Dell earnings down; Optimistic for 2nd Half

Dell reported earnings on Thursday (8/27) and difficult to read if the company is on track for financial success.

The company beat estimates by 2 cents a share (a former trademark of the company but hadn’t been accomplished for some time). Some key financials:

• Revenue was down 23% year over year
• Gross margins improved to 18.7% from 17.2% for same quarter last year
• Consumer saw 17% increase in sales, but as we know from Acer and HP, this segment is challenged for profitability
• No surprises that SMB and Corporate sales still lag

Michael Dell did say on the call that they “we expect revenue for the second half of the year to be stronger than the first half.”, expecting a bounce-back in corporate purchasing in early 2010.

Dell’s stock was at $16 and chance at the pre-open, today Friday 8/28. The stock, which had traded as low as $8/share in the past 52 weeks, is still garnering mixed opinions by investment analysts.