Dell, HP say chip shortages will hit PC supplies this

(Reuters) -Dell Technologies Inc and HP Inc reported quarterly revenue that beat Wall Street estimates on Thursday, as customers continued to shop for personal computers, even as pandemic-led restrictions eased in many parts of the world.
However, shares of Dell fell 1%, while those of HP dropped as much as 6%, after both companies warned the ongoing computer chip shortage could impact their ability to meet demand for laptops this year.

“The component supply situation remains constrained,” Dell Chief Financial Officer Thomas Sweet said in post earnings call, adding that rising costs to procure these chips would hit its operating income in the current quarter by the low to mid-single digits and lead to slightly lower revenue on a sequential basis.

HP Inc, which ranks second among global PC vendors according to IDC data, said the shortages would limit its ability to supply personal computing devices and printers at least until the end of the year.

Still, the companies, which are leaders in the personal computing industry, said they were bullish on the overall market, expecting the surge in demand for laptops needed by people working and going to school remotely to continue.

Global shipments of PCs, the industry’s collective term for laptops and desktops, grew 55.2% during the first quarter, according to preliminary data from research firm IDC.

Dell said revenue from its client solutions group, which includes desktops, notebooks and tablets, rose 20% to $13.31 billion in the reported quarter.

HP’s PC-related sales rose 27% in the quarter ended April 30, while notebook sales surged 47% from the same period a year earlier.

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Sen. Sherrod Brown (D-Ohio) hasn't forgotten the Great Recession.

In the first half of 2007, Brown recalls, there were more foreclosures in his hometown than anywhere else in the country. It was a period that led to the Global Financial Crisis: Millions of Americans lost their homes, while banks and other corporate sectors were rescued by billions of dollars in bailouts.

More than a decade later, Democrats control all three branches of government, and Brown and fellow populists like Sen. Elizabeth Warren, D-Mass., and Rep. Maxine Waters, D-Calif., are in powerful perches to oversee the Big Banks.

And Brown, like many of these top Democrats, believes that too many American are still getting the short end of the stick.

"They never get bailed out," Brown says in an interview with NPR. "They never get a second chance. They're just not in a position in an economy like this, where Wall Street writes the rules, where they can get ahead."

And top Democrats believe they are justified in pushing for change at Big Banks.

"They did very well during the pandemic," Brown notes about the banks. "We've seen stratospheric compensation levels. We see stock buybacks and dividend distribution. Yet, wages throughout our economy are essentially flat."

Brown is the chairman of the Senate Committee on Banking, Housing, and Urban Affairs, which also includes Warren, another Democrat with a reputation for being tough on Wall Street.

The Massachusetts senator played a key role in the creation of the Consumer Financial Protection Bureau (CFPB) in the aftermath of the Global Financial Crisis.

During that hearing, Warren asked Jamie Dimon, the chairman and CEO of JPMorgan Chase, about overdraft fees the bank charged its customers during the pandemic, which she estimated at nearly $1.5 billion.

The heated exchange ended when Warren asked Dimon if he would volunteer to refund that money. He declined.

Warren is unapologetic about pushing banks to do more given their roles as critical institutions in society.

But Republican lawmakers disagree with that very premise. They criticize executives for comments they have made – about voting rights, in particular, and they are critical of companies making business decisions based on environmental considerations.

"That ought to be left to elected lawmakers," says Sen. Pat Toomey, R-Penn., the ranking Republican on Brown's Banking Committee.

"You know, what I have discovered about the banking community is that they have had a way of operating traditionally, historically, and they don't change easily," Waters tells NPR.

Today, prices for everything from gasoline to groceries are surging as the economy roars back from the pandemic recession. And that's raising concerns in some quarters about whether the United States is headed back to the awful economic days of the 1970s, when the country was gripped by double-digit inflation that required painful action by the Federal Reserve.

Prices actually started creeping up in the mid-1960s, when the federal government was spending heavily on both the Vietnam War and the Great Society. Nixon temporarily froze prices in the early 1970s, but that just postponed the pain. When his controls were lifted, prices bounced even higher.