Dell (DELL) closed up today. Its shares were up over 2% to $28.36. The company then reported preliminary results for its second quarter of fiscal year 2008, with revenue of $14.8 billion, operating income of $896 million and earnings per share of $0.32.

Several factors effected operating expenses in the quarter, including $102 million, or $0.03 per share, in incremental compensation expense related to payments for expired in-the-money stock options; $59 million, or $0.02 per share, in costs associated with the Audit Committee’s investigation into certain accounting and financial reporting matters; and higher headcount and associated costs related to investments in sales and customer support.

The company highlighted areas outside PCs. Server revenue in the second quarter was $1.6 billion. For Q2, Dell was again No. 1 in the United States in server units shipped with 32.7 percent share. But, this is still a small part of the overall product and service revenue mix.

Percentage of Total Net Revenue:
————————————————-
Desktop PCs                                                    34%
Mobility                                                            26%
Servers and Networking                                     11%
Storage                                                              4%
Enhanced Services                                              9%
Software and Peripherals                                    16%

And its forecast was vague but carried a warning. "Near-term results could be adversely impacted by a slower decline in component costs in the second half of the year."

Dell’s stock was fairly flat after hours.

Douglas A. McIntyre

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.