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Dell hails strong PC sales as profits rise
Promotional push may have helped...

By Reuters

Published: Friday 13 May 2005

Dell has said that PC sales in April overcame weakness earlier in the quarter, fuelled by strong growth in European markets and Japan.

The company's forecast for revenue in the current quarter was equal to or slightly above the average analyst forecast, and its shares rose 1.5 per cent.

Net income rose to $934m, or 37 cents per share, in the fiscal first quarter, compared with $731m, or 28 cents per share, a year earlier. Revenue rose 16 per cent to $13.39bn from $11.54bn. The quarter ended on 29 April.

Analysts believe a heavy promotional push aimed by Dell at consumers and small businesses helped offset weakness that company officials had cited in February and March.

Wall Street was looking for Dell to report a net profit of 37 cents per share, up 32 per cent from a year earlier, according to Reuters Estimates. Forecasts from Reuters Estimates ranged between 36 cents and 37 cents.

Analysts were looking for revenue of $13.42bn on average. Forecasts were in a tight range between $13.37bn and $13.50bn. In April, Dell reaffirmed its prior outlook for $13.4bn in revenue and earnings of 37 cents per share.

Dell expects revenue for the fiscal second quarter to increase between 16 per cent and 18 per cent, to a range of $13.6bn to $13.8bn, with earnings per share of 37 cents to 39 cents, chief executive Kevin Rollins said in a statement.

Earnings estimates were in line with current forecasts, but the revenue was equal to or slightly better than the average analyst forecast. Dell's second quarter ends in July.

Shares of Round Rock, Texas-based Dell rose 7 cents to close at $36.61 on the Nasdaq. They climbed to $37.19 in after-hours trade on the Inet electronic brokerage.