Dell Disappoints Investors With First Quarter Earnings

Dell announced its first-quarter earnings that was a disappointment for its shareholders. The world’s third largest personal computer manufacturer has also presented gloomy scenario for the second quarter performance. Analysts were expecting revenue of $15.4bn for the second quarter; however the PC company forecasts revenue in the range of $14.7bn to $15bn.

Revenues for the first quarter dropped by 4% to $14.4bn against analysts’ expectation of $14.9bn. Adjusted EPS dropped by 22% to 43 cents against expectation of 46 cents.

Shifting away of companies and individuals from laptops and desktops to mobile devices as well as other tablet computers was cited as the main reason for dismal performance of the company. During the quarter under review, Dell’s notebook business shrank by 10%.

Dell chief financial officer, Brian Gladden has acknowledged that the first-quarter results fell short of expectations. He promised that the company will cut back segments that are less profitable. The company was hit by the protracted effects of flooding in Thailand during last year. It is struggling hard to restore supply channels.

Revenues in Africa, Asia and the Middle East were unchanged whereas US sales were lower by 7%.

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Leo Pierson

About Leo Pierson

Former partner in a real estate management firm, Leo, has been active in the market for the last 8 years. Ex-blogger on penny stocks, now focused on long term growth stocks, Leo provides valuable market snapshots each day as part of our editorial team.

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