The latest Dell Technologies financial results suggest a surge in on-premises IT spending is providing a boon to both Dell and its channel partners. For its most recent first quarter, Dell Technologies reported revenue of $21.4 billion, an increase of 19 percent over the previous quarter. Dell is still operating in the red with a loss of $153 million for the quarter. But the company’s overall cash position improved to $21. 7 billion and the company has now paid back a total of $13 billion in debt since acquiring EMC. Total debt has now been reduced to $39.8 billion.
A major contributing fact to growth this quarter has been a significant increase in storage revenue. Sales of storage for the previous quarters have been stagnant since the merger, which has to a degree belied the “better together” rationale that drove the merger with EMC. But over the last two quarter Dell Technologies has invested heavily in both direct and indirect sales program specifically aimed at boosting storage sales, says Cheryl Cook, senior vice president for global channel marketing at Dell EMC.
Improved storage sales along with continued growth in sales of PCs and servers, coupled with increase licensing revenue being generated by the VMware are of Dell Technologies is enabling Dell Technologies to now be “firing on all cylinders,” says Cook.
Growth in the sales of server, storage, and VMware software also suggests that despite a large number of workloads moving into public clouds, demand for IT infrastructure running in on-premises IT environments remains robust.
“We’ve always contended it’s going to be a hybrid model,” says Cook. “There is not a wholesale shift to the cloud underway.”
In fact, Cook notes Dell EMC is now number one in both server units shipped and revenue.
Cook credits channel partners with much of the company’s recent success. Dell channel partners alone brought in or reactivated over 14,800 customers in the most recent quarter, says Cook. Just as significantly, Cook says partners registered over 120,000 deals for the quarter, which suggests that partners continue to be engaged. That’s critical because it not only signals that Dell Technologies has opportunities to continue revenue growth, it means the company’s channel partners are not wasting time chasing the same deal, says Cook.
Dell’s share in the markets it competes in is still well less than 25 percent, so Cook concludes there’s still plenty of opportunities to grow revenue by taking share away from rivals. Cook notes that partners that leverage Dell financing have been especially successful at closing deals.
In the meantime, Dell channel partners should expect to see more growth following a slew of product introductions made during the recent Dell Technologies World conference. Those offerings have yet to ship in volume, which means whatever potential impact those offerings might have on the Dell balance sheet has yet to be felt.
Be First to Comment