No Stopping Dell: Record Revenue, Earnings; More Expected Next Quarter

A company spokesperson attributed the results to server and storage sales, which outpaced the industry by a considerable margin.

Revenue for the quarter was $10.6 billion, up 16 percent compared with the $9.1 billion recorded the same quarter last year. Earnings hit $677 million, up 21 percent over the $561 million reported last year.

For its efforts, Round Rock, Texas-based Dell ended up with an extra $1.1 billion in the bank, raising its total cash and investments by quarter-end to $11.0 billion.

For the quarter, Dell's worldwide server shipments on a volume basis rose 30 percent compared with the same period last year. Storage unit shipments were up 68 percent during that time.

Dell's Condensed Consolidated Statement of Operations tells part of the reason for its high revenue growth during a time when the per-unit pricing of servers and storage is falling: a shift to higher-value products.

About 50 percent of the company's revenue for the quarter came from desktops, down from 52 percent last year. However, its enterprise systems revenue, which includes servers and storage, rose as a percentage of revenue to 22 percent, up from 20 percent the year before. Notebook PC sales remained constant in terms of total revenue at 28 percent. Those numbers included hardware as well as related services, software and peripherals.

Calculating those numbers in revenue terms, Dell's enterprise revenue reached $2.3 billion this quarter, up 28 percent from last year's $1.8 billion. Desktop PC revenue was $5.3 billion, up 13 percent from the $4.7 billion in sales a year ago.

Overall, services revenue was $2.6 billion, up 31 percent compared to the prior year's quarter. Software and peripheral revenue was up 26 percent year-over-year. Printer sales were up 70 percent from the second quarter of this year, and are expected to increase 80 percent next quarter, company officials said.

For Dell, the good news is not expected to end this quarter. Michael Dell, chairman and CEO, told analysts on Thursday that his company expects fourth-quarter shipments, including desktops, notebooks and enterprise products, to rise 25 percent compared with the fourth quarter of last year. Fourth-quarter revenue is expected to hit $11.5 billion, up 18 percent from last year, while earnings are expected to reach 28 cents per share, up 22 percent.