| DELL INC. | ||||||||||||
| Condensed Consolidated Statement of Income and Related Financial Highlights | ||||||||||||
| (in millions, except per share data and percentages) | ||||||||||||
| (unaudited) | ||||||||||||
| Six Months Ended | % Growth Rates | |||||||||||
| July 29, | July 30, | |||||||||||
| 2011 | 2010 | Yr. to Yr. | ||||||||||
| Net revenue | ||||||||||||
| Products | $ | 24,669 | $ | 24,731 | (0 | %) | ||||||
| Services, including software related | 6,006 | 5,677 | 6 | % | ||||||||
| Net revenue | 30,675 | 30,408 | 1 | % | ||||||||
| Cost of net revenue | ||||||||||||
| Products | 19,371 | 21,316 | (9 | %) | ||||||||
| Services, including software related | 4,347 | 3,990 | 9 | % | ||||||||
| Total cost of net revenue | 23,718 | 25,306 | (6 | %) | ||||||||
| Gross margin | 6,957 | 5,102 | 36 | % | ||||||||
| Selling, general and administrative | 4,199 | 3,509 | 20 | % | ||||||||
| Research, development and engineering | 400 | 329 | 22 | % | ||||||||
| Total operating expenses | 4,599 | 3,838 | 20 | % | ||||||||
| Operating income | 2,358 | 1,264 | 87 | % | ||||||||
| Interest and other, net | (97 | ) | (117 | ) | 17 | % | ||||||
| Income before income taxes | 2,261 | 1,147 | 97 | % | ||||||||
| Income tax provision | 426 | 261 | 63 | % | ||||||||
| Net income | $ | 1,835 | $ | 886 | 107 | % | ||||||
| Earnings per share: | ||||||||||||
| Basic | $ | 0.97 | $ | 0.45 | 116 | % | ||||||
| Diluted | $ | 0.97 | $ | 0.45 | 116 | % | ||||||
| Weighted average shares outstanding: | ||||||||||||
| Basic | 1,883 | 1,956 | (4 | %) | ||||||||
| Diluted | 1,897 | 1,967 | (4 | %) | ||||||||
|
Percentage of Total Net Revenue: |
||||||||||||
| Gross margin | 22.7 | % | 16.8 | % | ||||||||
| Selling, general and administrative | 13.7 | % | 11.5 | % | ||||||||
| Research and development | 1.3 | % | 1.1 | % | ||||||||
| Operating expenses | 15.0 | % | 12.6 | % | ||||||||
| Operating income | 7.7 | % | 4.2 | % | ||||||||
| Income before income taxes | 7.4 | % | 3.8 | % | ||||||||
| Net income | 6.0 | % | 2.9 | % | ||||||||
| Income tax rate | 18.8 | % | 22.8 | % | ||||||||
|
Net Revenue by Product Category: |
||||||||||||
| Servers and Networking | $ | 4,027 | $ | 3,675 | 10 | % | ||||||
| Storage | 983 | 1,178 | (17 | %) | ||||||||
| Services | 4,020 | 3,806 | 6 | % | ||||||||
| Software and Peripherals | 5,136 | 5,031 | 2 | % | ||||||||
| Mobility | 9,477 | 9,263 | 2 | % | ||||||||
| Desktop PCs | 7,032 | 7,455 | (6 | %) | ||||||||
| Consolidated net revenue | $ | 30,675 | $ | 30,408 | 1 | % | ||||||
|
Percentage of Total Net Revenue: |
||||||||||||
| Servers and Networking | 13 | % | 12 | % | ||||||||
| Storage | 3 | % | 4 | % | ||||||||
| Services | 13 | % | 12 | % | ||||||||
| Software and Peripherals | 17 | % | 17 | % | ||||||||
| Mobility | 31 | % | 30 | % | ||||||||
| Desktop PCs | 23 | % | 25 | % | ||||||||
|
Net Revenue by Global Segment: |
||||||||||||
| Large Enterprise | $ | 9,061 | $ | 8,795 | 3 | % | ||||||
| Public | 8,224 | 8,436 | (3 | %) | ||||||||
| Small and Medium Business | 7,477 | 7,059 | 6 | % | ||||||||
| Consumer | 5,913 | 6,118 | (3 | %) | ||||||||
| Consolidated net revenue | $ | 30,675 | $ | 30,408 | 1 | % | ||||||
|
Percentage of Total Net Revenue: |
||||||||||||
| Large Enterprise | 30 | % | 29 | % | ||||||||
| Public | 27 | % | 28 | % | ||||||||
| Small and Medium Business | 24 | % | 23 | % | ||||||||
| Consumer | 19 | % | 20 | % | ||||||||
|
Consolidated Operating Income: |
||||||||||||
| Large Enterprise | $ | 952 | $ | 571 | ||||||||
| Public | 854 | 667 | ||||||||||
| Small and Medium Business | 867 | 636 | ||||||||||
| Consumer | 209 | (4 | ) | |||||||||
| Segment operating income | 2,882 | 1,870 | ||||||||||
| Severance and facility actions | (19 | ) | (81 | ) | ||||||||
| Broad based long-term incentives | (178 | ) | (174 | ) | ||||||||
| Amortization of intangible assets | (187 | ) | (175 | ) | ||||||||
| Acquisition-related | (140 | ) | (36 | ) | ||||||||
| Other (1) | - | (140 | ) | |||||||||
| Consolidated operating income | $ | 2,358 | $ | 1,264 | ||||||||
| Note: Percentage growth rates and ratios are calculated based on underlying data in thousands. | ||||||||||||
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Dell Reports Strong Second Quarter Financial Results Driven by Enterprise Solutions and Services
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