Dell Exceeds Expectations

Dell posted better than expected quarterly results late Thursday on strong enterprise sales and favorable pricing.

With average selling prices on the rise and component costs falling, Dell’s pro forma earnings of 35 cents a share easily topped Wall Street analysts’ expectations of a 31-cent profit.

Sales rose 5% to $14.77 billion, topping $14.63 billion forecasts.

“We continue to invest in company initiatives that align our products and services around customers’ needs in order to drive long-term, sustainable performance and extend our position as a trusted technology partner,” Chairman and CEO Michael Dell said in a statement. “While our results demonstrate we’ve made progress against our goals, we are still in the early stages of transforming our company’s structure, costs and operations.”

Dell, which is wrapping up a year-long accounting review, said it will hold a strategy call with analysts on Nov. 29 and an analyst meeting next April.

Server revenue grew double-digits, while notebook and desktop sales were up slightly from the year-ago quarter. Notebook sales were limited by supply constraints.

Dell said its second-half earnings “could be adversely impacted by a slower decline in component costs.”

Dell shares were little changed after hours after a 2% gain during the day.

Stocks were mixed in Thursday’s trading session, as traders awaited an eagerly anticipated speech by Federal Reserve Chairman Ben Bernanke Friday morning.

Novell , Vimpel and Sigma Designs jumped on their results, and Motorola rose on a Lehman upgrade.

International Rectifier slumped 9% on news that its CEO has gone on leave with pay pending the resolution of an audit committee investigation.

Ciena and TiVo fell on their quarterly results.

The Nasdaq gained 2 to 2565, the S&P 500 lost 6 to 1457, and the Dow fell 50 to 13,239. Volume declined to 2.58 billion shares on the NYSE, but rose to 1.75 billion on the Nasdaq. Declining issues led by a 19-13 margin on the NYSE, and 17-12 on the Nasdaq. Upside volume was 31% on the NYSE, and 63% on the Nasdaq. New highs-new lows were 24-62 on the NYSE, and 60-66 on the Nasdaq.