NewYork: Dell Incoporations quarterly revenue just missed Wall Street estimates, and the worlds No. 3 personal computer maker warned that full-year revenue could be hurt by an industry wide shortage of hard drives, Reuters reported.Uncertainties surrounding the economy and the hard drive shortage means that Dells fiscal 2012 revenue is tracking at the lower end of its growth forecast of one to five per cent, the company said.Investors fear a slowdown in PC manufacturing through 2012 after flooding in Thailand severely disrupted production of hard drives, a key component in computers.To the extent that we see higher (drive) prices well also see some offsets in other components and were going to do everything we can to protect our customers. But maybe in some cases we do have to raise our prices, Chief Financial Officer Brian Gladden told Reuters in an interview.The shortage of hard drives will force Dell to prioritize toward higher-value customers and products, Gladden said.Dell also appears to not have benefited much from the disarray at bigger rival Hewlett Packard Company, which spent much of the last quarter considering whether to spin off its PC business.The company lost market share during the third quarter to Asian rival Lenovo Group which vaulted past it to claim the No. 2 ranking in PCs behind market leader HP.The PC business will remain difficult over the next year, said Brian White, analyst with Ticonderoga Securities. He cited pressure from slowing public sector spending as various government agencies around the world take austerity measures over the next year.Dells public business generated revenue of 4.2 billion, which was down two per cent from the 2010 third quarter due to weakness in the United States and Western Europe.Desktop PC revenue slid six per cent to $3.4bn as Dells sales to consumers fell six per cent over the same period.Chief Executive Michael Dell said the company was moving away from low-margin businesses.Were choosing not to participate in low value opportunities which have put short-term pressure on revenue growth but have been a real driver of our expanded margins and growing earnings, Dell told analysts on a conference call.Gross margins slipped to 23.1 per cent from 23.2 per cent in the prior quarter, but rose from 20 per cent a year earlier.Dell said revenue in its fiscal third quarter was essentially flat at $15.36bn, but slightly lower than the average analyst estimate of $15.65bn according to Thomson Reuters I/B/E/S.Analysts on average had projected a 1.6 per cent climb in Dells fiscal 2012 revenue to almost $62.5bn.Net earnings rose to $893 million, or 49 cents a share, from $822m, or 42 cents a share, in the year-ago period.Excluding items, Dell earned 54 cents a share, better than the average analyst estimate of 47 cents.Dells large enterprise business increased sales eight per cent in the quarter as corporations continued to upgrade aging hardware.
Click here to read full news..
