Dell Raises Forecast Again on AI Server Growth
According to Dell Technologies, the company raised its full-year revenue and profit outlook again on September 1, marking the second time this year that it has increased its financial guidance. The upgrade reflects surging demand for artificial intelligence (AI) servers as technology companies continue investing billions of dollars in data center infrastructure.
Following the announcement, Dell shares rose approximately 6% in after-hours trading.
Headquartered in Round Rock, Texas, Dell, along with smaller competitor Super Micro Computer, plays a key role in supplying AI-optimized servers used by cloud service providers such as Nscale and CoreWeave to build large-scale computing clusters.
These AI servers are equipped with advanced NVIDIA chips, providing the high-performance computing capabilities required to train and operate large AI models, including OpenAI’s ChatGPT.
Strong earnings outlooks recently released by NVIDIA and Super Micro Computer have further strengthened investor confidence in the sustainability of the AI boom. S&P Global Ratings expects global spending on AI infrastructure to exceed $1.3 trillion by 2027, suggesting continued growth opportunities for companies involved in AI hardware and data center equipment.
Dell’s stock price has more than tripled so far this year. The company now expects revenue from AI-optimized servers to reach $74 billion in fiscal 2027, up from its previous forecast of $60 billion.
In addition, Dell raised its full-year revenue forecast by $25 billion to $192 billion and increased its adjusted earnings per share (EPS) outlook from $17.90 to $25.50.
For the second quarter, Dell reported record revenue of $47 billion, surpassing analysts’ expectations of $44.92 billion compiled by the London Stock Exchange Group (LSEG). Adjusted EPS came in at $7.04, exceeding the estimated $4.91.
“Our strengths continue to reinforce each other. During the quarter, we leveraged these advantages to drive growth, expand market share, improve profitability, and generate cash,” said David Kennedy, Dell’s Chief Financial Officer.
Looking ahead, Dell expects third-quarter revenue to reach $49 billion, with adjusted EPS projected at $6.50. Both figures are above analyst forecasts of $41.42 billion in revenue and $4.48 in adjusted EPS.
With accelerating AI adoption and increasing demand for high-performance computing infrastructure, Dell is positioned to benefit from the continued expansion of the AI server market and next-generation data center investments.
