“Late yesterday, Dell reported second-quarter results that show profit fell almost in half. The company earned $502 million, or 22 cents per share, on $14.09 billion in revenue. A year ago it earned $1.02 billion, or 41 cents per share, on $13.43 billion in revenue,” Ed Stenson reports for Schaeffer’s Investment Research.
Full article here.
“Dell Inc. (DELL : $20.70, -2.10, -9.2% ) saw its shares fall as much as 9%, to $20.74 Friday… Dell also said it has been under informal investigation by the Securities and Exchange Commission since August 2005 over past accounting practices. Goldman Sachs analyst Laura Conigliaro cut her rating on Dell’s stock to sell from neutal on the grounds that the company is likely to perform weakly compared to its main rivals over the next several months,” Rex Crum reports for MarketWatch.
Full article here.
MacDailyNews Take: We will dance on Dell’s grave.
Related MacDailyNews articles:
WSJ: Dell’s back-to-school business may be at risk – August 17, 2006
Dell cannot compete with Apple’s new Mac Pro price or feature set – August 15, 2006
Dell issues largest safety recall in history: 4.1 million laptop batteries due to fire threat – August 14, 2006
Dell warns of earnings miss; shares plunge 15% – July 21, 2006
Apple passes Dell in market value – May 02, 2006
Dell shares fall as Citigroup cuts rating two full notches from ‘buy’ to ‘sell’ – April 21, 2006
Dude, you got a Dell? What are you, stupid? Only Apple Macs run both Mac OS X and Windows! – April 05, 2006
Apple Mac is #1 in European education market, pushes Dell down into second place – February 03, 2006
Why buy a Dell when Apple’s Intel-based computers will run both Mac OS X and Windows? – June 08, 2005
Dell lost as well significant market share
Dell needs Mac OS X to stay alive. Steve Jobs should be getting a call from Mr. Dell soon.
I wonder if the factories making the Dell parts work over 60 hours a week.
Michael Dell should sell the beleaguered company and give the proceeds to the shareholders.
The original article does say “neutal.”
Is that a form of neutered?
To have you stocks listed as “neutal.” I wouldn’t know what to do with them had I any.
Dell’s market capitalization is now about $10 billion less than Apple’s ($47 billion for Dell vs. $57 billion for Apple).
Funny how the phrase, “Dude, your getting a Dell” has become a put-down rather than something cool or hip. I guess the fact that the actor who played that part got busted for trying to buy weed off an undercover cop didn’t help much either.
Anyone know what Apple’s capitalization is vs. Dell’s today?
Dell has been pinched off and has started it’s slow circle around the bowl.
This is where Apple’s decision to cater to only the middle and high end markets comes into play.
Because Dell devoted enormous resources to chase the low end market, they are saddled with it when the economy turns sour.
You see Apple will go tell a company to go fsck themselves if they try to lowball them.
But not Dell with it’s fleet of used car salespeople working on commission.
Apple has sacrificed market share for stability and profits.
If Steve is to liscense OS X to other computer manufacturers, he should choose someone better than Dell. Dell (with the possible exception of Gateway) makes the WORST computer hardware on the market. I’ve known people to have computer failures after not a year. He should choose someone who makes good yet affordable computers like HP. Or just not liscense the software and sell more Macs because of it.
“Dell reported second-quarter results that show profit fell almost in half”
Profit as cash:
0.502 billion vs 1.02 billion is a 50.8% reduction.
Profit as percentage of revenue:
0.502 billion on 14.09 billion is 3.56% profit
10.2 billion on 13.43 billion is 7.59% profit
3.56% vs 7.59% is a 53.1% drop
Almost in half?
Dell’s Trailing P/E is still less than half of what Apple’s is. That may mean nothing to market share, but this suggests – suggests – that Dell’s stock price is more closely aligned to its value than Apple’s is.
Dell’s market share has been weak, lately, and getting nibbled away at by HP and Apple. (Gateway and Lenovo have been static) This loss in profit likely means they have lost much of that share from the top end, rather than from the bread&butter; models that they sell so many of. Yes. From the models that compete with Apple’s models.
See you (MW=around), Dell
As I pointed out when I e-mailed MDN last night
Profits down to around 3.5% of revenue (getting close to Gateway territory surely)
Revenues up 5%
Profits down 46%
And to add to the pile of stats for today…
Dell is currently worth around $48 billion, which sounds all very well until you go back a year and realise that it was worth $88 billion. So not only are Dell stockholders being screwed by not getting a dividend, their investment is becoming worth less each day, which will come as a shock when Mikey and Kev have to shutter the company and give the proceeds to the shareholders.
Dell is now worth some $9.6 billion less than Apple on the open market, and is – if it’s not careful – going to become the fourth most valuable “manufacturer” after Sony.
You know, there really is nothing like the sweet feeling of schadenfreude mixed with karmic payback. Shameful joy, my ass.
It’s interesting. I read yesterday that Sony claims that their batteries don’t have issues in other manusfacturer’s computers (HP, Apple), and that Dell’s wiring is part of the problem:
“Sony has said it used the batteries in some of its Vaio notebooks.
A spokesperson for Sony said: “Some Vaio notebook series utilized the batteries in question, but at present we have not received any incident reports related to these products.
“Sony’s Vaio adopts its own design for safety technology, and Sony considers there is no danger of emission of smoke or fire from these products.
“The battery charging system that Vaio uses is different from that of Dell.”
She added that the fault was most likely linked to the way Dell integrated the battery into its laptop computers.”
<http://news.bbc.co.uk/2/hi/technology/4800947.stm>
One more thing: the egg is on Michael Dell’s face!
Not to mention their boxes are butt ugly. Worthy only to be hidden in the closet.
I got a catalog from them the other day. Those boxes have the design aptitude of a … well, I can’t think of anything that equates to how terrible they look.
A cow flop has more design sense.
Market Cap At Time of Posting
Apple $ 57,400,784,920
Dell $ 48,608,991,560
Earnings Per Share
Apple $ 2.22
Dell $1.42
If I were put in charge of Dell I would break it up, sell the components and give the money back to investors
DLMeyer >
Or it could be that Apple’s intellectual property has some value that the market recognises.
Dell could also have some IP, but given their paltry spending on R&D ($128 million against Apple’s $175, which in real terms [expressed as a percentage of revenues] works out as 0.91% to 4.00%), maybe they don’t have any.
Maybe the market realises that Apple is investing in its future, whereas Dell is paying for Microsoft’s future.
I don’t know, I’m just spitballing here – help me along.
I think Michael Dell should shut down the company sell the assets and give the money back to the beleaguered share holders..
ROTFFL!!!!!!
FINALLY people are beginning to see how much Dell sucks donkey. well, give the money back to the share holders…oh wait, I think I might enjoy watching the slow death….. so go ahead ride it out, you can listen to your dj ditties (if they work) on the way to the grave!!!!!!
HAHAHAHAHA
Michael Dell should shut it down and give the money back to the investors.
Wow, Dell sure did a good job with their purchase of Alien PCs.
Dude! I’m get’n an HP!
Drunk Cheney:
A cowflop would belong to Gateway. Dell’s boxes have the design of the dead.
“Dell has been pinched off and has started it’s slow circle around the bowl.”
Old Mac Dude LOL!!!!! and off my chair