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

To: Eric S. who wrote (26251)	12/23/1997 5:03:00 PM
From: Meathead	Read Replies (1) \| Respond to of 176388

No, COGS is totally independent of ASP. The goal is to keep margin healthy but if PC prices fall faster than component prices, margins get squeezed. The last few quarters we have been witnessing the opposite. For Dell's ASP to remain at ~$2600, their product mix must shift to look like this: As Percentage of Revenue 1997 1998 1999 2000 2001 DeskTop 73.0% 73.3% 70.9% 70.1% 69.8% Portables 16.4% 14.5% 15.4% 15.1% 14.9% Enterprise 10.6% 12.2% 13.8% 14.8% 15.3% As you can see, this looks highly do-able. If portables can take more from desktops... even better. The key is to lower the Desktop revenue percentage and replace it with higher margin products. MEATHEAD