Dell Shares : Earnings

CFO Brian Gladden Discusses Dell Q3 Fiscal Year 2010 Performance

Robert L Williams — Thu, 19 Nov 2009 21:38:00 GMT

I am pleased to have Brian Gladden, Senior Vice President and CFO, join us on Dell Shares to provide his views on the third quarter, the economy, industry demand, and the Perot acquisition.

Dell announced third-quarter fiscal-year 2010 financial results on November 19^th. Dell reported improved business performance with revenue up 1% sequentially to $12.9 billion. EPS was $0.17 per share and operating expenses were down 10% versus Q3 last year. In addition, cash flow from operations was strong again at $801 million and $3.4 billion over the last four quarters, which is up 42 percent from the previous four quarters.

(Please visit the site to view this media)

I strongly encourage you to read the full press release and earnings presentation; and listen to our conference call that can be found on the investor relations web site. As always, we encourage you to ask questions or leave comments on Dell Shares.

Best,

Rob

CFO Brian Gladden Discusses Dell Q2 Fiscal Year 2010 Performance

Robert L Williams — Thu, 27 Aug 2009 17:16:00 GMT

I am pleased to have Brian Gladden, Senior Vice President and CFO, join us on Dell Shares to provide his view on the second quarter, the economy, industry demand, and the company's outlook.

Dell announced second-quarter fiscal-year 2010 financial results on August 27th. Dell reported improved business performance with revenue up 3% sequentially to $12.8 billion. EPS was $0.24 per share and operating expenses were down 14% versus Q2 last year. In addition, cash flow from operations exceeded $1 billion.

Best,

Rob

(Please visit the site to view this media)

Review of Dell's 2009 Analyst Meeting

Robert L Williams — Tue, 14 Jul 2009 19:00:00 GMT

Dell Equity Analyst Meeting

Today more than 200 participants, including analysts and investors, joined us in Austin for Dell's Analyst meeting. There were also a record breaking number of webcast attendees for this meeting, where we broke our record of 400, rising to nearly 500 participants. This meeting was an opportunity to hear directly from Dell's senior leadership on our near-term operating agenda and long-term strategy and address questions or concerns. The presentations from this meeting are available for viewing online,

This year, the meeting and briefings took place the same day. Dell executives discussed the company's strategy and operating agenda along with a financial overview and update on its four customer segments.

We are competing in a rapidly changing environment. As a result, we are improving our core business performance while expanding and extending across a broader set of customer solutions. Key messages delivered today were Dell's differentiated view of how to win in enterprise, our strategic mission "to provide disruptively great value to our customers", and that both these items will be realized through a combination of internal investments, partnerships and inorganic growth.

The meeting was opened by Michael Dell, Chairman of the Board and CEO, where he discussed Dell's key assets, view on the enterprise, and long-term priorities. Michael noted that Dell has a strong presence and currently holds #1 or #2 share position in most key segments. He also covered strategic priorities to deliver operating income and cash flow growth as well as the requirements needed to win longer-term.

Brian Gladden, CFO, followed and built on striking the optimal balance between liquidity, profitability and growth. Brian reviewed Dell's operating agenda, gave an update on the solid progress on $4B cost reductions, and provided a long-term value creation framework that articulated Dell's vision for revenue growth, profitability and cash flow generation. He also stated that Dell is well positioned to benefit from an economic recovery and will continue to provide strong liquidity.

Steve Schuckenbrock, President of Large Enterprise, walked us through our higher-value & higher-margin enterprise vision which addresses innovation and virtualization in next-generation data centers vs. our competitors' full-stack approach. He also reviewed how Dell is delivering steady growth in its core business while powering enterprise efficiency through innovation without legacy. For example, we approach services very differently from our competitors. We believe services should be customizable, a la carte, and available remotely. We let customers choose which services they want and when they want them. And we provide solutions where consultants are available - but not required.

