Dell Boosts Profit Forecast on Strong AI Server Demand
So, Dell's been doing pretty good, huh? They just upped their yearly profit guess. Looks like folks really want those AI servers they make, especially the ones with those super powerful chips from Nvidia.
You know, companies like Elon Musk's xAI and CoreWeave are using Dell's servers. That's a pretty big deal, right? Dell and another company called Super Micro Computer have been getting a boost from everyone wanting these servers. The thing is, making them costs a lot, and there's tough competition, so that cuts into how much money they actually make.
Dell's Chief Operating Officer, Jeff Clarke, shared some cool info. He said they got a whopping $12.1 billion in AI orders just this quarter! That's more than they shipped in all of their last fiscal year, and they still have $14.4 billion in orders they need to fill. Crazy!
Plus, the U.S. Department of Energy just announced they're launching a new supercomputer called Doudna. Guess what? It's going to use some fancy tech from Dell and Nvidia to do all sorts of complicated computing stuff. That's pretty neat.
Because of all this, Dell now thinks they'll make about $9.40 per share in adjusted profit this year. Before, they thought it would be $9.30. They're keeping their yearly sales prediction the same though. For the next three months, they expect to make between $28.5 billion and $29.5 billion in sales, which is way more than what most analysts were guessing. And their adjusted profit guess for those months is also higher than expected.
Their sales for the first three months of the year were good too, a bit more than expected. Their adjusted profit for that time was a little less than people thought though. One analyst, Shreya Gheewala, mentioned that things like how competitive prices are, tariffs, and where they're selling stuff could put some pressure on their profit margins in the near future.
Breaking down their business a bit, the part that sells servers, storage, and software went up by 12% in sales. The part that sells PCs also saw a 5% increase. Clarke also said that while people aren't buying new PCs as fast as they used to, it looks like more folks are switching to Windows 11 PCs, which include those cool AI-powered ones. Maybe it's finally time to get a new computer?
