
I’m guessing the vast majority of our readers read the headline, smacked their foreheads and said “duh!”, but believe it or not component prices dipped even faster in the pervious quarter then analysts were expecting. Dell executives were the first to admit that core components such as memory and LCD screens were significantly less expensive than expected, and this had a hugely positive impact on profits.
Healthy OEM profits are great for shareholders, but when asked about when these reductions would start being reflected in end user pricing Dell’s CFO Brian Gladden admitted it would probably take a few quarters for the price reductions to make its way through the supply chain. “There will be some areas where I think it will bottom out a little bit in maybe LCDs and hard disks as we see those markets play out”.
Either way you can expect to see lower prices going into the holiday season, and its only get better going into 2011.