Dell posted a third quarter that beat Wall Street estimates and offered assurances that structuring changes regarding its mobile devices represent "progress" it's pleased about.
PC maker Dell had a better-than-expected fiscal third
quarter, announcing on Nov. 18 profits of 42 cents a share, or $822 million,
and revenue of $15.4 million. The PC maker said the year-to-date revenue has
grown 21 percent to $45.8 billion.
"Our strong results demonstrate that we are
listening to customers and delivering what they want," Dell CEO
Michael Dell said in a statement. "Dell is growing in the right areas, and
I'm very excited about our momentum."
Dell has recently been working to break into the
lucrative smartphone market, releasing first the Android-running Aero (also
known as the Mini 3), then the Android-running Dell Streak, which it markets as
a tablet. Over the holidays it will begin offering the Dell Venue Pro, a
smartphone running Windows Phone 7 that's being marketed to both consumer and
enterprise users. Dell's consumer group revenue saw a 4 percent increase over
the quarter, despite what Dell described in its earnings statement as "muted
Ron Garriques, the executive behind Dell's mobile
consumer products, will
be leaving the company in January
, the media first began reporting Nov. 17,
following a company restructuring that dissolved Garriques' group, instead
folding the devices into other units. On a Nov. 18 call with the press, Dell
Chief Financial Officer Brian Gladden said the change was not at all due to
Dell's mobile device business being "in a bit of a disarray," as one
"I would say that this was a very positive [and]
thoughtful move to take the mobility business and move it into the core
structure of the company, so we're generally pretty pleased with the progress
here," said Gladden. "We're optimistic about the products and the
road map that we have, and think this is a chance to actually accelerate our
presence and our growth there in the mobility space. So that couldn't be
farther from the truth."
During a later call with analysts, Michael Dell was asked
whether the management changes signaled any change in the company's strategy
for mobile operating systems. Dell indicated that the company had no plans to
favor one mobile platform over the other. "We are very much in the mobile
space working with Android and Windows Phone 7 and are encouraged with the
development of both of those and see them as great opportunities for us,"
Steve Felice, president of Dell's consumer and SMB group,
told analysts that the company is also determined to build its tablet business.
Dell sees a lot of potential in tablets and is "really driven to bring
this capability into the mainstream of the business," Felice said. While
over the last year the company did a lot of learning, Dell is now ready to be "more
bullish" in its actions, he said.
"We want to mainstream the supply chain, the sales
capability and the marketing capability ... and we see tablets having great
potential, not just in our consumer business, but in our commercial business,"
said Felice. "So all of this is aimed at getting this more to scale in a
faster way than we originally envisioned."
Going forward, Dell expects to see fourth-quarter revenue
track slightly higher from the third quarter, as commercial demand remains
stable with corporate clients continuing to refresh their PCs, while consumer
demand "remains more muted."