Why dont you ask him for a source to back-up his assertions? I just did.
What they were talking about is a decrease in earnings per system ... that caused a shortfall in earnings on the revenue
http://www.nytimes.com/2005/08/1...11cnd-
dell.html
Dell Inc. said today that its second-quarter earnings jumped 28 percent, matching Wall Street's expectations, but investors were disappointed that revenue grew more slowly than anticipated.
The company, the world's largest computer maker, said slack federal government orders and its aggressive discounts on machines sold to consumers hurt revenue, which at $13.4 billion was up 15 percent from the second quarter of 2004.
Dell posted its earnings after the stock market closed and its shares fell 8 percent, to $36.45, in after
-hours trading. The stock closed regular Nasdaq trading down 15 cents, to $39.58.
Executives accepted the blame for the revenue shortfall, saying they offered consumers too good a deal on computers.
"We don't think the competitive environment has fundamentally changed a lot," Kevin Rollins, chief executive, said on a conference call with reporters. "Some of the lowering of average selling price was our fault. We got a little bit more aggressive than we needed to."
Typially, Dell lures consumers to its Web site and toll-free phone numbers by advertising cut-rate prices. Consumers are offered extra memory, faster chips and other upgrades that can increase the final price by hundreds of dollars. This time, that approach did not work as well as it has in the past.
Dell's average total revenue per product fell to $1,480 from $1,610 a year earlier and $1,520 in the first quarter.
Al,
They may have decreasing average sales price (as many technology firms do), and even decreasing margins.
This doesn't make Huffington's headline true. Earnings and average sales price are two entirely different things. The writers at Huffington Post apparently can't tell the difference.
Commenting by HaloScan