Paul Bell, President of Public Sector business, addressed how Dell is aligning its global organization for balanced geographic expansion via vertical solutions designed for three unique customer bases -Education, Government, and Healthcare. Paul mentioned the challenges in this segment due to the macro environment, but also highlighted opportunities that exist internationally as well as those related to stimulus funds. Requirements needed to win in the Public sector include deep expertise in the sector-specific challenges, solutions investments, technology leadership, and solid partnerships.

Steve Felice, President of Small & Medium Business, presented Dell's plans to lead in the SMB space through innovative solutions and its go-to-market strategy. Steve reviewed the varied needs across the customer base of Small Businesses and Medium Businesses as well as regional opportunities to grow the business. He highlighted the solutions and product offerings that will help drive growth in each of these areas along with the benefits offered through SMB's go-to-market strategy. Having a multi-channel strategy will enable Dell to expand presence in under-represented geographies and drive incremental growth in enterprises and solutions.

Ron Garriques, President of Dell's Consumer Group, walked through consumer's brand architecture, its multi-channel customer portfolio and how it's bringing a disruptive approach to PCs. Dell grew to 33,000 retail stores globally in two years. Clearly, there is a lot of opportunity to continue to grow in this retail space. Ron reviewed Consumer's plan to grow faster than the industry through aggressively managing costs to reflect the multi-channel infrastructure, expanding global presence, and offering competitive products. He also reviewed plans to reinvigorate Dell.com to create a destination for all customers.

If you haven't already seen the presentations, I encourage you to watch a replay of them here.

As always, we welcome any questions or comments.

-Rob

Dell Seeing Demand Stabilization, Expects Slight Seq. Revenue Growth with Modest Margin Pressure in Q2

Robert L Williams — Mon, 13 Jul 2009 19:37:00 GMT

This afternoon after the close of the financial markets, we shared a press release announcing that year-over-year demand for our information-technology products appears to have stabilized, and that we expect to report a slight sequential revenue increase in our fiscal second-quarter 2010, which ends July 31. In the announcement, we also said that we anticipate a modest decline in Q2 gross margins, the result of higher component costs, a competitive pricing environment, and an unfavorable mix of product and business-segment demand. Also, we shared that over the longer horizon we are targeting 5-7 percent compounded annual sales growth, operating income at or above 7 percent of revenue, and cash flow from operations exceeding net income. It's important to point out that such results are dependent on broad global economic improvement accompanied by higher worldwide IT spending, including sustained double-digit growth rate in demand for computer systems. As always is the case with announcements like these, I highly encourage you to read the complete press release for additional details and disclosures.

This news was released prior to our analyst meeting, which will take place Tuesday, July 14^th here in Austin, TX and is available live via webcast on Dell.com/Investor. The analyst meeting is an opportunity for analysts, investors, and you to listen to Dell Leadership and review our strategy and financial overview, and ask questions directly to the executives which you can do via the web this year. At the analyst meeting, Dell executives will discuss the company's strategy and operating agenda along with a financial overview and update on its four customer segments.

As always, our IR team is here to answer your questions.

- Rob

CFO Brian Gladden Discusses Dell Q1 Fiscal Year 2010 Performance

Robert L Williams — Thu, 28 May 2009 20:15:00 GMT

Dell announced first-quarter fiscal-year 2010 financial results on May 28^th. Brian Gladden, Senior Vice President and CFO, discusses the results and the company's outlook. Please review earnings materials on the Dell Investor Relations Q1 events page. All comparisons are year-over-year unless otherwise noted.

We announced Q1 results today. Revenue was down 23% to $12.3 billion. EPS was $0.15 per share and cash from operations was $761 million.

I am pleased to have Brian Gladden join us on Dell Shares to provide his view on the first quarter, the economy, industry demand, and the company's outlook.

