Dell stock falls after pessimistic outlook; company announces CFO change

The computer company posted record sales for the year, though its fourth-quarter sales were down year over year. But on the call, executives said both corporate and consumer spending are slowing, though they expected things to get better later in the year.

Chief Financial Officer Tom Sweet said on the call that he expects first-quarter revenue to be down 15% to 21% year over year, more than the seasonal average.

“The broad caution in the IT spending environment that we called out in Q2 continues,” Chuck Whitten, co-chief operating officer, said on the call.

Dell reported fourth-quarter net income of $606 million, or 84 cents a share, compared with a loss of $29 million, or 4 cents a share, in the year-ago period. Adjusted for stock-based compensation, amortization and other costs, earnings were $1.32 billion, or $1.80 a share. Revenue fell to $25 billion from almost $28 billion in the year-ago quarter.

Analysts surveyed by FactSet had forecast adjusted net income of $1.2 billion, or $1.64 a share, on revenue of $23.42 billion.

For the full year, Dell reported net income of $2.42 billion, or $3.24 a share, on revenue of $102.3 billion. Adjusted earnings were $7.61 a share, adjusted for stock-based compensation, amortization and other costs. Analysts had expected adjusted earnings of $7.46 a share on $100.6 billion in revenue.

The company also announced a 12% increase in its annual cash dividend, to $1.48 a share.

In addition, Sweet will retire at the end of the second quarter, and current corporate controller Yvonne McGill will become CFO at that time, according to a company news release.