Recently, Dell Inc. announced plans to continue its workforce reduction in 2024 to control costs. According to the latest company announcements, Dell intends to reduce its employee count by the end of the fiscal year in February 2025 through measures such as limiting external hiring and restructuring positions.
This decision reflects Dell's cautious approach in the current economic environment, especially after experiencing two consecutive years of revenue decline.
Although Dell has expanded its sales of high-performance servers in the AI field, the relatively high costs of AI chips have put pressure on the company's profit margins. In the most recent quarter, Dell's AI server sales increased, and although overall profits improved compared to the previous quarter, profit margins were still affected. Facing fierce market competition, Dell's investments in AI products, while laying a foundation for the future, have posed short-term financial challenges.
It is worth noting that Dell's personal computer business has seen a significant decline over the past two years. Financial reports show that Dell's revenue for the second fiscal quarter reached $12.4 billion, a 4% decrease year-over-year. Among this, commercial PC revenue remained stable, but consumer PC revenue plummeted by 22%. This trend has made it more urgent for Dell to find new growth points in its overall business.
Against this backdrop, Dell's layoff plan and investment in AI servers are both aimed at reducing costs and strategically positioning for future development. In June of this year, Dell already conducted layoffs in the sales department, with the exact number undisclosed.
Key Points:
🌐 Dell plans to continue layoffs in 2024 to control costs, with a projected reduction in employee numbers.
📈 AI server sales have increased, but profit margins are affected by high costs.
💻 Dell's PC business has declined for two consecutive years, with a 4% year-over-year decrease in revenue for the second fiscal quarter.