Dell Technologies cables at the University of California San Diego.
Bing Guan/Bloomberg
Dell Technologies posted better-than-expected results for the fiscal first quarter ended April 30, driven by impressive personal computer growth.
For the quarter, Dell (ticker: DELL) posted revenue of $24.5 billion, up 12% from a year ago and ahead of the Street consensus forecast at $23.4 billion. Product revenue was $18 billion, up 12%; services revenue was $6.5 billion, up 10%.
Non-GAAP profits were $2.13 a share, blowing past the Street consensus view of $1.61. On a GAAP basis, the company earned $1.13 a share. Operating income was $1.4 billion, up 96%. Gross margin was flat with a year ago, at 31%. The company noted that cash flow from operations over the past 12 months was a record $14.4 billion.
“There has been a substantial acceleration in digital transformation across the globe, and you can see it in our results,” Dell Chief Operating Officer Jeff Clarke said in a statement. “Looking ahead, we see technology becoming increasingly central to the global economy and society. We’re excited for the opportunities ahead and for the data-fueled future we’re creating.”
Dell’s Client Solutions Group, basically the company’s PC business, had revenue of $13.3 billion, up 20%. Operating income for the group was $1.1 billion, up 84%. Consumer revenue was up 42%, while commercial client revenue was up 14%. Dell said Alienware gaming notebook orders were up 76%.
The company’s Infrastructure Solutions Group had revenue of $7.9 billion, up 5%. Servers and networking revenue was $4.1 billion, up 9%, while storage revenue was $3.8 billion, flat with a year ago. Operating income in the segment was $788 million, up 8%. The company said revenue at majority-owned VMware (VMW) was $3 billion, about in line with Street estimates.
Dell also said it now expects to pay down at least $16 billion in debt in fiscal 2022, up from a previous target of $14 billion, driven in part by the expected special dividend from VMware just ahead of the planned spinoff of Dell’s stake in the company to holders. The VMware spin is expected to close in the fourth quarter.
In Thursday’s regular session, Dell shares were up fractionally at $99.70. The S&P 500 was up 0.1%.
Write to Eric J. Savitz at [email protected]
