Dell stock surges 21% as AI server sales projected to hit $50 billion in fiscal 2027

Dell Jumps After Projecting AI Server Sales of $50 Billion

Dell Technologies Inc. shares jumped in extended trading after the company gave an outlook for sales of its artificial intelligence servers that exceeded estimates, a sign of robust demand for machines helping fuel the AI data center build-out. The company will generate about $50 billion in AI server revenue in the current fiscal year, which ends in January 2027, Dell said Thursday in a statementBloomberg Terminal. "The AI opportunity is transforming our company," Chief Operating Officer Jeff Clarke said in the statement. Dell enters the year "with a record backlog of $43 billion -- powerful proof that our engineering leadership and differentiated AI solutions are winning," he said. Dell's servers designed to run AI workloads are attracting customers from companies that rent computing power like CoreWeave Inc. and Nscale Global Holdings Ltd., as well as corporate clients and major AI providers. The Texas-based company has been working to hold down costs and improve margins even as prices for memory chips rise rapidly. In the fiscal fourth quarter, Dell reported an operating margin of 14.8% for its server and networking unit, compared with an average estimate of 12.9%. In its computer unit, the margin was 4.7%. Analysts, on average, projected 6.18%. "Across the industry, the environment remains highly dynamic, with unprecedented AI demand creating sustained supply tightness and frequent pricing resets" Clarke said in prepared remarks, referring to the memory chip issue. The shares gained about 10% in extended trading after closing at $121.45 in New York. The stock has increased 5% in the past 12 months. Earnings, excluding some items, will be about $12.90 a share in the current fiscal year, Dell said in the statement. Sales will be about $140 billion. Analysts, on average, projected profit of $11.56 a share on revenue of $126.3 billion. The company also announced a $10 billion increase in its share buyback program. In the quarter, total sales increased 39% to $33.4 billion, compared with the average estimate of $31.7 billion. Profit, excluding some items, was $3.89 a share. Analysts, on average, projected $3.52. Revenue produced by the infrastructure group increased 73% to $19.6 billion. Sales in the computer unit, called the Client Solutions Group, jumped 14% to $13.5 billion.

Dell shares climb 19% on earnings beat as company navigates rising memory costs

Dell shares soared 19% on Friday after the company beat fourth-quarter estimates and issued strong guidance, as a historic memory shortage puts pressure on prices in the sector. Dell reported adjusted earnings of $3.89 per share, exceeding the $3.53 per share expected by analysts surveyed by LSEG. The company reported $33.38 billion in revenue for the quarter, topping a forecast of $31.73 billion. The company estimates fiscal 2027 revenue will come in between $138 billion and $142 billion, blowing away the $124.7 billion expected by Factset. Dell expects revenue for its AI servers to hit $50 billion in 2027, over double the year prior.

Dell's stock pops as soaring AI demand drives stellar 39% revenue increase - SiliconANGLE

