Dell blames its financial problems on sluggish Windows 8 adoption, a slowdown in Windows 7 upgrades and longer enterprise PC replacement cycles

Dell says financial woes caused by Windows 8

The “uncertain adoption” of Microsoft’s Windows 8 operating system and the slowdown in Windows 7 upgrades are partly responsible for Dell’s financial problems, according to a proxy statement filed by the company with the United States Security and Exchange Commission (SEC).

The statement presented to Dell shareholders the company’s case for accepting a $24.4 billion offer made by founder and CEO Michael Dell and private equity firm Silver lake Partners to buy the company and make it private. Microsoft Corp. is contributing $2 billion to the purchase.
 

“The difficult environment faced by the Company as a result of its underperformance relative to a number of its competitors (includes)…the uncertain adoption of the Windows 8 operating system,” the filling said. Dell also blamed “unexpected slowdowns” in Windows 7 upgrades in the enterprise space and the decision of many companies to extend their PC replacement cycle to save money.

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Dell also admitted that it sells a limited number of tablets and does not manufacture smart phones, both very popular devices in the market.

Dell, which ironically has a long history of partnership with Microsoft, is still the world’s third largest PC manufacturer, accounting for 10.6 per cent of the market share in the final quarter of 2012, according to analyst firm IDC.

Dells personal computer and associated products and services which the proxy called end-user computing (EUC) business, makes up 65 per cent of the company’s revenue.

Michael Dell and his co-investors favour a strategy that would focus more on moving to the more profitable enterprise services side of the business than EUC.

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