Dell Chugging Along

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News Posted: Thu, May 29 2008 11:58 PM

Dell's been in a kind of funk. They lost the title of largest computer maker to HP last year, cut a  bunch of jobs, talked a lot about restructuring. Whatever they're doing seems to be working. They're still in second place, but they're making money at it; their first quarter numbers are in and they outperformed analysts' expectations for profit and sales.

The company’s first-quarter revenue was $16.08 billion, up 9 percent from $14.72 billion in the year-earlier quarter. Net income was $784 million, or 38 cents a share, up from $756 million, or 34 cents, in the period a year ago.

Analysts forecast an average profit of 34 cents a share on sales of $15.68 billion, according to Thomson Financial.

“We are executing on all points of our strategy to drive growth in every product category and in every part of the world,” said Michael S. Dell, the company’s founder, who returned as chief executive to lead its turnaround effort in January 2007. Since his return, Mr. Dell has instituted a broad plan aimed at cutting costs, improving customer relations and revamping the product line.

At the same time, the company also warned that businesses appear cautious about technology spending, and that the caution is spreading to smaller companies from large ones.

Dell's been concentrating on growing their laptop business with great success, leading the way in unit growth for all types of products with a 43 percent jump. Hmm. Making money in a tough market. Identifying growth sectors and excelling in them. Finding new markets.  If Dell's not careful, people will start to refer to them as a smart company again.

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Dev replied on Fri, May 30 2008 8:18 AM

A lot of IT companies are claiming huge profits, they seem somewhat immmune to the current recession in the US.

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Smart management works well for large companies.  I guess this Mr. Dell was smart if he founded this large company.  I wonder why he left though.  Anyway, ff they can make their customer service reputation higher, they can fight back HP.  I think that's something they need to focus on too.


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MikeL_HH replied on Fri, May 30 2008 5:07 PM
Actually, he went back to being the CEO again at the beginning of 2007.

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