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Dell posts 79% fall in profits amid takeover battle | Dell posts 79% fall in profits amid takeover battle |
(1 day later) | |
Dell has reported a 79% slide in net profit, underlining a fall in personal computers sales as more consumers shift to smartphones and tablets. | Dell has reported a 79% slide in net profit, underlining a fall in personal computers sales as more consumers shift to smartphones and tablets. |
The PC maker's net profit fell to $130m (£85m) in the three months to 3 May, on revenue down 2% to $14bn. | The PC maker's net profit fell to $130m (£85m) in the three months to 3 May, on revenue down 2% to $14bn. |
Dell is in the middle of a dispute between founder Michael Dell and two of its biggest shareholders. | Dell is in the middle of a dispute between founder Michael Dell and two of its biggest shareholders. |
Mr Dell wants to take the company private, but some investors oppose the plan. | Mr Dell wants to take the company private, but some investors oppose the plan. |
Mr Dell, and private equity group Silver Lake, have offered to buy back the company for $24.4bn, and have pledged to shift the business away from PCs to mobile devices. | Mr Dell, and private equity group Silver Lake, have offered to buy back the company for $24.4bn, and have pledged to shift the business away from PCs to mobile devices. |
But its biggest shareholders - the investor Carl Icahn and Southeastern Asset Management - have argued that the valuation of the company is too cheap, and that Mr Dell's deal is a "giveaway". | But its biggest shareholders - the investor Carl Icahn and Southeastern Asset Management - have argued that the valuation of the company is too cheap, and that Mr Dell's deal is a "giveaway". |
Instead, they have proposed to offer additional shares to shareholders and install new management. | |
In its quarterly results, Dell said that revenue from new technologies, services and software, rose 12% to $5.5bn. That was in contrast to PC sales, which fell 9%. | In its quarterly results, Dell said that revenue from new technologies, services and software, rose 12% to $5.5bn. That was in contrast to PC sales, which fell 9%. |
The company did not issue a profit guidance for the second quarter due to the ongoing dispute. It has created a special committee of the board to study the private equity deal and alternative bids. | The company did not issue a profit guidance for the second quarter due to the ongoing dispute. It has created a special committee of the board to study the private equity deal and alternative bids. |
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