Financial News: EMC profit up, income down with layoffs planned [amplification]

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EMC reported a drop in net income with $283.7 million in Q3 2006, compared with $421.7 million a year earlier. Revenue, however, hit $2.82 billion compared to $2.37 billion a year ago, boosted by the company’s acquisitions of RSA Security and Network Intelligence. This beat estimates of $2.67 billion in revenues forecast by analysts surveyed by Thomson Financial, Bloomberg reports. However, EMC has announced plans to lay off 1,250 employees by the end of 2007 — which represents 4 percent of its total workforce. And to cover the costs of restructuring, EMC expects to absorb a pre-tax charge of between $150 million and $175 million in Q4. Yet there could be good news around the corner. According to an A.G. Edwards & Sons analyst, many large companies such as Yahoo! are adding storage as they bulk up in preparation for additional video capabilities, and new security regulations are forcing some companies to hold on to more documents longer, Bloomberg reports. The company’s latest Q4 forecast has revenues up close to $3.16 billion, including a projected $110 million from a new security division.