The world's second largest personal computer (PC) maker, Dell Computer, has reported a smaller than expected fall in profits during the first three months of this year.

Net profits fell to $457m (�314m) from $462m a year earlier.

Sales during the three-month period rose to $8.07bn from $8.03bn last year.

"Our business did quite well," chairman and chief executive Michael Dell told BBC's World Business Report.

"We continued to gain market share.

But the generally weak demand for computer equipment from companies and low sales of PCs hit Dell's earnings.

Nevertheless, the computer maker is optimistic about its future performance, predicting that its sales during the April to June quarter are set to increase 8% compared with a year earlier to $8.2bn.

Overtaken

Dell is no longer the world leader following the takeover of its rival Compaq Computer by Hewlett-Packard earlier this month.

But this is not a concern to the company, Mr Dell said.

"We've remained number one in profitability," he said.

"We're not anxious to achieve a certain revenue target while sacrificing profits."