Dell announced Q1 earnings, although the PC market is weak, but the sales of enterprise as the target, the degree of decline is not as serious as predicted, revenue better than analysts estimate, and improved cost control also helped profit exceed expectations, which is a positive signal for the PC manufacturer.
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The company’s revenue for the quarter was $20.9 billion, down 20 percent year-on-year, less than the 22 percent average analysts expected; net income was $578 million, down 46 percent year-on-year; earnings per share excluding some items was $1.31, higher than analysts’ forecasts. The company reported net income of US$578 million, down 46% year-over-year, and earnings per share excluding certain items of US$1.31, above analysts’ forecasts of 85 cents.
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Dell noted that sales of enterprise PCs beat expectations, with the business bringing in $9.86 billion in revenue, far better than the $9.06 billion expected. The consumer PC business was not positive, with sales of $2.12 billion, down 41 percent year-over-year and below estimates of $2.3 billion. Revenue from the Solutions segment, which includes servers, storage and network infrastructure, was $7.59 billion, down 18 percent year-over-year and in line with analysts’ expectations.
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The company’s first-quarter results reflect the fact that PC sales are still in the doldrums, and it is noted that market research firm Gartner pointed out in April that PC shipments fell sharply from October last year to March this year after a wave of home office equipment purchases ended during the epidemic. Dell’s rival, Hewlett-Packard, previously announced its earnings report showed that its PC sales were also lower than expected. HP predicted that PC sales would pick up in the second half of the year.
Dell Vice President Yvonne McGill said on a conference call that second-quarter revenue would be between $20.2 billion and $21.2 billion. The median analyst estimate was $21.2 billion. Woo Jin Ho, an industry research analyst at Bloomberg, said the performance could mean the company’s sales have bottomed out and will begin a slow rebound.
