Page 2 of 2
Dell's EqualLogic storage business grew 66 percent over last year, and currently has a run rate of over $800 million, Dell said.
He declined to directly address a financial analyst's question about Dell's reaction to losing its 3PAR acquisition bid to HP or about how EMC's proposed acquisition of Isilon might impact his company. He did say that Dell continues to invest in the storage business, citing as examples its recent acquisitions of Exanet for CIFS and NFS storage technology and of Ocarina.
Dell also said that his company's 10-year relationship with EMC continues to evolve.
"We're focused on continuing to grow our storage business," he said. "For us, the measure of success is profitability, and we're working to grow (it)."
When asked about how virtual desktop or tablet PC trends might impact Dell's PC business during the current customer refresh cycle, Dell said the company is working hard to make virtual desktops a viable alternative to PCs, but is not seeing widespread adoption yet. "We'd like to," he said.
As for tablet PCs, Dell said his company is seeing enthusiasm from customers about the products. "We're coming out with tablets next year that will address commercial and consumer needs," he said.
Dell also said that his company is solidly focused on profitability, and not on gaining market share with low-margin products. A big part of that is continuing to emphasize solutions, he said.
"There will be shifts within the business as we index to more profitable businesses," he said.
Dell the company has leveraged its supply chain to cut the cost of doing business thanks to falling component costs and other savings.
For instance, Felice said, Dell has done much in terms of shortening delivery time of products from overseas by an average of a week even as it depends more on sea freight for its consumer business. Dell also cut costs in the third quarter by consolidating its consumer business into three brands: Inspiron, XPS, and Alienware.
Looking forward, Dell the company expects to see growth from the PC refresh cycle at large corporate accounts and from an increase in sales of enterprise products and services. As a result, the company expects full-year revenue to be somewhere around the midpoint of its previously-discussed growth of between 14 percent and 19 percent, while full-year non-GAAP operating income is expected to grow by between 28 percent and 32 percent.