Dell delivers ‘best-ever quarter’ performance

12 Nov 2004

Strong corporate sales particularly in Europe helped computer maker Dell to its best-ever quarterly performance. Dell, which employs 4,500 in Ireland through its facilities in Limerick and Bray, saw revenue increase by 18pc from the same quarter a year ago to US$12.5bn.

The company achieved revenue growth of 27pc in EMEA, 25pc in Asia-Pacific and Japan and 20pc in the US, where its share of the overall computer market has reached one third.

In the third quarter, Dell’s operating profit improved to 8.8pc of revenue, the company’s highest rate in four years. The company generated a record US$1.8bn in cash from operations and total cash and investments rose to US$12.4bn.

Earnings per share were 33 cents, up 27pc, for the quarter ended 29 October.

“The record quarter is testament to the company’s superb team executing a better business model,” said Kevin Rollins, Dell chief executive officer. “An improving component cost environment further favours Dell, with customers and shareholders the primary beneficiaries.”
According to Rollins, Dell’s fourth-quarter product shipments should be about 20pc higher than in the same year-ago period. This would produce quarterly revenue of about US$13.5bn, up 17pc, and earnings per share of 36 cents, a 24pc increase.

Dell sold a combined eight million standards-based servers, notebook computers and desktop computers in the quarter. The highlight of the unit growth 22pc overall was a 35pc jump in notebook sales. EMEA performed best with third-quarter shipments up 31pc. Server shipments in the region increased 24pc, earning Dell nearly two points of server market share for the quarter.
In Asia-Pacific and Japan, company-shipment growth of 25pc was nearly three times the rate of the market excluding Dell. Revenue from enterprise systems, including servers and storage, increased 27pc.

Dell also established an industry record for unit shipments in the US, surpassing five million systems in the quarter, and increased its market share by nearly two points to 33pc.
Worldwide revenue from software and peripheral products increased 37pc year on year. The company expects to sell more than five million printers and generate more than US$1bn in imaging and printing revenue this year. During the third quarter, the company introduced its first generation of colour laser printers for business customers, as well as two new printers with advanced digital photography features for consumers.

By Brian Skelly