Dell Server Racks
Dell Server Racks
Dell Server Racks
Surging enterprise and public-market requirement for Dell's servers, storage and networking components propelled second-quarter gross sales at the No. 3 PC maker up 22 p.c from a 12 months in the past, sufficient to top Wall Street's quarterly profits and earnings estimates.
For its second quarter of fiscal 2011, Dell (NASDAQ: DELL) stated product sales totaled $15.5 billion, beating analysts' profits estimates of $15.2 billion, according to Thomson Reuters information. Earnings ahead of one particular-time fees arrived in at $.32 per share, ahead of Wall Street consensus of $.30 per share.
On a GAAP basis, income arrived in 16 per cent higher than a 12 months before, at $545 million, or $.28 per share.
Dell credited the strong performance to a assortment of aspects, which includes a continuing corporate refresh cycle that helped cushion slow progress in its client company.
The company mentioned general revenues from its server and networking lines jumped 35 percent, with blades showing unique growth.
Storage also noticed a nutritious boost, increasing 13 p.c, with Dell's EqualLogic storage items proving particularly hot, with earnings growing 63 %.
Latest weeks have seen Dell moving to capitalize on mounting desire in storage with numerous acquisitions. Dell snapped up storage technologies vendor 3PAR for $one.15 billion before this week. In late July, it bought Ocarina Networks, a player in storage deduplication.
Providers also continues to be a main source of growth for Dell, as it has typically proven for rivals like HP (NYSE: HPQ). Dell stated its companies earnings elevated 57 p.c during the quarter to $1.9 billion -- gross sales that consist of the contribution of Perot Systems, which Dell acquired for $three.9 billion final yr.
Cellular and desktop PCs also found nutritious progress, thanks to corporate IT efforts to refresh old methods, Dell stated. The business stated its mobility products observed 21 percent earnings growth over very last year, although desktops jumped 17 %.
Enterprise, General public Sector IT investing surge
Although Dell's client group raked in $2.9 billion -- basically flat from a yr ago, and yielding a little operational loss -- investing among deep-pocketed venture IT departments and public-sector wellness care and life sciences clients skyrocketed.
In certain, the company's Huge Venture phase clients spent a total of 38 per cent more with Dell than they did a 12 months in the past, pushing revenues for the category to $4.5 billion. Within that client group, Dell explained gross sales of servers, providers and mobility every grew a lot more than 50 percent from last yr.
Product sales of goods and solutions to public-sector clients outstripped even business requirement, nevertheless, with that section contributing revenue of $four.6 billion, up 21 p.c. With state and local government product sales remaining almost flat, a significant chunk of that enhance came from well being care clients. Solutions proved especially strong in the category, with earnings growing much more than 100 per cent from a yr earlier, Dell mentioned -- although those outcomes once more factor in Perot Methods income.
Tiny and midsized companies also upped their spending with Dell. The company's SMB group found powerful increases, with revenue increasing 25 percent to $3.five billion. Gross sales of Dell SMB mobility goods grew 32 %, although desktop PC income elevated 29 p.c from a yr back. SMB servers and networking offerings raked in 28 p.c much more earnings, while storage income improved 22 percent.
Dell stated desire for its products and solutions proved generally powerful worldwide. Some areas noticed tremendous advancement, even so, such as the company's enterprise in emerging regions like Brazil, Russia, India and China. While the so-called BRIC countries accounted for only 12 % of Dell's overall quarterly earnings, income there grew 52 per cent from a 12 months backwards, it stated.
The organization also mentioned income from its Asia-Pacific and Japan group grew 38 %, although the phase comprised of Europe, the Middle East and Africa (EMEA) rose 24 per cent.
Advancement in product sales within the Americas trailed behind, with an improve of 17 p.c. Nevertheless, the U.S. still accounts for the bulk (53 p.c) of Dell's earnings -- though not by significantly.
Dell mentioned that it ended the quarter with $13.1 billion in money and investments, after money flow from operations totaling $one.3 billion.
The business also explained it doesn't see the corporate client refresh petering out for at least a number of far more quarters, although it also expects federal authorities gross sales and commercial product sales to grow slightly.
For the full 12 months, Dell gave guidance of profits progress between 14 p.c to 19 %, whilst earnings before 1-time charges could rise 18 % to 23 p.c.
Christopher Saunders is senior managing editor at InternetNews.com, the news service of Net.com, the network for technology professionals.
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