Last night Dell released its final set of full-year results as a publicly-traded company. Michael Dell himself was absent from the analyst call in “light of [his] involvement in the pending transaction” and the company refused to discuss the subject of going private.
Instead, CFO Brian Gladden took the reins and talked analysts through results that weren’t exactly pretty. For FY13, revenue declined 8% to $56.9b and operating income declined 23% to $3.9b. The desktop and mobility business dropped 20%, putting continued pressure on Dell to further develop alternative compute models, such as its thin client business, Wyse.
In Q4, total revenue declined 11% to $14.3b, but increased 4% sequentially. Operating income (non-GAAP) decreased 17% to $954m over the previous year. The services business declined 3% but was flat sequentially at $2.1b. Support and deployment was flat. Infrastructure, cloud, and security services increased 2%, led by the security business, which increased 17%. There was a 22% decline in the apps and BPO business, due to “select contract expirations”.
The bottom line is that Dell has struggled to transform itself around IT services in the way it had hoped (see Schuckenbrook makes sudden departure from Dell). As cloud services become increasingly important to IT buyers, the company needs to have a specific and robust strategy for approaching this. However, it faces significant challenges here - see Dell’s cloud hurdles. Surely we must ask if a key part of the transformation process will need to be the appointment of a new CEO with a different and more relevant skillset.
With regards to the current financial year, we are entering into the realm of the unknown. Given the company’s move into private ownership, Dell is not providing an outlook for its fiscal 2014 or Q1.