Dell Technologies Inc. Q4 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Overview

  • Dell delivered record FY2023 revenue of $102.3B (up 1% vs. FY2022), record operating income of $8.6B (up 11%), and record EPS of $7.61 (up 22%).
  • The year showed a split in performance: first-half revenue grew 12%, but softened materially in the second half, falling 9% as macro conditions weakened.
  • Infrastructure Solutions Group (ISG) remained a bright spot with strong share gains and record results in both servers and storage.
  • Client Solutions Group (CSG) (PCs) continued to face significant market contraction, particularly in consumer PCs.

Q4 FY2023 Results

  • Q4 revenue: $25B, down 11% year over year.
  • Operating income: $2.2B, down 1% year over year.
  • EPS: $1.80, up 5% (helped by lower share count).
  • Currency was a 410 bps revenue headwind.

Business Segment Highlights

Infrastructure Solutions Group (ISG)

  • Q4 revenue: $9.9B (up 7%).
  • Storage revenue: $5B (record; up 10%).
  • Servers & Networking revenue: $4.9B (up 5%).
  • Operating income: $1.5B (record; 15.6% margin, +360 bps vs. prior year).
  • Momentum was driven by strong demand in very large customers, improved attach rates, and strong storage software mix.

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Operator: Good afternoon, and welcome to the Fiscal Year 2023 Fourth Quarter and Year-end Financial Results Conference Call for Dell Technologies Inc. I'd like to inform all participants this call is being recorded at the request of Dell Technologies. This broadcast is the copyrighted property of Dell Technologies Inc. Any rebroadcast of this information in whole or part without the prior written permission of Dell Technologies is prohibited. Following prepared remarks, we will conduct a question-and-answer session. [Operator Instructions]. I'd like to turn the call over to Rob Williams, Head of Investor Relations. Mr. Williams, you may begin. Rob Williams : Thanks for joining us. With me today are Jeff Clarke, Chuck Whitten, Tom Sweet and Tyler Johnson. Our earnings materials are available on our IR website, and I encourage you to review our materials and presentation which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial measures refer to non-GAAP financial measures, including non-GAAP revenue, gross margin, operating expenses, operating income, net income and diluted earnings per share. A reconciliation of these measures to their most directly comparable GAAP measures can be found in our web deck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that

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