Intel Investors - I suggest you all read Dell's quarterly report - there are some very interesting comments about market share growth and unit growth that bodes very well for Dell (and their CPU supplier !!).
Paul
{=================================}
biz.yahoo.com
Thursday February 14, 4:16 pm Eastern Time
Press Release
SOURCE: Dell Computer Corporation
Improved Profitability, Global Share Gains Highlight Dell's Q4 Sales of $8.1 Billion, 17-Cent Per-Share Earnings Meet Increased Guidance
AUSTIN, Texas--(BUSINESS WIRE)--Feb. 14, 2002--Dell (Nasdaq:DELL - news) said its industry-best operating efficiency again helped the company simultaneously provide customers with exceptional value and achieve improved, leading operating profitability during the fiscal fourth quarter, which ended Feb. 1.
Analysts said Dell gained almost three points of worldwide market share in servers from the year-ago quarter, and more than five in the United States. The company significantly exceeded overall industry growth rates in strategically important markets such as China, Germany and Japan.
As anticipated, Dell reported quarterly net earnings of $456 million, or 17 cents per share, compared with $434 million, or 16 cents per share, last year. Excluding charges, year-ago per-share earnings were 18 cents. Revenue for the most recent period was $8.1 billion. Results exceeded original company guidance, primarily because of a stronger-than-planned performance by Dell's profitable, fast-growing consumer business.
Full-year net earnings were $1.25 billion versus $2.18 billion in fiscal 2001. Absent charges, earnings for fiscal 2002 were $1.78 billion, or 65 cents per share. NOTE: All subsequent financial information in this release excludes charges for fiscal 2002 and 2001.
Fourth Quarter Full Year
(in millions, except share data)
FY'02 FY'01(a) Change FY'02(c) FY'01(a),(b) Change
----- ----- ------ ----- ----- ------
Revenue $8,061 $8,674 (7%) $31,168 $31,888 (2%)
Operating
Income $594 $589 1% $2,271 $2,768 (18%)
Net Income $456 $508 (10%) $1,780 $2,310 (23%)
Earnings
Per Share $0.17 $0.18 (6%) $0.65 $0.84 (23%)
(a) Q4 and full-year FY'01 income/earnings data exclude a $105
million charge related to job reductions and consolidation of
facilities.
(b) Full-year FY'01 income/earnings data exclude a $59 million
after-tax charge related to the cumulative effect of an accounting
change.
(c) Full-year FY'02 income/earnings data exclude a $742 million
second-quarter charge related to job reductions, consolidation of
facilities and impairment of assets.
``As our industry moves into a new stage of consolidation, the opinions that still matter most belong to customers,'' said Michael Dell, the company's chairman and chief executive officer. ``The pace with which they're choosing Dell products and services accelerated last year, and puts us in a stronger competitive position than at any time in our history.''
Calendar 2001 was the first full year in which Dell led the global computer-systems industry, with nearly 14-percent market share. In the U.S., Dell's full-year share exceeded 25 percent, up almost six points from 2000.
According to Mr. Dell, the company expects to outperform the industry again in the first quarter of fiscal 2003. He said a seasonal drop in purchases of home computers combined with softness in demand by businesses suggest a 10-percent sequential decline in industry shipments. Dell believes its Q1 unit volumes and revenue will be down 3 to 5 percent, producing per-share earnings of 16 cents.
Dell continued to successfully deliver on its strategy to sequentially improve operating profitability despite challenging industry conditions. Net operating margins for the period were 7.4 percent of revenue versus 6.8 percent in the year-ago fourth quarter. Operating expenses were 10.2 percent of revenue, the lowest level in company history.
Dell's leading asset management helped generate more than $1 billion in cash from operations during Q4. Total cash and investments at the close of the period were $8.3 billion. Four days of supply in inventory matched the low achieved in the previous two quarters.
Enterprise Growth Again Dell's Fastest
Company shipments of enterprise systems grew 12 percent from the same quarter one year ago. Dell's server volumes in Central and South America rose more than 50 percent; in Japan, the increase was 23 percent, more than three times the industry average.
