Business Recipes for Success

Slumping Profits of Dell Explained

I am hardly surprised to find this article about Dell's poor profit performance under Techonology news. The analyst attributed the profitability's decline to the shift from INTEL processor to AMD.

A marketing analyst would look at the customer service efficiency that turns off customers from buying the products.

A finance analyst would blame the increase in operating expenses brought about by the
additional manpower hired.

An accountant would view this from the financial statements components and the treatments of revenue recognition and expenses in their reports of profit and loss.

Here is the excerpt of the story.



Technology
By Arik Hesseldahl

Dell Disappoints Once More
The PC maker says it will use more AMD chips, but that did little to make up for disclosures of slumping profits and a regulatory probe

Say this much for Dell: It delivered on at least some expectations when it reported earnings Aug. 17. For starters, the computer maker said second-quarter profit tumbled to $502 million, or 22 cents a share, in keeping with an earlier warning that analysts' average projections were too optimistic.

Then there was the disclosure that Dell (DELL ) would expand its relationship with chip maker Advanced Micro Devices (AMD). Dell had already begun using AMD chips for servers, the computers that run Web sites and corporate networks. It was long rumored that Dell would also use AMD chips in other computers. Dell confirmed the scuttlebutt, saying it would use AMD chips in desktop PCs.

Read the entire story here.

business,financial statements ,balance sheet ,statement

posted by cathy at 4:26 AM