Dell's Q1 results boiled down
Dell claimed it has become the 'unquestioned leader' in servers for the first time in 23 years in its latest financial numbers. But what were the other key takeaways for partners?
Dell's Q1 sales and profits soared by double digits, which the vendor says is down to increasing demand from its partners and customers around "digital transformation".
Revenues increased by 19 per cent to $21.4bn for the three months ending 4 May 2018. Meanwhile, Dell brought in non-GAAP operating profits of $2bn, up 42 per cent year on year.
We take a look at some of the key takeaways from Dell's Q1 numbers.
Dell looks unstoppable as infrastructure business surges
Dell Technologies' biggest growth segment was in its Infrastructure Solutions Group, which was up 25 per cent to $8.7bn in Q1. The vendor said this was primarily thanks to 41 per cent growth in servers and networking.
In an earnings call transcribed by Seeking Alpha, Dell noted Q1 2018 was its sixth consecutive quarter of server revenue growth. The firm claims that it has become the "unquestioned server leader" for the first time in almost 23 years.
Just last week, IDC analysts revealed that the worldwide server market at large also had a stellar Q1, with revenues up 38.6 per cent.
And within that market, Dell and HPE are statistically tied as the vendors with the most market share, while Dell was identified as the fastest growing server vendor among the top five companies, growing revenue 50.6 per cent year on year to $3.6bn.
Commenting on the results, Dell's vice-chairman of products and operations Jeff Clarke said:
"The great momentum we saw exiting last year for servers and commercial client continued through the first quarter. We gained share in PCs and servers during the first calendar quarter and, when the numbers are revealed, expect to gain share in storage as well."
As a result, Dell also claims to be worldwide leader for x86 servers, based on units and revenue.
Dell's making headway in paying off its debts
During the quarter, Dell made a GAAP operating loss of $153m, down from $1.27bn in the same period last year. The vendor claims to have made headway in servicing its debts: in Q1 it paid $600m of core debt, ending the quarter with a debt balance of $39.8bn.
In total, Dell has paid off $13bn in debts since the close of its EMC transaction in September 2016.
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Dell's Q1 results boiled down
Dell claimed it has become the 'unquestioned leader' in servers for the first time in 23 years in its latest financial numbers. But what were the other key takeaways for partners?
Strategy to cross-sell across VMware, Pivotal and RSA is paying off
The rest of the Dell family performed well, with Dell's other businesses including VMware, Pivotal and RSA also reporting strong results.
CFO Tom Sweet said Dell's strategy to cross-sell products and services is paying off.
"We've rolled out the Dell Technologies Advantage framework that provides tools and incentives to help channel partners sell solutions and services across our entire portfolio of brands," he said.
"We launched the initial public offering for Pivotal Software ranging approximately $540m. That will stay at that level for their general corporate needs and to fund future growth initiatives. So, the cross-selling between our families of companies continues to be strong."
Investing big in hyper-converged infrastructure
Dell also highlighted what it called big investments in hyper-converged, software-defined products and services.
Clarke said "several $100m" has been invested in sales capacity and R&D around hyper-converged infrastructure and software-defined datacentre.
He added: "As most of you know, we have taken several steps over the past few months to improve storage, which include launching our new PowerMax storage solution, aligning our software-defined storage strategy to VSAN and releasing product updates for Unity, SC and XtremIO X2."