Growth in shipments of PowerEdge servers worldwide and in the U.S. defied industry server declines of 1 and 9 percent, respectively. Dell's U.S. server share in the quarter exceeded 28 percent and the company led that category for the fourth straight quarter. For the full year, worldwide company server shipments increased 27 percent while the industry, excluding Dell, fell 3 percent; company server units in the U.S. rose 20 percent, even as industry totals dropped 10 percent.
Dell sold 69 percent more storage capacity during the quarter than in the year-ago quarter. External storage systems increased to 47 percent of the sales mix. Shipments of Dell Precision workstations, which already ranked No. 1 globally and in the U.S., were up 21 percent.
Shipments of PowerConnect network switches expanded at a rapid pace as Dell customers increasingly capitalize on availability of standards-based switch technology, including high-speed gigabit Ethernet. PowerConnect switches, the first of which were introduced just five months ago, are designed especially for small and medium businesses and are currently sold in the U.S.
Combined unit volumes of Inspiron and Latitude notebook computers were up at twice the quarterly industry rate, and four times faster for all of last year.
Company Extends Momentum in Key Global Markets
Dell's best geographic growth during the quarter was in Asia-Pacific and Japan, where shipments were up 19 percent in a market that dropped 6 percent. Volumes of the company's enterprise-computing systems increased about 30 percent in both China and Japan. Full-year Dell shipments of all products in Asia-Pacific and Japan were up 37 percent; without Dell, the overall market was flat.
Shipments of Dell products in Europe, the Middle East and Africa (EMEA) increased 9 percent in the fourth quarter, even as overall industry volumes declined 5 percent. Crisp execution in Germany again achieved outstanding results: a 23-percent increase in shipments in a market that dropped 15 percent. In Germany, Dell workstation units were up 50 percent, those for notebook computers 46 percent.
Analysts said Dell's full-year EMEA share reached 10 percent, moving the company from No. 3 to No. 2 in the region. In servers, the company's unit growth of 29 percent last year was three times the industry average.
Dell's total shipments in both the Americas and the U.S. grew 10 percent in the fourth quarter; the U.S. industry declined 9 percent. Dell's Q4 U.S. share of more than 27 percent was an industry record. For the full year, the company ranked No. 1 in the overall U.S. market and, for the first time, in all major product categories: servers, workstations, portable computers and desktop computers. Dell's total unit growth in the U.S. last year was 11 percent, compared with a national industry drop of 12 percent.
Unit volumes purchased by U.S. government customers in the quarter jumped 28 percent, and shipments in the education segment increased 20 percent.
'Dude...You're Gettin' a Dell'
Company sales to consumers were particularly strong in the quarter, which includes the critical holiday purchasing season. Dell shipments to home customers were up 56 percent from the third quarter and were 38 percent better than one year ago. The strong performance is attributable in part to spending on a popular, consumer-focused U.S. television campaign featuring the character ``Steven.'' A youthful advocate for the company's products, services and direct relationships with customers, Steven enthusiastically tells other characters and viewers, ``Dude, you're gettin' a Dell.''
About Dell
Dell Computer Corporation (Nasdaq:DELL - news) is the world's No. 1 computer systems company and is a premier provider of products and services required for customers to build their information-technology and Internet infrastructures. The company's revenue for the past four quarters totaled $31.2 billion. Dell ranks No. 48 on the Fortune 500, No. 122 on the Fortune Global 500 and No. 7 on the Fortune Global ``most admired'' lists of companies. Dell, through its direct business model, designs, manufactures and customizes products and services to customer requirements, and offers an extensive selection of software and peripherals. Information on Dell and its products can be obtained on the World Wide Web at www.dell.com.
Dell, PowerEdge, Dell Precision, PowerConnect, Inspiron and Latitude are trademarks of Dell Computer Corporation.
Fortune and Fortune 500 are registered trademarks, and Fortune Global 500 is a trademark, of Time Inc.
Dell disclaims any proprietary interest in the marks and names of others.
