Dell's Sales Play Pinches Profit

Dell(DELL Quote) blew past Wall Street's revenue estimates in its fiscal second quarter, but the company's efforts to stoke sales dented the bottom line, pushing net income down 17%.

Dell said the profit pressure was a result of decision to expand sales to consumers across the globe as well as to customers in the Europe, Middle East and Africa region, where Dell said it grew unit shipments of servers faster than any of its major competitors.

"Strategic actions to accelerate growth in certain areas of our business affected gross margins this quarter and there will likely be some non-linearity in the improvements in our operating income margins as we rebalance our portfolio, make cost improvements and drive growth," said CFO Brian Gladden in a statement. ...