Dell raises annual forecasts as AI boom continues to reward hardware vendors
Supply chain adjustments and shrewd management of the memory chip shortage help Dell capitalize on increased demand for AI
Dell Technologies has raised its annual revenue and profit expectations on the back of an increased demand for its AI-optimized servers.
Strong quarterly results mark Dell as one of the biggest winners of the AI boom and also highlight its management of the memory chip shortage, with strategic price increases and supply chain adjustments.
Dell reported its net income for the most recent quarter had more than tripled to $3.44 billion from $965 million compared to the same quarter of 2025. However, the tech giant also raised its prices in January, reflecting higher input costs due to the global memory shortage driven by the AI boom.
"We're repricing, it feels like, every day, and I'm sure our customers feel that pain," Jeff Clarke, Dell Technologies' vice chairman and COO, said on a conference call with analysts, according to CNBC. "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."
As a result, Dell expects to see revenue from AI servers somewhere around $60 billion for fiscal 2027, according to Reuters. This is up from its previous expectation of $50 billion. Quarterly revenue from Dell's infrastructure solution group, which includes storage and server products and services, hit 181%, and PC sales also rose by 17%.
The revised expectations also come in the same week that Dell landed a $9.7 billion deal with the Pentagon to manage Microsoft licenses. This five-year deal will see Dell as the main contractor providing Microsoft 365, cloud subscriptions, and software licensing for Microsoft products to be used by the US defense agency and the US military.
-
Ransomware negotiator-turned cyber criminal jailed after working with hackers to extort clientsNews Angelo Martino was supposed to be negotiating on behalf of victims, but was secretly working for ransomware operators
-
Developers are swerving programming fundamentals in favor of AINews O'Reilly has recorded a massive fall in programming fundamentals courses, but that’s not to suggest devs aren’t learning key skills
-
AI projects are stalling at mid-market firms – Google Cloud and Accenture want to solve thatNews The new scheme aims to help mid-market companies move from pilot to production faster than ever before
-
FCA recommends expanded powers to boost financial services AI regulationNews The regulator has called for another review about whether AI needs to be regulated
-
UK business leaders have a 'limited understanding' of AI usage costs – and it's coming back to bite themNews Companies where CEOs are accountable for AI decisions report higher confidence in their strategy
-
What are the minimum skills for AI use?We're all talking about AI but do we all have the right skills to maximize its potential in our roles, departments, and organizations?
-
Forget tokenomics – agents are a personnel costLooking at AI agents as an IT cost is to misunderstand what they are, says HPE chief
-
Sluggish AI returns ignored as ‘fear of missing out’ continues driving investmentNews Poor returns on investment aren’t stopping the sharp increase in AI investment
-
Upskill your staff in AI or expect them to quit, says GartnerNews Organizations need to focus on targeted AI tools and training to make the most of their staff and succeed in transformation
-
Three things I expect to see at Dell Technologies World 2026, and one I don’tOpinion These are my predictions for the big talking points at this year’s Dell Technologies World
