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With higher server demand and lower costs, Dell’s quarterly profit jumps

A better supply chain benefits the company and results in increased profits

On Monday, Dell Technologies Inc. reported a 68 percent increase in quarter-over-quarter operating profit because of strong server and network equipment demand that buffered weak PC sales and eased supply-chain pressure keeping costs under control.

A 12% increase was reported in revenue for the company’s infrastructure solutions division, which includes servers, storage devices, and networking hardware.

At the same time/In parallel/ In the meantime, the company was impacted by the widely recorded cooling demand for personal computers and laptops in the wake of the pandemic.

The revenue of consumers plunged 29%, and the revenue of large enterprises, or commercial sales, dropped 13%. Despite a decline in revenue, Refinitiv IBES data showed total revenue of $24.72 billion, beating expectations of $24.54 billion by $3 billion.

An improved supply chain helped minimize the impact of higher component and freight costs on the company. Furthermore, it prevented external hiring to reduce expenses.

During the third quarter ending Oct. 28, operating expenses decreased by 8%, the company reported.

Due to a $1 billion settlement of a lawsuit over a disputed 2018 stock swap, net income declined 93% to $241 million.

An increase of $1.76 billion was recorded in operating income from $1.05 billion last year.

In terms of earnings per share, Dell earned $2.30 after excluding items.