- FQ2 revenue of $14.51B (up slightly Y/Y) soundly beat a $14.18B consensus, as DELL continues to sacrifice margins to gain share (or simply lose less of it). Gross margin was 18.5%, -100 bps Q/Q and -310 bps Y/Y.
- Enterprise hardware revenue +8% Y/Y to $3.3B (23% of total). Dell continues to take server and Ethernet switch share (networking +19%). Storage remains soft, -7%. Division op. income -9% Y/Y to $137M.
- PC division sales (still 63% of revenue) -5% Y/Y to $9.1B, though that's better than FQ1's 9% drop and a ~10% calendar Q2 industry decline. Desktops +1%, notebooks +10%, 3rd-party software/peripherals -5%. Thanks to aggressive pricing, the division's op. income fell 71% Y/Y to $205M.
- Services +2% to $2.1B. Op. income +1% to $339M.
- Software revenue +228% Y/Y to $310M, thanks to Quest and other acquisitions. Op. loss of $62M thanks to R&D investments.
- Company-wide R&D spend +23% Y/Y to $320M, as Michael Dell gets his post-LBO strategy going ahead of time. SG&A +6% to $2.1B.
- DELL +0.2% AH to $13.73, a little closer to the $13.88/share LBO offer price ($13.75/share + $0.13/share special dividend).
- FQ2 results, PR
Dell FQ2 revenue beats estimates thanks to aggressive pricing
Aug 15 2013, 16:26 ET