On May 31, computer maker Dell (NASDAQ:DELL) released preliminary first-quarter earnings for the period ended May 4.

  • The good news for the quarter came in the form of higher average selling prices. That led to small increases in sales and EPS.
  • Management also announced massive layoffs: About 10% of the company, or some 8,800 employees, will be looking for work.
  • Fool Tim Beyers warns investors not to get too excited, noting that Dell still has a long way to go.
  • Our Motley Fool CAPS community has pulled the stock out of the one-star sewer, improving its rating to two stars out of five. That's still below average, however.

(Figures in millions, except per-share data.)

Income Statement Highlights

Q1 2007

Q1 2006

Change

Sales

$14,622

$14,216

2.9%

Net Profit

$759

$762

(0.4%)

EPS

$0.34

$0.33

3.0%

Diluted Shares

2,254

2,318

(2.8%)

Get back to basics with the income statement.

Margin Checkup

Q1 2007

Q1 2006

Change*

Gross Margin

19.5%

17.4%

2.1

Operating Margin

6.5%

6.7%

(0.2)

Net Margin

5.2%

5.4%

(0.2)

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights
The results are still "preliminary" as the audit committee wraps up its investigations of past accounting practices. Thus, no balance sheet.

The balance sheet reflects the company's health.

Cash Flow Highlights
And no cash flow statement for the same reason.

Free cash flow is a Fool's best friend.

Related Foolishness:

Dell is an Inside Value and Stock Advisor pick.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.