Storage giant EMC plans to drop 7 per cent of its workforce because of a disappointing third quarter and the continuing weak outlook in IT spending.
EMC expects to report total revenue of approximately $US1.25 billion and a loss of $US0.02 per share for the third quarter when complete results are announced on October 17. The expected result compares with a loss of $0.01 per share for the second quarter.
Joe Tucci, EMC's president and CEO, blamed the projected losses on a "brutal" IT spending environment.
"The harsh reality of reduced budgets and the uncertainty of the economic and geopolitical climate are weighing heavily on business confidence, causing key projects and the corresponding IT spend to be delayed," Tucci said.
EMC has already embarked on cost-cutting measures and plans to continue along these lines by reducing its global workforce by almost 1,300, or 7 per cent, to 17,000. A company announcement said the previously stated goal of reaching profitability by the end of the second half of the year was now unlikely.
"These pre-results have been issued as a warning and we will not know how they will affect us in this region until complete third-quarter results are announced," said a spokesperson for EMC Asia-Pacific. The company currently employs almost 300 staff in Australia.