Dell announces fastest Sales Growth since 2018, Shares Soar 39%

Dell Technologies reported its fastest revenue growth since returning to the public market more than seven years ago. It exceeds analysts’ expectations on both sales and profit. The strong performance facilitated the company’s stock to increase as much as 39% in extended trading on Thursday.

For the quarter ended May 1, Dell posted adjusted earnings of $4.86 per share, well ahead of the $2.94 consensus estimate, while revenue surged to $43.84 billion, significantly exceeding the expected $35.43 billion. This marked an impressive 88% year-on-year revenue jump. It is the company’s highest growth rate since its 2018 IPO, far surpassing its previous peak growth of 39%.

The growth was fueled by demand for AI infrastructure, with Dell assembling servers containing graphics processing units from the likes of Nvidia. Dell’s AI server revenue skyrocketed 757% year over year to $16.1 billion. The company has now raised its full-year AI revenue forecast to $60 billion, up from its earlier $50 billion projection, representing expected annual growth of 144%. Dell said it now serves more than 5,000 AI server customers across neocloud providers, sovereign clients and enterprises.

The stock had already gained more than 150% this year through Thursday’s close, significantly outperforming the broader S&P 500, which is up roughly 10%.

One big winner in the Dell pop is President Donald Trump, who became a shareholder in the first quarter, according to filings with the U.S. Office of Government Ethics. At a White House event earlier this month, Trump said, “Go out and buy a Dell.” On Wednesday, the Pentagon announced a five-year contract with Dell worth $9.7 billion for Microsoft365 productivity services. That comes roughly five months after Dell CEO Michael Dell and his wife, Susan Dell, donated $6.25 billion to fund Trump Accounts for 25 million U.S. children.

Dell also reported net income of $3.44 billion, or $5.24 per share, more than tripling from $965 million, or $1.37 per share, in the same quarter last year. The company attributed part of its pricing strength to higher input costs driven by the AI-led global memory shortage.

“We’re repricing, it feels like, every day, and I’m sure our customers feel that pain,” Jeff Clarke, Dell’s Vice Chairman and Operating Chief, said on a conference call with analysts. “Unfortunately, I don’t see that changing, given the world that we’re living in today, where you have an inflationary environment, whether it’s fuel, whether it’s raw materials, whether that’s DRAM, whether that’s NAND, CPUs. We are living in an inflationary environment that is changing at a rate that obviously we’ve never seen before ... and everything that we see suggests that continues.”

Looking ahead, Dell forecast second-quarter adjusted earnings of $4.80 per share on revenue between $44 billion and $45 billion, well above analyst expectations of $2.98 per share and $34.97 billion in revenue.

The company also raised its fiscal 2027 outlook, now projecting adjusted earnings of $17.90 per share and revenue between $165 billion and $169 billion, implying approximately 47% growth at the midpoint, ahead of analysts’ expectations of $13.09 per share and $142.5 billion in revenue.

Within its business segments, Dell’s Infrastructure Solutions Group delivered standout results, with revenue surging 181% to $29 billion, driven by accelerating demand for AI servers, traditional servers and networking equipment. Meanwhile, the Client Solutions Group, which includes PCs and accessories, posted 17% revenue growth to $14.6 billion, supported by new laptop and workstation launches for enterprise customers.