The 10 Top Dell Technologies News Stories Of 2023 (So Far)
Still leading the compute infrastructure pack, Dell Technologies sales took a dip in the first quarter, even as new horizons open for the company around generative AI. Here is a look at all of the top news for Dell Technologies so far in 2023.
Six months into 2023 and Dell Technologies is taking on customer demands for on-premise generative AI compute, expanding the choices available inside of the hybrid-cloud world where data now lives and keeping pace with challengers.
Dell Technologies was already the infrastructure sales leader before ChatGPT was released and reframed the conversation that partners could have with their customers.
It is no longer sufficient to plan for the eventual deployment AI workloads, the company said during its recent Dell Technologies World. And it now an on-premises device capable of running generative AI workloads. Additionally the company’s sales leader, Bill Scannell told partners the demand to build and scale out AI server farms are already coming in priced as high as $600 million.
And yet, even as its competitors also expound on the merits of generative AI to their future state, the current demand for those solutions has not shown up on the balance sheet. After eight consecutive quarters of growth, Dell’s infrastructure sales were down during the first quarter of Dell’s fiscal year 2024.
And while Dell set annual revenue records for the last two years, it expects the full fiscal year to be off between 12 and 18 percent.
But ever the optimist, Michael Dell took to the stage at Dell Technologies World and announced it would take on its customers most difficult digital challenges by meeting their compute and storage requirements no matter where the workload resides.
“Multi-cloud by design isn’t just a tag line. Here at Dell Technologies World over the next few days we will release the largest expansion ever to our Apex offerings, bringing customers a modern cloud experience and consumption model built for multi-cloud,” Dell told the crowd.
Dell has now paired its Apex as-a-service offering with the most powerful names in cloud—Amazon Web Services, Microsoft Azure, Red Hat and VMware—to give customers the choice and flexibility to avoid cloud-lock in.
Read about these and the other stories that made Dell’s top 10 news stories of so far in 2023.
No. 10: Dell Tells Workers To Come Back To The Office
Dell Technologies touted remote work for years, and enabled millions of companies to go remote during the COVID-19 pandemic. However, as the needs of the company have changed and the workforce has slightly contracted, Dell Technologies in May called some of its workers back to their local offices.
The news came about eight months after Michael Dell (pictured) wagged his finger at fellow executives who bemoaned remote workers sapping their productivity telling them, “You’re doing it wrong,”
Jeff Clarke, the company’s vice chairman and co-chief operating officer, made clear that 100 percent remote work while living near a Dell Technologies office would no longer be permitted but also emphasized the company’s desire to be a flexible employer.
“As soon as possible, we’d like more people to work in a hybrid model,” said Clarke. “Those living within about an hour commute to a major Dell office should come onsite at least three days a week. We’re still flexible – work with your leader to determine schedules within this framework that work best for you and the business.”
No. 9: Dell CFO Tom Sweet Retires
Dell Technologies’ longest-serving CFO, Tom Sweet (pictured), retired after 26 years at the Round Rock, Texas-based company.
“Since joining Dell in 1997, Tom has overseen every aspect of finance, guiding us through tremendous growth, and through some extraordinary milestones,” CEO Michael Dell told investors during a March earnings call. “From the merger with EMC, to returning to the public markets, the spinning off of Dell’s stake in VMware, thank you for everything, and most of all thank you for your friendship.”
Dell appointed Yvonne McGill, currently the company’s corporate controller, as its new CFO effective the start of Q3 fiscal 2024, expected to begin Sept. 1. She started working at Dell in 1997.
“Many of you already know Yvonne,” Dell said on the earnings call. “Yvonne has been responsible for a number of functions including ISG, tax, treasury, accounting, and investor relations since 2020. She’s a proven financial leader and we are all thrilled to have her as our new CFO.”
No. 8: Dell Sales Leader Byrne Promoted
Dell Technologies sales teams announced a global reorganization in March with all sales employees now reporting to John Byrne (pictured).
The longtime Dell sales leader was the company’s first global channel chief. He was previously president of North American sales.
“As Dell Technologies’ first Global Channel Chief, with a long history of working closely with the channel community, I know firsthand how strong partnership makes for extraordinary outcomes,” Byrne said in a statement. “We will continue our focus on growing faster than the market to accelerate our customers’ digital transformation journeys.”
