Growth in Asia and strong sales of notebook computers helped Dell Inc beat Wall Street expectations for first-quarter sales and profit.
That strong result pushed shares of Dell, the world’s second-largest seller of personal computers, up 9.9 percent in late trading on Thursday.
Now, investors will try to determine if the results were a one-term wonder or a sign that founder and CEO Michael Dell’s turnaround plan is working.
Notebook shipments jumped 43 percent in the first quarter from a year earlier. Dell had made them a priority, developing products for emerging markets, and the Round Rock, Texas-based company rang up more sales overseas than at home for the first time in the first quarter.
Revenue rose 19 percent in Asia and 15 percent in Europe, the Middle East and Africa, helping Dell overcome a weak US market, where businesses were cutting back on technology spending.
“Dell did relatively well, but it was against low expectations,” said Shaw Wu, an analyst with American Technology Research who rates the shares “neutral.”
They rose US$0.12 on Thursday, closing at US$21.81 in regular trading before the results were released, then jumped US$2.16 to US$23.97 in late trading.
Still, the results added to the sense that technology spending “is turning out a little better than expected,” Wu said.
Much of that strength has come from overseas. Dell, which is more dependent on US sales than Hewlett-Packard Co (HP), sees US business customers “holding back from spending” on desktops, chief financial officer Donald Carty said.
He added that US companies may continue to defer technology spending into this summer.
Dell trails HP in worldwide PC shipments but leads in US sales, technology research firms IDC and Gartner Inc said, but that could make Dell more vulnerable to a slowdown in the US economy.
For the three months ended on May 2, Dell earned US$784 million, or US$0.38 per share, up from US$756 million, or US$0.34 per share, in the same period last year. Revenue rose 9 percent to US$16.08 billion.
On average, analysts surveyed by Thomson Financial expected a profit of US$0.34 per share on sales of US$15.68 billion.
Michael Dell, who returned to the chief executive’s job in January last year after the company floundered, said the company was “executing on all points of our strategy to drive growth in every product category and in every part of the world.”
He told analysts on a company conference call on Thursday that the strong Asia sales were partly due to a 140 percent surge at 1,800 stores in China that sell Dell machines. By early August, he said, Dell will be in 3,500 Chinese stores.
But skeptics might said — as some analysts on the call did — that Dell’s strong first quarter was helped by the weak dollar and unusually sharp job cuts, which might be more difficult to repeat.
Authorities have detained three former Taiwan Semiconductor Manufacturing Co (TMSC, 台積電) employees on suspicion of compromising classified technology used in making 2-nanometer chips, the Taiwan High Prosecutors’ Office said yesterday. Prosecutors are holding a former TSMC engineer surnamed Chen (陳) and two recently sacked TSMC engineers, including one person surnamed Wu (吳) in detention with restricted communication, following an investigation launched on July 25, a statement said. The announcement came a day after Nikkei Asia reported on the technology theft in an exclusive story, saying TSMC had fired two workers for contravening data rules on advanced chipmaking technology. Two-nanometer wafers are the most
DEFENSE: The first set of three NASAMS that were previously purchased is expected to be delivered by the end of this year and deployed near the capital, sources said Taiwan plans to procure 28 more sets of M-142 High Mobility Artillery Rocket Systems (HIMARS), as well as nine additional sets of National Advanced Surface-to-Air Missile Systems (NASAMS), military sources said yesterday. Taiwan had previously purchased 29 HIMARS launchers from the US and received the first 11 last year. Once the planned purchases are completed and delivered, Taiwan would have 57 sets of HIMARS. The army has also increased the number of MGM-140 Army Tactical Missile Systems (ATACMS) purchased from 64 to 84, the sources added. Each HIMARS launch pod can carry six Guided Multiple Launch Rocket Systems, capable of
CHINA’s BULLYING: The former British prime minister said that he believes ‘Taiwan can and will’ protect its freedom and democracy, as its people are lovers of liberty Former British prime minister Boris Johnson yesterday said Western nations should have the courage to stand with and deepen their economic partnerships with Taiwan in the face of China’s intensified pressure. He made the remarks at the ninth Ketagalan Forum: 2025 Indo-Pacific Security Dialogue hosted by the Ministry of Foreign Affairs and the Prospect Foundation in Taipei. Johnson, who is visiting Taiwan for the first time, said he had seen Taiwan’s coastline on a screen on his indoor bicycle, but wanted to learn more about the nation, including its artificial intelligence (AI) development, the key technology of the 21st century. Calling himself an
South Korea yesterday said that it was removing loudspeakers used to blare K-pop and news reports to North Korea, as the new administration in Seoul tries to ease tensions with its bellicose neighbor. The nations, still technically at war, had already halted propaganda broadcasts along the demilitarized zone, Seoul’s military said in June after the election of South Korean President Lee Jae-myung. It said in June that Pyongyang stopped transmitting bizarre, unsettling noises along the border that had become a major nuisance for South Korean residents, a day after South Korea’s loudspeakers fell silent. “Starting today, the military has begun removing the loudspeakers,”
RSS