Dell Technologies is projecting total sales to reach upwards of $103.3 billion by fiscal year 2022, a sales figure channel partners said they are optimistic the infrastructure giant can hit.
"Honestly if anyone is capable of that much growth, it's Dell," said Dan Serpico, president and CEO of FusionStorm, a top Dell global partner, ranked No. 51 on CRN's 2018 Solution Provider 500 list. "They have an enormous amount of solutions for arguably the broadest portfolio in the market, bar-none, between servers, storage, security, networking, cloud solutions, VMware – and are number one or number two in market share for nearly every platform. Based on our own growth with them, and our own growth as a company, I continue to see enormous opportunity in the industry for all of us."
In its longest reaching guidance since becoming private in 2013, Dell Technologies said it expects to generate $87.5 billion in total revenue for its current fiscal year 2019, up 9 percent from $79.9 billion in fiscal 2018, according to an Aug. 6 S-4 filing with the U.S. Securities and Exchange Commission.
The Round Rock, Texas-based vendor is projecting strong double-digit revenue growth over the next several years, with expectations to reach between $99.5 billion and $103.3 billion in total revenue in fiscal 2022.
Dell expects revenue for its Infrastructure Solutions Group (ISG), which includes storage, servers, data protection and networking, to reach $34 billion for fiscal year 2019. The company predicts ISG revenues to increase by more than $1 billion annually over the next three years, hitting $38 billion by 2022.
The vendor expects Client Solution Group (CSG) sales, which includes PCs, notebooks and workstations, to generate $42.5 billion in fiscal year 2019. Dell projects CSG revenues to grow more than $1 billion annually over the next three years to $47 billion in fiscal year 2022.
Scott Winslow, president of Winslow Technology Group, a Waltham, Mass.-based Dell partner, said he was "impressed" by the growth projections. "I don't know many large companies that are growing at this large clip," he said. "It's pretty impressive growth numbers."
Winslow was interested by VMware's importance to Dell Technologies overall earnings before interest, taxes and amortization (EBITA).
"VMware is the golden child in the portfolio," said Winslow.
Dell is expecting VMware to reach $8.8 billion in total revenue in fiscal 2019, representing approximately 10 percent of Dell's overall $87.5 billion sales projection. However, VMware's contribution to Dell's overall $9.7 billion EBITA for fiscal year 2019 is $3.2 billion.
VMware's total revenue is expected to reach $11.6 billion by fiscal year 2022 and represent $4.3 billion of Dell's total $9.1 billion EBITA in 2022.
Dell's SEC filing comes as the company is striving to win over investors for its bid to go public again as part of a share swap with its DMVT VMware software business tracking stock. The information in the 300-page SEC filing makes the case to investors to buy out the tracking stock linked to VMware. The move will require an approval vote from a majority of DVMT shareholders expected to take place later this year.
"I'm excited that Dell's as bullish as they are," said FusionStorm's Serpico. "For decades they've done a very good job in meeting the market where it is and positioning itself for the changes that are coming. If Dell is as bullish as they are, then they have to be bullish about both their own technologies and the industry as a whole. That speaks volumes for the opportunity that exists for us and the rest of the solution provider community."