Dell Technologies: 6 Takeaways From Q3 Earnings
The weak demand for Dell PCs was hedged by a lower cost of shipping and components, and a reduction in server backlog which drover better than expected infrastructure performance.
Complex Macroeconomic Issues Still At Play Next Year
Sweet said Dell expects ongoing global macroeconomic factors including slowing economic growth, inflation, rising interest rates and currency pressure to weigh on its customers, and IT spending.
“With what we know today, it’s likely next year’s revenue is below historical sequentials using our Q4 guidance as a starting point,” he told analysts.
“It’s pretty early in our planning process from a fiscal year ‘24 perspective,” Sweet later added. “Clearly, the landscape and the dynamics are complex, and there’s a high degree of complexity out there, whether it’s around inflation or interest rates, what’s going on with FX, global growth in general, supply chain, geopolitical. I could probably go on, but you get the point that at this point. As we look at it, there’s a pretty wide range of financial outcomes depending upon how some of these things move and change on us. And in particular, I would say the back half of next year continues to.... have a fair amount of complexity.”