Dellreported earnings that declined 5 percent but easily exceeded expectations, sending its shares higher in late trading.
Dell's earnings dipped to $727 million in the quarter that ended Oct. 31, down from $766 million a year ago. But Dell bought back a significant number of shares over the last year, pushing earnings per share up 9 percent, to 37 cents per share.
Analysts put Dell's earnings for the quarter at 31 cents a share, on a topline of $16.22 billion, according to a consensus estimate compiled by Thomson Reuters.
Shares of Dell rose more than 5.5 percent in extended trading Thursday. They closed the day's regular session down 5.23 percent at $9.81.
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Dell bought back a significant number of shares over the last year, partly explaining the 9 percent per-share earnings increase.
Dell blamed a corporate spending slowdown for the sales decline, saying that its consumer PC sales improved by 10 percent.
In the Americas, Dell's largest region for sales to businesses, revenue dropped 8 percent. (See Jim Goldman's report on Dell's earnings announcement, left.)
"The company was able to report above expectations as cost-cutting efforts offset revenue growth. It was certainly a surprise and what this shows is that cost-cutting initiatives are beginning to take effect," said Technology Analyst Bill Kreher of Edward Jones.
"The slowdown in PC demand affected laptop sales and thus revenue, but despite the difficult environment, the company's strategic plans are paying off. It shows that best-of-breed companies will be able to still grow through cost-cutting," Kreher added.
"We expect the challenging environment to continue," Dell Chief Financial Officer Brian Gladden said during a conference call.
In one bright spot, Dell's consumer PC revenue increased 10 percent worldwide as unit shipments jumped 32 percent. Dell does not break out U.S. consumer sales, but Gladden said that "the U.S. was a strong part of the good performance."
However, Dell's consumer sales account for less than a fifth of the company's total, and the bright performance wasn't able to offset trouble in the corporate business. Dell also lacks the product diversity enjoyed by its biggest rival, Hewlett-Packard, which this week posted stronger-than-expected preliminary results and forecast full-year profit above Wall Street estimates.
—Wire services contributed to this story.