11:48 AM EDT, 09/11/2024 (MT Newswires) -- Dell Technologies ( DELL ) said late Tuesday in a filing that it forecasts "a continued reduction" in its overall headcount this year as the company grapples with a personal-computer refresh cycle that is yet to materialize.

For the year ending in February, the PC maker plans to cut costs through limited hiring and "employee reorganizations," according to the company's fiscal second-quarter Form 10-Q filing. Dell also plans lower expenses by leveraging new technology and optimizing business processes, it said.

"We anticipate these actions will result in a continued reduction in our overall headcount," it wrote in the filing.

During the second quarter and first six months of fiscal 2025, selling, general and administrative expenses fell 9% and 7%, respectively, year over year due primarily to a reduced headcount, the company said in the Form 10-Q. Dell reported $328 million in severance expenses for the quarter. Bloomberg News reported in August that Dell was terminating jobs as part of a restructuring of its sales teams.

Dell reported last month a surprise increase in second-quarter adjusted earnings per share with a 9% gain in revenue that beat market expectations, driven by demand for artificial intelligence servers. Sales in its infrastructure solutions group advanced 38% year over year to a record $11.65 billion.

However, revenue for Dell's client solutions division, which includes PCs, fell 4%.

The decline in CSG's top-line was led by its consumer category, which declined to $1.86 billion in the August quarter from $2.39 billion last year. Commercial CSG sales were largely flat at $10.56 billion. Weakness in consumer net revenue was attributable to lower volumes and a drop in average selling prices, Dell said in the 10-Q filing.

For the full year, Dell is anticipating flat to low-single digit revenue growth in clients solutions, Chief Financial Officer Yvonne McGill told analysts on a late August conference call, according to a Capital IQ transcript. "The coming PC refresh cycle and the longer-term impacts of AI will create tailwinds for the PC market," she told analysts at the time.

At an industry conference on Tuesday, Chief Operating Officer Jeff Clarke said he thought a PC refresh would have happened already but the company now sees it pushing into the end of the year and into next year. This was reflected in Dell's increased full-year revenue growth guidance of 10% at the midpoint from 8% previously, he said.

While infrastructure solution demand is recovering, "demand for PCs is a bit delayed at Dell," UBS Securities said in a report late last month.

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