Byrne reports to Dell global sales leader Bill Scannell, who remains in his role.
No. 7: Project Harmony Launched
Project Harmony is there when a partner has a sales opportunity, but doesn’t have the technical or knowledge workers who can provide the solution.
It gives partners access to Dell experts and technologists, which can be marked up and resold to customers, said Chuck Whitten (pictured), co-chief operating officer for Dell Technologies.
“This is not a traditional resell model. You are going to purchase Dell capabilities at a discount and embed them into your solutions. Fundamentally, it’s like having a full spectrum of Dell expertise in your back pocket, allowing you deliver outcomes customers need, but without having to build all of that expertise.”
Specifically focused on professional services, partners will be able to integrate Dell services into their existing branded services offerings to compliment their shop’s services portfolio.
The concept is to give customers Dell-delivered capabilities around complex issues such as security and automation. They can buy it, integrate it and brand it as their own, according to Dell’s Cheryl Cook.
“They’re not really reselling Dell, but it’s a way to extend their capabilities,” she said. “There are specific services and capabilities that a manufacturer like Dell would be able to provide that wouldn’t make sense for partners to invest in … They maintain the relationship with the customer.”
No. 6: Decline In Infrastructure Sales
Dell has been the No. 1 seller of x86 servers for the past six years, or 25 quarters.
In its most recent call in June, when Dell Technologies revenues took a 20-percent hit year over year on the back of soft demand in its commercial PC unit as well as the infrastructure business, which had grown for eight consecutive quarters until the first quarter of fiscal year 2024.
However the decline comes as Dell’s servers become critical for enterprises building AI applications as well as the AI farms that many data centers are adopting.
Infrastructure revenue fell 18 percent year on year dropping to $7.5 billion. The heaviest blow landed on servers and networking, which tumbled 24 percent, while storage fell 11 percent as a category, making up $3.75 billion of Dell’s revenue compared to $4.23 billion in the same period last year.
Dell expects demand for ISG to drop again in the single digits in the next quarter.
While it sounds dire, Dell maintained its position as number one provider in six categories including x86 server units, external enterprise storage, storage software, hyperconverged systems, and purpose-built backup appliance.
Rival infrastructure vendor HPE also saw a decline in its compute sales which were off 8 percent for the year.
Dell’s first quarter 2024 revenue came in at $20.9 billion -- $700 million more than the $20.2 billion consensus estimate by analysts at Zacks -- but $5.19 billion off the same time frame last year.
“The demand environment remains challenged, and customers are staying cautious and deliberate across their IT spending,” Dell’s co-COO Chuck Whitten told investors. “We continue to see softness across our major lines of business, all regions, all customer sizes, and most verticals.”
No. 5: Cloud Repatriation
Dell Sales Boss Bill Scannell told CRN the repatriation of workloads from the public cloud is real and it’s a fantastic opportunity for partners to help their customers save money. He said moves to hybrid environments have saved customers between 40 and 70 percent.
The company’s line of Apex products integrates with leading hyperscalers to make sure those workloads can live in any environment.
“Generally speaking, it’s about 40 to 45-percent less expensive to run it on prem, or in a colo of your choice than in the public cloud. However In many cases, it’s 50 to 60 percent less, in some cases it is close to 70 percent, less expensive to run it on prem, than from public cloud,” Scannell told CRN. “So we work with the hyperscalers, but at the end of the day, we want to work with our partners and our customers provide the right solutions at the right price point for their workloads.
No. 4: New Partner Program Roll Out
Dell Technologies revamped compensation around Apex, boosting incentives on the front end, providing market development funds (MDF) on the back-end, and giving partners the chance to sell, install and maintain the offering with their own managed services.
Dell’s senior vice president of partner marketing, Cheryl Cook (pictured), said other changes to the program allow partners to leverage their existing service delivery competencies, and also offer customers an Apex solution that is completely partner-managed.
“What this means is partners can engage in our Apex offerings, whether that’s our private and hybrid cloud Apex solutions, our data storage services solutions, and the installation, the deployment, the implementation is 100-percent done by the partner,” Cook said. “Then the ongoing management and engagement with the customer is 100-percent partner led, rather than a combination of Dell and partners.”
