Dell revenue drops slightly in Q3, but earnings rise

The company is focusing more on the enterprise market to try to boost profits

Dell has reported a small dip in revenue for the third quarter, owing to weaker consumer demand for PCs, but recorded an increase in earnings.

Revenue for the quarter that ended October 28 was $US15.37 billion, down slightly from the $US15.4 billion reported for the same quarter last year. Analysts expected revenue of $US15.6 billion.

The company's revenue from mobility, which includes laptops and tablets, fell by 2 per cent year over year, while desktop revenue fell by 6 per cent. The company's storage revenue fell by 15 per cent year over year. Combined, those units accounted for 56 per cent of the company's overall revenue.

However, revenue from enterprise solutions and services, which includes servers, storage and networking, rose 8 percent to $US4.7 billion, which was an all-time high, the company said.

The company reported $893 million profit, or $US0.49 per share for the quarter, compared to $US822 million, or $US0.42, in the same period last year. Excluding one-time charges such as costs related to acquisitions, the company reported earnings of $US983 million with earnings per share of $US0.54. Analysts had forecast earnings of $0.47 per share.

Dell's consumer business has taken a backseat as the company tries to focus more on the enterprise market, where the profit margins are higher. The PC market is hurting because of thin margins and a slowdown in unit shipments. Dell is actively trying to move a larger part of its revenue to its enterprise solutions and services business, which include servers, storage, networking and services.

(More to follow.)

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Agam Shah

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