Dell Surges on Soaring AI Server Demand, Raises Annual Revenue and Profit Forecasts

Dell Raises Forecasts as AI Server Demand Drives Growth

Dell Technologies has increased its annual revenue and profit projections thanks to strong sales of AI-optimized servers powered by Nvidia’s latest chips. These servers are built to handle the heavy computational load of AI workloads, including training large language models, sparking higher demand across the industry.

For fiscal 2026, Dell now anticipates $20 billion in revenue from AI server shipments, a notable jump from the $15 billion it forecasted earlier. Customers using these AI servers include Elon Musk's AI startup xAI and CoreWeave.

Upgraded Revenue and Profit Outlook

Dell updated its annual revenue guidance to a range of $105 billion to $109 billion, up from the previous $101 billion to $105 billion. Adjusted earnings per share are expected to reach $9.55, an increase from the prior estimate of $9.40.

For the third quarter, Dell projects revenue between $26.5 billion and $27.5 billion, surpassing analysts’ average estimate of $26.05 billion. However, the adjusted profit forecast of $2.45 per share is slightly below the anticipated $2.55 per share.

Recent Performance Highlights

In the second quarter, Dell posted revenue of $29.78 billion, beating estimates of $29.17 billion. Adjusted earnings per share came in at $2.32, just above the $2.30 forecast.

The company’s infrastructure solutions group, which includes storage, software, and servers, saw revenue grow 44% to $16.80 billion. Meanwhile, the client solutions group, focused on PCs, recorded a modest 1% increase to $12.50 billion.

PC Market Boost from Windows 10 Support Ending

A strong PC refresh cycle is expected as Microsoft ends support for Windows 10 in October. Users will likely upgrade to maintain security and access the latest features, benefiting PC manufacturers like Dell and HP.

HP also exceeded analysts’ revenue expectations for its third quarter, helped by the adoption of AI-enabled PCs and the Windows 11 upgrade cycle.

What Sales Professionals Should Know

• AI servers are a fast-growing segment—knowing the capabilities and benefits of Nvidia-powered AI solutions can help tailor pitches to enterprise clients.
• Expect continued investment in infrastructure solutions as companies scale their AI workloads.
• The PC market remains steady with refresh cycles tied to operating system support, creating opportunities for hardware sales.
• Staying current with AI trends and server capabilities can provide an edge when addressing customer needs.

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