Dell

Dell

Company Snapshot:

Dell Computers manufacturers computers and computer-related equipment which it sells directly to the public by phone or internet. The company employed 66,100 people and recorded sales of $55.91 billion in fiscal 2006.

Basic information

Ownership status:

Publicly traded

Chief executive officer:

Michael Dell

Website:

http://www.dell.com

Corporate accountability

Corporate accountability:

The Securities and Exchange Commission (SEC) began a formal investigation of Dell’s accounting and financial reporting matters. In August 2006, Dell revealed that the SEC was conducting an informal investigation regarding its accounting practices, including revenue recognition and end-of-quarter policies. The SEC first gave Dell notice about accounting practices in August 2005. Dell postponed reporting its quarterly results due to the “level of complexity” the company now faces with the SEC. BBC News, 11/17/2006

Miami resident Juan C. Arteaga initiated a class-action lawsuit against Dell Financial Services, LP, claiming the organization violated the Equal Credit Opportunity Act by denying credit to individuals based on their ethnic backgrounds. According to the complaint, Dell had confirmed Mr. Arteaga's credit application and had already applied his down payment for a new computer system when he was notified that the credit application was being denied because the company's verification department believed that Mr.Arteaga could not speak English and that a non-English speaker could not guarantee an account on the grounds that they may not understand the terms and conditions of the agreement. The case argues that despite Mr. Arteaga's impeccable credit, Dell made a judgment based on his accent and ethnic background. Dell's refusal to provide him credit is being referred to as a "clear and direct violation of the [Equal Credit Opportunity] Act." Daily Business Review, 05/08/2006

In 2006, Kevin B. Rollins, Dell's Chief Executive Officer, made $9.07 million in total compensation including stock option grants from Dell Inc. From previous' years, Rollins has another $106.07 million in unexercised stock options. AFL-CIO, 04/05/2006

According to the Social Investment Research Analyst Network, ten years after the Federal Glass Ceiling Commission recommended disclosure of diversity data as a way to remove barriers and promote women and minority advancement, most US companies still fail to fully disclose Equal Employment Opportunity data to the public. Dell is listed as one of the companies that does not provide full public disclosure. Rather, full disclosure is only made available to the public upon request. Social Investment Research Analyst Network (SIRAN), 12/07/2005

According to the North Carolina Institute for Constitutional Law (NCICL), Dell used unfair bargaining tactics to win $242 million in tax credits from the state government and an additional $37.2 million in local subsidies from city counsels in 2004. In the interest of creating more jobs, the state government made a generous deal with Dell involving perks such as a $15 per unit tax credit on every computer and consumer device produced in 2006, requiring local community colleges to create a Dell specific training program, and allowing $10,000 per year tuition deduction for Dell employees at Wake Forest University. In exchange, Dell was asked to meet limited constraints including covering some worker healthcare costs and not firing half of the plant's employees before an agreed upon date. TheRegister, 06/23/2005

During the 2002 election cycle, Dell gave $425,250 in soft money contributions, $415,250 of which went to Republicans, and $10,000 of which went to Democrats. Center for Responsive Politics

Labor:

Foxconn Electronics, a factory located in China that supplies $20.7 billion worth of products annually to Apple, Dell, Hewlett-Packard, Intel and Sony, and other top name brands, has come under criticism for alleged labor violations. According to British newspaper the Mail on Sunday, labor rights violations at Foxconn Electronics include the following:

* Wages below the legal minimum, with workers reportedly earning $50 a month

* Routine work shifts of 15 hours

* Poor and unsafe working conditions

* Inadequate dormitories

China Labor Bulletin research director Robin Munro stated, "They're not sharing proportionally in the benefits and profits in this huge globalization effort…. The only reason they can survive in these cities is because all they do is work." Foxconn states that there are huge discrepancies between the truth and allegations cited in the report. Associated Press, 06/16/2006

Environment and product safety:

Dell agreed to recall and replace 4.1 million of its laptop computer batteries made by Sony due to a glitch that can cause the batteries to burst into flames. The faulty Sony batteries were installed in notebooks that were shipped between April 1, 2004, and July 18, 2006. Dell spokesman Ira Williams stated, "In rare cases, a short-circuit could cause the battery to overheat, causing a risk of smoke and/or fire...It happens in rare cases, but we opted to take this broad action immediately." Press, 08/15/2006

Financial information

Detailed financial information

Stock ticker symbol:

DELL

Fortune 500 position:

102

Total revenue:

$55.908 billion

Fiscal year:

2006

Net Income:

$3.572 Billion

Fiscal year:

2006

Location

1 Dell Way

Round Rock, TX, 78682-2222

United States