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New Dell CEO greeted with increased Q2 guidance

New Dell CEO greeted with increased Q2 guidance

Dell has raised its second-quarter earning forecast, citing higher operating profitability and a continued decline in the company’s global tax rate.

The PC maker now expects earnings per share for the period ending July 30, to be $US0.31, up $US0.02 from Dell’s initial guidance and an increase of 29 per cent from the same quarter last year.

Dell still anticipated second-quarter revenue of $US11.7 billion, it said.

Industry analysts polled by Thomson First Call are expecting second quarter earnings per share of $US0.29.

Dell's positive outlook for the quarter continues its growth trend and came on the same day that company founder, Michael Dell, formally passed his CEO mantle to Kevin Rollins.

In April, the company boosted its earnings forecast for the first quarter of its 2005 fiscal year, the period ended April 30, based on the growth it was experiencing in markets outside the US. Bolstered by the sale of high-ticket items such as servers and notebooks, Dell posted earnings per share of $US0.28, on revenue of $US11.5 billion, up 21 per cent from the first quarter of last year.

Dell said those gains were continuing in the second quarter with robust sales of enterprise systems and services, further gains in markets outside the US and strong shipments to US small and medium business customers.

Market researchers at IDC and Gartner both issued reports recently stating that growth figures for worldwide PC shipments are still in the double-digits for a market that is being driven by demand for replacement PCs from business users.

Gartner said 42.8 million PCs were shipped worldwide in the second quarter, 13.3 per cent more than in the year-earlier period, while IDC reported PC shipment growth of 15 per cent over the same period, with 39.7 million units shipped.

Dell's full results for the second quarter would be announced on August 12, the company said.


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