Special note: Statements in this press release that relate to future results and events (including statements about future financial and operating performance) are based on the company's current expectations. Actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties, including general economic and business conditions; the level of demand for the company's products and services; the level and intensity of competition in the technology industry and the pricing pressures that have resulted; the company's ability to timely and effectively manage periodic product transitions, as well as component availability and cost; the company's ability to develop new products based on new or evolving technology and the market's acceptance of those products; the company's ability to manage its inventory levels to minimize excess inventory, declining inventory values and obsolescence; the product, customer and geographic sales mix of any particular period; the company's ability to recover its investments in venture capital activities; the company's ability to effectively manage its operating costs; and the effect of armed hostilities or other conflict on the economy generally, on the level of demand for the company's products and services, and on the company's ability to manage its supply and delivery logistics in such an environment. Additional discussion of these and other factors affecting the company's business and prospects is contained in the company's periodic filings with the Securities and Exchange Commission.
Consolidated statements of income and financial position follow.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
(in millions, except per share data)
(unaudited)
Three Months Ended
----------------------
Feb. 1, Nov. 2, Feb. 2, % Growth Rates
------ ------ ------ -------------------
2002 2001 2001 Sequential Yr. to Yr.
------ ------ ------ ------ ------
Net revenue $8,061 $7,468 $8,674 8.0% (7.1%)
Cost of revenue 6,645 6,155 7,115 8.0% (6.6%)
------ ------ ------
Gross margin 1,416 1,313 1,559 7.9% (9.2%)
Selling, general
and administrative 713 662 854 7.8% (16.6%)
Research, development
and engineering 109 107 116 1.0% (6.2%)
Special charge(a) -- -- 105 N/A N/A
------ ------ ------
Total operating
expenses 822 769 1,075 6.9% (23.6%)
------ ------ ------
Operating income 594 544 484 9.3% 22.7%
Investment and other
income, net 40 51 136 (23.9%) (71.4%)
------ ------ ------
Income before
income taxes 634 595 620 6.4% 2.1%
Income tax provision 178 166 186 6.4% (4.7%)
------ ------ ------
Net income $ 456 $ 429 $ 434 6.4% 5.0%
====== ====== ======
Earnings per
common share:
Basic $ 0.18 $ 0.16 $ 0.17
====== ====== ======
Diluted $ 0.17 $ 0.16 $ 0.16
====== ====== ======
Weighted average
shares outstanding:
Basic 2,599 2,611 2,582
Diluted 2,690 2,728 2,783
Percentage of Net Revenue:
-------------------------
Gross margin 17.6% 17.6% 18.0%
Selling, general
and administrative 8.9% 8.9% 9.9%
Research, development
and engineering 1.3% 1.4% 1.3%
Total operating
expenses 10.2% 10.3% 12.4%
Operating income 7.4% 7.3% 5.6%
Income before
income taxes 7.9% 8.0% 7.2%
Net income 5.7% 5.7% 5.0%
Income tax rate 28.0% 28.0% 30.0%
Net Revenue by geographic region:
--------------------------------
% of total revenue
------------------
Americas 70% 70% 70%
Europe 21% 20% 21%
Asia Pacific -- Japan 9% 10% 9%
Net Revenue by product line:
---------------------------
% of total revenue
------------------
Desktops 57% 52% 54%
Enterprise 18% 19% 18%
Portables 25% 29% 28%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
(a) Special charge for the three months ended Feb. 2, 2001, related to
job reductions and consolidation of facilities.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
Excludes Special Charge
(in millions, except per share data)
(unaudited)
Three Months Ended
----------------------
Feb. 1, Nov. 2, Feb. 2, % Growth Rates
------ ------ ------ -------------------
2002 2001 2001 Sequential Yr. to Yr.
