Tin box shifter Dell wants to increase the size of its software business by five times.
John Swainson, who was the former chief executive of CA Technologies until he joined Dell earlier this year, thinks that it can eventually make more than a quarter of Dell’s cash.
Software is a higher margin business than most of the company’s other units, but is not big enough to make a difference right now.
Talking to Reuters, Swainson said that Dell has been diversifying away from PCs and sees software and services as key growth areas.
His goal is to get to a meaningful figure like $5 billion. If Dell were to get to a $5 billion software business, with 30 percent margins, that would be roughly $1.5 billion in net income.
At the moment Dell’s software business makes about $1.2 billion of its $60.2 billion annual revenue.
Swainson said the $2.4 billion acquisition of Quest software was one of the steps to getting there.
However, he said that Dell was not planning to buy any more software companies of Quest’s size in the near-term, but he did not rule out buying a few smaller companies.