Dell Inc. (DELL) delivered first-quarter 2014 earnings of 21 cents per share, way below the Zacks Consensus Estimate of 34 cents.

Revenues

The company reported revenues of $14.1 billion in the reported quarter, down 2.2% year over year. The decline in revenues can be attributed to the lower contribution from the Product segment.

Revenues by Segments

The company reported revenues under the following segments:

The company generated Enterprise Solutions Group revenues of $3.1 billion, improving 10.0% on a year-over-year basis. Under, this segment, Dell server and networkingrevenuesincreased 16.0% compared to the year-ago quarter. Apart from this, Dell networking continues to grow with a 24.0% increase in revenues, which includes a 46.0% growth in the company’s Force10 business.

Dell Services witnessed a revenue growth of 2.0% and reached $2.1 billion, supported by an 11.0% increase in revenues from infrastructure, cloud and security services. Within this segment, the Support and Deployment revenues moved up 2.0%, while the Applications and Business Process services tumbled 15.0%.

Dell Software generated revenues of $295.0 million. Dell improved its software business and generated additional sales capability and research and development.

The End User Computing segment revenues were $8.9 billion, declining9.0% on a year-over-year basis. Within this segment, the Dell desktop and thin-client revenues declined 2.0% on a year-over-year basis, the mobility revenues declined 16.0%, and peripherals and software revenues declined 6.0%.

Operating Results

Gross margin in the reported quarter was 19.5% down from 21.3% in the year-ago quarter.

Operating income for the quarter was $226.0 million or 1.6% of revenues in the reported quarter, down 73.0% year over year, hurt by the reduction in revenues and substantial increase in operating expenses.

Reported earnings in the quarter were 7 cents per share compared with 36 cents a share in the year-ago quarter. Excluding special items like amortization of intangibles, severance and facility consolidation cost, acquisition-related costs, as well as income tax adjustments, earnings per share in the quarter came in at 21 cents versus 43 cents in the year-ago quarter.

Balance Sheet & Cash Flow

The company exited the quarter with cash and cash equivalents of $10.9 billion, down from $12.8 billion reported in the previous quarter. The company used $39.0 million cash in operating activity, a considerable improvement from the $138.0 million used in the year-ago quarter.

Guidance

As the company is looking forward to a pending merger agreement / leveraged buyout agreement (:LBO), so the management has not provided an outlook for the second quarter of fiscal year 2014.