Dell Inc.'s second-quarter results once again set company records for revenue and unit shipments, as it continues to dazzle investors and observers with its streak of positive earnings results amid a difficult economy.
For the period ending Aug. 1, Dell posted revenue of US$9.78 billion, as compared to revenue of $8.46 billion in the second quarter of 2002. Shipments were up 27 percent across all of Dell's product lines, led by a 46 percent increase in shipments to Asia-Pacific, Dell said in a release Thursday.
The Round Rock, Texas, company earned US$621 million in net income, up from US$501 million in last year's second-quarter. Earnings per share were US$0.24, in line with analyst expectations as surveyed by Thomson First Call.
Shipments of Dell servers were up 27 percent and shipments of storage systems rose 46 percent. The company has focused much attention recently on growing its server and storage businesses, though sales of PCs were also strong, said Michael Dell, the company's chairman and chief executive officer, on a conference call to discuss the results.
Dell has been quiet with its consumer efforts as the back-to-school shopping season reaches full swing in the U.S., but that doesn't mean the company has forgotten consumers, Dell said. Consumer shipments in the U.S. rose 47 percent in the second quarter, buoyed by sales of Inspiron notebooks, which were up 70 percent, he said.
"Other people say they can't make money in clients," but that's not a problem for Dell, the chief executive said.
He took a jab at Hewlett-Packard Co.'s launch announcement of over 150 products Monday.
"The most important measure of success is, do people actually buy what we're selling? We don't feel compelled to put out a whole lot of announcements just to put out announcements," he said.
Corporate customers seem a little more positive going into the second half of the year, but the situation is only "incrementally improving," Dell said. "We haven't seen a whole lot of things to make companies change their budgets," he said.
Several analyst firms had predicted that a recent increase in memory prices might affect Dell's bottom line for the quarter, but the effects were minimal, according to Jim Schneider, senior vice president and chief financial officer for Dell. Memory prices rose slightly, but overall component prices continued to fall as they have for the last several quarters, he said.
The third quarter should be just as strong, Dell said. The company predicted a 25 percent increase in unit shipments during the upcoming quarter, and said revenue should top the US$10 billion mark in that quarter.