Dell Earnings: AppAssure, Wyse, SonicWall Win Big Amid PC Weakness
Dell’s Q2 2013 quarterly earnings (announced today) disappointed Wall Street, and the company cut its full-year earnings expectations amid the wait for Windows 8. But take a closer look and you’ll find financial bright spots involving Dell’s AppAssure, Wyse and SonicWall acquisitions. Here’s the update.
In the second quarter of 2013, Dell completed its Wyse and SonicWall acquisitions. Both deals are off to strong starts, according to Dell CFO and Senior VP Brian T. Gladden. “Both are off to great starts, and their pipelines are up more than 35 percent sequentially. We’re also excited about the pending acquisition of the Quest Software, which we expect to close in the second half of the third quarter.”
Michael Dell said recent acquisitions are creating pull for Dell’s infrastructure solutions — storage, networking and servers. Said Dell:
“For example, when you think about AppAssure — which was already growing very fast in the backup, recovery, replication, and high-availability space — it turns out that a lot of customers are deploying unique server and storage environments for AppAssure. And so you’re going to see us leverage our infrastructure strength with our emerging software capabilities as we complete the Quest acquisition to drive even further growth there.”
Dell announced plans to acquire Quest Software for $2.4 billion a few weeks ago. It’s part of a larger strategy, led by Dell Software President John Swainson, to drive $5 billion in software revenue by 2016.
Still, Dell faces big challenges. Most of Dell’s revenues involve PCs — and that business is struggling amid weak overall global demand and fierce competition from Lenovo. For its Q2 2013, Dell’s revenues dropped 8 percent to $14.5 billion, and earnings per share dropped 13 percent.
For Dell’s channel partners the message seems clear: Amid challenging times in the PC and notebook markets, zero in on Dell’s acquisitions for opportunities — AppAssure, Wyse and SonicWall among them.