AI-Optimized Servers Drive Growth
A key driver of Dell’s performance has been the strong demand for its AI-optimized servers, which feature Nvidia’s advanced chips. These servers are designed to meet the computational needs of large language models, such as those powering AI tools like ChatGPT. Dell’s Chief Operating Officer Jeff Clarke highlighted the robust demand, revealing an AI server backlog of approximately $9 billion, including deals with Elon Musk’s xAI and other AI firms. The company aims to ship $15 billion worth of AI servers this fiscal year, positioning itself competitively against Super Micro Computer (SMCI) and Hewlett Packard Enterprise (HPE) in the burgeoning AI server market.
Cost Management and Profit Forecast
Dell’s strong earnings were bolstered by effective cost management strategies. The company raised its annual cash dividend by 18% and expanded its share repurchase program by $10 billion, demonstrating confidence in its financial stability. Additionally, Dell provided fiscal 2026 guidance with an EPS for