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Storage stocks slump following EMC's Q1 report

  • NetApp (NTAP -1.1%), Fusion-io (FIO -2.1%), and Nimble Storage (NMBL -3.2%) are all lower after EMC reported a 3% revenue drop for its core Information Storage ops, and a 7% drop in the unit's product sales.
  • EMC's high-end storage sales were particularly weak, falling 22% Y/Y. On the other hand, emerging storage sales (inc. flash storage, object storage, and scale-out NAS) rose 81%, and unified storage and backup/recovery sales rose 4%.
  • NetApp is EMC's biggest rival in the unified storage space. All three of the aforementioned companies compete to varying degrees against products offered by EMC's emerging storage ops.
  • EMC's numbers follow a relatively healthy Q4 for the storage industry. But they also come amid concerns about the long-term impact of cloud infrastructure services on traditional storage arrays from the likes of EMC, IBM, NetApp, and H-P - concerns heightened by an ongoing price war.
  • Separately, upstart flash array vendor Pure Storage has raised $225M at a $3B valuation. CEO Scott Dietzen says Pure, which asserts its flash arrays are cheaper than rival solutions and offer a superior data-reduction feature set, isn't in any rush to go public.
  • Nutanix, a maker of clustered server/storage systems for web-scale data centers, raised funding earlier this year at a ~$1B valuation.
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