Investor's have short memories.
Q2 is traditionally slow for pc sales. Dell is doing what they always have -beating the competition.
The market has been spoiled by Dell's past record and cannot tolerate even above average performance. Stop blaming Dell it's the market's current perception -which will change. Just know that this is temporary temporary temporary. Let the bears eat so they can fatten up for their hibernation.
ca.dailynews.yahoo.com
Friday August 11 4:26 PM ET
Dell shares drop despite stronger Q2 profit on 25% surge in revenue
AUSTIN, Tex. (AP) - Strong product sales and less expensive computer parts helped boost Dell Computer Corp.'s (NasdaqNM:DELL
- news) second-quarter revenue by 25 per cent and the computer maker offered a positive outlook for the rest of the year. Dell's
second-quarter earnings beat Wall Street expectations by a penny.
Investors weren't pleased with the results, however, sending shares down 10 per cent in trading Friday.
For the three months ended July 28, Dell earned $603 million US, or 22 cents per share. In the year-ago period, Dell posted a net
profit of $507 million, or 19 cents per share.
Analysts had expected Dell to show a per-share profit of 21 cents in the second quarter, according to a survey by First Call/Thomson
Financial.
Revenue for the three months was $7.7 billion, up from $6.1 billion in the year-ago period.
"Our second-quarter results and expectations for strong industry demand in the second half of the year keep us on track toward our
goal of 30 per cent full-year sales growth," said Michael Dell, chairman and chief executive.
Some analysts had expected sales to be closer to $7.8 billion, but Dell still did better than other personal computer companies that
have suffered from part supply problems.
Last month, both IBM Corp. and Apple Computer Inc. (NasdaqNM:AAPL - news) met earnings estimates but fell short of revenue
projections in the most recent quarter.
"They're growing above market, which is good news for them and bad news for everybody else," Barry Jaruzelski, an analyst with
Booz Allen & Hamilton in New York, said of Dell.
The results were released after the close of regular trading Thursday. On Friday, shares of Dell fell $4.06 to $37.69 US on the
Nasdaq Stock Market.
Sales of items other than base computer systems accounted for $1.3 billion of Dell's revenue, while sales of services worldwide
reached $577 million, up 35 per cent from a year ago.
The Round Rock, Tex.-based company reported that it was shipping 22 per cent more units than last year, more than the industry
average, which floats in the high teens.
Dell "continues to be this virtually unstoppable machine. They just keep cranking out these huge numbers," said Jaruzelski.
Analyst Steve Kleynhans of the Meta Group in Stanford, Conn., said the PC industry as a whole has been sluggish but should pick
up in the second half of the year.
Dell's strong Internet presence continues to help the company's bottom line, he added.
About 50 per cent of total sales came from Dell's Web site in the second quarter, averaging more than $50 million a day. That's up
$20 million from the prior year. © The Canadian Press, 2000
TTOSBT |
