Dell’s Stock Price Hits Historic Low

‘The coronavirus has created some level of uncertainty … We do expect our normal sequentials from Q1-Q4 [2021] to be softer as a result of the coronavirus impact,’ said Dell Technologies Chief Financial Officer Tom Sweet during the company’s quarterly earnings call this week.

Dell Technologies’ stock hit its lowest point since the $92 billion infrastructure giant became a public entity in December 2018.

The Round Rock, Texas-based company’s stock was down 10 percent today hitting a low of $39.21 per share Friday afternoon. Dell’s stock has never fell below the $40 per share threshold since it went public through a VMware stock-swap deal on Dec. 28, 2018.

The company’s stock is slowly rebounding. Dell’s stock on the New York Stock Exchange currently sits at $40.05 per share as of 4 p.m. Eastern Standard Time.

Dell stock, along with many other IT companies’ stock, has been hit significantly due to the concerns of the coronavirus epidemic and its effects on manufacturing in China.

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On Thursday, Dell reported its fourth fiscal quarter earnings with total revenues of $24.03 billion, up 1 percent year over year, with a net income of $416 million.

However, Dell – who is the worldwide server market leader – reported a massive 19 percent drop in server sales. Dell’s server business dropped to $4.27 billion in its fourth fiscal quarter 2020, down from $5.25 billion during the same quarter one year ago.

Dell CFO Tom Sweet said the declines were due to a challenging sales environment in China due to U.S.-China trade tensions and slower spending within the enterprise segment in the U.S.

“The coronavirus has created some level of uncertainty … We do expect our normal sequentials from Q1-Q4 [2021] to be softer as a result of the coronavirus impact,” Sweet said. “There’s two principle impacts right now: one is in our domestic China business as the Chinese economy softens, given what they are going through to try to contain the virus, and then the question becomes, will there be any supply chain or lead time dynamics.”

Dell's Infrastructure Solutions Group reported revenue of $8.76 billion, down 11 percent year-over-year from $9.89 billion. Dell's storage revenues also dipped 3 percent to $4.49 billion during the quarter compared to the same period a year ago.

Other IT companies have been hit hard by the coronavirus that has halted manufacturing in China. Just this week, Microsoft cut its revenue guidance due to the coronavirus outbreak, while HP Inc. postponed its Reinvent partner conference.