Make Kitco Your Homepage

Dell beats estimates for quarterly results on strong enterprise demand

Kitco News

May 26 (Reuters) - Dell Technologies Inc (DELL.N) on Thursday beat Wall Street estimates for quarterly profit and revenue, as enterprises invested heavily in the company's desktops and laptops to support hybrid work.

Dell's shares rose about 7% in extended trading as the PC maker forecast current-quarter revenue and profit above analysts' expectations.

The company has seen strong demand for its products and services over the past few quarters as businesses invest in remote-working equipment and consumers upgrade their devices.

Revenue at Dell's client solutions group (CSG)—home to its hardware units—rose 17% in the quarter ended April 29.

"We attribute this to Dell's outsized exposure to commercial PCs, which have higher selling prices, while it has minimal exposure to Chromebooks, where most of the pressure has been felt," said Angelo Zino, senior equity analyst at CFRA research.

Dell's commercial PC revenue jumped 22% to $12 billion in the quarter.

The company, however, added that some impact from the global chip shortage and supply chain disruptions, exacerbated by the China lockdowns, was seen in the quarter.

"We expect backlog to remain elevated through at least Q2 due to current demand and industry-wide supply chain challenges," said Jeff Clarke, co-chief operating officer at Dell, in a post-earnings call.

"We expect component costs to turn inflationary and logistics costs remain at elevated levels in Q2."

The company expects revenue to be in the range of $26.1 billion to $27.1 billion in the current quarter and forecast adjusted profit per share of between $1.55 and $1.70.

Analysts estimate second-quarter profit of $1.47 per share and revenue of $25.6 billion, according to Refinitiv IBES data.

For the first quarter, the company reported adjusted profit of $1.84 per share and revenue of $26.12 billion, compared with estimates for a profit of $1.39 per share and revenue of $25.04 billion.

Reporting by Richard Rohan Francis and Eva Mathews in Bengaluru; Editing by Amy Caren Daniel and Devika Syamnath
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.