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Dell profit drops 18% as home PCs continue to take hits

updated 04:45 pm EST, Tue February 21, 2012

Dell touts record enterprise but masks PC trouble

Dell on Tuesday reported results that it touted as producing records but which signaled continued problems in its mainstay home PC business. Although its revenue was up two percent from winter a year ago to just over $16 billion, its profit was down 18 percent to $764 million. The largest drag was in the consumer group, where its revenue dipped two percent to $3.2 billion and it saw an extremely sharp 43 percent drop in operating income to $39 million.

It came in spite of record growth in enterprise and healthy performance in small business.

The Texas PC builder declined to explain the cause for the home division's drop, although it may have given away a continued iPad effect. Most of the loss was concentrated in the US, where the iPad and Apple as a whole are strongest. Revenue from everywhere else grew 10 percent, Dell said.

Dell shouldn't be suffering from an overdependence on netbooks, having almost completely quit the category aside from niche models, but its emphasis on low-end notebooks has still left it stalled in PC share where Apple has been gaining. Most of its hopes for 2012 are focused on both enterprise as well as a partial shift towards the higher end through PCs like the XPS 14z and XPS 13.



By Electronista Staff
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  1. SockRolid

    Forum Regular

    Joined: Jan 2010

    +15

    The iPad effect has barely started

    Re: "The Texas PC builder declined to explain the cause for the home division's drop, although it may have given away a continued iPad effect."

    You might as well have said "The blacksmith declined to explain the cause for the horseshoe division's drop, although it may have given away a continued automobile effect."

    The iPad effect is barely starting. And Apple is poised to continue dominating the next wave of personal computing: pad computing. Sure, people still ride horses. Maybe Dell can take comfort in that knowledge.

  1. fractal_h

    Fresh-Faced Recruit

    Joined: Jun 2011

    +8

    reminded me of this...

    CUPERTINO, CA — In an ironic twist, Dell CEO Michael Dell — who once famously suggested that Apple should be shut down — is now an active figure in the Apple boardroom: dancing, juggling and making mirth.
    Mr. Dell has been named to the position of Board Jester at Apple. His responsibilities include providing levity and performing parlor tricks for the board during bathroom breaks.
    In a news release, Steve Jobs welcomed his former competitor. “The Apple board is a serious group, making billion-dollar decisions,” said Mr. Jobs. “But we’re people too, and we need a good laugh now and then to let off steam. We’re grateful to have someone of Michael’s caliber to lighten the atmosphere.”
    Apple board member Millard Drexler was practically in tears after Michael’s first performance. “He pulls these whimsical devices out of his satchel, like the Dell Streak,” says Drexler, “and he starts explaining how cool a five-inch tablet can be. Five inches! I almost wet my pants.”
    “The man is a treasure,” says board member William Campbell. “I asked him to do that ‘shutting-down Apple’ routine, and he actually pulled out a lute and put it to song. He’s priceless.”
    Mr. Dell’s contract requires him to attend quarterly Apple Board Meetings, two company events per year and do occasional light cleaning in the executive wing.
    Board member Andrea Jung takes a more philosophical view of Apple’s new jester. “Sometimes life can get you down. But when Michael somersaults into the room, the clouds lift. You look at him and realize that things could be so much worse.”
    http://scoopertino.com/michael-dell-joins-apple-as-board-jester/

    Comment buried. Show
  1. facebook_Justin

    Via Facebook

    Joined: Feb 2012

    -15

    Sad

    Really it saddens me. As much as I love Apple, its upsetting to think how many n00bs actually pick a tablet "computer" over a full blown Mac or PC. I mean you REALLY have to be an idiot. If it was a true tablet, (had an Intel processor, ran a desktop OS such as OS X or Windows) then it would be fine but its a freakin iPod touch that happens to be big. What the h*** is wrong with people? It's not a damn computer. iOS is a great mobile OS, but thats it, a MOBILE OS. It doesn't belong on a so called "computer". It belongs on smart phones and PDA's.

  1. Foxypaco

    Fresh-Faced Recruit

    Joined: Apr 2010

    +8

    re: Sad

    I know many people that only use their computer for email, Facebook and surfing websites. The iPad can do all three fairly well. If I only used my computer for those three things (which I don't), I'd gladly get rid of my computer for an iPad.

  1. facebook_Butos

    Via Facebook

    Joined: Feb 2012

    +6

    comment title

    It's quite obvious that the consumers are responding well to the tablet. Not everybody does robust work on a home computer. I've helped many home users with their PC's and the number one request has always been ease of use. Normal users just want to go home surf the web, check email and post some pictures online minus the virus, the pop ads, the malware etc. I would not categorize that as idiot. To put it in perspective, do you buy a car and have to go under the hood every time you have to drive it. So why do you want to do that with a computer, it should just work. So kudos to all the people that are buying the iPad, the Kindle fire, and the Droid. I, myself own an iPad along with a Mac Pro, a mac mini and a macbook pro but I find myself using the iPad 70% of the time when I am at home and on the go. So to call it not a computer, I will strongly disagree with the previous comment.

  1. facebook_Justin

    Via Facebook

    Joined: Feb 2012

    -5

    comment title

    Actually I realize now why most people are buying iPads. Because they're scared of used products and cant afford a new Mac. "Oh wow, a $500 computer, awesome". That's what most iPad owners are saying. Meanwhile, I'm very much enjoying my $300 MacBook that I bought on eBay. It's a late 2006 model and it would be a cold day in h*** before I trade it for any model of iTampon. I also have my Dell Hackint0sh, which cost me just $100 more than an iPad and is nearly as powerful as a Mac Pro. Yea, no thanks on that tampon Apple, I'll stick to computers.

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