Dell Avoids Being Kicked off Nasdaq
The board of directors at the Nasdaq stock exchange have thrown an important lifeline to Dell after they decided to let its shares continue trading, despite the failure of the beleaguered computer maker to meet its listing requirements.
On 19 June, Dell failed once again to meet Nasdaq's reporting deadlines after it failed to publish its first quarter results on time. Under Nasdaq rules, delays automatically trigger a de-listing notice, but on 27 June, the Nasdaq Listing and Hearing Review Council gave Dell an extension until July 16 to get up-to-date with its filings, or see trading in its shares suspended.
This extension expired yesterday, with Dell once again failing to update its filings. Yet despite this lapse, it was revealed on Monday that the Nasdaq's board had decided to let Dell continue trading its stock on its exchange, pending a further review.
This is a vitally important decision for the PC maker, as it removes the immediate de-listing threat, and means there's no longer a date in place that would trigger a de-listing.
"[Dell] is committed to regaining compliance with all Nasdaq listing requirements as soon as possible," the company said in a written statement on Monday.
Once the golden child of the Nasdaq exchange, Dell has been struggling since this time last year to meet its regulatory deadlines. Indeed, the problems are so serious that Dell has actually missed the reporting deadlines for filing its past four quarterly earnings reports, as well as its annual report.
When the official investigations began last year, Dell also undertook an internal audit, which discovered in March evidence of misconduct and accounting errors, although it didn't disclose the exact nature of these errors.
In June, Dell said that it was nearing the end of its internal audit, but this did not prevent it missing subsequent regulatory deadlines. Dell says that due to ongoing investigations, it is only able to file preliminary earning reports, which are not officially audited.