14 DAY TRIAL // Dell announced improved financial results for 2009's second-quarter. Revenue, operating income, product shipment, gross margin and earnings were all above the first quarter's levels, and the company continues to reduce operating expenses. As Brian Gladden, Dell’s chief financial officer, stated, “This quarter again demonstrates the discipline with which we are managing our business and further strengthening our balance sheet. The best path for Dell remains one focused on profitable growth, lower costs and smart use of working capital.”
Overall shipment figures grew by ten percent, and revenue by three percent compared with the first quarter. Combined revenue from storage and servers raised by seven percent to a total of $12.8 billion, which is still 22 percent less than a year ago. Dell's operative-derived cash flow was of $1.1 billion, as Dell ended the second-quarter with $12.7 billion in investments and cash.
Dell's gross profit margin was of 18.7 percent of its revenue, mainly because of the company's disciplined pricing, improvement in the cost of its sold goods and the $69-million buyout of a revenue-sharing agreement by a vendor that managed to offset the previous pressure generated by component costs and competitive pricing. Operative expenses were 14 percent lower than last year's second quarter, registering only 13.5 percent of the revenue and $288 million. The operating income totaled to $671 million.
Dell's large enterprise revenue dropped by three percent compared with the last quarter and by over 32 percent since last year. Public revenue, on the other hand, was of $3.8 billion, a 20-percent growth sequentially and a 16-percent decrease from last year's second quarter. Small and Medium Business revenue decreased by five percent sequentially and by 29 percent compared with last year. Consumer revenue reached $2.9 billion, up two percent sequentially and a nine-percent decline compared with last year.
Dell redesigned over 90 percent of its product volume in order to cut costs and further augmented its enterprise position. The second quarter's server product shipments grew by 12 percent and revenue by nine percent. Overall, the company continues to build its emerging country presence, as Brazil, Russia, India and China displayed a total revenue increase of 16 percent.
Michael Dell, chairman and chief executive officer, added that, “We have been reducing complexity in our organization and significantly lowering operating costs, in anticipation of improvement in the global economy and IT spending. If current demand trends continue, we expect revenue for the second half of the year to be stronger than the first half. We are expanding our capabilities in enterprise technology and services and investing in our core business to distinguish Dell both with customers and in operating performance.”