With sizzling growth in shipments, revenue, and net income adding up to the best quarter yet for the hardware vendor.

Revenue was $12,5bn for the period ending October 29, an increase of 18% from last year's third quarter revenue of $10,6bn. Net income was $846m, up by 25% from $677m in the previous year's third quarter.

Earnings per share were $0,33, a 27% increase from last year. Both the revenue and earnings per share figures matched estimates of analysts polled by Thomson First Call.

Dell posted strong increases in shipments across the breadth of its products. The company has set internal records for quarterly revenue in three of the last four quarters.

The only exception was the traditionally slow first quarter of 2004, which, nonetheless, was a Dell record for first-quarter revenue.

PC market watchers such as IDC and Gartner have warned that consumer spending on PCs is headed for a slowdown, but Dell does not expect any impact on its business, says president and CEO, Kevin Rollins.

The company derives the majority of its revenue from businesses, which increased their spending on Dell products by 25% in the quarter, he adds.

The Round Rock, Texas, company expects more of the same for the fourth quarter. Revenue should be about $13,5bn and earnings per share should be $0,36, Dell says.

Worldwide shipment growth in the quarter was 22%, propelled by a 35% increase in notebook shipments, Dell adds.

A decline in component prices for flat-screen panels helped drive the growth in notebook shipments, Rollins says. Component prices fell in several categories, but the availability of cheaper displays was great news for the notebook business, he adds.

The company expects to sell five million printers this year, making its printer business the most successful start-up business Dell has ever built, Rollins continues.

Dell continues to grow strongly outside of the US, where it is chasing Hewlett-Packard (HP) in PCs and servers. Overall shipments to Europe, the Middle East, and Africa (EMEA) increased by 31% in the quarter, and shipments to Asia-Pacific and Japan were up by 25%.

HP ships the most servers worldwide, but Dell believes that it narrowed that lead by 2% in the third quarter.

Dell server shipments were up by 19% compared to last year, even though the company struggled in the early part of the quarter with some product transitions, Rollins adds.

Rollins reiterated comments made earlier this week that, while Dell is impressed with Advanced Micro Devices's Opteron server processor, it has no specific plans to break its exclusive relationship with Intel at this time.

In the third quarter, the company's headcount increased by 3 000 employees from the second quarter of this year, and by almost 10 000 employees compared to the same period last year.

Dell is bringing more call centre employees in-house, as opposed to using third-party companies to handle support calls, Rollins concludes.