Dell: Fiscal 3Q11 Financial Results

Dell Inc. reported financial results for the third quarter of fiscal 2011, ended October 29, 2010.

The company’s EqualLogic business grew yearly 66 percent but total storage business including products from EMC was up only 7% for the same period. Sequentially, storage revenues decreased by 13%, representing now just 3% of its total revenues against 4% for the preceding quarter. Dell needs really to acquire a storage company to fill its non iSCSI mid- and high-range market after losing to get 3par and Isilon.

During the earnings call, Michael Dell, chairman and CEO said:" If you look at our storage business, we had EqualLogic growing 66%. It’s now over $800 million run rate. We continue to invest in that business. You’ve seen how we have purchased Exanet to add NFS file system capability, Ocarina to add deduplication and compression capability. We are going to continue to build out that portfolio. We have a ten-year relationship with EMC. That relationship continues to evolve, and believe that we’ll continue to be working with them as well. So when we look at the growth in the gross margins in our storage business we are quite pleased. The gross margin in this business has roughly doubled over the course of the last two years. So we are very focused on continuing to grow our storage business. And for us the measures of success are profitability. And pretty pleased with the progress we’re making."