Dell Makes Moves to Survive in Cloud-Centric World

Grazed from The New York Times. Author: Quentin Hardy.

Despite headwinds in its core business, Dell is trying hard to move into the new world of corporate computing.

On Tuesday, the company said that Marius Haas, a well-regarded executive with a noted history at Hewlett-Packard, would take over Dell’s Enterprise Solutions business, which sells the servers, network, and storage equipment for big corporate data centers and cloud computing systems.

It is a future that can’t come fast enough: Mr. Haas’s position was announced along with Dell’s second-fiscal-quarter earnings. Dell had net income of $732 million, or 42 cents a share, on revenue of $14.5 billion…

Net income was 18 percent below year-earlier levels, owing largely to a collapse in demand for personal computers and laptops. The data center and cloud equipment businesses looked relatively strong.

On a nonstandard accounting basis, Dell had per-share earnings of 50 cents a share. While this was higher than the 45 cents a share projected by analysts surveyed by Thomson Reuters, Dell’s stock traded lower after the markets closed because Dell had also projected that third-quarter revenue would be 2 percent to 5 percent below second-quarter levels.

The revenue drop seems mostly limited to what the company called “challenging” demand for PCs, laptops and peripheral devices, particularly by consumers. The Enterprise Solutions business Mr. Haas is heading grew 6 percent over the quarter, Dell said, looks strong in the current quarter as well and is expected to bring more revenue in the future.

Michael Dell, the founder, has already said he wants to move Dell into providing comprehensive solutions for big data centers. Mr. Haas will be an important part of making this work, in a world seemingly dominated by Google, Apple, and Microsoft.

In July, Dell said it would buy Quest Software, which makes software for things like data backup and data center management, for $2.4 billion. Deals like that take Dell further into enterprise software and data center management, an important way for Mr. Haas to also sell servers.

At H.P.,Mr. Haas, a Dutch national, led the fast-growing networking division, and before that he played an important role under Mark V. Hurd, then the chief executive, as the head of strategy and corporate development.

“He was one of Hurd’s golden boys,” said a former H.P. executive, who asked not to be named in order to maintain relations with many of the tech companies. “He was well liked by the board, and people thought he’d play a role in top management.” Mr. Haas left H.P. in 2011, after Mr. Hurd was replaced by Leo Apotheker. Before coming to Dell, he was at Kohlberg Kravis Roberts, looking for investments in technology for that company.

As the head of strategy at H.P., Mr. Haas learned about the company’s many enterprise computing businesses, and he probably developed relationships with senior corporate executives at a lot of big companies. He was also closely involved in some of H.P.’s biggest acquisitions, including the purchase of Electronic Data Systems for $13.9 billion in 2008.

That may not be something Mr. Haas wants to talk about. Last month, H.P. announced that it would take a charge of $8 billion against the E.D.S. acquisition, which never yielded the high-value growth H.P. had hoped for.