Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: jim kelley who wrote (24118)	12/3/1997 8:52:00 PM
From: Meathead	Read Replies (4) \| Respond to of 176388

Everyone - the Nov 26 IDC PC report is out. A few interesting insights are worth reviewing. * Dell cautions that in future qtrs they will pass along component cost decreases to the customer more rapidly which will have a negative impact on margins * GM will also be under pressure from the continued requirement to invest in infrastructure and internet technology * GM will be positively affected by the roll-out of mfg efficiencies WW already achieved in Austin, improving product mix to high-end systems and accelerated transition to PentiumII * Says Pentium II-based systems now represent three quarters of the Dimensions and half the OptiPlexes sold. * Dell says that workstation business is growing faster than the server business did, but workstation's contribution in Q3 was minor since it was introduced only recently. * Combined workstation and server revenue was up 340% year on year, they now account for 10% of Dell's overall revenue. * "Dell continues to buck the overall industry trend of degenerating ASPs, made possible by an increase of servers and workstations in the mix, the clear targeting of corporate buyers more concerned with obsolesce than with initial selling price, and a firm resolve to hold off entry into the sub-$1,000 desktop market." * Dell wants to address above all the power-hungry business and consumer markets. Sixth-generation processors represented 70% of Dimension revenues in the third quarter. The company's 50 global enterprise accounts generate more than $1 billion in annual revenue * IDC believes that the Asian economic effects will begin to show up in fourth quarter results and in 1998 market performance but that reiterates that Dell's exposure is limited. * Dell offers Web support in 12 languages in 40 countries. In Japan, 10% of Dell's servers and 50% of its consumer systems are sold over the internet. * Dell is enjoying decreasing cost of sales, particularly in its transaction business, due to the increasing proportion revenues coming from the internet. * IDC predicts that Dell's profitability will continue to improve due to improvements in product mix but yr/yr revenue growth will decline after the fourth quarter due to expected price competition. * IDC also states the although Dell has deliberately chosen to avoid the sub-zero "business" market for the time being, but forces may drag it in. Dell sees no immediate need to push here at the moment but will not hesitate when the time is right. Essentially, they are already in the sub-zero with NetPC at $950. MEATHEAD