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Dell (DELL) Q1 Earnings Beat Estimates, Revenues Up Y/Y
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Dell Technologies (DELL - Free Report) reported first-quarter fiscal 2023 non-GAAP earnings of $1.84 per share, beating the Zacks Consensus Estimate by 33.33%. The bottom line jumped 36% year over year.
Revenues, on a non-GAAP basis, improved 16% year over year to $26.12 billion and beat the consensus mark by 3.13%.
Product revenues increased 17% year over year to $20.46 billion. Services revenues rose 11% year over year to $5.65 billion.
Recurring revenues were roughly $5.3 billion, up 15% year over year.
Dell Technologies Inc. Price, Consensus and EPS Surprise
Dell shares were up 11.77% after hours following fiscal first-quarter results. The company’s shares have fallen 21.8% year to date (YTD) compared with the Zacks Computer & Technology sector’s decline of 28.5%.
Quarter in Detail
Infrastructure Solutions Group (“ISG”) revenues were up 16% year over year to $9.29 billion.
The upside can be attributed to 22% growth in servers and networking revenues that totaled $5.05 billion. Storage revenues grew 9% year over year to $4.24 billion.
Client Solutions Group (“CSG”) revenues were $15.59 billion, up 17% year over year. This performance was driven by Commercial revenues, which surged 22% year over year to $11.97 billion. Consumer revenues were up 3% to $3.62 billion.
The non-GAAP gross profit increased 9% year over year to $5.94 billion. The gross margin contracted 150 basis points (bps) year over year to 22.7%.
SG&A expenses declined 3% year over year to $3.55 billion. Research and development expenses were up 10% year over year to $681 million in the reported quarter.
Non-GAAP operating expenses increased 3% year over year to $3.81 billion. Operating expenses, as a percentage of revenues, declined 190 bps on a year-over-year basis to 14.5%.
The non-GAAP operating income was $2.14 billion, up 21% from the year-ago quarter’s levels. The operating margin expanded 40 bps year over year to 8.2%.
The ISG operating income increased 39% year over year to $1.08 billion. Meanwhile, the CSG operating income was $1.12 billion, up 3% year over year.
Balance Sheet
As of Apr 29, 2022, DELL had $8.52 billion in cash and long-term investments compared with $11.3 billion as of Jan 28, 2022.
Debt was $27.12 billion as of Apr 29, 2022 compared with $16.1 billion as of Jan 28, 2022.
Dell returned $1.75 billion to its shareholders through a combination of share repurchases and dividends.
Zacks Rank & Stocks to Consider
Dell carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the same sector are Samsara (IOT - Free Report) , The Descartes Systems (DSGX - Free Report) and Progress Software (PRGS - Free Report) .
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Dell (DELL) Q1 Earnings Beat Estimates, Revenues Up Y/Y
Dell Technologies (DELL - Free Report) reported first-quarter fiscal 2023 non-GAAP earnings of $1.84 per share, beating the Zacks Consensus Estimate by 33.33%. The bottom line jumped 36% year over year.
Revenues, on a non-GAAP basis, improved 16% year over year to $26.12 billion and beat the consensus mark by 3.13%.
Product revenues increased 17% year over year to $20.46 billion. Services revenues rose 11% year over year to $5.65 billion.
Recurring revenues were roughly $5.3 billion, up 15% year over year.
Dell Technologies Inc. Price, Consensus and EPS Surprise
Dell Technologies Inc. price-consensus-eps-surprise-chart | Dell Technologies Inc. Quote
Dell shares were up 11.77% after hours following fiscal first-quarter results. The company’s shares have fallen 21.8% year to date (YTD) compared with the Zacks Computer & Technology sector’s decline of 28.5%.
Quarter in Detail
Infrastructure Solutions Group (“ISG”) revenues were up 16% year over year to $9.29 billion.
The upside can be attributed to 22% growth in servers and networking revenues that totaled $5.05 billion. Storage revenues grew 9% year over year to $4.24 billion.
Client Solutions Group (“CSG”) revenues were $15.59 billion, up 17% year over year. This performance was driven by Commercial revenues, which surged 22% year over year to $11.97 billion. Consumer revenues were up 3% to $3.62 billion.
The non-GAAP gross profit increased 9% year over year to $5.94 billion. The gross margin contracted 150 basis points (bps) year over year to 22.7%.
SG&A expenses declined 3% year over year to $3.55 billion. Research and development expenses were up 10% year over year to $681 million in the reported quarter.
Non-GAAP operating expenses increased 3% year over year to $3.81 billion. Operating expenses, as a percentage of revenues, declined 190 bps on a year-over-year basis to 14.5%.
The non-GAAP operating income was $2.14 billion, up 21% from the year-ago quarter’s levels. The operating margin expanded 40 bps year over year to 8.2%.
The ISG operating income increased 39% year over year to $1.08 billion. Meanwhile, the CSG operating income was $1.12 billion, up 3% year over year.
Balance Sheet
As of Apr 29, 2022, DELL had $8.52 billion in cash and long-term investments compared with $11.3 billion as of Jan 28, 2022.
Debt was $27.12 billion as of Apr 29, 2022 compared with $16.1 billion as of Jan 28, 2022.
Dell returned $1.75 billion to its shareholders through a combination of share repurchases and dividends.
Zacks Rank & Stocks to Consider
Dell carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the same sector are Samsara (IOT - Free Report) , The Descartes Systems (DSGX - Free Report) and Progress Software (PRGS - Free Report) .
Samsara, Descartes and Progress Software each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Descartes’ shares have underperformed the sector YTD, declining 28.5%. DSGX is set to report first-quarter fiscal 2023 results on Jun 1.
Samsara is scheduled to release first-quarter fiscal 2023 results on Jun 2. IOT shares have been down 61.8% YTD.
Progress Software’s shares have outperformed the sector YTD, declining 0.9%. PRGS is likely to report second-quarter 2022 results on Jun 23.