Dell's stock pops as soaring AI demand drives stellar 39% revenue increase Data center hardware and personal computer maker Dell Technologies Inc. easily beat Wall Street's expectations today as it posted its latest financial results, benefitting from surging artificial intelligence demand. The company reported fourth-quarter earnings before certain costs such as stock compensation of $3.89 per share on sales of $33.38 billion, up by a staggering 39% from the same period one year earlier. Wall Street analysts had been looking for earnings of just $3.53 per share on much lower sales of just $31.67 billion. Dell's profitability increased commensurately with its revenue. It posted net income of $2.26 billion in the quarter, rising from a $1.53 billion profit in the year-ago period. Over the last few years, Dell has leveraged its close relationship with the chipmaker Nvidia Corp. to become one of the world's top sellers of data center servers and networking gear used by enterprises to power their AI projects. Demand for that hardware has surged, and Dell has become one of the most reliable suppliers of AI servers at a time when Nvidia's powerful graphics processing units are in short supply. During the quarter, Dell banked more than $8.95 billion worth of sales of AI-optimized servers, up 342% from the year before. Its total servers and networking revenue came in at $14.8 billion, well ahead of the Street's consensus estimate of $13.9 billion. Overall, Dell's infrastructure solutions group generated $19.6 billion in sales, while its client solutions group, which is focused on PCs, added another $13.49 billion. Dell Vice Chairman and Chief Operating Officer Jeff Clarke (pictured) said fiscal 2026 was a defining year in the company's history, during which it delivered record revenue of $113.5 billion. "The AI opportunity is transforming our company. We closed more than $64 billion in AI-optimized server orders, shipped more than $25 billion throughout the year, and are entering fiscal 2027 with a record backlog of $43 billion," he said. "[This is] powerful proof that our engineering leadership and differentiated AI solutions are winning." Even more encouraging is that Dell is seeing demand rise across multiple customer types, including hyperscalers, large enterprises and government customers. Clarke said on a conference call with analysts that its AI server customer base now surpasses 4,000 clients. Dell doesn't expect to slow down anytime soon. For the first quarter, it's looking for earnings of about $2.90 per share at the midpoint of its guidance range, with revenue of between $34.7 billion and $35.7 billion. That's well ahead of the Street's consensus, which calls for earnings of just $2.34 per share on sales of about $29 billion. For the full year, Dell is aiming for a $12.90 per share profit on sales of between $138 billion and $142 billion. Wall Street is looking for just $11.45 per share on $124.7 billion in revenue. Not surprisingly, the market reacted positively to Dell's bullish forecast. The company's stock rose more than 11% in the after-hours trading session. The stock is down 3% in the year to date. Dave Vellante, founder and chief analyst of SiliconANGLE Media's sister organization theCUBE Research, said Dell had a blowout quarter, with both AI servers and traditional systems in strong demand. "Positives were server growth, margin expansion, free cash flow growth, strong guidance and returns of capital to shareholders," he said. "Dell's balance sheet keeps getting stronger and the company is riding the AI infra wave to new heights." The analyst noted the almost symbiotic relationship between Dell and Nvidia, with the company's fortunes mirroring those of the chipmaker since becoming one of the premier channels for GPUs. But Nvidia's earnings results this week had a much more muted reception from shareholders. "Dell seems to have a formula that is breaking through the negative sentiment," Vellante said. One secret may be the way Dell has handled the rising memory chip costs that have plagued the rest of the technology industry. Demand for memory components has outpaced the available supply due to the rise in AI server sales, putting pressure on tech hardware manufacturers and their margins. However, Dell's gross margins were 20.5% in the quarter, higher than the 20.3% that analysts had expected. Clarke told analysts that the supply environment remains extremely dynamic, with unprecedented AI demand resulting in frequent pricing resets. But he said the company is "managing this environment in real time, applying lessons learned from prior cycles to improve resilience" and strengthen its position.

Dell stock jumps as strong AI server demand boosts sales forecast

Dell stock is rising because the company expects very strong demand for AI servers. Big tech companies are spending huge money on AI infrastructure, which helps Dell get more orders. The company also gave higher sales and profit forecasts than expected. Even though chip costs are rising, Dell believes AI demand will keep growing and support its future business. Dell Technologies said it expects very high sales from its AI servers this year. This shows strong demand for machines used in AI data centers. The company said it may earn about $50 billion from AI servers in the current financial year ending January 2027. Dell's COO Jeff Clarke said AI is changing the company and it already has a record backlog of $43 billion orders. Dell's AI servers are being bought by cloud computing firms like CoreWeave and Nscale Global Holdings, along with big AI companies and businesses. The company is trying to control costs because memory chip prices are rising fast, which makes servers expensive. Dell's server division reported a 14.8% operating margin, higher than analysts' estimate of 12.9%. The computer division margin was 4.7%, lower than analysts' expected 6.18%, as stated by Bloomberg. Jeff Clarke said AI demand is very high and this is causing short supply and changing prices often. Dell stock jumps after results Dell shares jumped about 6% after the news, after closing at $121.45. The company expects annual profit of about $12.90 per share and total yearly sales near $140 billion. Analysts had expected lower numbers -- about $11.56 profit per share and $126.3 billion revenue. In the latest quarter, Dell's total sales rose 39% to $33.4 billion, beating estimates. Quarterly adjusted profit was $3.89 per share, higher than analysts' prediction of $3.52. Dell said its total yearly revenue forecast for fiscal 2027 is $138-$142 billion, above Wall Street estimates, as noted by Reuters. Demand is growing because big tech firms like Alphabet, Microsoft, Amazon, and Meta plan to spend around $630 billion on AI infrastructure. This spending will help server makers like Dell and its rival Super Micro Computer. Dell stock faces chip cost pressure Rising memory chip costs and US trade rules have forced Dell and HP Inc. to increase prices to manage costs. Memory chips are very important in AI servers because they store data and help processors run fast. Dell expects AI server revenue to grow 103% to $50 billion in fiscal 2027. Dell said it now has over 4,000 AI server customers, including Elon Musk's startup xAI. Memory chip shortages may reduce global demand for gadgets like PCs and phones. China's Lenovo also warned about pressure on PC shipments. Dell's infrastructure solutions group revenue jumped 73% to $19.6 billion, driven by storage and servers, as cited by Reuters. Its PC business sales grew 14% to $13.49 billion. Dell stock rose because AI server demand is booming, and the company expects huge future revenue from AI infrastructure. FAQs Q1. Why did Dell Technologies stock go up? Dell stock rose because the company gave strong forecasts for AI server sales and higher future revenue. Q2. What is helping Dell grow fast right now? High demand for AI servers from big tech companies and cloud firms is driving Dell's strong growth.

