Dell’s results leap off the page in these recessionary times: Austin, Texas-based Dell Computer Corp has reported third quarter net profits up 89.7% on turnover that rose 67.7% to $229.3m. Chairman and chief executive, 26 year-old Michael Dell, says the company is well-positioned to meet rapidly changing market conditions with its revenue growth. The research and development programme, amounting to 4% of total revenues, has been crucial to this, he says, and cites the 19 new systems introduced since the beginning of the fiscal year, new portables and 486-based systems, as evidence of this. Portables and 486-based systems currently account for 35% of third quarter total system revenues. He describes net income as having benefitted from lower operating expenses, higher interest from the company’s cash and investments, and tax breaks on Dell’s manufacturing facility in Ireland in line with the Irish government’s incentives for foreign investors. Improved tax structure in start-up operations and tax benefits derived from tax-exempt interest income have further contributed to the lower rate tax, he says. Dell UK marketing manager, Maurice Cowey, said the company is able to sustain lower gross margins by a company-wide discipline that manifests itself in tight advertising budgets, direct sales and a general carefulness with regard to costs amongst the 2,700 employees. Name another major computer maker that has increased sales and earnings each quarter this year.
