New York, Feb 13: Number two personal computer maker Dell Inc. on Thursday said quarterly net income rose 24 percent as demand rose for its most profitable products, such as server computers, notebook computers and data storage systems. Executives from the Round Rock, Texas-based company, whose revenue rose 18 percent in the fiscal fourth quarter ended January 30, said demand by corporations for its technology picked up beyond the gradual improvement it had cited in recent quarters.
"Business is growing," Chief Executive Officer Michael Dell told reporters on a conference call. "The signs are getting relatively healthy and we're seeing a lot of increased demand from customers to refresh their older installed base of products."
The company, which said it expects steady growth in technology spending this year, forecast profit in the current fiscal first quarter of 28 cents a share and revenue of $11.2 billion, in line with analysts' expectations.
Shares of Dell, which lost its spot as the No. 1 PC maker during the quarter to Hewlett-Packard Co., fell initially in after-hours trading but later rose about 1 percent as investors were reassured by executive comments.
Dell, which typically takes market share through its low-cost supply and distribution system and by selling directly to customers to keep prices low and undercut its competitors, said demand has been strong in its new consumer electronics markets like televisions and digital music players.
It said net profit rose to $749 million, or 29 cents a share, in the fourth quarter, from $603 million, or 23 cents a share, a year earlier. Revenue increased to $11.51 billion from $9.74 billion a year earlier.
That compares with analysts' expectations for revenue of $11.51 billion and earnings of 28 cents per share, according to Reuters Research, a unit of Reuters Group Plc.
Chief Financial Officer James Schneider attributed the 1-cent gap between expectations and earnings to lower taxes. Bureau Report