Dell forecast current-quarter sales above market expectations as a pandemic-driven shift to remote work and learning powered demand for its desktops and notebooks
(Reuters) - Dell Technologies Inc forecast current-quarter sales above market expectations as a pandemic-driven shift to remote work and learning powered demand for its desktops and notebooks, helping it post a surprise rise in third-quarter revenue.
The company said, on an
earnings call with analysts on Tuesday, that it expects fourth-quarter revenue
to rise 3% to 4% sequentially, implying a range between $24.18 billion and
$24.42 billion, compared with analysts' average expectation of $23.09 billion.
The PC maker's shares were
last up marginally in volatile after-market trading, as adjusted earnings
matched Wall Street expectations of $2.03 per share.
Consumers and businesses
are spending on notebooks at a rate Dell has not seen in over a decade,
according to an earnings presentation, helping its client solutions group rake
in a record $12.29 billion in revenue, up about 8% from a year earlier.
Global shipments in the
traditional PC market, which includes desktops, notebooks, and workstations,
jumped 14.6% year-over-year to 81.3 million units in the third quarter of 2020,
according to data from IDC.
While the health crisis
lifted demand for Dell's remote workstation products, the company's data center
business remained under pressure, with revenue from the unit falling about 4%
to $8.02 billion in the quarter.
Sales at VMware Inc rose
about 8% to $2.89 billion. Dell plans to spin off its 81% stake in the software
unit to help reduce debt.
Total revenue rose nearly
3% to $23.48 billion in the three months ended Oct. 30, while analysts had
estimated a drop of 4.4% to $21.85 billion, according to IBES data from
Refinitiv.
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