Dell Computer Corp. posted a 5 percent increase in quarterly profits despite a 7 percent drop in sales. However, its annual net income plummet 43 percent, the worlds top PC maker reported on Thursday.
For its fiscal fourth quarter, which ended Feb. 1, Dell posted net income of $456 million, or 17 cents a share, up from the $434 million, or 16 cents, it earned during the same quarter a year earlier.
For fiscal 2001, Dells net earnings were $1.25 billion, as compared with $2.18 billion a year earlier.
Sales during the fourth quarter totaled about $8.1 billion, more than $600 million less than last year. Looking ahead, the company project sales would fall another 3 to 5 percent in the coming quarter, reflecting an ongoing industry-wide slump in computer sales.
Dells results fell within Wall Streets expectations, which were based on guidance the company offered last month.
Rather than earnings, Dell touted its recent market share gains against its competitors. Over the last year, the Round Rock, Texas-based company has used aggressive low-pricing to gain share on its rivals, leveraging cost-savings from its more efficient made-to-order business model to lure away customers from Compaq Computer Corp., Hewlett-Packard Co., IBM and others.
According to the Dell, the company gained almost three percentage points of worldwide server market compared to a year ago, and more than five points in the United States, based on units shipped.
"As our industry moves into a new stage of consolidation, the opinions that still matter most belong to customers," company Chairman and CEO Michael Dell said in a prepared a statement. "The pace with which theyre choosing Dell products and services accelerated last year, and puts us in a stronger competitive position than at any time in our history."
Dell predicted that his company would outperform the industry during the first quarter, despite a seasonal drop in consumer sales and continued weak demand from enterprise customers.