By Jaspreet Singh<\/p>\n
May 28 (Reuters) – Dell boosted its annual revenue and profit expectations on Thursday, showing data center expansion by clients is fueling demand for its \u200cAI-optimized servers that are powered by Nvidia’s advanced chips.<\/p>\n
Shares of the company, which counts \u200cCoreWeave, Honeywell International and Samsung Electronics as its customers, rose around 39% in extended trading.<\/p>\n
U.S. tech giants including Alphabet \u200band Amazon plan to spend over $700 billion on AI infrastructure this year, which would drive up demand for server and data center equipment from suppliers such as Dell and Super Micro Computer.<\/p>\n
The strong results show how Dell has turned into one of the biggest winners of the generative AI \u200cboom as the company is \u2060managing the memory chip crisis well by implementing price increases and adjusting its supply chain.<\/p>\n
“We’re repricing, it feels like, every day. And I’m sure our \u2060customers feel that pain. Unfortunately, I don’t see that changing given the world that we’re living in today where you have an inflationary environment,” Dell’s chief operating officer Jeff Clarke said on a \u200bpost-earnings \u200bcall.<\/p>\n
Dell said it now expects AI server revenue of \u200broughly $60 billion for fiscal 2027, up \u200cfrom its prior expectations of $50 billion.<\/p>\n
It raised its annual revenue forecast to between $165 billion and $169 billion, a sharp increase from its previous forecast of $138 billion to $142 billion.<\/p>\n
The company also lifted its annual adjusted earnings per share forecast to $17.90 from the prior view of $12.90.<\/p>\n
Dell’s revenue rose 88% to $43.84 billion in the first quarter, handily beating LSEG-compiled analysts’ average estimate of $35.43 billion. Its adjusted \u200cEPS of $4.86 also topped estimates of $2.94.<\/p>\n
“The company is better \u200bpositioned than rivals due to its scale, supplier relationships, \u200band ability to prioritize demand, helping it \u200bgain market share during the (memory) shortage,” said Melissa Otto, head of S&P \u200cGlobal Visible Alpha research.<\/p>\n
Dell’s quarterly revenue from \u200bits infrastructure solutions group, \u200bwhich includes its storage, software and server offerings, jumped 181%, while sales at its client solutions group \u2014 home to PCs \u2014 rose 17%.<\/p>\n
It also provided second-quarter revenue and adjusted profit \u200bper share forecasts that were \u200cabove market estimates.<\/p>\n
On Wednesday, the U.S. Department of Defense awarded a Dell unit \u200ba five-year contract worth $9.7 billion to help handle licenses for Microsoft software.<\/p>\n
(Reporting by \u200bJaspreet Singh in Bengaluru; Editing by Shreya Biswas)<\/p>\n","protected":false},"excerpt":{"rendered":"By Jaspreet Singh May 28 (Reuters) – Dell boosted its annual revenue and profit expectations on Thursday, showing…\n","protected":false},"author":3,"featured_media":829758,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[21],"tags":[691,95037,738,5880,16281,36972,32793,158,67,132,68],"class_list":["post-829757","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-annual-revenue","tag-artificial-intelligence","tag-data-center","tag-dell","tag-samsung-electronics","tag-super-micro-computer","tag-technology","tag-united-states","tag-unitedstates","tag-us"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/116657168444791995","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/829757","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=829757"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/829757\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/829758"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=829757"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=829757"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=829757"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}