Menu
Dell profits fall as company battles to go private

Dell profits fall as company battles to go private

Dell's profit and revenue both declined amid a collapse in PC sales

Comments

Dell has reported another quarter of declining revenue and profits as the company's CEO continues his battle to take the PC maker private.

It was the fifth consecutive quarter in which Dell's profits shrank, and the fourth in which it reported declining revenue. The company has been hit by a downturn in the PC market.

Revenue for its fourth fiscal quarter, ended Feb. 1, declined 11 percent to US$14.3 billion, Dell said. Net income was $530 million, or $0.30 per share, down from $764 million, or $0.43 per share, a year earlier.

Revenue from desktop and laptop PCs, which account for about half Dell's business, declined 20 percent in the quarter. Sales from storage and services also fell from the year earlier. The only business unit to see growth was Dell's server and networking business, where sales were up 18 percent, Dell said.

Dell has been trying to reduce its dependence on PCs and refashion itself as a complete "solutions" company, one that sells higher-margin software and services as well as PCs and servers. But the transformation has been taking longer than investors would like.

Earlier this month, Michael Dell announced a plan to team up with Silver Lake and take his company private in a $24.4. billion deal. The move could allow the company founder to focus on longer-term investments, away from the constant scrutiny of Wall Street.

However, the plan has run into opposition from big shareholders, who think the $13.65 per share that the buyout group is offering doesn't reflect the value of the company. One big investor, Donald Yacktman of Yacktman Asset Management, has said the chances of the deal going through at its current valuation are "close to zero."

The quarterly profit figures reported above include one-time charges and other items. Excluding those items, Dell reported a profit of $0.40 per share for the quarter, a penny ahead of the consensus analyst forecast, according to a poll by Thomson Reuters.

James Niccolai covers data centers and general technology news for IDG News Service. Follow James on Twitter at @jniccolai. James's e-mail address is james_niccolai@idg.com

Follow Us

Join the ARN newsletter!

Error: Please check your email address.

Tags business issuesDellservershardware systemsdesktop pcslaptopsfinancial results

Upcoming

Slideshows

IN PICTURES: VMware's VMworld 2015 day 1 (+13 photos)

IN PICTURES: VMware's VMworld 2015 day 1 (+13 photos)

VMware has kicked off VMworld 2015 in San Francisco and the first day saw keynotes from its president and CEO, Carl Eschenbach; executive vice-president and general manager, Bill Fathers; and executive vice-president and general manager of SDDC, Raghu Raghuram; amongst others. VMware also made Cloud-related announcements and demonstrated its latest technology.

IN PICTURES: VMware's VMworld 2015 day 1 (+13 photos)
IN PICTURES: 2015 Microsoft Australia Partner Awards (+21 photos)

IN PICTURES: 2015 Microsoft Australia Partner Awards (+21 photos)

The achievements of Microsoft’s Australian partners over the past year have been recognised through a number of prestigious awards announced at the 2015 Microsoft Australia Partner Conference (APC) on the Gold Coast. The Microsoft Australia Partner Awards showcased partners delivering innovative solutions and services to customers, with many embracing Microsoft’s Cloud solutions. Awards were presented in 17 categories. The winners were chosen from more than 170 nominations. With more than 11,000 partners in Australia it was a competitive field. Photos by ARN Editor, ALLAN SWANN.

IN PICTURES: 2015 Microsoft Australia Partner Awards (+21 photos)

iasset.com is a channel management ecosystem that automates all major aspects of the entire sales, marketing and service process, including data tracking, integrated learning, knowledge management and product lifecycle management.

Show Comments