Dell Technologies (NYSE: DELL) reported its third quarter financial results after the closing bell on Tuesday. The Company surpassed earnings estimates, but fell short of revenue expectations, sending shares lower by 5% on Wednesday morning.
For the quarter, Dell reported earnings of USD 1.75 per share on revenue of USD 22.84 Billion. FactSet analysts anticipated earnings of USD 1.59 per share on revenue of USD 23.03 Billion.
Despite missing revenue estimates, Dell reported that its quarterly revenue increased by 2% year-over-year. Operating income during the quarter was USD 836 Million compared to an operating loss of USD 356 Million the same period a year ago, improving by 335%.
Dell’s Client Solutions Group reported revenues of USD 11.4 Billion, increasing by 5% year-over-year. Commercial revenue grew by 9% to USD 8.3 Billion, while consumer revenue was down 6% to USD 3.1 Billion. The revenue was driven by double-digit unit and revenue growth in commercial desktops and workstations.
Infrastructure solutions group reported revenue of USD 8.4 Billion, representing a 6% decrease year-over-year. Storage revenue totaled USD 4.1 Billion, up 7% year-over-year, while servers and networking decreased by 16% to USD 4.2 Billion.
VMWare revenue amounted USD 2.5 Billion in the quarter, up 11% year-over-year, driven by strength across Dell’s strong product portfolio.
Overall, Dell’s products segment reported total revenues of USD 17.48 Billion, decreasing by 1% year-over-year. The segment was offset by a 10% growth in Dell’s services segment, delivering total revenues of USD 5.35 Billion.
“This quarter’s results were driven by the strength of our diverse model, with our storage, commercial client and VMware businesses performing very well,” said Tom Sweet, Chief Financial Officer, Dell Technologies. “We remain focused on long-term profitable growth, growing faster than competitors and the industry, growing operating income and EPS faster than revenue and generating strong cash flow over time.”