Revenue from international regions topped U.S. revenue for the first time, with Brazil, Russia, India and China (BRIC) leading the way with 73 percent shipment growth in the first quarter, Steve Felice, president of Dell Asia-Pacific and Japan, told reporters during a teleconference.

At the rate things are going “two-thirds could come in five years,” said Felice, referring to sales from outside the U.S.

The comments came after Dell posted higher-than-expected quarterly profit, driven by cost cuts and strong demand from consumers and foreign markets, pushing its shares up nearly 10 percent in after-hours trade.

Dell pointed to the strong performance as evidence that a year-long turnaround led by founder Michael Dell, who returned to the chief executive post in January 2007, was yielding results.

However, Dell said U.S. corporate customers were still cautious about buying given the uncertain economic outlook.

The firm’s Americas revenue rose 1 percent in the quarter ended May 2, although server unit shipments soared 20 percent, four times that of the industry.

Dell has announced a plan to cut 8,900 jobs to reduce costs, but said Asia — with faster sales growth and a large part of the company’s supply chain — would see more job growth.

“You will continue to see continued head-count growth in Asia,” he said.

In March, the company said it would buy US$23 billion of components from China this year and US$29 billion in 2009, rising from US$18 billion last year to help reduce costs.

The company posted a higher-than-expected quarterly profit Thursday, driven by cost cuts and strong demand from consumers and foreign markets, and its shares jumped nearly 10 percent.

Growth in Asia and strong sales of notebook computers helped Dell beat Wall Street expectations for first-quarter sales and profit.

Dell’s unit shipment growth of 22 percent was the strongest in two years, though it said U.S. corporate customers were keeping a tight grip on spending, a trend it expects to last through the summer.

Net income in the three months ended May 2 rose to US$784 million, or 38 cents per share, from US$759 million, or 33 cents per share, a year earlier. Revenue was US$16 billion, up 9 percent from a year earlier.

Analysts had expected a profit of 34 cents per share, excluding special items, on revenue of US$15.7 billion in its fiscal first quarter, according to averages of Wall Street expectations on Reuters Estimates.

Dell shares jumped 9.5 percent to US$23.88 in extended trade, after rising 12 cents to US$21.81 in regular Nasdaq trade Thursday.

Dell shares have risen nearly 10 percent in the past three months, compared with a fall of about 2 percent for rival Hewlett-Packard Co. and slightly trailing an 11 percent rise in the Nasdaq. Dell shares were trading at 18.7 times expected 2009 earnings, a premium to HP’s 14.9 multiple.

Subscribe to The China Post and save.  Click hereSharePrintEmail

Write a Comment

Enter your comments - 800 characters max

Receive China Post promos

Respond to this email