Memory price spikes to affect Dell earnings

Memory price spikes to affect Dell earnings

While demand for its products remains strong, Dell Computer this week said problems related to memory price hikes will affect its third-quarter financial results.

Dell officials had told analysts and reporters earlier this month that despite the severe earthquake in Taiwan, the company wasn't encountering serious supply problems there.

"After the analyst meeting, the company learned that the latest memory pricing had increased more sharply than expected, to as much as 25 per cent higher than the previous price," Dell said in a statement released on Tuesday. The increases are affecting RAM.

"We are managing the memory situation carefully and are working to offset the cost increases with efficiencies in other parts of our business," Dell chief financial officer Thomas J. Meredith said in the statement. "We are also taking actions to reduce overall memory consumption, including advertising system configurations with lower amounts of base memory."

Dell considers the problem short-term, but it will impact financial results to be announced on November 11, the company said.

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