[ad_1]
Text size
Business spending on personal computers has been stronger than buying by households.
Courtesy of Dell
Dell Technologies
posted strong results for its fiscal first quarter, driven primarily by better-than-expected demand for enterprise computing hardware, and continued healthy sales of business PCs.
The report for the three months ended April 29, released late Thursday, could calm concerns sparked by disappointing recent results from
Cisco Systems
(ticker: CSCO) about a potential softening of enterprise technology spending.
It is also noteworthy that in its results, Dell (
DELL
) didn’t address any impact on its business from Covid-related lockdowns in China, the war in the Ukraine, or macroeconomic worries. Dell had previously said that it was withdrawing from selling its products in Russia.
Dell shares, which rose 1.3% in Thursday’s regular session, rallied 6% in late trading, to $46.53. Through the close, the stock was off about 22% so far this year.
For the quarter, Dell (ticker: DELL) posted revenue of $26.1 billion, up 16% from a year ago, and well ahead of the company’s forecasted range of $24.5 billion to $25.7 billion. Non-GAAP profits were $1.84 a share, above the company’s projection of $1.25 to $1.50 a share.
Wall Street consensus estimates had called for revenue of $25 billion and profits of $1.39 a share. Under generally accepted accounting principles, the company earned $1.37 a share, up from 84 cents in the year-earlier quarter.
Dell had especially robust results in its Infrastructure Solutions Group, which sells servers, storage, and networking equipment to enterprise customers.
ISG
had revenue of $9.3 billion, up 16% from a year ago. According to FactSet, the consensus call on Wall Street was that revenue would be $8.3 billion, which would have been 5% growth.
The big factor behind ISG’s strength was servers and networking revenue, which was $5 billion, up 22%, and well ahead of the Street consensus of $4.3 billion. Storage revenue also topped expectations, at $4.2 billion, up 9% and ahead of the consensus call of $4 billion.
Client Solutions Group, the company’s PC business, had April quarter revenue of $15.6 billion, up 17%, and slightly above the Street consensus at $15.5 billion. As has been the pattern in recent quarters, demand was stronger for business PCs than from the consumer sector. Commercial PCs revenue was $12 billion, up 22%, while consumer revenue was $3.6 billion, up 3%.
Dell said it repurchased $1.5 billion of its common stock in the quarter, nearly 5% of the company’s current market capitalization. Dell also paid out about $250 million in dividends. The company has a little over $3 billion remaining on its current stock buyback authorization.
Write to Eric J. Savitz at [email protected]
Source link