Dell Earnings Top Expectations as AI-Driven Demand Grows

Dell (DELL) reported fiscal fourth-quarter earnings that exceeded analysts’ expectations, as the PC and server maker benefitted from growing demand for artificial intelligence infrastructure.

Dell posted adjusted earnings of $1.91 billion, or a record $2.68 per share, up from $1.66 billion, or $2.27 per share, a year earlier and beating expectations. Its revenue of $23.9 billion was up 7% year-over-year but slightly missed the analyst consensus from Visible Alpha. The growth came as servers and networking revenue jumped 37% to $6.6 billion, driven by AI and traditional server demand.

Earlier this month, Bloomberg reported Dell was nearing a deal to sell more than $5 billion of servers powered by Nvidia (NVDA) chips to Elon Musk’s artificial intelligence company, xAI. The companies have partnered before, with Musk and Dell executives saying last summer that Dell would provide hardware for the AI “supercomputer” the company was planning to build in Memphis, Tennessee.

“Our prospects for AI are strong, as we extend AI from the largest cloud service providers, into the enterprise at-scale, and out to the edge with the PC,” Chief Operating Officer Jeff Clarke said in a release Thursday. “The deals we’ve booked with xAI and others puts our AI server backlog at roughly $9 billion as of today.”

Looking ahead, Dell forecast fiscal 2026 revenue of $101 billion to $105 billion and adjusted EPS of $9.30, compared to analysts’ expectations of $103.81 billion in revenue and adjusted EPS of $9.28.

Shares of Dell climbed 2% in extended trading Thursday following the release. They’ve gained about 14% over the past year through Thursday’s close.