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Life has been hectic for Dell over the past few years. The onetime global leader in PCs lost its place to HP during 2007, before facing an equally daunting challenge from Lenovo, which managed to over-leap both Dell and HP by 2013. Most damaging of all was the dramatic slump in PC sales as a result of surging demand for tablets. Key to Dell's original success had been its decision to focus on a direct sales model, selling only via the internet, telephone and mail order in order to provide high quality technology at the lowest cost. Other companies attempted to emulate the formula, but for many years none was able to match Dell's efficiency or success. Eventually, though, Dell became distracted by other issues, including internal control problems, and it struggled to keep abreast of the fast-changing market. To fix those problems away from the glare of a public listing, founder Michael Dell launched a $25bn bid to take the business private again in 2013. Two years later, he unveiled an equally bold plan to acquire storage and services company EMC for around $63bn. That deal, then the biggest to-date in the tech industry, created a new IT giant with combined sales almost $80bn. At the end of 2018, the group returned to the stock market with a complicated buyout of publicly quoted part-subsidiary VMware. It spun off VMware again in 2021 but retain its own public listing. Michael Dell remains chairman & CEO of the greatly enlarged business, which reported record revenues of $94.2bn for the year to Jan 2021, with net income of $3.5bn. Desktops and laptops accounted for roughly half of sales, servers and storage for around a third. Products accounted for three-quarters of sales, and services for the remainder. Dell is the #3 PC manufacturer globally (and #2 in the US), with around 17% global share in 2020, and also makes a variety of related hardware including servers and storage devices. It is the global leader in servers and enterprise storage with around 25% share. However the main business is surrounded by a collection of services businesses offering IT consultancy, networking, cloud computing, data management and analytics including VMware, Pivotal, ScureWorks, RSA Security and Boomi.
Capsule checked 25th May 2021
Adbrands Account Assignments tracks account management for the world's leading brands and companies, including details of which advertising agency handles which accounts in which countries for major markets.
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Historical profile information for Dell
Adbrands Update 2nd Mar 2022: A stream of companies in the US and Europe have suspended operations in Russia in response to President Putin's unprovoked invasion of Ukraine. Apple has suspended sales of all products in that country as has Dell. US oil giant Exxon followed in the footsteps of BP and Shell in halting production in its joint venture with Rosneft and other companies and said it will exit that business. In Germany, BMW halted exports of new vehicles to Russia and will cease local assembly of cars at its local joint venture. Volkswagen warned that production in Germany would be impacted by its inability to import certain components from suppliers in Ukraine.
Adbrands Daily Update 3rd May 2021: In a further restructuring of its portfolio, Dell has sealed a deal to sell its cloud software subsidiary Boomi to private equity investors. Owned by Dell since 2010, the business makes iPaaS (integration platform as a service) software that allows cloud-connected companies to integrate all their communications and IT operations across multiple locations. Two firms, Francisco Partners and TPG, are jointly buying the unit for $4bn.
Adbrands Daily Update 15th Apr 2021: Dell will spin-off the bulk of its holding in cloud software provider VMware before the end of 2021, and use the proceeds to pay down its still sizeable debt mountain. It currently owns 81% of VMware, with the remaining shares publicly owned. Dell said it will spin off its entire holding to its own shareholders, while also paying a special dividend to VMware shareholders totalling $12bn. As a result, as VMware's biggest shareholder, it will pay itself the bulk of that sum, or around $9.7bn. Though separate, the two companies will continue to have close commercial ties. [Updated: In May 2022, VMware accepted a deal to be acquired by chip and infrastructure group Broadcom for $69bn.]
Adbrands Daily Update 29th Dec 2018: Dell returned to partial public ownership for the first time since 2013 in a complex $24bn cash and stock buyout of quoted software developer VMware, in which it was already the biggest shareholder. It bought out VMware's other investors, inheriting the process the smaller company's existing stock market listing. Dell himself retains a 55% stake in the combined business, while private equity backer Silver Lake Capital has 18%. Around 22% of shares are publicly traded. Revenues for the current year to Feb 2019 are expected to come in at between $90.5bn and $92bn.
Adbrands Weekly Update 19th Jul 2018: New research from both IDC and Gartner suggests that the global PC market enjoyed its strongest quarter for six years. According to IDC, total PC shipments rose 2.7% to almost 62.3m devices, the best growth since 1Q 2012. However the growth was largely confined to the five leading manufacturers, all of whom reported a positive lift at the expense of other suppliers, who suffered a combined 11% decline. HP retained its position at the top of the table, though Lenovo closed the gap slightly as a result of its newly minted joint venture with Fujitsu of Japan. Dell remains 3rd, while Apple showed the weakest year-on-year growth (of just 0.1%) in 4th place. Acer rounded out the top five, with Asus ranked 6th globally. The top six companies alone account for well over 80% of total volumes.
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