Top Storage Vendors Weigh In on Sales PerformanceBy Steve Wexler | Print
As the amount of data to be stored grows at more than 50 percent per year, and the length of time that data must be stored is being extended, it's no surprise that the big four storage vendors -- EMC, HP, IBM and NetApp -- are getting bigger, aided by their channels.
From an earnings perspective, three of the top storage vendors reflected this growth, with only HP coming up short. During the earnings call discussing the fiscal first-quarter results for the quarter ended Jan. 31, Chairman, CEO and President Mark Hurd called out his storage group, which reported a 3 percent decline year over year.
He said there are three segments—high-end, midrange and the low-end, more industry-standard part of storage.
"And what you have for us is really strong growth in the industry-standard part of storage. Very mediocre performance in the midrange that we think we can improve, and then not a lot of growth in the high end," he told analysts during the earnings call.
However, he agrees with the other major vendors that the market opportunity is huge.
"But, we feel good about the market direction and the position we’ve got. We just, frankly, have to do a better job from an execution perspective," he added.
On April 19 IBM reported that storage revenue grew 11 percent year over year. Disk grew 18 percent and gained share with double-digit growth in enterprise, midrange and low-end products, said CFO and SVP Mark Loughridge during the earnings call. Tape declined 5 percent, but the company gained share.
"Our hardware storage results complement the strong performance in
storage software; our storage hardware and software together grew 14
percent," he told analysts.
EMC's first-quarter results were up 23 percent year over year, to $3.9 billion, the lion's share coming from storage, up 24 percent to $2.9 billion. Chairman and CEO Joe Tucci said during the earnings call on April 21 that the company is growing and taking market share.
"Clearly, at an apple to apples year-on-year growth rate of 20 percent
this Q1, we are growing significantly faster than the markets we serve; in
other words, we are taking share," he said.
In mid-February NetApp announced its results for its fiscal third quarter, stating it was outgrowing the market, too. GAAP revenues were $1.01 billion, compared with $746 million a year ago. Net income was $108 million, compared with a net loss of $82 million in F3Q09.
President and CEO Thomas Georgans said the company significantly outpaced both the market and the competition and forecast Q4 sequential growth at about 6 percent to 9 percent.
"NetApp clearly gained significant share this quarter," he said.
Boles tells Channel Insider that he expects the large vendors that are entrenched in the enterprise market will remain so. "The storage industry has always been less disruptable than other IT domains."
However, there are always new players coming and going, with a number like 3Par and Isilon demonstrating that size isn't everything.
"I think this bodes well for somebody trying to enter the market."