May 20, 2010, 4:21 p.m. EDT · Recommend · Post:

Dell profit jumps 52% as PC, server sales rise

By Benjamin Pimentel, MarketWatch

SAN FRANCISCO (MarketWatch) - Dell Inc. on Thursday reported a 52% jump in quarterly profit, boosted by strong demand in the personal computer and server market.

Shares of Dell /quotes/comstock/15*!dell/quotes/nls/dell (DELL 13.78, -0.54, -3.77%) fell more than 5% in after-hours trading, as the computing giant also said it expects typically softer demand among "larger commercial customers" in the U.S. and Europe in the second quarter and the first part of the third quarter.

Dell reported a fiscal first-quarter profit of $441 million, or 22 cents a share, compared with a profit of $290 million, or 15 cents a share, for the year-earlier period. Revenue rose to $14.9 billion from $12.3 billion for the same quarter the previous year. Adjusted income was 30 cents a share.

Analysts had expected the company to report earnings of 26 cents a share, on revenue of $14.3 billion, according to a consensus survey by FactSet Research.

In a statement, the company said it "is seeing the early stages of a corporate IT refresh.

"Commercial demand continued to build in the first quarter and Dell is optimistic the trend will continue throughout the year," the company said.

But Dell also added, "But, the second quarter and the first part of the third quarter typically experience slower demand from larger commercial customers in the U.S. and Europe. Overall, Dell expects a normal, seasonal sequential demand pick-up in the low single digits in its second quarter."

The company also said it anticipates "some components to remain in tight supply for the next couple quarters and some volatility in global currencies."

Benjamin Pimentel is a MarketWatch reporter based in San Francisco.

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