Dell disappointed investors with a sharp decline in sales the
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Dell disappointed investors with a sharp decline in sales: the PC market has not yet begun to recover, but at least the server segment is growing

American personal computer and server equipment maker Dell ended its fiscal third quarter with revenue down 10% to $22.3 billion. This is below analysts’ expectations of $23 billion. The company’s client device revenue fell 11% to $12.3 billion, also greatly disappointing investors.

    Image source: Dell Technologies

Image source: Dell Technologies

In the current fiscal quarter ending in January next year, the company expects no more than $22 billion, according to Yvonne McGill, CFO of Dell Technologies, although analysts on average expected $23.9 billion, according to company management decrease sequentially by 2-3%. At the same time, there will be “islands of stability” in some niches of the PC market before a recovery in demand is seen across the segment.

In the last quarter, Dell managed to earn $500 million from sales of servers intended for use in artificial intelligence systems. Overall, the server business brought in $4.66 billion for the company, beating market expectations of $4.43 billion. Dell’s server sales grew steadily at 9%, with demand boosted by the popularity of generative artificial intelligence systems.

Dell management expects revenue growth for the next fiscal year, which begins in February. Analysts expect the company’s revenue growth to be 3.5% next year. Management expects demand for hardware to increase across the industry, including in the enterprise segment of the US market, on which Dell is heavily dependent. After the US stock market closed, Dell shares lost 4%.

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Johnson Smith

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