Tag: Dell

Corporate axeman visits Dell

shining_2380857bSoon after the ink dried on the EMC Dell merger, the ruler of the new companies, Michael Dell has called up the corporate axeman to slice up those who are not worthy to be in the new kingdom.

Dell will cut 2,000-3,000 jobs, mostly in the United States and mainly in the supply chain, marketing and general and administrative divisions.  Actually it could be a lot worse. the combined company has 140,000 employees so 2-3000 people is just a drop in the bucket.

The figure comes from Bloomberg which is quoting its own deep throats. The figure strikes us as a little low.

Dell spokesman Dave Farmer said that it is common with deals of this size, there will be some overlaps we will need to manage and where some employee reduction will occur.

We agree, which is why we think the 2-3000 figure is either the first wave or the most obvious duplications.

Dell, which was taken private by founder Michael Dell along with private equity firm Silver Lake Management in 2013, agreed to buy EMC for $67 billion in October last year.



Apple’s PC business bites the fruit of doom

poison-appleThe fruity cargo cult Apple has managed to ward off the downturn in the PC market for a while now – thanks mostly to its fanboys refusing to buy anything without an Apple logo.  However, all that has suddenly changed.

Apple shipped eight percent fewer Mac computers during the second quarter of 2016, compared with a year earlier, according to new estimates from two research firms.

What should be worrying Jobs’ Mob is that some of its bigger rivals managed to find growth in the PC business. So the concept that Apple will always have a market for its products is proving groundless.

Analysts estimate Apple shipped 4.4 million to 4.6 million Macs in the quarter ending June 30. True, they had a higher margin than other PCs in the market, but if a couple of fanboys refuse to buy a Mac then the figures take a bigger kicking.

The Tame Apple Press is doing its best, saying that that the whole of the PC market is suffering and it was wonderful that Apple saw off the inevitable for so long. However.

But HP, Dell and ASUS all increased their shipments during the last quarter, and benefited from a healthy US market. This is a bit weird given that is the same market which Apple is supposed to be doing well in.

Some of the problem is that Apple has basically ignored the Mac and not bothered to upgrade its MacBook Pro. Instead the company has been promoting its Surface Book clone so that it probably only has itself to blame.


Dell has a few problems buying EMC

Dell's Computer Shipments Increase 28% In ChinaTin box shifter Michael Dell is having a few problems getting the cash he needs to buy EMC.

The commitment deadline on $10 billion of pro-rata loans in a $45 billion financing package backing computer giant Dell’s  EMC purchase has been extended .

One of the problems was the Chinese New Year, which delayed approval of requests from foreign banks’ home offices to participate in the financing.

Asian banks — Chinese and Taiwanese — have balance sheets and an ancillary connection with Dell and EMC, and at the moment they are short on the paperwork.

But this, coupled with sinking oil prices, equity sell-offs and increased dollar funding costs are making it more expensive for some banks to lend and were expected to make Dell’s pro-rata loans a tougher than expected sell.

Some of the people behind the deal are a little worried. The size of the loans was challenging but trying to do it right now  makes it harder.





Dell’s $10 billion pro-rata loans include a $3.5 billion three-year term loan, a $3.5 billion five-year term loan and a $3 billion five-year revolving credit facility.

The loan package also includes an $8 billion seven-year Term Loan B that will be sold to institutional investors and $25 billion of high-yield bonds, both of which will come to the market before the acquisition is scheduled to close in August.


However the thought is that even if the deal takes longer to sell, Dell’s strong enterprise-oriented business model, the credit quality of the name (expected corporate ratings Ba1/BB+, expected debt ratings Baa3/BBB), and a focus on paying down debt are seen encouraging banks to absorb the pro-rata loans.

Thin clients shipments get slimmer

HP logoIDC reported that the thin and terminal client market fell in the third quarter of 2015 by 6.7 percent.

Budget contraints and a move to use repurposed PCs and Chromebooks affected sales in the third quarter.

IDC said its overall forecast for the year will fall by over six percent compared to 2014.

But the market research company believes that shipments will grow between next year and 2019.

HP kept its lead in the market, with 26.9 percent. But hot on its heels was Dell with a 26 percent share. Ncomputing, Centerm, Igel and others made up the total figure.

HP’s share fell by 8.2 percent in the quarter, while Dell fell by 10.6 percent.

Dell to float SecureWorks

Dell logoTin box shifter Michael Dell’s cybersecurity unit SecureWorks has filed for an initial public offering with U.S. regulators.

SecureWorks said it intends to list its Class A common stock on the Nasdaq under the symbol “SCWX” which is suitably cryptic.

Dell bought the outfit in 2011 and it could be worth as much as $2 billion, though the target valuation was not finalised. The filing did not reveal how many shares were planned for sale in the IPO or their expected price. The company set a nominal fundraising target of $100 million.

However all that changed when Dell agreed to buy data storage company EMC Corp for $67 billion in October. His plan was to diversify from a stagnant consumer PC market and give it greater scale in the more profitable and faster-growing market for cloud-based data services. This meant doing something with the security company and raising a bit of cash through it.

There are no indications that he is planning to sell off any of his stake in the company once the IPO is completed, but it is a pretty good bet.