Why Dell Stock Surged Today | The Motley Fool

Shares of Dell Technologies (DELL +21.93%) popped on Friday after the tech giant highlighted the soaring growth of its artificial intelligence (AI)-focused businesses. By the close of trading, Dell's stock price was up more than 21%. Dell's revenue rose 39% year over year to $33.4 billion in its fiscal 2026 fourth quarter, which ended on Jan. 30. The personal computer (PC) maker is enjoying booming demand for its AI infrastructure. Sales of Dell's AI-optimized servers soared 342% to $9 billion. "The AI opportunity is transforming our company," chief operating officer Jeff Clarke said in a press release. All told, Dell's adjusted net income climbed 36% to $2.6 billion. Its adjusted earnings per share, boosted by stock buybacks, increased 45% to $3.89. Dell guided for full-year revenue to grow by 23% to approximately $140 billion in fiscal 2027. The company expects sales of its AI-optimized servers to more than double to $50 billion. Management also sees adjusted earnings increasing by 25% to $12.90 per share. This optimistic outlook prompted Dell to boost its cash dividend by 20% to $2.52. "We closed more than $64 billion in AI-optimized server orders, shipped more than $25 billion throughout the year, and are entering FY27 with a record backlog of $43 billion -- powerful proof that our engineering leadership and differentiated AI solutions are winning," Clarke said.

Dell soars as Wall Street praises 'unexpectedly' strong guidance, thanks to AI (DELL:NYSE)

Dell Technologies (DELL) was in the spotlight on Friday after the tech giant reported better-than-expected results and guidance, leading to much praise from Wall Street. The reason? Artificial intelligence. Looking to the first-quarter of fiscal 2027, Dell anticipates adjusted earnings of $2.90 AI server sales are expected to contribute $13B, drive 100% y/y growth, and represent a significant factor in Dell's raised EPS growth and strong operating income outlook. Risks include potential demand pull forward, uncertainty about demand elasticity following price increases, cyclical memory market concerns, and challenges in sustaining gross margin expansion outside AI servers. Analysts are mixed: BofA and J.P. Morgan are upbeat on the elevated EPS growth target and margin gains, while Morgan Stanley remains cautious due to skepticism about ex-AI margin improvements and memory market headwinds.

JPMorgan resets price target on this AI dividend stock

Dell Technologies stock soared 22% after the company blew past fourth-quarter expectations and delivered guidance that left analysts scrambling to revise their models. JPMorgan responded by hiking its Dell (DELL) stock price target to $165 from $155, and that move is worth paying close attention to. The firm kept its "Overweight" rating on the dividend stock, pointing to Dell's positioning in the AI-driven compute investment cycle as the core reason for its bullish stance. JPMorgan bets on Dell's AI runway JPMorgan's confidence in Dell comes down to one thing: its Infrastructure Solutions Group, or ISG. The investment bank sees stronger-than-expected growth in ISG, led by a booming compute investment cycle. According to JPMorgan, that puts Dell on a path toward double-digit earnings growth, even as its PC and general-purpose server businesses face pressure from macroeconomic headwinds. The bank also sees upside in Dell's valuation, arguing the stock deserves a higher multiple than its historical average, given its deep exposure to AI infrastructure spending. That said, JPMorgan noted Dell is unlikely to be perceived as a primary beneficiary of the AI megatrend the way Nvidia (NVDA) or other chip-focused names are. But that doesn't mean the opportunity isn't real. Dell closed fiscal 2026 with $43 billion in AI server backlog, a record, and $64.1 billion in total AI orders for the year. In Q4 alone, it booked a staggering $34.1 billion in AI orders, shipped $9.5 billion in AI servers, and reported $9 billion in AI server revenue. Dell hikes dividend by 20% Del reported a cash flow of $11 billion in fiscal 2026, while its annual dividend expense was around $1.3 billion. Dell returned$7.5 billion to shareholders over the last 12 months, including the repurchase of 54 million shares, more than double the number repurchased in fiscal 2025. More Dividend Stocks: A low payout ratio should translate to consistent dividend hikes. The server maker raised its annual dividend 20% to $2.52 per share, and the board approved a new $10 billion share repurchase authorization. Analysts forecast Dell to increase the annual dividend to $3.35 per share in fiscal 2030. A snapshot of key Dell dividend metrics: * Annual dividend per share: $2.52 (raised 20% for fiscal 2027) * Dividend yield: Approximately 1.7% (based on share price near $148) * Payout ratio: Low, supported by strong free cash flow generation * Capital returned to shareholders (fiscal 2026): $7.5 billion * Share repurchase authorization: $10 billion (newly approved) Dell's record quarter tells the story Dell's fiscal Q4 was the strongest in company history. * Revenuehit $33.4 billion, up 39% year-over-year (YoY), topping the $31.73 billion Wall Street expected. * Adjusted earnings per share came in at $3.89, crushing the $3.53 consensus estimate. * Full-year revenue reached $113.5 billion, up 19%. * Earnings per share grew 27% to $10.30. For fiscal 2027, Dell is guiding for revenue between $138 billion and $142 billion. That's well above the $124.7 billion analysts expected. AI server revenue alone is projected to hit $50 billion, roughly a 100% year-over-year growth. However, a historic memory chip shortage is pushing up component costs across the industry, putting pressure on margins in both PCs and traditional servers. Dell COO Jeff Clarke said: CFO David Kennedy added that the company has priced to "offset" those rising costs. According to CNBC, competitor HP recently hit a 52-week low after flagging that memory costs had risen roughly 100% sequentially, and that memory now makes up about 35% of its PC bill of materials, double the level from a year ago. What is the Dell stock price target? Analysts tracking Dell forecast adjusted earnings to grow from $10.30 per share in fiscal 2026 to $22.23 in fiscal 2031. If DELL stock is priced at 10.7x forward earnings, similar to its historical average, it should trade around $238 in early 2030, indicating an upside potential of 61% from current levels. If we adjust for dividends, cumulative returns could be closer to 70%. Out of the 12 analysts covering DELL stock, 10 recommend "Buy", one recommends "Hold", and one recommends "Sell". The average DELL stock price target is $160, around 8% above current levels. Dell, with its scale, direct model, and long-standing supplier relationships, appears to be navigating the challenge better. But the pressure is real, and the second half of fiscal 2027 carries more uncertainty than the first. For now, though, Dell is entering the new year with record backlog, surging AI demand, and a dividend that keeps climbing. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published March 2, 2026 at 6:03 PM.

