Q1 results at storage heavyweight and VMware parent company EMC show the company weathering the impact of acquisition costs and planned business changes, but Q1 revenues were up 2% to $5.5 billion, exceeding its first quarter outlook by $80m.

Quarterly net income was $392m, a 32% drop on the $580m of Q1 2013. EMC also cut its full year profit forecast, citing acquisition costs at VMware, from $1.95 a share to $1.90 a share.

Otherwise its full year revenue forecast increased to $24.58bn from $24.5bn and the company increased the quarterly shareholder dividend by 15%.

In January VMware, in which EMC has an 80% stake, committed to buying mobile security company AirWatch for $1.54bn. The company also announced in January that it would be cutting 1,000 jobs and this resulted in charges of between $100m to $120m.

CEO Joe Tucci was optimistic. He said that customers are embracing the company’s transformative technologies like VMware and Pivotal – EMC’s PaaS subsidiary, launched 12 months ago - as core to their ability to not only maximize existing infrastructure but also redefine their businesses as they seek new ways to generation growth and customer value.

“Our strategy is squarely aimed at helping our customers to transition to the third platform of IT, and helping them transform to a more agile software defined enterprise,” he said.

But the economic environment is still uncertain: “There’s more focus on the future which is causing caution today, and there’s a huge shift going on which is not for the faint-hearted,” he added.

CFO David Goulden added that the company is at the “threshold of an expansive opportunity” and well equipped to help customers flourish in the next wave of computing.

He said that while planned business changes had had a negative impact year on year, the company was on the right track.