Menu
Menu
Dell confirms disappointing Q3 results

Dell confirms disappointing Q3 results

As Dell warned last week, its third-quarter revenue and earnings were lower than expected, something the company blamed on its U.S. and U.K. operations.

Dell Inc.'s third-quarter revenue and earnings came in short of the company's original expectations, as it had warned last week.

Third-quarter revenue was US$13.9 billion, as compared to revenue of $12.5 billion in last year's third quarter. Dell had originally expected revenue between $14.1 and $14.4 billion, but in an earnings warning last week the Round Rock, Texas, company blamed a slow quarter in its U.S. consumer business and its U.K. operations for dragging down results.

Net income for the quarter was $606 million, as compared to net income of $846 million last year. Dell was forced to take a one-time $442 million charge during this year's quarter to account for a variety of problems, including the costs associated with replacing faulty capacitors on some of its OptiPlex desktops, layoffs in its Texas and U.K. offices, and, perhaps most surprisingly for a company known for its lean direct-selling operation, inventory write-offs.

Excluding the charge, earnings per share for the quarter were $0.39, as the company predicted last week. Before the earnings warning, Dell and financial analysts originally predicted earnings per share would fall between $0.39 and $0.41.

On a positive note, Dell continued to strengthen its services business, one of the company's top priorities this year. Revenue from services increased by 36 percent to $1.2 billion in the quarter.

Dell Chief Executive Officer Kevin Rollins is expected to give more details about the company's third-quarter problems during separate conference calls with reporters and analysts Thursday afternoon.

Join the CIO New Zealand group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.

Join the newsletter!

Error: Please check your email address.
Show Comments

Market Place