Dell Technologies (NYSE:DELL) saw its shares fall as much as 5% in after-hours trading Thursday as the company gave a financial outlook that suggested tough times are in the making for the PC giant.
Speaking on a conference call, Dell (DELL) Chief Financial Officer Tom Sweet said that for its fiscal third quarter, the company expects to report earnings, excluding one-time items of $1.53 to $1.79 a share, on revenue in range of $23.8B to $25B. During its third quarter a year ago, Dell (DELL) earned $2.37 a share, on $28.4B in revenue.
Sweet said Dell (DELL) began seeing issues affects PC sales taking effect in May. As for where the company is headed, Sweet said Dell will "remain focused on what we can control."
Sweet also said that for its full 2023 fiscal year, Dell (DELL) expects revenue to be either flat, or up by 2% from the $101.B it reported last year.
The outlook came along with Dell (DELL) reported slowing revenue growth in its second quarter amid an industry that is seeing more impacts from a strong U.S. dollar and customers postponing their big technology expenses.
After U.S. stock markets closed, Dell (DELL) reported a second quarter profit of $1.68 a share, excluding one-time items, on revenue of $26.4B. Wall Street analysts had forecast Dell (DELL) to earn $1.64 a share, on $26.47B in revenue.
In addition to Dell's (DELL) sales falling shy of expectations, the company's revenue grew just 9% from the $24.2B the company reported a year ago. Dell (DELL) said its results also included a $66M impact from foreign currency exchange rates.
Jeff Clarke, Dell's (DELL) co-Chief Operating Officer, said in a statement that the company did "execute well" despite dealing with what he said was an "increasingly challenging environment."
Among its individual business areas, Dell (DELL) said its client solutions group, which includes desktop and laptop PCs, turned in revenue of $15.5B, up 9% from a year ago. Commercial revenue rose 15%, to $12.1B, but consumer sales fell by 9% from a year ago, to $3.3B.
Infrastructure solutions, which includes items such as networking, storage and servers, totaled $9.5B, up 12% from the same period last year.
Prior to Dell's (DELL) results, Bank of America analyst Wamsi Mohan on Tuesday cut his fiscal-year estimates on Dell (DELL) due to what he said was continuing weakness in the PC market, and the impact of foreign currency exchange rates.