14 DAY TRIAL // After a long run accounting debacle, Dell finally presents its financial balance for the third quarter of the year. At a 90-minute press conference held yesterday, during which he presented the company's fresh product strategy, Michael Dell announced a nine percent revenue year-over-year. Dell cashed one billion from operations, reaching near double-digit rise to 15,6 billion $. Dell's operating income has reached up to 13 percent rise to 829 million $ and 26 percent increase in earnings per share.
Michael Dell, chairman and CEO, declared that the profits are the results of DELL's long-term strategy for growth and that the results from the third quarter indicate that "we're making solid progress through investments in five key business priorities - consumer, emerging countries, notebooks, enterprise and small/medium business". Dell's initiative is to simplify IT through innovation and to create new values for customers and shareholders. On the other hand, Michael Dell said on a phone conference, as the IT news site The Register states that the company is not very happy with the registered profit, as they were expecting more. Apparently, shareholders were also hoping for more and seem to be concerned with Dell's outlook as well.
Dell's position on the PC market dropped 1 percent this quarter, while notebook sales registered a 19 percent jump. The storage, server and service business grew eight percent. Also, software and peripherals sales registered an eleven percent growth. Sales grew on global scale, by 18 percent in Asia and Pacific, 14 percent in Europe and 5 percent in America. The overall growth that Dell registered on Q3 shed a good light on the company. Accordingly, Michael Dell declared that "strong cash flow in the quarter demonstrates we are taking the right actions to create value".
The key business priorities for the company are as stated above: consumer, emerging countries, notebooks, enterprise and small/medium business. While the consumer business declined six percent, Dell announces strong progress including new product design, product personalization, channels and mobility. Dell closed the acquisition of ZING Systems Inc. during the quarter, a company focused on audio and entertainment devices. Regarding emerging countries, the company plans to expand its business here, as these countries represent 85 percent of the world's population. Dell also expects its notebook sales to grow six times the rate of desktop systems in the next years. The company plans to lower costs and tailor mobile devices for some customer segments, while increasing the speed of introducing new products on the line.
Dell also plans to help customers simplify IT as a part of its enterprise future initiative. This includes simplifying desktop administration and management on Demand Desktop Streaming. For the small/medium business, Dell announces new products, as PowerVault MD3000i, which will simplify storage consolidation. All these represent a part of the company's intention to focus on priorities that will end in providing better value to customers.
Some of the losses Dell registered lately are the result of the fact that the company is restructuring to improve productivity. These costs offset benefits, as the company invests in infrastructure and in key growth priorities. As it is trying to improve productivity and execution, the company may lose in performance for a while and the near term results could be negatively impacted by a decline in component costs. On 4th of December, the company will hold the annual meeting of shareholders at its headquarters in Round Rock. Also, on 2nd and 3rd of April Dell plans to conduct an analyst meeting in the same place. The results of these meetings will say a lot about the company's future. More details about the costs and benefits of the company during this quarter can be found on Dell's site, as well as some statements regarding future results and events.
