Dell Technologies Sees Strong Growth in AI Infrastructure
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Source: NASDAQ.COM
- Record Revenue: Dell Technologies' Infrastructure Solutions Group generated $29 billion in revenue in Q1 FY2027, marking a 181% year-over-year increase, with operating income soaring 206% to $3.1 billion, highlighting robust demand for AI infrastructure alongside traditional servers.
- Surge in AI Orders: The company booked a staggering $24.4 billion in AI orders during the first quarter, resulting in a record AI backlog of $51.3 billion, prompting management to raise FY2027 AI server revenue guidance to $60 billion, reflecting strong market demand for AI solutions.
- Product Innovation and Partnerships: Dell is expanding its AI Factory ecosystem with partners like NVIDIA and Google Cloud, launching new offerings such as Dell PowerRack and 18th-generation PowerEdge servers, positioning itself as a full-stack AI infrastructure provider to meet customer preferences for integrated solutions.
- Optimistic Market Outlook: Dell expects revenues between $165 billion and $169 billion for FY2027, with non-GAAP earnings guidance of $17.90 per share, demonstrating strong confidence in sustained demand driven by enterprise infrastructure modernization and the shift towards production-ready AI solutions.
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Analyst Views on DELL
Wall Street analysts forecast DELL stock price to fall
15 Analyst Rating
11 Buy
3 Hold
1 Sell
Moderate Buy
Current: 411.800
Low
113.00
Averages
164.85
High
180.00
Current: 411.800
Low
113.00
Averages
164.85
High
180.00
About DELL
Dell Technologies Inc. is engaged in designing, developing, manufacturing, marketing, selling, and supporting a wide range of comprehensive and integrated solutions, products, and services. The Company operates through two segments: Infrastructure Solutions Group (ISG) and Client Solutions Group (CSG). Its ISG segment enables the Company’s customer’s digital transformation with solutions that address artificial intelligence (AI), machine learning, data analytics, and multi cloud environments. Its comprehensive storage portfolio includes modern and traditional storage solutions, including all-flash arrays, scale-out file, object platforms, hyper-converged infrastructure, and software-defined storage. Its CSG segment offers branded personal computers (PCs) including notebooks, desktops, and workstations and branded peripherals that include displays, docking stations, keyboards, mice, and webcam and audio devices, as well as third-party software and peripherals.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- High Strike Call Activity: Notably, the $500 strike call option for Dell has seen particularly high activity with 2,553 contracts traded today, representing about 255,300 underlying shares, suggesting investor expectations for future price increases.
- IIPR Options Activity: Concurrently, Innovative Industrial Properties Inc. options have recorded a volume of 3,225 contracts today, translating to approximately 322,500 shares, which accounts for 59.8% of its average daily trading volume of 539,465 shares over the past month, reflecting market interest in the company.
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- Dell Options Volume: Dell Technologies Inc. options have seen a trading volume of 51,851 contracts today, equating to approximately 5.2 million shares, which represents a significant 61.5% of its average daily trading volume of 8.4 million shares over the past month, indicating strong market interest.
- High Strike Call Activity: Notably, the $500 strike call option for Dell has seen particularly high activity with 2,553 contracts traded today, representing about 255,300 underlying shares, suggesting investor expectations for future price increases.
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- Hesai Technology Expansion: Despite being deemed a national security threat by the U.S. Defense Department, Hesai continues to collaborate with U.S. companies, notably Nvidia, showcasing its competitive edge in the autonomous driving sector, which may influence future industry dynamics.
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- Tech Stock Rebound: The Dow Jones Industrial Average surpassed 53,000 for the first time, with tech stocks leading the charge as the Nasdaq Composite rose over 1%, and semiconductor stocks rebounded notably after a rough previous week, reflecting renewed investor confidence in the tech sector.
- Hesai Technology Expansion: Despite being labeled a national security threat by the U.S. Defense Department, Hesai Technology continues to expand its presence in the U.S. market, partnering with Nvidia, and its CEO asserts product safety, showcasing resilience amid regulatory scrutiny.
- Microsoft Layoff Announcement: Microsoft announced it would cut 4,800 jobs, representing over 2% of its workforce, with 3,200 positions in the Xbox division, as part of efforts to reduce costs in the AI era, indicating a strategic shift in response to evolving market conditions.
See More
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- Strong Market Performance: The S&P 500 rose by 0.72%, reaching a 2.5-week high, while the Dow Jones Industrial Average increased by 0.29%, setting a new all-time high, reflecting robust confidence in tech stocks and chipmakers.
- Supportive Economic Data: The US June ISM services index stood at 54.0, meeting expectations, with the employment sub-index rising to 51.2, surpassing the anticipated 48.2, indicating ongoing economic expansion that may alleviate Fed rate hike pressures.
- Optimistic Earnings Outlook: Bloomberg Intelligence forecasts a 23% increase in Q2 earnings, close to Q1's 30% surge, primarily driven by strong performance in AI infrastructure stocks, expected to contribute nearly 60% of earnings growth, further boosting market sentiment.
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- Service Sector Expansion: The US June ISM services index fell to 54.0, meeting expectations, and although the pace of growth has slowed, the employment sub-index rose to 51.2, surpassing the expected 48.2, suggesting that companies are still hiring amid easing cost pressures, potentially supporting economic growth.
- Strong Q2 Earnings Outlook: Bloomberg Intelligence forecasts a 23% increase in Q2 earnings, close to Q1's 30% growth, primarily driven by AI spending, which is expected to account for nearly 60% of S&P 500 earnings-per-share growth, providing an optimistic outlook for investors.
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See More
