Dell net profit down 23 pct

Friday, August 28, 2009

AFP - Friday, August 28NEW YORK (AFP) - - US personal computer giant Dell reported a 23-percent decline in quarterly net profit on Thursday but surpassed the expectations of Wall Street analysts, sending its shares sharply higher.
The Texas-based company said net profit fell to 472 million dollars in the second quarter of its fiscal year compared with 616 million dollars a year ago.
Earnings per share were 24 cents compared with the 23 cents per share expected by analysts.
Dell said revenue declined by 22 percent in the quarter to 12.8 billion dollars.
"We have been reducing complexity in our organization and significantly lowering operating costs, in anticipation of improvement in the global economy and IT spending," chairman and chief executive Michael Dell said.
"If current demand trends continue, we expect revenue for the second half of the year to be stronger than the first half," he added in a statement.
Brian Gladden, Dell's chief financial officer, said the "best path for Dell remains one focused on profitable growth, lower costs and smart use of working capital."
Looking ahead, Dell said it expects seasonal demand improvements from the consumer and US federal government businesses in the third quarter, although demand from large commercial customers in the United States and Europe is expected to slow.
Dell said revenue in its large enterprise division declined 32 percent in the quarter from a year ago to 3.3 billion dollars.
It said public revenue division revenue was down 16 percent from a year ago to 3.8 billion dollars. Small and medium business revenue was down 29 percent to 2.8 billion dollars.
Consumer revenue declined by two percent to 2.9 billion dollars.
Dell is the number two personal computer maker worldwide after Hewlett-Packard and lost its top spot in the US market to HP in the first quarter of the year.
Dell shares gained 6.71 percent in New York to close at 15.65 dollars and added another 1.12 percent in after-electronic trading to 15.83 dollars.