Dell Rides AI Wave to Sales Surge—Wall Street Pretends It Saw This Coming

Dell’s revenue spikes as it capitalizes on the AI infrastructure boom—because nothing sells hardware like a hype cycle.

The tech giant’s servers are now the pickaxes in this digital gold rush, with CFOs suddenly ’believing in AI’ just in time for budget approvals.

Meanwhile, analysts who dismissed enterprise tech six months ago now slap ’AI-powered’ on every earnings report. Some things never change.

Sales grow as Dell taps into AI gold rush

For the three months ended May 2, Dell reported $23.4 billion in revenue, a 5% increase from the comparable period a year earlier. That was more than the $23.1 billion average estimate of Wall Street analysts.

Earnings, adjusted for one-time gains and costs, came to $1.55 per share, which fell short of the $1.69 per share analysts surveyed by Zacks Investment Research expected. The company said it was pleased with its performance and bullish that future quarters WOULD be even better.

Dell’s earnings per share and revenue for the current quarter, $2.25 and $29 billion, surpass average market estimates.

The increase in AI server orders has been driven by leading customers such as Elon Musk’s xAI and CoreWeave, who use Dell’s high-end servers in growing data centers.

The tech firm has been buying back many shares as part of a share repurchase program to add to shareholder value. This reduces the number of shares in circulation, effectively increasing earnings per share.

Dell builds flagship supercomputer with Nvidia

In a separate huge victory, Dell has partnered with the chipmaker Nvidia to construct a next-generation supercomputer for the U.S. Department of Energy. Based at the Lawrence Berkeley National Laboratory, the system will fulfill the most advanced research requirements, from fusion energy to biomolecular modeling, materials design, and even fundamental physics.

This MOVE further cements Dell as a key AI and high-performance computing player.

Still, challenges remain. AI server sales, which show much promise, are what Clarke referred to as “lumpy.”  

Outside AI, the consumer PC market continues to woes. In the three months until the end of June, Dell’s consumer PC revenues dropped 19%. Its operating income in that unit — consumer and business machines — fell 16%.

Economic uncertainty and persistent tariffs from the United States also hamper parts of the tech industry. On Thursday, HP Inc., a Dell competitor, had its stock drop 8.3% after reducing its profit forecast because of tariffs and slow demand.

Curiously, that same day, a United States court panel concluded that most tariffs during the TRUMP administration ran afoul of the law, despite which they remain in place while the legal process continues.

Dell noted that its updated full-year guidance takes into account everything currently known about these tariffs.

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