Dell Computer yesterday forecast stronger-than-expected results for fourth-quarter sales and earnings, bucking a trend among techs and making it the only US computer firm to gain market share last year.
The Austin, Texas-based firm which employs about 5,500 in Limerick and Bray is the only major computer maker to project a boost in unit sales and market share in the fourth quarter and for all of 2001 compared with a year earlier, according to International Data and Gartner's Dataquest unit.
Buoyed by higher returns from an agressive advertising and price-cutting campaign, Dell anticipates sales of $8 billion (€9.05 billion), up from previous guides of $7.6 billion and fourth-quarter earnings of 17 US cents a share, up one cent. Official results for the period, which ends February 1st, will be reported on February 14th.
Dell's projected unit sales in the US for the fourth quarter and for the year exceeded the combined total of Compaq and Hewlett-Packard, the second and third largest computer makers which are attempting to merge. Total PC sales fell in 2001 for only the second year on record. Dataquest put the worldwide drop at 4.6 per cent, with US sales declining 11.1 per cent.
Dell's guidance contrasted with weak forecasts from Microsoft, IBM and Sun Microsystems. Microsoft said it expected more sluggishness in the PC market and reported falling profits due to a $660 million legal charge. Its shares slid $3.06 to $66.80. IBM shares fell by more than 5 per cent after it reported declining revenue and earnings. Sun Microsystems fell 14 US cents after the network computer maker reported a quarterly loss and plunging sales.
Intel, the world's number one computer chipmaker, warned on Tuesday that it was slashing 2002 capital spending, dampening hopes for a quick profit recovery.
On a brighter note, US consumer confidence is rising in anticipation of the end of the recession, according to the University of Michigan's consumer sentiment index. This surged for a fourth straight month to 94.2 in early January from 88.8 in December, far exceeding analysts' expectations.
"It's telling you the same thing everything else is telling you: people are becoming more optimistic," said Mr James Glassman, senior economist at J.P. Morgan Chase in New York.
