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Dell's profit fell 47 percent to 39 cents per share while revenue dropped 11 percent to $13.7 billion

Dell's financial report for the third quarter seems to have missed the targets predicted by Wall Street on many levels due to sluggish PC sales.

For Q3 2012, Dell's profit fell 47 percent to 39 cents per share while revenue dropped 11 percent to $13.7 billion from a year previous (Wall Street expected $13.9 billion). Its net income fell from $893 million (49 cents per share) in Q3 2011 to $475 million (27 cents per share) in Q3 2012.

A large reason for Dell's financial tumble is the lack of demand for PC upgrades. Dell's PC shipments fell 8.3 percent in Q3 2012 from a year earlier.

“In a difficult global IT spending environment we saw solid proof points that demonstrate progress in our strategy,” said Brian Gladden, Dell CFO. “A highlight has been the strong progress of our newly introduced servers, with our server and networking business up 11 percent. We’re also encouraged by early interest in our new Windows 8 touch portfolio and the opportunities it creates for our commercial and consumer businesses.”

Looking forward, Dell predicts a fourth quarter revenue of $14 billion to $14.4 billion, which is a bit less than the $14.5 billion analysts were shooting for. In Q4 2011, revenue was $16 billion.

In response to all of this disappointing news, Dell stock dropped to $8.81 this morning, which is the lowest its been since March 12, 2009.

While Dell is looking to Windows 8 for some kind of revival, the new operating system hasn't provided any immediate boost for PC makers. In fact, Gladden said Windows 8 wouldn't affect Dell's financial results for the next two quarters.

"The client business continues to be challenging," said Gladden. "Commercial customers tend to be lagging adopters of a new operating system. They're going to wait."

To make matters worse, Microsoft doesn't solely depend on PC makers for hardware anymore. Last month, it released its first tablet hardware, Surface RT, which features the RT version of the Windows 8 mobile OS. Next year, Microsoft plans to release the Surface Pro, which will run Windows 8 Pro.

Source: Dell

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RE: Windows 8 the savior ???
By bigboxes on 11/18/2012 1:25:52 AM , Rating: 3
XP was great for it's time. After SP2, you had a very stable product. Now, I know you are going to beat your chest some more for Win8, but only time will tell. In the meantime, don't be such a fanboi.

RE: Windows 8 the savior ???
By TakinYourPoints on 11/18/2012 5:05:26 PM , Rating: 1
B3an is a ridiculous MS fanboy, so its pretty funny to hear someone call him otherwise.

I'm surprised that he slams XP, but good on him for seeing reality. XP was a disaster from a security standpoint. Microsoft fixing those problems with Vista by adding Unix style user elevation of rights rather than the "every user is root/admin" style of XP (a disaster) did so much to fix the issue of malware on Windows.

RE: Windows 8 the savior ???
By rdhood on 11/19/2012 10:22:29 AM , Rating: 2
XP was great for it's time. After SP2, you had a very stable product.

That was my experience. Pre-XP was a BSOD peppered 5 years. It meant praying/playing with IRQs, unstable hardware and software. Post-XP/SP2 was mostly stable and headache free.

I did not go to Vista, but went straight to Windows 7. There was a time, several years ago, when XP vs. 7 was a competitive choice. But $90 for a 6-core processor + motherboard and $40 for 8GB of DDR3 memory fixed any qualms I had about going to a new operating system with ever so slightly worse performance than XP. I upgraded my three systems at home to Win7 for under $100. There is no legitimate reason to stay on XP anymore.

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