Dell’s Earnings Beat Forecasts, but Sales Fall Short

Dell Computer Corp. reported a 19% rise in its second-quarter profit, a penny better than forecasts, but revenue missed expectations. Dell, the largest direct seller of personal computers, said earnings rose to $603 million, or 22 cents a share, and revenue increased 25% to $7.7 billion. Analysts were expecting sales of $7.86 billion, according to IBES International Inc. The company said revenue was hurt by softer demand in Europe and among government customers, the latter of which was slow in rebounding from Y2K expenditures. Dell said it benefited from favorable component costs and healthy sales of higher-margin products, such as servers and notebook computers. Chief Executive Michael Dell said the company still expects to reach its revenue growth target of 30% for the year, even though it didn’t hit that target for the quarter. Shares in Round Rock, Texas-based Dell fell $1.38 to $40.38 in extended trading after closing off 6 cents at $41.75 on Nasdaq, before the earnings report was released.