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ComputerWire: IT Industry Intelligence

Dell Computer Corp set aggressive targets for the fourth quarter yesterday as it delivered on its earlier raised guidance for the third quarter.

The Round Rock, Texas-based company turned in sales of $9.1bn for the quarter ending November 1, up 22.5% on the year. Operating income was up 39.3% to $758m, while net income was up 31% to $561m. This resulted in earnings per share of $0.21. The figures chimed in with the raised guidance Dell gave at the beginning of October.

As usual, the company contrasted its success with the industry as a whole, saying industry revenues were flat to slightly down, and that the company had gained 2.3% of share, while the rest of the top ten had lost more than two points of share combined.

Looking ahead, the company said it expects fourth quarter revenue to be $9.7bn, up 20% on the year. Net earnings per share should be $0.23. Wall Street currently expects $0.22 per share on revenues of $9.5bn.

Despite Dell's raised guidance, CFO Jim Schneider was downbeat on the state of the market as whole. "It's too early to call a rebound in IT spending," he said. "Demand hasn't changed. It's stable in the US, but some other markets show softness." He added that the company had seen an increase in aggressive pricing from its rivals.

President and COO Kevin Rollins added that while there were a lot of new technology trends that customers would like to buy into, "Technology transitions are not the issue in stalling or picking up growth. It's an economy and capital spending issue."

For the year to date, Dell's sales were up 11.1% at $25.7bn. Net income for the year so far is $1.5bn, up 92.2% on the year.

© ComputerWire

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