Dell meets earnings expectations in Q3

Dell has posted a 16 per cent gain in third-quarter revenue, cracking the $US10 billion barrier on strong server and storage device shipments. Revenue was $US10.6 billion, compared with last year's third quarter revenue of $9.1 billion.

Third-quarter net income was $US677 million, up 21 per cent from last year's third-quarter net income of $US561 million.

Overall, worldwide shipments increased 22 per cent in the period, which ended October 31. Shipments of servers increased 30 per cent and shipments of external storage systems increased 68 percent in the third quarter.

"We still have lots of room to grow in servers, storage, peripherals, and services," chairman and CEO, Michael Dell, said.

Dell also said he believed the technology world as a whole had stabilised, citing five consecutive quarters of industry growth and unseasonably high third-quarter growth.

While the largest part of Dell's growth comes from enterprise hardware, the PC business continues to account for the majority of the company's revenue.

Desktops represented 50 per cent of Dell's revenue in the third quarter.

Notebooks made up 28 per cent of that revenue, the company said.

Shipments of the Inspiron and Latitude models were up 31 per cent worldwide.

Desktop PCs such as the Dimension and Optiplex increased 20 per cent, the company said. PC sales had regained their late 1990s strength over the last few quarters, and the company saw double-digit percentage increases within every customer segment and geography, Dell said.

Revenue from all those segments was equally strong, except among enterprise customers, where revenue growth was evident but sluggish, he said.

Dell entered the consumer electronics market this quarter with the launch of liquid crystal display (LCD) televisions and a personal music player, but the launch occurred too late in the quarter to have an effect, Dell said.

The majority of Dell's third-quarter revenue, 71 per cent, came from the Americas. Revenue from Europe made up 19 per cent of the total revenue. Asia-Pacific, including Japan, accounted for 10 per cent.

The company expects fourth-quarter shipments to grow 25 per cent, with revenue of $US11.5 billion.

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