EMC CEO and CEO Jotus to shareholders: cloud computing is unstoppable

EMC Chairman and CEO Jotus: EMC President and CEO Jotus issued a shareholder letter, saying that the wave of cloud computing will be the biggest change in the IT industry's history. The following is the full text of the letter: Dear Shareholders: 2010, I am proud of EMC's outstanding performance and record. This year, EMC grew rapidly with a significant increase in market share.　　We have fully played the role of financial leverage, in order to promote technological innovation to invest a lot of money. After 2008 or 2009 of the recession, we entered 2010 with the best financial and operational status. Not only that, our vision is desirable, products and services are leading the way, we have the ability to lead customers safely on the journey to the cloud. EMC has built a successful strategic partnership that consolidates its leadership position. Most importantly, we have a group of talented people, it is because of them, 2010 years to become the company's most glorious year ever. EMC was unprecedented in 2010, with total revenue, profit and cash flow record.　　To this end, I would like to thank more than 48,500 EMC and VMware employees around the world, to congratulate them on their leadership, thank them for their high level of attention to their customers, and thank them for their contributions to the company. Cloud computing is sweeping, and I believe this will be the biggest shift ever in the IT industry. EMC has been a great success in the 2010 and we have the ability to lead and facilitate the transition to cloud computing. The traditional IT environment is becoming more complex, more clumsy, more and more expensive, small and medium-sized enterprises no matter where they are, can not get rid of these problems.　　The growing popularity of mobile devices, the growing interconnection between mobile devices, the explosion of a new generation of applications and the surge of digital social interaction have led to rapid changes in it. EMC and VMware have embarked on a common desire to become undisputed leaders in implementing hybrid clouds through the transformation of infrastructure and applications.　　By combining private cloud and public cloud, in other words, running a variety of application loads between their own private cloud and the public cloud of a designated service provider partner, this hybrid cloud model will greatly increase enterprise agility and significantly reduce it deployment and management costs. EMC is impacting and accelerating this round of it transformation. In fact, we have industry-leading virtualization, information storage, information protection, information security, and information management technologies, with smart products and smart services.　　Customers need to safely and efficiently leverage the full potential of cloud computing, and these technologies, products, and services are essential. EMC's outstanding performance in 2010 amounted to a record $17 billion trillion in total revenues for 2010, up from 21% in 2009, and 1 billion dollars more than we had set in the beginning of 2010. Our annual non-GAAP earnings per share is 13% higher than the set target, non-GAAP per share of thin stock yield up toTo 1.26 dollars, up 40% from the previous year. EMC also produced a record annual operating cash flow and free cash flow of $4.5 billion and $3.4 billion, which grew by 36% and 31% respectively compared with 2009. At the end of 2010, we had 9.5 billion dollars in cash and investment. These revenue results highlight our continued strong financial momentum and flexibility to enable us to invest in our business for long-term growth.　　Our stock's performance in 2010 reflected the fact that we were able to exceed the more aggressive targets, and that we did climb 31% per cent over the same period, surpassing the Jones, S&p 500 and s&p high tech indices. Publicly listed VMware is the leader in the global virtualization and cloud infrastructure market, with EMC having a majority stake in VMware. VMware's 2010-year revenue was 2.9 billion dollars, up 41% from 2009. VMware's Virtualization solution represents an innovative computing approach that separates applications from the underlying IT hardware to dramatically increase efficiency, availability, flexibility, and manageability, and VMware's virtualization solutions provide customers with a clear way to change the IT cloud environment. EMC products are optimized for virtual data center environments. In 2010, EMC's research and development investment was about $1.9 billion trillion, which greatly enhanced EMC's technology leadership, and EMC invested 3.2 billion of dollars in acquisitions to open up emerging, high-growth segments in the IT marketplace. EMC has also invested heavily in enhancing the company's cloud services business, market development capabilities, international sales infrastructure, and global partner networks. We are still very focused on implementing pillars's financial policies-expanding market share in all our key markets, investing in long-term growth, and applying financial leverage to business practices to increase profitability, which is consistent with the company's overall strategy.　　EMC has made great strides in these 3 areas, so the company can start 2011 in the best financial and operational state ever. With a solid financial base, strong business momentum and numerous market opportunities, EMC is confident about the new year. We expect 2011: EMC revenue will grow by 15% to $19.6 billion; non-GAAP net income is up 20% to about 3.25 billion dollars; non-GAAP earnings growth of 16% per share to $1.46 trillion, while the number of shares bought by EMC increased from $1 billion in 2010 to $1.5 billion in 2011. EMC's free cash flow target for 2011 is 4 billion dollars.　　