Thursday, November 19, 2009

Dude, I Hope You Didn’t Own Dell

Dell reported that their fiscal third-quarter profit fell 54%.

Officials offered less than robust outlook on end demand. Chief Financial Officer Brian Gladden said demand had stabilized but a significant uptick was unlikely until 2010. Dell’s shares are down about 6% in after-market trading.
In the post-earnings conference call, officials said desktop PC revenue declined 26% year-over-year. Mobility fell 14%, servers down 6%, storage down 19%, according to our colleagues over at Digits.
You know, this is sad news for the 3rd quarter and all, but I’m guessing that 4th quarter demand (and forward) may increase with people upgrading PCs and moving to Windows 7.  I’m speaking for myself, as I am planning on a new purchase in the next few weeks. In addition, friends and family are also in the market now that Windows 7 is out.  I’m guessing Dell will get most of our business.  Just saying.
But bad news in the rear-view mirror, that’s for sure. 
Is the 26% year-over-year decline in desktop revenue really that shocking?  I can’t think of anyone buying right before the Windows 7 release.  Even with a free upgrade to Windows 7, it’s much easier to just buy a PC with the operating system already installed.

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