More Good Times For Dell - InformationWeek

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More Good Times For Dell

The PC maker reported its fifth consecutive quarter of year-over-year profit improvement and said that technology demand has stabilized but not greatly improved.

Dell just keeps rolling along.

The PC maker Thursday reported its fifth consecutive quarter of year-over-year profit improvement and said that technology demand has stabilized but not greatly improved. CEO Michael Dell said the outlook among business executives is improving slightly, following a three-year slump in IT spending.

"I will certainly tell you that there is increased optimism among CEOs and large companies, but I don't really want to characterize it too strongly," Dell said during a conference call with the media. "It's sort of incrementally improving. I think it's going to take a couple more quarters of economic improvement before you see IT budgets growing substantially."

Shipments of the company's desktop PCs, notebook PCs, and servers rose an average of 27% from a year ago, faster than the growth of the rest of the industry, as Dell continued to take market share from rivals.

The CEO said the company would shift its purchases to keep costs in check. "As we see components moving in the wrong direction, we'll adjust our usage of those components to essentially drive demand away from them," Dell said.

For its second quarter ended Aug. 1, Dell reported net profit of $621 million, or 24 cents per share, up from $501 million, or 19 cents per share, a year earlier. Revenue rose to $9.78 billion from $8.46 billion in the year-ago quarter.

The company said it expects shipments to rise more than 25% in the third quarter, outpacing the broader industry, and sees third-quarter revenue growing about 15% to $10.5 billion, with expected earnings of 26 cents per share.

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