Dell Warns on Second-Quarter Earnings

By John G. Spooner  |  Posted 2006-07-21 Print this article Print

Aggressive prices hurt the company's revenue and profit.

Dell on July 21 issued a de facto earnings warning, citing an aggressive PC pricing environment in a slowing commercial market worldwide.

The Round Rock, Texas-based PC maker said that its second-quarter fiscal year 2007 results would yield about $14 billion in revenue and earnings per share in the range of 21 cents to 23 cents, lower than its first-fiscal-quarter results, reported in May.

Dell no longer gives specific quarterly revenue and earnings per share guidance. It says instead that it will comment on the bigger picture, including long-term specific company and industry factors influencing its performance. However, it did say on May 18, when it reported first-quarter earnings, that it expected second-quarter results to be "similar" to its first-quarter financials.

Dell reported revenue of $14.2 billion and earnings per share of 33 cents for the first quarter. Thus the company's results will be lower than in the first quarter, despite actions it has taken to increase its growth.

"All of our initiatives are focused on providing the best value, experience and products to customers every day, which will maximize shareholder value over the long term," said Dell CEO Kevin Rollins.

Read the full story on eWEEK.com: Dell Warns on Second-Quarter Earnings

John G. Spooner John G. Spooner, a senior writer for eWeek, chronicles the PC industry, in addition to covering semiconductors and, on occasion, automotive technology. Prior to joining eWeek in 2005, Mr. Spooner spent more than four years as a staff writer for CNET News.com, where he covered computer hardware. He has also worked as a staff writer for ZDNET News.

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