Dell expects AI server revenue to double in fiscal 2027 on data center boom

Feb 26 (Reuters) - Dell said it expects revenue from its key artificial intelligence-optimized servers business to double in fiscal year 2027 and promised to return more cash to shareholders, sending its shares surging 10% in extended trading. The company announced a 20% hike in its cash dividend and an additional $10 billion for its share repurchase program. Big tech firms, such as Alphabet, Microsoft, Amazon, and Meta, are expected to spend at least $630 billion to build AI infrastructure this year, which would boost demand for server and data center equipment from vendors such as Dell and rival Super Micro Computer. U.S. trade regulations and surging memory chip costs due to the AI infrastructure buildout have forced companies like Dell and HP Inc to implement price increases, which are helping them offset cost pressures. Almost all servers have memory chips that hold data and instructions, keeping processors running at high speed, which is paramount for AI applications. Initially, infrastructure clients experienced "sticker shock" but quickly grasped the supply constraints, shifting their focus to securing necessary components, which led large customers to aggressively acquire supply for their AI servers, traditional servers, and storage build-outs, Dell Chief Operating Officer Jeff Clarke said on a post-earnings call. The company raised server prices on December 10, while price changes for PCs occurred on January 6, Clarke said. Dell expects AI server revenue to grow 103% to about $50 billion in fiscal 2027. The company said it has more than 4,000 AI server customers, including Elon Musk's AI startup xAI and CoreWeave. Dell forecast annual revenue of $138 billion to $142 billion, above analysts' average estimate of $125.54 billion, according to data compiled by LSEG. The memory chip squeeze is expected to dampen global demand for consumer electronics, including PCs, smartphones, and gaming consoles. HP Inc said it expected fiscal 2026 results to be at the low end of its prior forecasts, while China's Lenovo warned about mounting pressures on PC shipments. "By proactively addressing rising memory costs, and demonstrating early success reflected in both its fiscal first quarter results and full-year guidance, the company showed it is getting ahead of a challenge that continues to pressure peers," said Hendi Susanto, a portfolio manager and research analyst at Gabelli Funds, which holds Dell shares. Dell expects annual adjusted earnings per share of $12.90, above estimates of $11.59. In the first quarter, Dell expects revenue between $34.7 billion and $35.7 billion, above estimates of $29.13 billion. The first-quarter adjusted EPS forecast of $2.90 exceeded estimates of $2.37. It reported record revenue of $33.4 billion in the fourth quarter, beating estimates of $31.73 billion. Its adjusted EPS of $3.89 also exceeded the $3.53 estimate. Dell's revenue from its infrastructure solutions group, which includes its storage, software, and server offerings, jumped 73% to $19.60 billion, while sales from the client solutions group - home to PCs - rose 14% to $13.49 billion. (Reporting by Jaspreet Singh in Bengaluru; Editing by Shinjini Ganguli and Rashmi Aich)