Dell Boosts Profit Forecast on Strong AI Server Demand
Hey, so lately Dell's been kinda crushing it, right? They just upped their yearly profit guess, and it seems like it's all thanks to their cool AI servers. These servers are hooked up with Nvidia's super strong chips, which is pretty neat.
You know how guys like Elon Musk's AI company, xAI, and also CoreWeave use Dell's servers? Well, that's a big deal! Dell's stock price even went up slightly after the news. Both Dell and this other company, Super Micro Computer, are doing well 'cause everyone wants these special servers. But making them can be expensive, and there's lots of competition, so that can make things a bit tricky for their profit margins.
Dell's Chief Operating Officer, Jeff Clarke, said they got a whopping $12.1 billion in AI server orders just this past quarter. That's more than they shipped in their whole last fiscal year! And get this, they still have $14.4 billion in orders waiting to go out. That's a lot of servers!
This good news came out right after the U.S. Department of Energy said they're building a new supercomputer called Doudna. It's gonna use Dell and Nvidia's fancy tech to do some really complicated stuff.
Because of all this, Dell now thinks their yearly adjusted profit will be around $9.40 per share. They were thinking $9.30 before, so that's an improvement! They also said their total money coming in for the year should be about the same as they thought before. For the next three months, they're guessing they'll bring in between $28.5 billion and $29.5 billion. That's way more than the $25.05 billion that other financial folks were expecting, which is pretty impressive, tbh. Dell's expected profit for the next three months is also looking good, at $2.25 per share, which is higher than the $2.09 estimate.
In the first three months of the year, Dell made $23.38 billion in money coming in, which was a bit more than expected. But their adjusted profit per share, which was $1.55, was a little less than the $1.69 that was guessed. One expert, Shreya Gheewala, thinks that maybe competition, tariffs, and where they're selling stuff could put some pressure on how much profit they make in the short term.
Breaking down where Dell makes their money, the part of their business that deals with servers, storage, and software went up by 12%. Their PC business also grew by 5%. Jeff Clarke mentioned that people aren't buying new computers as quickly as they used to, but it seems like more folks are starting to get those newer Windows 11 PCs that have AI features. What do you think about these AI PCs?
