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Dell quarterly profits fall by almost half

Dell announces further cost cutting as fiscal quarter profits falls 48% from previous year

Dell has announced that it intends to cut costs by a further billion dollars, after quarterly profits fell by 48%.

Net income was down to $351 million for fiscal Q4 2009, down from $679 million from the same quarter last year.

The company had already stated that it was aiming to cut costs by $3 billion, but would now target an extra billion on top of that.

Brian Gladden, Dell’s chief financial officer said: “The cost actions we took this past year made us more competitive and delivered value to customers in a challenging economic environment. In fact, we now have a clear view to additional opportunities, and are raising our cost-reduction target to $4 billion.”
For the EMEA region, revenue for the quarter was down 17% and shipments down 19%, with full year revenue of $13.6 billion, the same as the previous year.

Michael Dell, chairman and chief executive officer commented: “Customers know they need information technology, and we think we’re best able to help them use IT to improve productivity, but a lot of IT spending is being deferred until there’s better economic visibility.

“Within our business, we’re being very disciplined in managing costs, generating profitability and cash flow, and investing in ways that separate Dell from others today and when the economy inevitably improves,” he added.