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Wednesday 24 November 2021

Commercial sales propel Dell to another record quarter

Dell logoDell Technologies is breaking records again. Q3 revenue was up 21% to $28.4bn (Q3 2021: $23.5bn) with growth across all business units, customer segments and geographies. Operating income for the three months ended 29 October 2021, was up 19% to $1.3bn (Q3 2021: $1.1bn) and Non-GAAP operating income was up 5% to $2.9bn (Q3 2021: $2.7bn). This was the fifth quarter of record quarterly revenue and operating income.

Revenue for its Client Solutions Group (PCs etc) was up 35% to $16.5bn (Q3 2021: $12.3bn). As was the case in Q2, growth was particularly strong in the division's Commercial business, which was up by an impressive 40% to $12.3bn (Q3 2021: $8.8bn). Its Consumer business grew by 21% to $4.3bn (Q3 2021: $3.5bn). The company is benefiting from a combination of hybrid workers, the return to the office, and the introduction of Windows 11.

Revenue from its smaller Infrastructure Solutions Group (servers, networking and storage) was up by 5% in the quarter to $8.4bn (Q3 2021: $8.0bn). Servers and Networking revenue was up by 9% to $4.5bn (Q3 2021: $4.2bn) and, after a slight fall in Q2, Storage revenue returned to growth, up 1% to $3.9bn (Q3 2021: $3.9bn).

The results for this quarter include VMware, which was up 10% to $3.2bn (Q3 2021: $2.9bn); however, after Dell finally sold off its 81% majority stake in the company, Q4 results will only include VMware reseller revenue. See VMware waves farewell to Dell with 11% Q3 growth for further discussion.

The company has paid down a total of $15.9bn of debt year-to-date, including $2bn paid during Q3 and $9.4bn paid after quarter end. Core debt at the end of the quarter adjusted to include the $9.4bn payment stood at $17.6bn.

With the sale of VMWare, Dell Technologies is beginning to write the next chapter of its story. It believes it is uniquely positioned to thrive in the data and multi-cloud era and is placing a great deal of emphasis on its APEX portfolio of as-a-Service offerings. Last month it announced APEX Cloud Services with VMware Cloud, its first alliance with the newly independent VMware. The company is actively broadening its portfolio, including investing in new growth opportunities in telco and edge, but it needs to be careful it doesn't over complicate things after putting so much effort into simplifying its proposition. 

Posted by: Dale Peters at 09:57

Tags: results   storage   infrastructure   PCs   Q3  

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