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: Alohal who wrote (103721)	2/22/1999 12:46:00 PM
From: Greg Jung	Respond to of 176387

Aloha, you fail to use the important qualifier, "unit". PC unit sales are up, ASPs were down. I'm not concerned at the moment, so I won't look up numbers - except I do recall an article about growth in China which included overall numbers for several of the countries there. So overall revenues (unit sales * ASP) will be down if %decrease in ASP exceeds %increase in units. The installed PC base is growing rapidly with the sub-1000 models. You can view this as bearish or bullish. Bullish: it seeds the market for the higher end boxes which users eventually buy for reliability. Bearish: the sub-zeroes use adequate components and their dominance will continue or accelerate, lowering profitability and bringing market saturation on faster. The market saturation aspect is a troubling one for Dell, as software innovation, aside from the usual bloating technique, has not kept pace with the hardware speed. To justify its valuation Dell needs several years of >30% growth, not just 3.x times industry average. To get that growth they may need to venture beyond their core competency and this would crimp the quarter-by-quarter performance. Greg

To: Alohal who wrote (103721)	2/22/1999 3:50:00 PM
From: Knighty Tin	Read Replies (1) \| Respond to of 176387

Aloha, First, did you read the part about Dell's market share dropping 3Q to 4Q? If not, read Gabriel's reply # 100,303. Then, you still don't understand the difference between unit sales and revenues. If you grow unit sales at 12.3% and avg. sales prices are down 20-30%, you did not grow. You declined. This is the only industry that tries to scam investors with unit sales. All the others show dollar sales, as they are all that matter. I could just hear the laugh if the steel industry tried that trick. "12% more Rolled sheets were sold in 1998." The first question an analyst would ask is, what were sales. Units are not sales. $ are sales. MB

To: Alohal who wrote (103721)	2/22/1999 4:17:00 PM
From: Chuzzlewit	Respond to of 176387

Alohal, the first point you raise is interesting: 1. worldwide PC sales rose 12% for the year after a very rough start to the year due to inventory & channel problems. Why? Because many shipments to end customers were recorded as sales in the previous year when companies like CPQ were stuffing their channels. During the first two quarters the channels were selling inventory in their possession rather than fresh inventory coming in from companies that use the channels -- and outfits like IDC measure shipments from the factory, not sales to the end consumer. That means that sales to the end customer were likely significantly better than these numbers imply. CTC