Dell Reports Revenue of $15.6 Billion in Q3; Earnings Per Share up 26 Percent


Company Outlook

The company continues to focus on strategic priorities that will provide better value to customers while driving a more optimal balance of liquidity, profitability and growth. As the company executes against these priorities it will continue to incur costs as it restructures to improve productivity and execution, reduce headcount where appropriate, and invest in infrastructure and acquisitions. These actions, which the company believes are necessary to drive long-term sustainable value, may adversely impact the company's performance. In addition, the company's near term results could be adversely impacted by a slower decline in component costs and a seasonal shift in mix to U.S. consumer and international regions.

Strategy Update and Earnings Call

Dell will conduct a 90-minute conference call today, Nov. 29, at 3:30 p.m. CST, to discuss its long-term strategy and Q3 results. Mr. Dell, Mr. Carty and Steve Schuckenbrock, president of Global Services and Chief Information Officer, will provide an update focused on the company's key growth priorities.

Annual Meeting and Analyst Meeting Update

The Company's annual meeting of shareholders will be held Dec. 4, 2007, at the company's Round Rock, Texas, headquarters. The Company also plans to conduct an analyst meeting on April 2 and 3, 2008, in Round Rock, Texas.

About Dell

Dell Inc. (NASDAQ: DELL) listens to customers and delivers innovative technology and services they trust and value. Uniquely enabled by its direct business model, Dell is a leading global systems and services company and No. 34 on the Fortune 500. For more information, visit www.dell.com, or to communicate directly with Dell via a variety of online channels, go to www.dell.com/conversations. To get Dell news direct, visit www.dell.com/RSS.

(1) Source: IDC Preliminary Top 10 Vendors, Worldwide PC Shipments, Third Quarter 2007 (Preliminary)

(2) Source: Forrester Research, Inc., How Enterprise Buyers Rate Their PC Suppliers And What It Means For Future Purchases. The State Of The Enterprise PC -- 2007 And Beyond. Ben Gray, November 12, 2007

Special Note

Statements in this press release that relate to future results and events (including statements about future financial and operating performance) are forward-looking statements based on Dell's current expectations. Actual results and events in future periods could differ materially from those projected in these forward-looking statements because of a number of risks and uncertainties including: general economic, business and industry conditions; our ability to maintain a cost advantage over our competitors; local economic and labor conditions, political instability, unexpected regulatory changes, trade protection measures, tax laws, copyright levies and fluctuations in foreign currency exchange rates; our ability to accurately predict product, customer and geographic sales mix and seasonal sales trends; information technology and manufacturing infrastructure failures; our ability to effectively manage periodic product transitions; any additional issues or matters that may arise from the ongoing SEC investigation; our ability to successfully remediate identified internal control deficiencies; our reliance on third-party suppliers for quality product components, including reliance on several single-source or limited-source suppliers; our ability to access the capital markets; litigation and governmental investigations or proceedings arising out of or related to accounting and financial reporting matters; our acquisition of other companies; our ability to properly manage the distribution of our products and services; effective hedging of our exposure to fluctuations in foreign currency exchange rates and interest rates; obtaining licenses to intellectual property developed by others on commercially reasonable and competitive terms; our ability to attract, retain and motivate key personnel; loss of government contracts; expiration of tax holidays or favorable tax rate structures; changing environmental laws; and the effect of armed hostilities, terrorism, natural disasters and public health issues. For a discussion of those and other factors affecting Dell's business and prospects, see Dell's periodic filings with the Securities and Exchange Commission.
                              DELL INC.
  Condensed Consolidated Statement of Income and Related Financial
                              Highlights
      (in millions, except per share data or as otherwise noted)
                             (unaudited)

                      Three Months Ended
               ---------------------------------
               November 2, August 3, November 3,    % Growth Rates
                                                 ---------------------
                     2007      2007        2006  Sequential Yr. to Yr.
               ----------- --------- ----------- ---------------------

Net revenue       $15,646   $14,776     $14,419         6%         9%
Cost of revenue    12,758    11,825      12,028         8%         6%
               ----------- --------- -----------
    Gross
     margin         2,888     2,951       2,391        (2%)       21%
Selling,
 general
and
 administrative     1,900     1,894       1,531         0%        24%
Research,
 development
 and
 engineering          159       155         126         3%        27%
               ----------- --------- -----------
    Total
     operating
     expenses       2,059     2,049       1,657         0%        24%
               ----------- --------- -----------
    Operating
     income           829       902         734        (8%)       13%
Investment and
 other income,
 net                  107        96          66        11%        62%
               ----------- --------- -----------
Income before
 income taxes         936       998         800        (6%)       17%
Income tax
 provision            170       252         199       (33%)      (14%)
               ----------- --------- -----------
    Net income       $766      $746        $601         3%        27%
                    ===========  =========  ===========

Earnings  per
  common  share:
        Basic                      $0.34          $0.33              $0.27                  3%                26%
                              ===========  =========  ===========
        Diluted                  $0.34          $0.33              $0.27                  3%                26%
                              ===========  =========  ===========

Weighted
  average  shares
  outstanding:
        Basic                      2,236          2,237              2,229
        Diluted                  2,266          2,264              2,238

Percentage  of
  Total  Net
  Revenue:
---------------
Gross  margin                  18.5%          19.9%              16.6%
Selling,
  general  and
  administrative            12.2%          12.8%              10.6%
Research,
  development
  and
  engineering                    1.0%            1.0%                0.9%
Operating
  expenses                        13.2%          13.8%              11.5%
Operating
  income                              5.3%            6.1%                5.1%
Income  before
  income  taxes                  6.0%            6.8%                5.6%
Net  income                        4.9%            5.1%                4.2%
Income  tax  rate            18.2%          25.3%              24.9%

Net  Revenue  by
  Geographic
  Region  (in
  billions):
---------------
Americas                          $9.7            $9.2                $9.2                  5%                  5%
Europe                                3.8              3.5                  3.4                10%                14%
Asia  Pacific  -
  Japan                                2.1              2.1                  1.8                  2%                18%

Percentage  of
  Total  Net
  Revenue:
---------------
Americas                              62%              62%                  64%
Europe                                  24%              24%                  23%
Asia  Pacific  -
  Japan                                  14%              14%                  13%

Net  Revenue  by
  Product
  Category  (in
  billions):
---------------
Desktop  PCs                    $4.8            $5.0                $4.8                (5%)              (1%)
Mobility                            4.7              3.9                  3.9                22%                19%
Servers  and
  Networking                      1.6              1.6                  1.5                  2%                  8%
Storage                              0.6              0.6                  0.6                  2%                  8%
Enhanced
  Services                          1.4              1.3                  1.3                  6%                  7%
Software  and
  Peripherals                    2.5              2.4                  2.3                  6%                11%

Percentage  of
  Total  Net
  Revenue:
---------------
Desktop  PCs                        30%              34%                  33%
Mobility                              30%              26%                  27%
Servers  and
  Networking                        11%              11%                  11%
Storage                                  4%                4%                    4%
Enhanced
  Services                              9%                9%                    9%
Software  and
  Peripherals                      16%              16%                  16%

Note:  Percentage  growth  rates  and  ratios  are  calculated  based  on
  underlying  data  in  thousands.
 


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