Dell is also reportedly looking for a buyer for its $5 billion outsourcing business, which it acquired in 2009 when it bought Perot Systems for $3.9 billion.



Dell can buy back VMWare shares

Dell logoTinbox shifter Michael Dell said he could write a $3 billion cheque to buy back VMWare tracking stock to help finance its EMC acquisition.

This is important as it shows that Dell is working out ways to jack-up VMware’s value. The plans to issue a tracking stock have weighed on VMware’s common shares, which have lost a quarter of their value since the acquisition of EMC was announced in October.

Under the deal, EMC shareholders will receive 0.111 VMware tracking share for each EMC share, a move intended to give investors exposure to VMware, which is growing faster than EMC.

Dell said in a registration statement Monday that Dell “intends to consider opportunities to repurchase shares.”

Dell said it could support up to $3 billion in share repurchases and other types of payments and that the amount may increase over time, depending on its net income.

Dell said its goal will be to reduce its debt load in the first 18 to 24 months to achieve an investment-grade rating. Dell will have $49.5 billion in debt under current plans to finance the EMC deal.

Dell has reduced its debt by $4.5 billion, including $2.5 billion paid off by Dell itself. In addition, Denali Holdings, the holding company owned by private equity firm Silver Lake Partners and Michael Dell that controls Dell, paid off a $2 billion loan from Microsoft.

Enterprise server storage worth $9.1 billion

EMC storageWorldwide revenues from enterprise storage systems grew by 2.8 percent in the third quarter and amounted to a figure of $9.1 billion.

That’s according to a report from IDC, which said capacity shipments were up by 31.5 percent compared to the same quarter last year, and amounting to 33.1 exabytes.

Original design manufacturers (ODMs) which sell directly to hyperscale datacentres appeared to do the best, with this section of the market growing by 23.4 percent year on year with revenues of $1.3 billion.

While external storage systems is the biggest market segment, the $5.8 billion of sales showed a fall of 3.1 percent, year on year.

EMC was the leader in the quarter with 18.4 percent of revenues, followed by HP (16.3%), Dell (9.9%), NetApp (7.1%), IBM (6.4%). The ODMs took 13.7 percent share.

Server revenues and shipment numbers up

destroyedserverShipments of servers worldwide in the third quarter of this year grew by 9.2 percent, while vendors’ revenues grew 7.5 percent.

But, according to Jeffrey Hewitt, a research VP at Gartner, there were mixed results depending on the regions. “All regions showed growth in both shipments and vendor revenue, except for Eastern Europe, Japan and Latin America, which posted revenue declines of 5.8 percent, 11.7 percent and 24.2 percent respectively,” he said.

The reason for the differences in regional performance were mostly down to currency fluctuations, he said.

The Asia Pacific region showed a 23.8 percent shipment increase, with revenue growth at 25.4 percent.

HP dominates the worldwide server market, followed by Dell, IBM, Lenovo and Cisco.

IBM showed a decline of 42.8 percent but that’s mostly because it sold its server business to Lenovo. However, its mainframe business grew by 15 percent, Gartner said.

The RISC, Itanium and Unix server revenue declined by 11.5 percent during the quarter.

All-in-one PC sales show a fall

IBM PCAll-in-one PCs were a great hope for PC vendors as the traditional desktop market fell, but a report suggests that sales are set to fall this year.

According to Digitimes Research (DR) only 13 million units will ship tgis year, a decline of 3.9 percent compared to 2014.

DR said that sales are expected to be flat in 2016 or even fall by around half percent.

If all-in-one PCs are included as overall desktop shipments however, they account for 10.5 percent of the total.

Lenovo was top of the pile this year, with Apple taking second place and with both vendors holding 60 percent of the total shipments.

Third, fourth and fifth are HP, Dell, and Acer.

The machines are mostly manufactured by Taiwanese original design manufacturers – the usual suspects like Quanta, Wistron, Compal and others supply 90.1 percent of the machines to the brand name vendors.

Microsoft kills dodgy security certificates

bugSoftware giant Microsoft has killed off two dodgy security certificates being used on Dell bloatware.

Updates apply to Windows Defender for Windows 10 and 8.1; Microsoft Security Essentials for Windows 7 and Vista; and its Safety Scanner and Malicious Software Removal tool, will remove the certificates.

Dell mistakenly included private encryption keys for two digital certificates installed in the Windows root store as part of service tools that made its technical support easier. The tools transmit back to Dell what product a customer is using.

However the private keys in both of the digital certificates could be used by attackers to sign malware, create spoof websites and conduct man-in-the-middle attacks to spy on user’s data.

One of the certificates is named eDellRoot and the other DSDTestProvider. Exposure to the latter certificate was likely more limited, as users had to download it, and the risky version was only available between October 20 and November 24, Dell claoms.

But the eDellRoot certificate, however, shipped with many new Dell laptop and desktop models. Also, older computers that ran the support tool, Dell Foundation Services (DFS), may also have been affected if DFS was configured for automatic updates.

Dell has issued an upgrade itself to remove the certificates, and it also described how to remove the certificates manually. Microsoft’s tool may help those who for one reason or another haven’t either downloaded or received the updates from Dell.