Dell Stock Surges 350% in 2026 as AI Infrastructure Demand Drives Record Growth and S&P 100 Entry

Dell Stock Jumps 10% on RBC Outperform Rating

Dell stock surged 10% on Friday after RBC Capital Markets initiated coverage with an outperform rating and set a $640 price target, pushing shares to an all-time high1

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. RBC analyst David Paige cited Dell's dominant position in the multi-year AI infrastructure spending cycle as the primary driver behind the bullish outlook. The longtime PC maker has emerged as one of the top vendors for Nvidia-based servers and related equipment, with cloud companies and enterprises aggressively purchasing hardware for artificial intelligence deployments1

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Dell stock has more than quadrupled in 2026, representing a nearly 350% gain so far this year1

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. Over the past three years, shares have climbed roughly 700%, placing the hardware giant alongside market leaders like Apple, Microsoft, and Nvidia3

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. This extraordinary performance reflects the company's successful pivot from traditional computing to becoming a critical supplier in the AI infrastructure boom.

Massive AI Server Backlog Signals Sustained Growth

Dell holds $95 billion in sales in its server order backlog that it hasn't yet started to fill, according to RBC Capital Markets1

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. The company sold approximately $16.4 billion of AI servers in its second quarter alone, demonstrating the scale of current demand1

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. Dell booked $60.9 billion in AI orders during Q2, a fresh record, with AI server orders topping $131.7 billion over the past 12 months3

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The Infrastructure Solutions Group, which includes AI servers, storage, and networking equipment, posted revenue of $31.8 billion in the second quarter, up 89% year over year3

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. AI-optimized server revenue reached $16.4 billion, double the year-ago figure2

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. Dell reported second-quarter earnings earlier this month that surpassed estimates, with total revenue hitting $47 billion, a 58% increase year over year, while earnings per share more than tripled to $7.043

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Dell Raises Full-Year Revenue Outlook to $192 Billion

Dell upped its fiscal full-year revenue outlook to $192 billion, which would represent nearly 70% growth over last year1

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. The company raised its guidance by $25 billion and now expects AI-optimized server revenue to triple year over year to $74 billion, representing roughly 200% growth2

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. Full-year adjusted EPS guidance now stands at $25.50, up 148% annually2

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Dell executives told investors on the earnings call that the company is increasing prices because of rising costs for computer parts such as memory, which factored into the elevated guidance1

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. Despite price increases, demand remains robust across multiple product lines. Storage revenue grew 26% in the most recent quarter, marking its sixth consecutive quarter of above-market demand growth3

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. Traditional server revenue jumped 122% as companies replace aging equipment, while PC revenue in Dell's Client Solutions Group rose 20%, its fastest pace in five years3

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Supply Chain Advantages and Nvidia Partnership

RBC analyst David Paige highlighted Dell's supply chain as a competitive moat that differentiates the company during periods of supply disruption. "Dell's best-in-class supply chain represents a competitive moat that differentiates the company during periods of supply disruption, as customers increasingly turn to Dell for a 'calming hand' during periods of supply volatility/constraints," Paige wrote1

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Dell was among the first companies to ship Nvidia's Grace Blackwell NVL72 racks, highlighting its close relationship with Nvidia and ability to secure supply of the company's GPUs1

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. This early access to cutting-edge hardware demonstrates Dell's strategic importance to Nvidia and positions the company to capture premium demand from customers seeking the latest AI infrastructure. Dell supplies neoclouds including CoreWeave, further cementing its role as a critical infrastructure provider1

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Dell's products that aren't based on Nvidia GPUs, such as storage solutions, are also seeing increased demand driven by AI1

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. RBC argues this breadth makes Dell a single destination for enterprises assembling full AI infrastructure stacks2

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. Effectively, Dell can be a one-stop shop for companies looking to stand up AI infrastructure1

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Dell Joins S&P 100 Index in September

Dell will join the S&P 100 index on September 21, 2026, according to S&P Dow Jones Indices3

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. The S&P 100 is a subset of the broader S&P 500, made up of the 100 largest and most established companies by market value. Getting added to the S&P 100 is not just symbolic—the inclusion forces index funds and institutional portfolios that track the benchmark to buy shares, adding a fresh layer of short-term demand3

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Membership signals that Dell stock has grown large and stable enough to be treated as a core holding rather than a speculative bet3

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. For Dell, the timing aligns with a business that is scaling rapidly. The same rebalancing also adds Palo Alto Networks, Arista Networks, and SanDisk, while removing Nike, Simon Property Group, and Colgate-Palmolive3

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. The index addition confirms what the stock's run already suggested—Wall Street now views Dell as core infrastructure for the AI economy3

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Leadership Sees Structural AI Chip Supply Shortage

CEO Michael Dell addressed the durability of AI infrastructure demand at the Goldman Sachs Communacopia and Technology Conference on September 9, pointing to a structural gap between AI chip supply and what companies need3

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. "All of the improvements in the models, particularly from basic LLMs to reasoning to agents, has occurred well within the timeframe required to build a new semiconductor fab," Michael Dell said. "You just have a structural shortage, probably worse in 2027 than in 2026 from everything that we see"3

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COO Jeff Clarke told investors the firm expects the AI infrastructure market to be worth more than a trillion dollars by 2030, with AI making up 75% of all data center demand by then3

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. Clarke also pointed to a massive installed base of aging equipment still waiting to be replaced. Dell said 1.2 million servers in its customer base are still running on 14th generation hardware or older, a backlog of upgrades that should keep demand strong well beyond this year3

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Michael Dell described the company as still early in a broader shift where businesses reorganize around AI rather than simply buying faster computers. "I would say we're really at the very beginning of that in most companies," Dell said. "They don't know how to do it. It's hard"3

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. This commentary suggests Dell's leadership expects sustained demand as enterprises navigate the complex transition to AI-centric operations.

Strong Cash Generation and Shareholder Returns

Chief Financial Officer David Kennedy told analysts on the September 1 earnings call that the company generated $8.1 billion in adjusted free cash flow during the quarter and returned an all-time record $4.3 billion to shareholders, including share buybacks at an average price of $401 per share3

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. Operating expenses fell to about 8% of revenue, the lowest level in the company's 42-year history3

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. This operational efficiency combined with explosive revenue growth demonstrates Dell's ability to scale profitably during the AI infrastructure boom.

Out of the 21 analysts covering Dell stock, 14 recommend "Buy," and seven recommend "Hold." The average Dell stock price target is $595, above the current price of $5353

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. With no signs of slowing in AI infrastructure spending, Dell appears positioned to benefit from what executives describe as a multi-year cycle that is still in its early stages1

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