Dell Technologies 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 three percent to four percent sequentially, implying a range between US$24.18 billion (A$32.3 billion) and US$24.42 billion (A$33.2 billion), compared with analysts’ average expectation of US$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 US$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 US$12.29 billion in revenue, up about eight percent from a year earlier.
Global shipments in the traditional PC market, which includes desktops, notebooks, and workstations, jumped 14.6 percent 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 four percent to US$8.02 billion in the quarter.
Sales at VMware rose about eight percent to US$2.89 billion. Dell plans to spin off its 81 percent stake in the software unit to help reduce debt.
Total revenue rose nearly three percent to US$23.48 billion in the three months ended October 30, while analysts had estimated a drop of 4.4 percent to US$21.85 billion, according to IBES data from Refinitiv.
Net income attributable to the company rose to US$832 million, from US$499 million a year earlier.