Dell reports 21% jump in 3rd-quarter earnings

Dell reports 21% jump in 3rd-quarter earnings

PC maker cites significant growth in key foreign markets

By APRIL CASTRO Associated Press

Friday, November 14, 2003

Austin, Texas — Personal computer maker Dell Inc. on Thursday reported a 21% increase in third-quarter earnings, citing significant growth in key European and Asian markets.

Dell said that it earned $677 million, or 26 cents a share, in the three months ended Oct. 31 compared with $561 million, 21 cents a share, in the same quarter last year.

Results matched expectations of analysts surveyed by Thomson Financial / First Call.

Revenue was $10.62 billion, 16% higher than the $9.14 billion reported in the same quarter last year and up more than 40% from two years ago.

Chairman and chief executive Michael Dell said the company expects revenue in the fourth quarter of $11.5 billion, an increase of 18%, and earnings per share of 28 cents, which would match analysts’ forecasts and represent a 22% rise from a year ago.

“Their relentless success kinda gets boring after a while,” said Barry Jaruzelski, head of technology consulting at Booz Allen Hamilton. “They’re an operational machine that just keeps cranking it out.”

Despite the company’s foray into the consumer electronics market during the third quarter — including a flat-panel television and digital music players — Dell said the majority of growth was in storage and data service.

Sales of servers rose 30% from the same quarter last year.

Dell said the printer segment, which was launched in March, was profitable for the company, selling more than 1 million units so far.

Dell cited a 32% increase in product shipments in five strategic markets — China, France, Germany, Japan and the United Kingdom.

Asia-Pacific and Japan led the company’s regional growth with a 35% increase, nearly three times the combined rate of other companies. Dell’s strength in Asia-Pacific and Japan was most notable in servers and notebook computers.

Dell said systems sold to U.S. consumers rose 28%, and sales to governments and small and medium businesses both increased 22%.