Dell names new enterprise chief as profit drops 18 percent

21.08.2012

Its forecast for the rest of the year was not good. Citing the uncertain economy, weak consumer sales and "competitive dynamics," Dell said its third-quarter revenue would be down 2 percent to 5 percent from the quarter just ended. It also reduced its full-year profit forecast to $1.70 per share, well below the consensus analyst estimate of $1.91 per share.

A new OS release can sometimes boost sales for PC makers, but Dell doesn't expect much benefit from Windows 8, at least in the near term. Dell sells most of its PCs to businesses, rather than consumers, and a lot of businesses are still completing their migration to Windows 7, CTO Brian Gladden said on a conference call.

The company may see "a bit of benefit" from Windows 8 going into next year, he said.

Dell is in the midst of a turnaround effort to make more money from higher-margin products such as software and services, and those products are often sold hand in hand with data center equipment, making Dell's enterprise products business important.

As part of the effort, Dell has been buying up software companies such as SonicWall, AppAssure, Scalent and, most recently, Quest Software, which at $2.6 billion will be one of its biggest acquisitions to date. It hopes to with its enterprise hardware to expand its sales.