“It opens up and unlocks richer and more services opportunities for the partner,” she added.
No. 3: AI Superpowers -- Project Helix
How big does Dell Technologies think the Generative AI opportunity is? So big, the benefits can’t be contained to one category.
“The real opportunity is to reimagine your organization and what you can become given the superpowers AI unleashes,” he wrote in the post. “If you’re not applying AI across your organization and thinking deeply about reinvention, you’re already behind.”
Meanwhile, the company is also capitalizing on business demand for bespoke generative AI solutions, thanks to a partnership with Nvidia.
Dell Technologies Co-COO Jeff Clarke, introduced Project Helix along with Nvidia CEO Jensen Huang at Dell Technologies World. The product is a full stack solution for enterprises to create and run custom AI models built with Dell’s infrastructure and software, as well as Nvidia’s accelerators, AI software and expertise.
“Over the last 30 years we have built a lot of things. Nothing is nearly this impactful,” Huang said. “Every company at its core is about intelligence. For the first time together, Project Helix will help every company be an AI factory and be able to produce their domain-specific intelligence, their expertise, and then do it at lightspeed and do it at scale.”
Clarke said when it comes to hardware, Project Helix has a Dell PowerEdge XE 9680 running eight Nvidia H100 GPUs in a Dell-validated design. He said it can run at any scale and includes AI consulting services wrapped around it.
No. 2: Dell Lays Off Thousands
It hasn’t all been product announcements and bright horizons. Dell Technologies announced plans to axe 6,500 jobs earlier this year, amid a reckoning in the tech sector that saw tens of thousands of workers lose employment.
Michael Dell told CRN later that many tech companies had over hired during the pandemic and with unpredictable economic headwinds, layoffs resulted.
In February, Jeff Clarke, Dell’s vice chairman and co-COO, said the company had tried to stave cuts with a hiring freezes, travel restrictions and expense reductions that ultimately failed to turn conditions to Dell’s advantage.
“Steps we’ve taken to stay ahead of the downturn impacts … are no longer enough. We now have to make additional decisions to prepare for the road ahead,” Clarke wrote. “In the coming days and weeks, you’ll begin to see a series of changes, some resets, across the organization to better structure us for the future, to better collaborate, reduce complexity, increase speed and to accelerate innovation. They’ll help us focus on purpose-driven work and be in the best position to make the greatest difference for customers, Dell Technologies and each other. You’ll hear from your leader soon about any changes that may impact your team.”
No. 1: Revamping Of Dell Apex
Dell Apex is focused on being the forever home of workloads around the world, while also letting them interoperate with hyperscalers for the ultimate in pricing flexibility.
Dell Apex Cloud Platforms for Microsoft, Red Hat and VMware are built to drive horizontal consistency across the environment with common hardware platforms built on PowerEdge technology, common software built on PowerFlex technology, and a shared automated management and orchestration for that entire stack from the firmware up to the cloud operating system.
Meanwhile, Dell announced in May that Dell ApexBlock Storage for AWS and Dell Apex Block Storage for Microsoft Azure, formerly “Project Alpine,” gives customers 300 percent better performance per dollar through linear scalability and performance.
“The architecture itself provides multi-availability-zone durability so you can truly have that resilience that you’re used to in the data center and bring that to the cloud,” said Dell Technologies Vice President of Product Management Caitlyn Gordon. “Ultimately, that allows you to bring workloads you never could have before from the data center to the public cloud.”
Dell’s CO-COO Chuck Whitten said Dell’s “ground to cloud” capabilities extend advanced storage software out to the public clouds, while Dell’s “cloud to ground” products can return that cloud experience to the data centers.
“True multi-cloud by design requires something easy to say and very hard to do: the freedom to run workloads wherever your business needs dictate, unconstrained by technology,” he said. “Running the right workloads in the right environment, giving developers access to the innovations across the cloud ecosystem—we are significantly expanding from where we have been and officially can say that we are now the world’s most comprehensive as-a-service and multi-cloud portfolio that spans from the data center to the public cloud and now to client devices.”