With businesses persisting with the restrain with regard to buying PCs amid the downturn, the Thursday-reported first quarter sales and earnings of Dell Inc. indicated a sharp 34 percent plunge, with the company's profits having dropped by a montrous 63 percent!

Saying that it would retain its present focus on cutting expenses to see through the troubling times, Dell added that it was preparing itself for an industry-wide turnaround for the better. However, at the same time, the company termed the current environment as "still challenging."

Owing to cost-reductions under execution, the first quarter operating expenses for Dell dropped to $101 million from the earlier quarter, and $312 million from the year-before operating expenses. The company is looking at a $4 billion reduction in annual costs by 2011-end.

During a conference call with analysts, Michael Dell - the company's founder and CEO - said: "What we're seeing is a big deferral of purchases among corporations, but they're planning on a pretty big 2010 client refresh. Customers will be very focused on new technology, and virtualization ... and we think there are some big opportunities there."

Despite the fact that the company said it was readying itself for what would likely be a "powerful replacement cycle," it still stopped short of offering a forecast for the ongoing second quarter, citing "mixed indicators" of global IT demand.