4 April 2003 PC maker Dell has told Wall Street analysts that it expects to nearly double its $35 billion revenues to $60 billion over the next few years through a concerted push into servers, storage, printers and services.
Founder and CEO Michael Dell said that he believe the “the back end data centre is staring to transition” to PC-derived technologies. If this is the case, it is likely to benefit companies that are strongest at the low and middle sectors of the IT infrastructure market, such as Intel, Microsoft and Dell, he said.
Dell reported fourth quarter 2002 revenues up by one-fifth to $9.7 billion. Net income grew by a third to $603 million, in spite of the industry-wide slowdown in IT. Dell has told analysts it expects revenues to rise 18% during the first quarter.
Strong server and storage sales are the main reason for Dell’s continued strong growth. However, the company also says it continues to gain share in the PC market.
James Schneider, Dell’s Chief Financial Officer, said that the company is “taking market share in all products, segments and geographies”. He pointed out that even in PCs, Dell only accounted for 20 million of the 135 million sold worldwide.
To strengthen its hand in the corporate sector, Dell recently allied with storage maker EMC — once derided by Michael Dell as the “Excess Margin Corporation” — and business software supplier Oracle.
Industry analysts are forecasting that corporate IT sales will either be flat or grow slowly for the next two years. Over the longer term, sales growth will be pegged to the global growth in gross domestic product. This suggests that, in order to grow as fast it is forecasting, Dell will need to take huge swathes of business from rivals such as IBM and Hewlett Packard.
