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What: Shares of embattled PC giant Dell (Nasdaq: DELL ) plummeted 17% on Wednesday after its quarterly results and guidance came in well below Wall Street expectations.
So what: Dell's first-quarter earnings and revenue fell a disappointing 33% and 4%, respectively, reigniting skepticism over management's much-ballyhooed turnaround efforts. Weak tech spending from corporations and increasing pressure from mobile threats like Apple on the consumer side continue to weigh heavily on results -- not to mention investor patience.
Now what: Management now expects second-quarter revenue growth of just 2% to 4% -- implying a total of $14.71 billion to $15 billion versus Wall Street's view of $15.44 billion. "This is a long-term strategy and will take time," CFO Brian Gladden reminded analysts in a conference call. "We're making progress and have several areas where our results are strong, proof points that our strategy's working." However, when you couple the quickly rising popularity of mobile devices with the macroeconomic headwinds working against Dell, I'd be cautious about buying into that turnaround talk.
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