Dell Profit Slips 33%

Elena
02 Mar, 2007
New York City

Dell Inc. reported disappointing Q4 results, blaming weak sales of laptops and notebooks. The computer maker posted 33% net income drop to $673 million, or 30 cents per share, compared with $1.01 billion, or 43 cents a year earlier, as revenue fell 4% to $14.4 billion. The biggest revenue shortfall was in mobility products and desktop PCs, accounting for 58% of Dell''''s revenue.

[R]8:15 AM Dell reported 33% profit drop in Q4.[/R]
Dell Inc. ((DELL)) reported disappointing Q4 results, blaming weak sales of laptops and notebooks. The computer maker posted 33% net income drop to $673 million, or 30 cents per share, compared with $1.01 billion, or 43 cents per share a year earlier, as revenue fell 4% to $14.4 billion. The biggest revenue shortfall was in mobility products and desktop PCs, accounting for 58% of Dell's revenue. Mobility products, including notebook computers, fell 2% to $3.8 billion. Desktop PCs posted an 18% drop in units year-over-year. However, quarterly earnings beat analyst expectations for earnings of 29 cents per share. Although Dell once again released weak financial results, it looks determined to solve the numerous problems and gain its once strong positions back, as well as its customers’ confidence. . Dell also mentioned several turnaround plans, including streamlining operations, shortening product development cycles and developing new approaches to manufacturing and distribution. The computer giant still faces an accounting SEC probe, customer service complaints, several shareholder lawsuits and stiff competition from rivals. Dell’s shares slipped 3.1% in pre-market trading.


[R]6:30AM European markets were lower Friday on Adecco, Mediaset.[/R]
European markets were lower on Friday. Frankfurt Xetra Dax was 0.5% lower at 6,609.7 the CAC 40 in Paris fell 0.6% to 5,425.07 and London FTSE 100 slipped 0.2% to 6,102.

Advancers

Philips, the Dutch electronics group, led technology stocks higher. The company shed more than 8% over the previous three sessions after a trade dispute with Taiwan over recordable compact disc patents. The shares surged 2.5%.

UK supermarket Tesco gained 0.9% after investment group Berkshire Hathaway said it had taken a 2.9% stake. Air Liquide, the French industrial gases group, gained 1.7% after ING raised its price target following the group strong five-year outlook.

Decliners

Mediaset, the Italian broadcaster, fell 5.9% after downgrades from Deutsche Bank, Merrill Lynch, JPMorgan and Citigroup after reporting on Thursday that its 2006 net income profit fell on lower advertising revenues. Merrill Lynch lowered its rating to neutral.

Staffing company Adecco declined 4% after it posted revenue growth a bit below forecasts, with a 23% increase in Q4 net profit to 212 million euros largely due to a one-time tax benefit. Lagardere shed 5 % as investors corrected a 6.7 % rise in the previous session, on what was thought by dealers to have been an erroneous trade.

Oil and gold

Oil prices gained Friday on concerns about tightening gasoline supplies. Crude oil for April delivery rose 21 cents to $62.21 a barrel in electronic trading on the New York Mercantile Exchange by noon in Europe. Brent crude for April gained 37 cents to $62.48 a barrel on the ICE Futures exchange in London. Gold opened Friday at a bid price of $662.30 a troy ounce, down from $670.10 late Thursday.

Currencies

The euro lost a little more ground Friday against the dollar, which built on gains made as positive U.S. economic data helped calm traders in US. The euro bought $1.3164 in morning European trading, down from $1.3198 in New York late Thursday. The British pound fell to $1.9542 from $1.9605. The dollar edged up to 117.69 Japanese yen from 117.58 yen.