To: Fangorn who wrote (115151 ) 4/8/1999 1:12:00 PM From: Mohan Marette Read Replies (2) | Respond to
This just in- Dell to Focus on Services, Consumers to Stoke Earnings Growth Dell Computer Corp., the No. 1 direct seller of personal computers, said it will increase sales and earnings by offering more computer services and selling more machines to consumers. Founder and Chairman Michael Dell told a meeting of analysts in New York that the PC market is ''healthy'' and unit sales in the industry likely will rise about 14 percent a year. His lieutenants said services will be key to sustaining the company's sales growth, which has topped 50 percent a quarter for most of the last two years. Dell defines services as anything beyond selling a computer. That includes solving computer glitches for clients and adding software to customize PCs. Emphasizing services is a change for Dell, which turns to outsiders to provide services to its customers. Services ''is an area Dell has downplayed,'' said Kurtis King, an analyst at Nationsbanc Montgomery Securities, who rates Dell ''buy.'' ''This is an important, positive message.'' Dell said it still has no plans to enter the market for bargain-priced PCs, though it cuts prices as costs fall. Demand Analysts said they were encouraged by Dell's optimistic outlook. The stock slumped in February amid concern after Dell reported fourth-quarter results that disappointed some investors. Dell rebounded this week as analysts anticipated positive comments at today's meeting. ''They are pretty upbeat,'' Richard Chu, an analyst at SG Cowen Securities Corp. who rates Dell ''buy.''
