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Earnings Roundup

Dell's profit rises 46% in quarter

August 31, 2007|From Times Wire Services

Dell Inc. said preliminary second-quarter earnings jumped 46% on stronger sales of enterprise products and services, improved average selling prices and favorable component costs.

The computer maker said it earned $733 million, or 32 cents a share, in the three months ended Aug. 3, compared with $502 million, or 22 cents, a year earlier. Sales rose 4% to $14.8 billion.

The results beat the prediction of analysts polled by Thomson Financial, who expected earnings of 30 cents a share on sales of $14.63 billion.

The report comes as Round Rock, Texas-based Dell emerges from a yearlong internal investigation into accounting misconduct.

Dell said it would have to reduce more than four years' worth of earnings by as much as $150 million after misleading auditors and manipulating results to meet expectations.

"While our results demonstrate we've made progress against our goals, we are still in the early stages of transforming our company's structure, costs and operations," Chief Executive Michael Dell said in a statement.

The earnings were dragged down a nickel a share by a $102-million charge for compensation expenses related to payments for expired stock options and $59 million in costs related to the internal probe.

The results did not include year-ago figures and remain preliminary until Dell resolves an ongoing Securities and Exchange Commission investigation into the accounting issues.

Dell faces shareholder lawsuits, and federal prosecutors in New York have also subpoenaed documents on the company's financial reporting since 2002.

Shares rose 60 cents, or 2.2%, to $28.46.

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