Dell looks outside US for growth opportunities

Posted on Saturday, June 07 2008 @ 10:25 CEST by Thomas De Maesschalck
Dell stated this week it will focus more on markets outside the US. The PC vendor says it expects 2/3rds of its sales to come from foreign sales in the next five years.
Dell posted a higher than expected profit last quarter attributed to cost cutting and a higher than expected amount of shipments in markets outside the United States. Dell, now the world’s second largest PC shipper, says that sales outside the U.S. market are growing much faster than at home. Last quarter was the first for Dell where revenue from international regions topped its revenue from the U.S.

Dell reported a 73% growth in PC shipments in Q1 with international regions including Brazil, Russia, India, and China as the top regions. Dell president of Asia-Pacific and Japan Steve Felice told journalists on a conference call that, “two-thirds (of Dell sales) could come (from sales outside the U.S.) in five years.”

The majority of Dell’s cost cutting methods that contributed to the better than expected profits came from layoffs and work force reductions. This year Dell has closed its PC plant in Austin, Texas and expects to cut 8,800 jobs. Dell is also going to increase component purchases from China to $23 billion this year from $18 billion last year to save on production costs according to Reuters.

About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.

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