Dell Reports Revenue That Tops Estimates on Robust PC Demand
(Bloomberg) -- Dell Technologies Inc. reported quarterly revenue that topped analysts’ estimates, in a sign of robust demand for the company’s personal computers during the pandemic-fueled work-from-home period.
Sales climbed 2.8% to $23.5 billion in the period that ended Oct. 30, the Round Rock, Texas-based company said Tuesday in a statement. Analysts, on average, expected $21.9 billion, according to data compiled by Bloomberg. Profit, excluding some items, was $2.03 a share compared with analysts’ average estimate of $1.42.
Chief Executive Officer Michael Dell has sought to modernize his namesake company by moving to a subscription-based business model. Dell Technologies is letting clients pay for software and hardware as they go rather than upfront, which will generate more predictable, recurring revenue. The company formed a pact with FedEx Corp. and Switch Inc. earlier this month to develop a U.S.-based private cloud network hosted in FexEx facilities, giving customers an alternative to corporate server farms and public cloud services from Amazon.com Inc. or Microsoft Corp.
“We met unprecedented demand for remote work and learn solutions,” Chief Operating Officer Jeff Clarke said in the statement.
Dell shares gained 3% in extended trading after closing at $70.33 in New York. The stock has increased 37% this year.
Revenue from consumer PCs jumped 14% to $3.5 billion in the fiscal third quarter, the company said. PC sales to business and government clients increased 5.4% to $8.78 billion.
Server and networking sales fell 1.8% to $4.16 billion, while storage hardware revenue declined 7% to $3.86 billion.
Sales from VMware Inc., a software maker majority-owned by Dell, rose 8% to $2.89 billion. The publicly traded company offers software for data centers as well as programs that let employees access their corporate systems to work remotely. Dell is considering plans to spin off VMware, but won’t make a decision until after September 2021.
For more articles like this, please visit us at bloomberg.com
Subscribe now to stay ahead with the most trusted business news source.
©2020 Bloomberg L.P.