(Please visit the site to view this media)

Also, we strongly encourage investors to read the full press release and earnings presentation; and listen to our conference call that can be found on the investor relations web site. As always, we encourage you to ask questions or leave comments on Dell Shares.

Changes to Dell’s External Reporting Effective First Quarter Fiscal 2010

Lynn Tyson — Fri, 15 May 2009 14:49:00 GMT

We are scheduled to report our Fiscal 2010 first quarter earnings on May 28, 2009. When you look at our financial tables you will notice a few key changes to how we report some of the information and I describe those changes below. Our financial tables will also include our Fiscal 2009 results, by quarter, restated for these changes so that you can easily compare our year-over-year results. As always, our IR team is here to answer your questions - so after we report our first quarter earnings we'd be happy to answer any questions you have about these changes.

Global Customer Segments

On December 31, 2008 we announced that to serve business customers with faster innovation and greater responsiveness we would change the organization of our commercial business from three geographic segments (Americas, Asia-Pacific and Japan and EMEA) to three global customer segments: Large Enterprise, Public and Small and Medium Business. Our Consumer business, which was globalized in 2008, would remain unchanged. In our first quarter, we completed our reorganization and changed our internal reporting to correspond to how we run our business. As a result, we will now report revenue and operating income for four global customer segments.

Service and Product Revenue

There will be two primary changes to the reporting of our product and service revenue. One will affect our profit and loss (P&L) presentation and the other will change our supplemental line of business financial information for enhanced services and products.

First, the Securities and Exchange Commission Rules (SEC) require enhanced service revenue and cost of goods sold (COGS) associated with those revenues to be presented separately on the P&L once that revenue reaches 10% of a company's total revenue. As a result of our strategy to diversify our revenue and profit streams we have hit that percentage and will now break out the services revenue and COGS. With the change in our P&L presentation we will classify revenue and COGS related to software with post contract customer support in the same line item as enhanced services in our P&L.
Second, as a part of our review of our services disclosure we identified certain offerings that had previously been reported in services revenue that are substantially more similar to our standard warranty offerings, or "attached to the box" and therefore that revenue is more appropriately classified as product revenue and will be included in the product revenue in the future.

Organizational Effectiveness Expenses (OE)

Global customer segment operating income will no longer reflect the impact of OE expenses which include items such as severance and facility closure expenses.

Compensation

Stock compensation expense has historically been excluded from the operating income of our segment disclosure. In FY 2010 we have shifted a portion of our broad based long-term performance compensation from equity to cash. The cash portion of the long-term performance compensation will be included along with stock compensation and excluded from segment operating income.

Jeff Clarke, Vice Chairman, Technology and Operations, Discusses Progress on $4B Cost Initiative

Robert L Williams — Fri, 17 Apr 2009 14:50:00 GMT

I recently sat down with Jeff Clarke, Vice Chairman, Technology and Operations, to discuss a range of topics that have received investor attention including:

Declining Client ASPs in the commercial customer business
Desktop and mobility virtualization
Progress on our $4 billion cost initiative
Optimization of our global manufacturing and logistics network
What we are going to do with the savings we realize from some of these initiatives

As always, I look forward to your questions and comments!

(Please visit the site to view this media)

CFO Brian Gladden Addressed Investors at Morgan Stanley’s Annual Technology Conference

Robert L Williams — Wed, 04 Mar 2009 19:45:00 GMT

Brian participated in a fireside chat at the Morgan Stanley Annual Technology Conference yesterday. You can sign up and be notified in advance via email of these events. He started off by providing a brief overview of our latest quarterly and fiscal year results and then did some Q&A. In his message to investors, Brian emphasized profitability and liquidity as the two foremost priorities for us in this current economic environment and expressed confidence in our ability to extract further cost improvements in the business and emerge in a stronger competitive position. As a short recap, I've included a few questions and answers Brian took during the meeting. I encourage you listen to the full webcast by clicking here. As always, please provide your comments on Dell Shares.

