Dell eyes two-thirds of sales from outside U.S. in 5 years

BEIJING Fri May 30, 2008 3:23am EDT

File photo shows Dell Inc Chief Executive and founder Michael Dell addressing investors at the Dell 2008 Equity Analyst Meeting in Round Rock, Texas, April 3, 2008. REUTERS/Bob Pearson

File photo shows Dell Inc Chief Executive and founder Michael Dell addressing investors at the Dell 2008 Equity Analyst Meeting in Round Rock, Texas, April 3, 2008.

Credit: Reuters/Bob Pearson

BEIJING (Reuters) - Dell Inc DELL.O, the world's No. 2 personal computer maker, said on Friday sales outside the United States were growing much faster than its home market and could account for two-thirds of total revenues within five years.

Revenue from international regions topped U.S. revenue for the first time, with Brazil, Russia, India and China (BRIC) leading the way with 73 percent shipment growth in the first quarter, Steve Felice, president of Dell Asia-Pacific and Japan, told reporters during a teleconference.

At the rate things are going "two-thirds could come in five years," said Felice, referring to sales from outside the U.S.

The comments came after Dell posted higher-than-expected quarterly profit, driven by cost cuts and strong demand from consumers and foreign markets, pushing its shares up nearly 10 percent in after-hours trade.

Dell pointed to the strong performance as evidence that a year-long turnaround led by founder Michael Dell, who returned to the chief executive post in January 2007, was yielding results.

However, Dell said U.S. corporate customers were still cautious about buying given the uncertain economic outlook.

The firm's Americas revenue rose 1 percent in the quarter ended May 2, although server unit shipments soared 20 percent, four times that of the industry.

Dell has announced a plan to cut 8,900 jobs to reduce costs, but said Asia -- with faster sales growth and a large part of the company's supply chain -- would see more job growth.

"You will continue to see continued head-count growth in Asia," he said.

In March, the company said it would buy $23 billion of components from China this year and $29 billion in 2009, rising from $18 billion last year to help reduce costs.

($=6.94 yuan)

(Reporting by Kirby Chien; Editing by Anne Marie Roantree)

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