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Licky_201
Hates with a Vengance
Joined: 07 Aug 2007
Posts: 55
Location: St Louis
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 Posted: Thu Aug 28, 2008 3:21 pm Post subject: Dell profits way down |
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SAN FRANCISCO (Reuters) - Dell Inc (NasdaqGS:DELL - News) reported a surprise 17 percent decline in quarterly profit on Thursday as the company suffered from tighter corporate spending in United States, sending its shares down 8 percent.
Net income for the fiscal second quarter ended August 1 fell to $616 million, or 31 cents per diluted share, from the restated year-ago net income of $746 million, or 33 cents per diluted share.
Revenue rose 11 percent to $16.43 billion.
Dell shares tumbled to $23.20 in extended trade following the quarterly report, after closing down 42 cents at $25.21 on Nasdaq. |
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AngelusDaemonicus
Dances with Hate
Joined: 08 Mar 2008
Posts: 111
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| Posted: Thu Aug 28, 2008 4:33 pm Post subject: |
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Ah, beat me to it. I was about to post this myself.
As far as DELL stock plummeting... GOOD!
It'll go up again and down again. DELL doesn't have any strategy. They just try stuff and if it works, great. If not, they scrap it. This is not a stable company by any respect.
And, as far as blaming it on external conditions, guess again. HP and others are doing pretty well for themselves. Pretty funny, huh?
_________________
"One man's garbage is another man's DELL." |
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suspiciousfish
came back and replied a few times
Joined: 10 Apr 2008
Posts: 8
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| Posted: Fri Aug 29, 2008 1:06 am Post subject: |
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All Dell is is a guy who had a really good idea back in the day and the idea snowballed before he knew what the hell happened. He then laid a foundation for the company of idiots who didn't and still don't have a CLUE as to how to run this kind of company.
No imagination, no innovation and definitely NO INTEGRITY.
Sales Men trying to figure out how to screw the customer out of some more money and Magicians trying to keep up the illusion that Dell is worth anything. Nothing more, nothing less. |
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hotrodlincoln
Moderator
Joined: 08 Apr 2003
Posts: 1691
Location: Not in Austin anymore
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| Posted: Fri Aug 29, 2008 7:26 pm Post subject: |
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| AngelusDaemonicus wrote: |
As far as DELL stock plummeting... GOOD!
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I partially share your sentiments. I was hoping it would go up close to $30 again so I could dump the last block that I own for a small loss; now, I'm looking at a healthy loss because it's down over $4 since the announcement. I missed my chance when I was asleep at the investment wheel last year.
Still, it couldn't happen to a more deserving company. |
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hotrodlincoln
Moderator
Joined: 08 Apr 2003
Posts: 1691
Location: Not in Austin anymore
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| Posted: Fri Aug 29, 2008 7:29 pm Post subject: Here's the local version of the story |
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Dell reports a strong rise in revenue but a drop in net income
Shares fall and then rise in after-hours trading.
By Dan Zehr
AMERICAN-STATESMAN STAFF
Friday, August 29, 2008
Dell Inc. reported a strong rise in revenue during its most recent quarter, but it paid a price for its gains.
The company on Thursday said sales increased 11 percent, exceeding Wall Street's forecast, but its ongoing push into retail stores and an aggressive price cut on some notebook PCs helped keep profit short of analysts' estimates.
Dell's shares finished regular trading hours down 42 cents. In after-hours trading, its stock was down 10 percent for most of the session but rebounded late to finish up 13 cents at $25.34.
Dell reported second-quarter revenue of $16.4 billion, up from $14.8 billion in the same period last year. Net income dropped 17 percent to $616 million from $746 million. Earnings per share fell to 31 cents a share from 33 cents last year.
"Clearly, they chose to focus on (market) share over profitability here," said Bill Kreher, an analyst with Edward Jones. "While that may be OK for now, we really would like to see some progress in overall profitability."
Leading up to the report, several analysts expressed concern that higher component costs and lower PC prices could limit Dell's profit growth. But few of them expected that vise to squeeze the company as tightly as it did. One time costs related to Dell's restructuring and recent acquisitions shaved 2 cents per share off its earnings, the company said. Excluding those charges, Dell posted earnings of 33 cents per share, 3 cents less than Wall Street's forecast, Thomson Reuters said.
Coming after a better-than-expected first quarter in which Dell showed signs of a more even recovery, the second quarter's results reminded investors that the company's efforts to reignite revenue and profit growth will remain volatile.
"The company has really provided an uneven performance over last several quarters, so it's difficult to gauge which Dell we'll see going forward," said Kreher, who has a "hold" rating on Dell shares.
In a conference call with reporters, Chief Financial Officer Brian Gladden said the company has made progress on its efforts to cut expenses, reduce the cost of producing computers and eliminate roughly 8,900 jobs.
Excluding the positions it added through acquisitions, the company said it has reduced its work force by 8,500 people in the past year. It expects to reach its 8,900-job target during the current quarter.
In addition to its progress in reducing costs, Dell has started to regain some of its lost market share. It posted industry-leading shipment growth for personal computers and servers in the second quarter of 2008, two research firms reported in recent weeks.
Dell said server revenue in its fiscal second quarter, which trails the calendar by a month, increased 5 percent. The gain came despite a slowing economy that has put a damper on commercial technology spending in the U.S. and increasingly in Western Europe, the company said. Part of the resilience stems from Dell's growing business supplying servers to run massive new data centers that power Web companies, such as Amazon and Yahoo.
"I hear a lot of concerns in the market about Dell as a (stronger) competitor," said Matt Eastwood, an analyst at IDC, which tracks the market for PCs, servers and other technologies. "I haven't heard that as much over the past two years. They're getting themselves in shape to really compete."
But the second quarter again showed how difficult it can be to simultaneously reignite growth, restructure a company and cut costs. Consider Dell's notebook computer business: Although laptop revenue increased 26 percent in the quarter, the company said it cut some of its prices too sharply in Europe.
On a call with analysts, chief executive Michael Dell called the situation "self-inflicted" but said it was something the company could fix "right away."
"Whenever you're restarting growth, what I can tell you is that it's an imprecise process," he said. "We certainly see some parts of our business where we were probably a bit too aggressive, and we're kind of modulating for that now."
In fact, Dell's overall execution in Europe lagged the rest of the company, in part because of the notebook pricing but also because of the more-cautious spending in Western Europe and the deferral of some services revenue, the company said. Before taxes and other accounting items, its commercial business in Europe, the Middle East and Africa earned a profit of 4 cents on every dollar of sales, down from 7.5 cents in the same period last year.
Overall, the company's operating profit slipped to 5 cents on every dollar of sales, a half-penny short of analysts' forecasts.
dzehr@statesman.com; 512-912-5932
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http://www.statesman.com/business/content/business/stories/technology/08/29/0829dell.html |
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