Dell, based in Round Rock, Texas, will continue to benefit from businesses upgrading employees' computers, server computers in data centers and other technology, which are more profitable than the PCs Dell sells to consumers. Businesses had held off spending money on technology during the worst of the economic downturn. Now, companies of all sizes are switching to Microsoft Corp.'s Windows 7 operating system as they swap out older PCs, analysts say.
Consumers, on the other hand, are spending less. Ongoing economic uncertainty and increasing buzz about tablet computers such as Apple Inc.'s iPad are both factoring into consumers' decision to hold off on buying new computers.
Analysts also expect Dell's earnings to get a boost from lower component prices during the quarter.
The company is expected to report fourth-quarter earnings of 36 cents per share, on $15.73 billion in revenue, according to FactSet. Last year, the company earned $334 million, or 17 cents per share, on $14.9 billion in revenue in the fourth quarter.