Earnings Preview: Dell Slips Even As PCs Rebound

Also during the quarter, Dell agreed to pay $4 million to settle a lawsuit in New York state over deceptive advertising of promotional credit financing and warranties. Dell acknowledged no wrongdoing in the settlement.

BY THE NUMBERS: Analysts surveyed by Thomson Reuters expect Dell to post a profit of 28 cents per share on $13.1 billion in revenue.

ANALYST TAKE: Broadpoint AmTech analyst Dinesh Moorjani wrote in a research note last week that Dell's PC shipment growth lagged the overall industry in the quarter because its business customers haven't resumed spending on technology yet. The company also resisted cutting prices just to gain market share.

The analyst also wrote that he expects Dell's margins to have declined in the quarter thanks to higher component prices.

But Moorjani raised his earnings estimates for Dell's next fiscal year in part due to "increased conviction of an enterprise (information technology) spending recovery and PC upgrade cycle in 2010."

WHAT'S AHEAD: Dell's next quarterly report, due in February, will include the first peek at how Dell's entry into the smart phone industry performed. The company unveiled phone hardware and announced its first two carriers, China Mobile in China and Claro in Brazil, last week.

STOCK PERFORMANCE: Shares of Dell gained 8 percent to end the quarter at $14.45 on Oct. 30. Since then, the stock has improved another 10 percent.

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