Dive Brief:
- Dell Technologies Corporate Controller Yvonne McGill will transition into the company’s top financial seat following the retirement of CFO Tom Sweet, according to a Thursday filing with the Securities and Exchange Commission.
- Sweet and McGill will work together during the next few quarters to ensure a smooth transition, according to the company, with McGill taking on the role effective Aug. 5.
- The CFO swap comes as Dell and other players in the technology space face waning customer demand for electronic products such as PCs, as well as other cost pressures from a challenging macroeconomic environment. The company posted an 11% decline in revenue for its fiscal fourth quarter during its earnings results Thursday, with quarterly revenue coming in at $25 billion.
Dive Insight:
A 26-year veteran of Round Rock, Texas-based Dell, Sweet is the company’s longest-serving CFO, according to a statement sent to CFO Dive. He took on the seat in 2014, having previously served as the company’s chief accounting officer and in various financial roles, according to his LinkedIn profile.
McGill, who first joined Dell in 1997 — alongside her spouse, Bryan McGill who is currently employed by the firm — has served as the company’s corporate controller since 2020, according to the Thursday filing. She has held a variety of roles throughout her 25-year tenure, including serving as CFO and SVP for its Infrastructure Solutions Group beginning in 2018.
Citing ongoing macro pressures, including demand trends and currency headwinds, Dell expects its revenue for the first quarter of 2023 to be down by between 17% to 21%, Sweet said Thursday during the company’s earnings call. For the full year, the company expects revenue to fall by between 12% to 18%, implying a return to growth throughout the year given its Q1 guidance.
Dell will “continue to be mindful of our pricing discipline and our cost structure making adjustments as appropriate, depending on the environment while also continuing to invest in innovation,” Sweet said Thursday.
Dell reported record full-year revenue of $102.3 billion, according to its earnings results.
However, continued economic headwinds, including a lessening demand for electronics by consumers and waning customer spending, also led the company to report an 11% dip in fourth quarter revenue to $25 billion, according to its earnings results.
Dell also recorded a $281 million charge during its fourth quarter related to staff cuts. The company announced in early February plans to reduce its workforce by about 5%, or 6,650 employees, according to a company filing.
The company’s Client Solutions Group — which includes its hardware offers such as desktop PCs and notebooks as well as “peripheral” products such as monitors and printers — reported a 17% drop in revenue for its commercial segment to about $10.7 billion for the three-month period ending Feb. 3, compared to $12.8 billion seen in the prior period. Consumer revenue for the CSG segment, meanwhile, plummeted by 40% to $2.7 billion compared to $4.4 billion in the previous period.
Economic uncertainty has seen consumers pull back from purchasing PCs and other electronics since the end of last year. January research from Gartner found worldwide PC shipments for the fourth quarter of 2022 fell by 28.5% year-over-year to 63.3 million units.
Slumping PC sales also impacted first quarter revenue for HP, which reported a 19% drop in net revenue to $13.8 billion, according to the company’s earnings results published Tuesday. Consumer revenue was down 36%, with continuing soft demand impacting its first quarter results, CFO Marie Myers said.
Looking forward to the remainder of 2023, the company expects that the “macro and demand environment will remain challenged and that our customer end markets will remain competitive,” Myers said during the earnings call. “We remain focused on what we can control as we navigate these difficult market conditions.”
