Wall Street Cheers Dell’s Results

Dell shares soared in after-hours trading Tuesday after the company posted quarterly earnings that were well ahead of Wall Street estimates.

Dell’s earnings of 39 cents a share were down 9 cents from the year ago quarter, but 6 cents better than analysts were expecting, a hopeful sign that the company’s pricing power has stabilized. Sales rose 3.4% to $14.38 billion, just under $14.44 billion estimates.

“In the quarter, the company achieved a better balance of liquidity, profitability and growth, which was driven by an improved mix of products worldwide,” Dell said in a statement. “In addition, the company continued to focus its actions to strengthen product lines, particularly in the enterprise, improve customer experience, and accelerate growth outside the U.S.”

Server revenue was up 12% to $1.5 billion, helped by new AMD-powered units. Mobility revenue was up 17% to $3.9 billion, while desktop sales slipped 5% to $4.7 billion.

Dell’s outlook was cautious, citing the need for continued investment and a “muted seasonal uplift due to changes in the mix of product and regional profit.”

Last week, Dell delayed its earnings report because of an escalating SEC probe into its accounting practices, which will delay the company’s formal SEC quarterly filing for the second straight quarter.

Because of the SEC investigation, Dell released its results in a press release only and did not hold a conference call.

Dell shares soared 8% in after-hours trading.

Stocks posted modest gained Tuesday in pre-holiday trading. Shares of Google surpassed $500 for the first time.

Chip stocks fell on news of lower utilization rates and a Novellus downgrade.

Adobe and Juniper gained on upgrades, and Apple shares hit a new all-time high on expectations of strong holiday iPod sales.

Tech Data gained 4% after beating estimates and raising guidance.

The Nasdaq rose 2 to 2454, the S&P 500 climbed 2 to 1402, and the Dow added 5 to 12,321. Volume declined to 2.54 billion shares on the NYSE, and 1.74 billion on the Nasdaq. Advancers led 20-12 on the NYSE, and 15-14 on the Nasdaq. Upside volume was 60% on the NYSE, and 53% on the Nasdaq. New highs-new lows were 268-20 on the NYSE, and 148-42 on the Nasdaq.

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