Feeds

Dell warns of Q2 earnings bloodbath

Mad at the world

Securing Web Applications Made Simple and Scalable

Rather than pointing a finger at itself, Dell has blamed a weakening global economy for its second quarter profit warning issued today.

Dell sees second quarter revenue coming in at $14bn and predicts a Q2 earnings per share figure between 21 cents and 23 cents. It's that EPS range that's the real tragedy for investors. Analysts had been expecting revenue of $14.2bn and a much higher EPS figure of 32 cents.

Dell shares began plummeting the instant word leaked about its second quarter update. At the time of this report, Dell had dropped more than 13 per cent to $19.14 - a new 52-week low.

This marks Dell's second fiscal warning in a row.

In the first quarter, Dell blamed tough competition and its own high prices for missing profit targets.

This time around, Dell has decided to curse the world for its woes.

"These (second quarter) estimates primarily reflect aggressive pricing in a slowing commercial market worldwide," Dell said.

You can bet that financial analysts will give Dell a very hard time over the second quarter drop. The Wall Street crowd didn't seem too convinced about CEO Kevin Rollins' plan to boost Dell's fortunes by lowering prices.

You'll also want to see if the analysts buy Dell's weak economy line. A weak chip sector and warnings from the likes of SAP had investors concerned earlier in the week, but solid results from IBM, Google, and Microsoft seemed to dampen these concerns. IBM's CFO this week noted that he did see a slowdown in corporate spending near the end of the company's most recent quarter but then added, "There is definitely no indication that this is a trend."

Dell will announce the second quarter results on Aug. 17. ®

Build a business case: developing custom apps

More from The Register

next story
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
Airbus promises Wi-Fi – yay – and 3D movies (meh) in new A330
If the person in front reclines their seat, this could get interesting
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
UK Parliament rubber-stamps EMERGENCY data grab 'n' keep bill
Just 49 MPs oppose Drip's rushed timetable
Want to beat Verizon's slow Netflix? Get a VPN
Exec finds stream speed climbs when smuggled out
Samsung threatens to cut ties with supplier over child labour allegations
Vows to uphold 'zero tolerance' policy on underage workers
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Mobile application security vulnerability report
The alarming realities regarding the sheer number of applications vulnerable to attack, and the most common and easily addressable vulnerability errors.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.