Dell's Profit Nosedives 72 Percent Ahead of Privatization Vote
Dell reported a 72 percent annual drop in net income to $204 million during its second quarter for fiscal 2014, though the company remains steadfast in its strategy to customers in what it termed a "challenging environment." Indeed it is for PC makers as sales continue to slide during the recent transition to mobile devices, like tablets and smartphones.
Revenue came in at $14.5 billion, about the same as it was a year ago. Interestingly, it was software, not hardware, that ultimately hurt Dell's bottom line. Dell's desktop and think client revenue actually jumped a percentage point, which doesn't sound like much to brag about, except that Dell was the only vendor among the top five PC makers to increase PC unit shipment share both year-over-year and sequentially in the past two calendar quarters.
"In a challenging environment, we remain committed to our strategy and our customers, and we’re encouraged by increasing customer interest in our end-to-end solutions offerings and continued growth in our Enterprise Solutions, Services and Software businesses," said Brian Gladden, Dell chief financial officer.
The latest financial picture comes a month before Dell's shareholders are set to vote on whether or not to sell the company to founder Michael Dell and investment firm Silver Lake Partners. If acquired, Michael will take the company private, though his plans have been hindered by outspoken investor Carl Icahn who claims the takeover bid undervalues the PC maker.
Revenue came in at $14.5 billion, about the same as it was a year ago. Interestingly, it was software, not hardware, that ultimately hurt Dell's bottom line. Dell's desktop and think client revenue actually jumped a percentage point, which doesn't sound like much to brag about, except that Dell was the only vendor among the top five PC makers to increase PC unit shipment share both year-over-year and sequentially in the past two calendar quarters.
"In a challenging environment, we remain committed to our strategy and our customers, and we’re encouraged by increasing customer interest in our end-to-end solutions offerings and continued growth in our Enterprise Solutions, Services and Software businesses," said Brian Gladden, Dell chief financial officer.
The latest financial picture comes a month before Dell's shareholders are set to vote on whether or not to sell the company to founder Michael Dell and investment firm Silver Lake Partners. If acquired, Michael will take the company private, though his plans have been hindered by outspoken investor Carl Icahn who claims the takeover bid undervalues the PC maker.