Such growth is particularly unusual for a company of our size and for the very high standards we set for ourselves in 2010. Growth drives EMC's opportunities are on the horizon. There are two most irresistible trends in the IT industry-cloud computing and "massive data" (Big DATA), and EMC now has the most powerful product lineup in the history of the company, right at the intersection of these two trends. First look at cloud computing. Because it is too complex and information is constantly increasing, so that only infrastructure and applications are maintained, most businesses use more than 2/3 it budgets, and less than 1/3 of IT budgets are used to enhance innovation and competitiveness.　　Cloud computing enables it to cost-effectively deliver dynamic, business-required services that help organizations release more resources to innovate and balance the use of IT budgets in different areas. Most customers are going through 3 phases in their transition to cloud computing. In the IT output (it Production) phase, customers need virtualization, server consolidation, and storage optimization for those applications that are typically owned by the IT organization to improve their operational efficiency. In the business output (Business Production) phase, the value of virtualization will be further manifested in the enterprise's existing, mission-critical applications, thereby improving efficiency and improving service quality. Finally, it will evolve to the prospect of "it as a service (It-as-a-service)", and it will provide more secure, cloud-based services at a consistent service level and through self-service dialogs. So far, many customers have embraced a variety of EMC and VMware Solutions to consolidate the IT environment, eliminate "islands" in traditional data centers, and start to improve enterprise agility.　　Such a strategy is relevant, and EMC's own IT department has virtualized 75% of mission-critical server environments, saving hundreds of millions of dollars in capital and operating expenses for the company in the first two phases, and is moving toward "it as a service". Many customers seek to transform to the cloud architecture in the quickest and easiest way, and to meet the needs of customers, EMC invests in a number of unique partnerships. 2010, EMC and Cisco further expanded the size of VCE (Virtual Computing Environnement Company) to enhance the company's strength. VCE is a joint venture between EMC and Cisco, and VMware and Intel also have investments in the company. VCE Company provides the industry's first fully integrated it product through the Vblock™ platform, which integrates the best network, computing, storage, management, information security, and virtualization technologies, and vendors can take full responsibility for the product end-to-end.　　Customers around the world are rapidly adopting this best product to dramatically simplify cloud deployment. The second major growth driver of the 2011 was "massive data". "Massive data" refers to geophysical exploration, gene sequencing, medical imaging, Internet commerce, mobile devices, mobile applications and other large, extensive information base. "Massive data" also covers new data analysis and other technologies that can help people take advantage of the number of petabytes of enterpriseAccording to and external data, complete the Super task, release the value of massive data. EMC is well prepared to help customers store, manage and secure information. We have acquired Greenplum and Isilon and continue to invest in the Atmos™ platform, which will help to promote "massive data" to unleash real potential.　　"Massive data" has created a lot of growing market opportunities, we are ready to firmly grasp this historic opportunity. I can not hesitate to say that in recent years we have actively invested, worked hard, and made excellent strategic decisions, laying the groundwork for the years 2011 and beyond.　　While we expect global IT spending to grow by about 5% to 7% in 2011, EMC is poised to take on a much higher-growth opportunity in the data center infrastructure and services, enterprise applications, and client devices markets. Long-term sustainability it is clear that the long-term success of our operations depends on the aforementioned achievements, but also on a vibrant economy, a well inclusive and well-educated society and a healthy environment. Therefore, we always pay attention to sustainability issues in policy-making and operation, that is, environmental, social and economic impacts. We held the first shareholder forum in 2010, and EMC executives and external stakeholders explored EMC's environmental performance and opportunities. We have enabled the Green data center in North Carolina State Durham, United States, and our India Center of Excellence has been LEED certified, and we have Quest Haute office in France River Qualite Environmentable (HQE) award. EMC's new generation of products employs industry-leading, highly efficient power technology to enable customers to run data centers with greater efficiency. Our sustainability efforts have been recognized by all, winning all sorts of honors, such as the 100 Best Corporate citizens (top Corporate citizens) selected in the Journal of Corporate Responsibility (Corporate responsibility Magazine), Ranked 19th place.　　We will continue to accelerate sustainability, and we still have a lot of work to do. This is my 12th year of joining EMC, and I can confidently say that I have never felt so excited and optimistic about EMCs future. Our common vision for VMware is to become an undisputed leader in a hybrid cloud computing market, with our focus on our customers and our ability to improve execution, so I believe we are well prepared to be the leader in this round of it transformation.　　I am also confident in my ability to lead EMC through a record year of double-digit growth, increased profitability, increased market share and investment in the future. Jotus, President and CEO of EMC Corporation Board of Directors (JoSeph M. Tucci) March 2011