Dell 2009 Annual Report Download - page 37

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Table of Contents
year-over-year as we continued to align our prices and product offerings with the marketplace. During Fiscal 2010, desktop revenue
decreased across all segments.
Fiscal 2009 compared to Fiscal 2008
• Enterprise Solutions
Servers and Networking — During Fiscal 2009, revenue from sales of servers and networking products remained flat year-over-year
on a unit increase of 4%. The flat revenue growth was mainly due to demand challenges. To address the demand challenges and
drive growth, we adjusted our pricing and product strategy to shift our product offerings to lower price bands. Consequently, our
average selling price for servers and networking products decreased 3% year-over-year during Fiscal 2009. During Fiscal 2009, we
experienced double digit growth in blades, 4-Socket rack servers, and our cloud computing initiatives.
Storage — The growth in revenue from sales of storage products was led by strength in our PowerVaultTM line and the strong
performance of our EqualLogicTM iSCSI networked storage solutions, which we acquired in Fiscal 2008. SMB and Public
contributed to the increase in storage revenue with year-over-year growth of 36% and 15%, respectively, for Fiscal 2009.
• Services — Services revenue increased during Fiscal 2009 as our annuity of deferred services revenue amortization increased and
also as a result of a 10% year-over-year increase in consulting services revenue for Fiscal 2009. For Fiscal 2009, Public and Large
Enterprise led year-over-year revenue growth with increases of 18% and 8%, respectively. Consumer revenue declined 3% for Fiscal
2009. Our deferred service revenue balance increased 7% year-over-year to $5.7 billion at January 30, 2009, primarily due to strong
unit growth in the first half of Fiscal 2009.
• Software and Peripherals — The growth in S&P revenue during Fiscal 2009 was driven by strength in software licensing primarily
due to our acquisition of ASAP in the fourth quarter of Fiscal 2008. At a segment level, Public led the revenue growth with a 23%
year-over-year growth rate for Fiscal 2009. Large Enterprise and Consumer experienced revenue growth of 8% and 6%, respectively,
during Fiscal 2009, while SMB revenue decreased 9% year-over-year during Fiscal 2009.
• Client
Mobility — During Fiscal 2009, revenue from mobility products grew 4% on unit growth of 24%. The average selling prices of our
mobility products across all of our segments dropped 17% year-over-year due to a soft demand environment and the continued
expansion into retail by our Consumer segment. Expansion into retail also contributed to our overall revenue growth as mobility
revenue in Consumer increased 29% year-over-year on unit growth of 60%, as compared to a decline in mobility revenue of 8% on
unit growth of 6% in our Commercial business. Large Enterprise and SMB experienced declines in mobility revenue of 16% and
3%, respectively, on a unit decline of 2% and unit growth of 10%, respectively.
Desktop PCs — During Fiscal 2009, revenue from desktop PCs decreased year-over-year on a unit decline of 4%. The decline was
primarily due to the on-going competitive pricing pressure for lower priced desktops and a softening in global IT end-user demand.
Consequently, our average selling price for desktops decreased 6% year-over-year during Fiscal 2009 as we aligned our prices and
product offerings with the marketplace. For Fiscal 2009, desktop revenue decreased across all segments. Our Consumer, Large
Enterprise, SMB, and Public segments experienced year-over-year desktop revenue declines of 17%, 11%, 10% and 6%,
respectively.
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