Dell Details Ongoing 'Pressure'

Posted by Mary Jander on March 2, 2007

Tags: Other

Channel: Other

Dell has released a report of its latest quarterly earnings, revealing the woes of a company in crisis.

Since Dell is in the midst of an investigation by regulators into its books, the latest financials, like those of the two previous quarters, remain preliminary. Still, the numbers tell a tale of struggle: Revenues for the most recent fourth fiscal quarter 2007 were $14.4 billion, flat with the previous quarter; operating income was $801 million, down about 3 percent sequentially; earnings per share were 30 cents, flat with the previous quarter; and cash and investments were $12.5 billion, up from $11.6 billion last quarter.

In addition, Dell reported that costs associated with the ongoing investigations into its accounting practices took an $89 million bite out of operating income, representing a reduction of 3 cents per share.

"We are disappointed with the company's results," said CEO Michael Dell in a prepared statement. "We are systematically moving to... transform the company... We will be known again for strong operating and financial performance and a great experience for our customers. But it will take time to realize the future benefits of the improvements we are making today."

Dell's return earlier this year to the helm of the company he founded is one step in the process. (See EMC Loses Ally in Rollins and Dell Preps for Long Haul.) Another step could be partnerships, like the one Dell has with EMC, in which Dell will co-market EMC's midrange Clariion storage systems through 2011.