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Dell Sales Rise 16% In Fis. Q1

Dallas — Revenue growth outside the United States, namely Europe and Asia-Pacific/Japan, helped push up overall fiscal first-quarter sales 16 percent at computer maker Dell, hitting $13.4 billion from a year-ago $11.5 billion.

First-quarter operating income jumped 22 percent to $1.2 billion from $966 million, while net income soared 28 percent in the first three months, reaching $934 million, compared with a year-on-year $731 million.

Revenue for the three months, ended April 29, rose 20 percent in Europe, to $3.2 billion, from $2.7 billion in the prior year, while revenue in Dell’s Asia-Pacific and Japanese markets increased 19 percent to $1.7 billion from $1.4 billion.

U.S. revenue in the first quarter moved up 14 percent, reaching $8.6 billion from a year-earlier $7.5 billion. However, the percentage of total net revenue attributed to the Americas in the first quarter dipped to 64 percent, down 1 percentage point from the prior year, while Europe increased to 24 percent, from 23 percent a year ago, and Asia/Japan remained the same, at 12 percent.

“Our greatest strength in the quarter was precisely in the products, services and regions in which we’re most focused on growing,” said Kevin Rollins, CEO.

Revenue from desktop PCs — which still account for 40 percent of Dell’s products mix, but down from 44 percent in the first quarter of last year — jumped 6 percent in the three months, hitting $5.3 billion, compared with $5 billion in the same quarter in 2004.

Dell, which continues to expand beyond its PC base, registered a 22 percent year-over-year revenue increase in its mobility segment, mainly laptops and handheld organizers, with three-month sales coming in at $3.3 billion, up from $2.7 billion in the same quarter the previous year. This segment accounted for 24 percent of total net revenue, compared with a year-ago 23 percent. Shipments of notebook computers rose 41 percent.

The company’s software and peripherals segment, including printers and televisions, enjoyed a first-quarter revenue increase of 29 percent, climbing to $2 billion, up from $1.5 billion a year earlier. This segment’s percentage of total net revenue rose to 15 percent in the first three months, compared with 13 percent a year ago. Dell cited strong growth in imaging and printing products.

Server segment revenue in the first quarter increased 12 percent to $1.3 billion, from $1.2 billion last year. This business accounted for 10 percent of the company’s total net revenue in the three months, the same as a year earlier.

Gross margin in the first quarter at Dell rose to 18.6 percent, compared with 18 percent in the year-ago three months, and 18.5 percent in the fourth quarter of the past fiscal year. Operating margin as a percent of revenue hit 8.8 percent in the first quarter, up from 8.4 percent year-on-year.