PC maker Dell said Thursday its third-quarter profit fell 5 percent as businesses around the world bought fewer computers and other technology products.
Dell’s earnings dipped to $727 million in the quarter that ended Oct. 31, down from $766 million a year ago. But Dell bought back a significant number of shares over the last year, pushing earnings per share up 9 percent, to 37 cents per share.
That was 6 cents better than analysts were expecting, according to a Thomson Reuters poll.
Sales slipped 3 percent to about $15 billion, shy of analyst expectations for $16.2 billion, dragged down by slower spending by corporations. In the Americas, Dell’s largest region for sales to businesses, revenue dropped 8 percent.
“We expect the challenging environment to continue,” Dell Chief Financial Officer Brian Gladden said during a conference call.
In one bright spot, Dell’s consumer PC revenue increased 10 percent worldwide as unit shipments jumped 32 percent. Dell does not break out U.S. consumer sales, but Gladden said that “the U.S. was a strong part of the good performance.”
However, Dell’s consumer sales account for less than a fifth of the company’s total, and the bright performance wasn’t able to offset trouble in the corporate business. Dell also lacks the product diversity enjoyed by its biggest rival, Hewlett-Packard, which announced this week that it would exceed analysts’ forecasts for its most recent quarter.
Shares of Dell jumped to $10.39 in extended trading, after falling 5 percent to close at $9.81 before the earnings report came out.
Retrenching as it tries to deal with the economic uncertainty, Dell has been on a cost-cutting campaign. The Round Rock, Texas-based company has slashed about 9 percent of its work force in the past year.