------ ------ ------ ------ ------
Net revenue $8,061 $7,468 $8,674 8.0% (7.1%)
Cost of revenue 6,645 6,155 7,115 8.0% (6.6%)
------ ------ ------
Gross margin 1,416 1,313 1,559 7.9% (9.2%)
Selling, general
and administrative 713 662 854 7.8% (16.6%)
Research, development
and engineering 109 107 116 1.0% (6.2%)
------ ------ ------
Total operating
expenses 822 769 970 6.9% (15.3%)
------ ------ ------
Operating income 594 544 589 9.3% 0.9%
Investment and
other income, net 40 51 136 (23.9%) (71.4%)
------ ------ ------
Income before
income taxes 634 595 725 6.4% (12.7%)
Income tax provision 178 166 217 6.4% (18.5%)
------ ------ ------
Net income $ 456 $ 429 $ 508 6.4% (10.2%)
====== ====== ======
Earnings per
common share:
Basic $ 0.18 $ 0.16 $ 0.20
====== ====== ======
Diluted $ 0.17 $ 0.16 $ 0.18
====== ====== ======
Weighted average
shares outstanding:
Basic 2,599 2,611 2,582
Diluted 2,690 2,728 2,783
Percentage of Net Revenue:
-------------------------
Gross margin 17.6% 17.6% 18.0%
Selling, general
and administrative 8.9% 8.9% 9.9%
Research, development
and engineering 1.3% 1.4% 1.3%
Total operating
expenses 10.2% 10.3% 11.2%
Operating income 7.4% 7.3% 6.8%
Income before
income taxes 7.9% 8.0% 8.4%
Net income 5.7% 5.7% 5.9%
Income tax rate 28.0% 28.0% 30.0%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
(in millions, except per share data)
(unaudited)
Year Ended
---------------------
Feb. 1, Feb. 2,
2002 2001 % Growth Rates
-------- -------- -------
Net revenue $ 31,168 $ 31,888 (2.3%)
Cost of revenue 25,661 25,445 0.9%
-------- --------
Gross margin 5,507 6,443 (14.5%)
Selling, general
and administrative 2,784 3,193 (12.8%)
Research, development
and engineering 452 482 (6.2%)
Special charge(a) 482 105 N/A
-------- --------
Total operating
expenses 3,718 3,780 (1.6%)
-------- --------
Operating income 1,789 2,663 (32.8%)
Investment and other
income (loss), net(a) (58) 531 (111.0%)
-------- --------
Income before income
taxes and cumulative
effect of change in
accounting principle 1,731 3,194 (45.8%)
Income tax provision 485 958 (49.4%)
-------- --------
Income before cumulative
effect of change in
accounting principle 1,246 2,236 (44.3%)
Cumulative effect of
change in accounting
principle, net(b) -- 59 (100.0%)
-------- --------
Net income $ 1,246 $ 2,177 (42.8%)
======== ========
Earnings per common share:
Before cumulative effect
of change in accounting
principle:
Basic $ 0.48 $ 0.87
======== ========
Diluted $ 0.46 $ 0.81
======== ========
After cumulative effect of
change in accounting
principle:
Basic $ 0.48 $ 0.84
======== ========
Diluted $ 0.46 $ 0.79
======== ========
Weighted average shares
outstanding:
Basic 2,602 2,582
Diluted 2,726 2,746
Percentage of Net Revenue:
-------------------------
Gross margin 17.7% 20.2%
Selling, general
and administrative 8.9% 10.0%
Research, development
and engineering 1.5% 1.5%
Total operating expenses 11.9% 11.8%
Operating income 5.8% 8.4%
Income before income taxes
and cumulative effect of
change in accounting
principle 5.6% 10.1%
Net income 4.0% 6.8%
Income tax rate 28.0% 30.0%
Net Revenue by geographic region:
--------------------------------
% of total revenue
------------------
Americas 70% 72%
Europe 21% 20%
Asia Pacific -- Japan 9% 8%
Net Revenue by product line:
---------------------------
% of total revenue
------------------
Desktops 53% 53%
Enterprise 19% 18%
Portables 28% 29%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
(a) Special charge for the 12 months ended Feb. 1, 2002, and Feb. 2,
2001, related to job reductions, consolidation of facilities and
impairment of assets.
(b) Effective Jan. 29, 2000, Dell adopted Staff Accounting Bulletin
No. 101, Revenue Recognition in Financial Statements ("SAB 101"),
as amended, issued by the Securities and Exchange Commission.
