Arik Hesseldahl

Recent Posts by Arik Hesseldahl

Dell Offers a Dividend, Giving Its Shares a Rare Reason to Rally

Shares of Dell did something in after-hours trading that they haven’t been known to do in recent months: They rallied.

The cause was news that the company would begin paying its first-ever shareholder dividend. Dell said it will pay 32 cents per share a year, or 8 cents a quarter. The company’s shares rose 33 cents, or more than 2 percent, to $12.30 a share.

CEO Michael Dell took to CNBC to discuss the move mere minutes after the announcement crossed the wires. (See video below.) In the segment, Dell reiterated the company’s strategy that calls for it to shift away from the personal computers for which it is best known and toward the enterprise IT solutions business.

To further that end, Dell has been on a surge of deal-making in recent months, spending about $400 million for Wyse Technology and $1.2 billion for security concern SonicWall, among others. Not all deals are getting closed. Dell appears to have walked away from a deal for Quest Software earlier this month.

Despite the pivot in strategy, Dell continues to struggle with meeting the expectations of investors. Last month it announced a big three-cent miss in its quarterly earnings, prompting investors to bolt. It was its second earnings miss in a row.

Dell’s CNBC appearance is below.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik