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Earnings Roundup / Dell

Earnings sink on 16% fewer sales

February 27, 2009|Times Wire Reports

Dell Inc. said its profit dived 48% during its fiscal fourth quarter as the recession forced consumers and businesses to spend less on technology. The company also said it expected to make further cuts to its workforce.

Earnings for the quarter that ended Jan. 30 sank to $351 million, or 18 cents a share, from $679 million, or 31 cents, a year earlier.

Excluding one-time charges, Round Rock, Texas-based Dell would have earned 29 cents a share in the quarter, just above the 26 cents a share expected by analysts polled by Thomson Reuters.

Sales dropped 16% to $13.4 billion from $16 billion the prior year, missing expectations for $14.2 billion in revenue.

Investors must have been expecting worse. Shares rose 15 cents, or 1.8%, to $8.36 in after-hours trading, after sinking 15 cents to close at $8.21.

Dell plans to cut $4 billion in annual costs by the end of fiscal 2011, $1 billion more than previously planned.

Much of that will come from reducing how much it costs to make laptops and other products, but layoffs and other ways of cutting operating expenses will probably play a part, the company said.

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