Dell's adoption of SAB 101 resulted in a change in the method of
accounting for certain product shipments. The cumulative effect of
this change was $59 million, net of taxes. This accounting change
had no material effect on Dell's previously reported revenue or
quarterly earnings (other than the cumulative effect) during
fiscal 2001.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
Excludes Special Charge and Cumulative Effect
(in millions, except per share data)
(unaudited)
Year Ended
---------------------
Feb. 1, Feb. 2,
2002 2001 % Growth Rates
-------- -------- -------
Net revenue $31,168 $31,888 (2.3%)
Cost of revenue 25,661 25,445 0.9%
-------- --------
Gross margin 5,507 6,443 (14.5%)
Selling, general
and administrative 2,784 3,193 (12.8%)
Research, development
and engineering 452 482 (6.2%)
-------- --------
Total operating expenses 3,236 3,675 (11.9%)
-------- --------
Operating income 2,271 2,768 (18.0%)
Investment and
other income, net 202 531 (62.1%)
-------- --------
Income before income taxes 2,473 3,299 (25.1%)
Income tax provision 693 989 (30.0%)
-------- --------
Net income $ 1,780 $ 2,310 (22.9%)
======== ========
Earnings per common share:
Basic $ 0.68 $ 0.89
======== ========
Diluted $ 0.65 $ 0.84
======== ========
Weighted average shares
outstanding:
Basic 2,602 2,582
Diluted 2,726 2,746
Percentage of Net Revenue:
-------------------------
Gross margin 17.7% 20.2%
Selling, general
and administrative 8.9% 10.0%
Research, development
and engineering 1.5% 1.5%
Total operating expenses 10.4% 11.5%
Operating income 7.3% 8.7%
Income before income taxes 7.9% 10.4%
Net income 5.7% 7.2%
Income tax rate 28.0% 30.0%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Financial Position
and Related Financial Highlights
(in millions, except for "Ratios" and "Other information")
(unaudited)
Feb. 1, Nov. 2, Feb. 2,
2002 2001(a) 2001(a)
-------- --------- --------
Assets:
------
Current assets:
Cash and cash equivalents $ 3,641 $ 3,442 $ 4,910
Short term investments 273 309 525
Accounts receivable, net 2,636 2,692 2,895
Inventories, net 278 269 400
Other 1,049 988 996
-------- --------- --------
Total current assets 7,877 7,700 9,726
Property, plant
and equipment, net 826 806 996
Investments 4,373 4,267 2,418
Other non-current assets 459 514 530
Total assets -------- --------- --------
$ 13,535 $ 13,287 $ 13,670
======== ========= ========
Liabilities and Stockholders' Equity:
------------------------------------
Current liabilities:
Accounts payable $ 5,075 $ 4,771 $ 4,286
Accrued and other 2,444 2,446 2,492
-------- --------- --------
Total current liabilities 7,519 7,217 6,778
Long term debt 520 518 509
Other 802 770 761
-------- --------- --------
Total liabilities 8,841 8,505 8,048
Stockholders' equity 4,694 4,782 5,622
-------- --------- --------
Total liabilities
and stockholders' equity $ 13,535 $ 13,287 $ 13,670
======== ========= ========
Ratios:
------
Quick ratio 0.87 0.89 1.23
Days supply in inventory 4 4 5
Days of sales
in accounts receivable 29 32 32
Days in accounts payable 69 70 58
Other Information:
-----------------
Headcount (approximate) 34,600 34,400 40,000
Average total
revenue/unit (approximate) $ 1,700 $ 1,800 $ 2,050
Note: Ratios are calculated based on underlying data in thousands.
(a) Prior periods have been restated to conform to the Q4FY02
presentation.
--------------------------------------------------------------------------------
Contact:
Dell Computer Corporation, Austin
Media Contacts:
T.R. Reid, 512/728-7977
tr_reid@dell.com
or
Mike Maher, 512/723-2575
mike_maher@dell.com
or
Investor Contacts:
Lynn A. Tyson, 512/723-1130
lynn_tyson@dell.com
or
Robert Williams, 512/728-7570
robert_williams@dell.com
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