No. 1 personal computer maker Dell Inc. (DELL) reported higher first-quarter profits Thursday due to better corporate demand for new technology, and it predicted more profit and revenue gains in the second quarter.

Chief Financial Officer Jim Schneider (search) said during a conference call that demand by corporations for new technology is the best it has been in three and a half years.

"We're seeing good pickup in U.S. corporate demand," Schneider said. "Actual selling prices have not declined as much as in other periods," he added.

The company, based in Round Rock, Texas, reported net income of $731 million, or 28 cents per share, for the fiscal first quarter ended April 30, compared with $598 million, or 23 cents per share, a year earlier.

Revenue increased to $11.54 billion from $9.53 billion a year earlier and was above the $11.4 billion Dell told analysts in early April to expect. The company also said then to expect first-quarter earnings of 28 cents a share.

According to Reuters Research, a unit of Reuters Group Plc, analysts had expected earnings of 28 cents a share and revenue of $11.41 billion.

Dell said it expects second-quarter revenue of $11.7 billion, up 20 percent from the prior year, and earnings of 29 cents a share compared with 24 cents a year earlier. Dell sees product shipments rising 24 percent.

Analysts were expecting fiscal second-quarter revenue of $11.59 billion and earnings of 29 cents a share, according to Reuters Research.