1. How would you characterize the current demand environment?

The demand environment continues to be pretty tough year to date and we are seeing a lot of customers deferring purchase decisions due to the economy.
We expect broad-based challenging environment to continue as budgets are likely to remain pressured at least through the first half of 2009.
Our demand in Q4 was more linear than Q3 but the trends late in Q4 and in early Q1 are still negative.
Do not know what magnitude of slowdown will be - but we will be nimble enough to rapidly adjust to the realities of the demand environment.

2. How are you going to maintain gross margins in this environment?

We have made significant progress in taking cost out of the box but there's more work to be done.
We continue to make progress on the price and sell-to-value side of the equation as we introduce new products and will place an emphasis on smart pricing of these products.
Progress here has provided a buffer to declining volumes late in the year and enabled us to remain competitive and deliver stable gross margins.
We are confident in our ability to extract cost improvements even in a slowing demand environment and emerge in a stronger competitive position.

3. Why haven't you made more acquisitions?

Historically, our focus has been on organic growth... that model has worked for us successfully in the past.
Having said that, we have made 9 acquisitions in the last year and a half and will continue to look for more opportunities that make strategic sense.
We continue to look for opportunities in enterprise products, software and services, but it take two willing parties to make an acquisition work.
In this environment, there's not much M&A activity going on because companies are not willing to sell at these low valuations.

4. Can you comment a little bit on how you are managing working capital at Dell?

Liquidity is #1 priority for us in this environment.
During this period of declining revenue growth, we are aggressively managing our cash conversion cycle.
For inventory, we have reduced our strategic buys, which also helps us benefit from cost deflation.
Our payables have been impacted by the demand environment but we do not expect any significant structural changes.
Given the current demand environment we would like to maintain our cash conversion cycle, and we continue to believe there are opportunities to improve our cash conversion cycle over time.

5. Where should we expect to see Dell 2 years from now?

We will take advantage of this downturn to reshape our revenue portfolio and better position us competitively.
Over time, our goal is to move the weight of our portfolio to higher margin offerings and recurring revenue streams.
We will accomplish this by migrating to a solutions-driven business with an increased mix of enterprise products, services and bundled solutions.
We will also make strategic acquisitions as necessary that fit our model.

CFO Brian Gladden Discusses Dell Q4 Fiscal Year 2009 Performance

Robert L Williams — Thu, 26 Feb 2009 20:04:00 GMT

Dell announced fourth-quarter fiscal-year 2009 financial results on Feb. 26. Brian Gladden, Senior Vice President and CFO, discusses the results and the company's outlook. Please review earnings materials on Dell Investor Relations Q4 events page. All comparisons are year-over-year unless otherwise noted.

We announced Q4 results today. Revenue was down 16% to $13.4 billion. EPS was $0.18 per share and cash from operations was $729 million. For the full year fiscal 2009, revenue was $61.1B and EPS was $1.25. Cash flow from operations was $1.9B, and we completed the year with $9.5B in cash and investments.

Each quarter we evolve the format here on Dell Shares to provide you with a little more insight into what is going on in our business. This quarter, instead of writing our traditional earnings blog, I am pleased to have Brian Gladden join us on Dell Shares to provide his view on the fourth quarter, the economy, industry demand and the company's outlook.

(Please visit the site to view this media)

Also, we strongly encourage investors to read the full press release and earnings presentation; and listen to a replay of our conference call that can be found on the investor relations web site after the earnings call. As always, we encourage you to ask questions or leave comments on Dell Shares.

3Q Earnings - Executive Q&A

Lynn Tyson — Thu, 20 Nov 2008 21:05:00 GMT

Chairman and CEO Michael Dell and CFO Brian Gladden Discuss Dell Q3 Fiscal Year 2009 Performance Dell announced third-quarter fiscal-year 2009 financial results on Nov. 20. Michael Dell , chairman and CEO, and Brian Gladden , discuss the results and the...(read more)