Dell Channel Partners Revenue Shows Modest Growth in Q3

Dell channel partners delivered more revenue during the third quarter despite the continued challenges from the COVID-19 pandemic.

Dell’s Cheryl Cook

That’s according to Cheryl Cook, senior vice president of Dell Technologies global channel marketing. She said the need for more technologies, and not less, is helping to drive growth.

Revenue as measured by orders globally was up 1%.

“A a little modest growth, but growth nonetheless, a big improvement from Q2,” Cook said. “So we can see a trend of a lot of recovery and growth. Distribution globally is at the same rate. We had 1% growth globally with our distribution business.”

Dell‘s client business, which includes the PC, monitors and workstation business, had another strong growth quarter, up 6% year on year, she said. There’s been a huge swell in demand for customers focused on allowing employees to safely work remotely.

Dell’s server business was up 6% during the quarter, Cook said. However, storage business was down 10%. That’s likely from customers prioritizing projects.

“There is still infrastructure business going on for sure,” she said.

In addition, Dell’s VMware business globally was essentially almost flat in Q3.

There’s still growth taking place in industry verticals like health care, government and education, Cook said. This is despite industries like hospitality and health care that have been more impacted from a growth perspective.

Satisfying Results

“I would say we’re really pretty satisfied and pleased with these results,” Cook said.

The channel has been successful in acquiring new customers and expanding relationships, she said.

“We continue to believe one of our differentiators to our partner community is the breadth of our portfolio and the fact that they have a cross-sell or upsell opportunity with existing customers across the portfolio,” Cook said. “We’re getting feedback from partners that when everything is remote and we’re all doing virtual selling, breaking into a net new customer and displacing competition may not be the easiest thing to do, But certainly expanding a relationship with existing clients is something our portfolio gives them the ability to do.”

In Q3 alone, Dell channel partners brought in over 60% of new or reactivated buyers, Cook said. This continues to be a strategic focus area for Dell.

With everyone doing business virtually and remotely, partners are making time for more online training and online courses, she said.

Dell delivered nearly 14,000 credentials to individuals receiving certifications. That represents over 1,700 partner companies.

Global Business

Globally, Dell’s channel business saw positive growth in North America and almost flat growth internationally, Cook said. EMEA showed positive growth, while Asia-Pacific-Japan had negative growth.

“I think indicative to the trend we’re seeing in the marketplace is increased customer demand and request for as-a-service consumption models,” Cook said. “How can I move from CapEx to OpEx? One of our strongest, most robust capabilities is through our Dell Financial Services, which we’ve been doing consumption models and ratable revenue for over a decade now. And in Q3 we continued to see robust demand in the partner community. Our originations in Q3 were up 32%. So this includes flexible on-demand or pay-as-you-grow vehicles where the customers just pay as they grow or just pay for use.”

Partners that have managed services capabilities and remote services capabilities, and represent themselves as MSPs or cloud service providers saw a spike in growth in Q3, she said.

In addition, partners that sell two and three lines of business are growing faster and with higher margins than those only selling one, Cook said.

Looking ahead, the fourth quarter and into 2021 should bring further positive growth for Dell and its partners, she said.

“The one silver lining or thing that we’ve all definitely seen in this pandemic is it has accelerated digital adoption and digital transformation,” Cook said.