Dell beats Wall St. estimates
Shares of No. 2 PC maker rally on better-than-expected earnings results.
NEW YORK (CNNMoney.com) -- Dell reported preliminary earnings well above Wall Street's expectations Tuesday, sending shares of the PC maker soaring in extended trading.
The No. 2 PC maker reported net income of $677 million, or 30 cents a share, for its fiscal third quarter ended Nov. 3. In the year-ago period, Dell reported net income of $606 million, or 25 cents a share.
Analysts surveyed by Thomson Financial had expected earnings of 24 cents a share.
Dell shares surged 9 percent in after-hours trading on the better-than-expected results, which were reported after the market close.
Dell said revenue in the latest period rose 3.3 percent to $14.4 billion, roughly in line with forecasts.
That investigation into the company's accounting practices was raised from informal to formal status last week.
Dell did not host a conference call to discuss its latest earnings results with analysts.
Shipments in Asia-Pacific and Japan grew 23 percent during the period. Europe, Middle East and Africa shipments rose 9 percent. In contrast, shipments in the Americas fell 4 percent.
Dell has been losing share in the mature markets as consumers have turned to buying laptops over desktops.
Dell said desktop shipments fell 5 percent. Desktops, the company's core business, contributed $4.7 billion in revenue during the quarter.
Dell's sales have been lackluster, but the company should get a boost from the launch of Vista, the newest update of Microsoft's (Charts) Windows operating system, down the road, said Kim Caughey, an analyst at Fort Pitt Capital Group, which owns shares of Dell.
"We think there will be compelling reasons for businesses to buy Vista, and Dell should benefit from that," she said.
Vista is due to ship to business customers at the end of the month and to consumers in January.