Key facts
- Dell Technologies raised its annual revenue and profit forecasts for the second time this year.
- The company expects fiscal 2027 revenue for AI-optimized servers to reach $74 billion.
- Dell's annual revenue outlook was increased to $192 billion.
- Second-quarter revenue hit a record $47 billion, with adjusted EPS of $7.04.
- Third-quarter revenue is projected at $49 billion, with adjusted EPS of $6.50.
Dell Technologies on Tuesday raised its annual revenue and profit forecasts for the second time this year, driven by strong demand for its AI servers. The company now expects fiscal 2027 revenue for AI-optimized servers to reach $74 billion, an increase from its prior expectation of $60 billion.
Dell, along with rivals like Super Micro Computer, supplies AI-optimized servers crucial for cloud providers training AI models. These servers utilize Nvidia's chips, essential for AI computations. Strong forecasts from Nvidia and Super Micro had previously boosted investor confidence in the AI sector.
S&P Global Ratings projects AI infrastructure spending to exceed $1.3 trillion by 2027, indicating continued demand for AI equipment manufacturers.
Dell's shares have more than tripled this year. The company now anticipates annual revenue of $192 billion, up from previous projections, and has raised its adjusted earnings-per-share forecast to $25.50 from $17.90.
For the second quarter, Dell reported a record revenue of $47 billion, surpassing analyst estimates. Adjusted earnings per share also exceeded expectations at $7.04.
Looking ahead, Dell projects third-quarter revenue of $49 billion and adjusted earnings per share of $6.50, both above analyst consensus.