Dell (DELL) Stock Skyrockets After Blowing Past Revenue Forecasts

Tech investors cheer as Dell’s numbers defy the skeptics—proving even legacy hardware can still surprise Wall Street.

Revenue smashes expectations: The PC giant’s latest earnings report sends shares soaring, leaving analysts scrambling to upgrade their price targets.

Cynical footnote: Another quarter, another victory lap for corporate earnings theater—until the next guidance adjustment, of course.

TLDR

• Dell reported Q1 revenue of $23.4 billion, beating analyst expectations of $23.2 billion by 5% year-over-year growth
• The company provided strong guidance with Q2 revenue forecast of $28.5-29.5 billion, well above analyst expectations of $25.3 billion
• AI server orders exceeded $12 billion, driving unprecedented demand according to COO Jeff Clarke
• Morgan Stanley raised Dell’s price target from $126 to $135 while maintaining Overweight rating
• Dell stock rose 5.6% after earnings release but remains down 2% year-to-date

Dell Technologies delivered better-than-expected first quarter results. The company posted revenue of $23.4 billion for the quarter ended in April.

$DELL JUST REPORTED EARNINGS

EPS of $1.55 missing expectations of $1.69🔴
Revenue of $23.4B beating expectations of $23.2B🟢

Dell said it expects its revenue next quarter to come in between $28.5B-$29.5B above expectations of $25.1B pic.twitter.com/G3aOggaOaq

— Evan (@StockMKTNewz) May 29, 2025

This represented a 5% increase from the prior year. Wall Street had expected revenue of $23.2 billion according to FactSet data.

The revenue beat came despite earnings per share missing expectations. Dell reported adjusted earnings of $1.55 per share. Analysts had forecast $1.70 per share.

Dell’s guidance painted an optimistic picture for the coming quarters. The company forecast current quarter revenue between $28.5 billion and $29.5 billion.

This range sits well above analyst expectations of $25.3 billion. For fiscal 2026, Dell provided a revenue forecast of $101 billion to $105 billion.

The consensus estimate stood at $103.1 billion. Dell raised its full-year earnings per share guidance to $9.40, reflecting a 15% increase.

AI Server Business Powers Growth

Dell’s artificial intelligence server business drove much of the strong performance. AI server orders exceeded $12 billion during the quarter.

Chief Operating Officer Jeff Clarke highlighted the unprecedented demand. “We’re experiencing unprecedented demand for our AI-optimized servers,” Clarke said in the earnings release.

The company counts major AI players as customers. CoreWeave, a cloud computing company focused on graphics processing units, uses Dell hardware.

Elon Musk’s xAI also relies on Dell servers for AI infrastructure buildouts. These partnerships have positioned Dell as a key supplier in the AI boom.

Dell’s Infrastructure Solutions Group saw revenue climb 12% during the quarter. The Client Solutions Group also posted growth with revenue up 5%.

Morgan Stanley Raises Price Target

Following the earnings report, Morgan Stanley upgraded its price target for Dell stock. The investment bank raised its target from $126 to $135 per share.

Morgan Stanley maintained its Overweight rating on the stock. Analyst Erik Woodring noted that AI server strength should offset enterprise sector concerns.

The firm’s long-term projections for fiscal 2026 remained largely unchanged. However, Woodring believes Dell’s second-half guidance appears conservative.

Morgan Stanley’s earnings estimate now sits 15 cents above management’s $9.40 guidance midpoint. The analyst sees potential for upward earnings revisions.

Dell has gained market share in traditional enterprise markets while managing costs effectively. This has resulted in revenue and earnings growth that exceeds the company’s long-term model.

The stock responded positively to the earnings news. Dell shares ROSE 5.6% following the results announcement.

Despite the post-earnings pop, Dell stock remains down about 2% for the year. The company returned $2.4 billion to shareholders through buybacks and dividends during the quarter.

Dell’s strategic partnerships with NVIDIA and Google have strengthened its AI market position. These relationships continue to drive demand for Dell’s AI-optimized server solutions.