.43bn. But rising overheads and a change in business practices meant EMC's Q1 net income plummeted by a third year on year to $392m.

During Q1, EMC changed the way it does business in an effort to swerve extra costs associated with trying to fulfil high-volume orders at the end of a quarter.

The firm's chief financial officer David Goulden said although the change put a spanner in the works this quarter, it would pay off in the long term.

"While planned business practice changes had a negative impact on year-over-year revenue and EPS [earnings per share] growth in the quarter, we are very confident we are on the right track with our federation model [VMware, RSA, Pivotal and EMC] and technologies," he said.