Dell to shut North Carolina plant, cut 905 workers

SAN FRANCISCO (Reuters) - Dell Inc said it will close a North Carolina desktop computer manufacturing plant early next year, laying off 905 workers, as the world's No. 2 PC maker continues to shed jobs and streamline its business as its copes with declining sales and market share.

Dell is in the middle of an effort to wring out $4 billion in cost savings by the end of fiscal 2011.

Nearly 60 percent of Dell's revenue comes from PCs, which have been severely impacted by the global economic downturn. The company is very reliant on hardware sales to businesses, which have drastically cut back on spending.

The company posted a 22 percent decline in revenue in the July quarter, while net income fell 23 percent.

Dell trails Hewlett-Packard Co in the PC market, and is feeling the pressure from No. 3 Acer Inc, which has been gaining market share.

According to industry tracker IDC, Dell's shipments fell 17 percent in the calendar second quarter. Its market share stood at 13.7 percent.

The closure of the Winston-Salem facility is expected to be completed in January, Dell said on Wednesday. About 600 of the affected employees are expected to be laid off next month.

Dell had around 76,500 regular employees as of January 30, down from 82,700 a year earlier.

Shares of Round Rock, Texas-based Dell fell 1 percent to close at $15.36 on Nasdaq.

(Reporting by Gabriel Madway; Editing Bernard Orr)