Dell's AI Server Boom Sends Profit Forecast Higher
So, Dell's doing pretty well, huh? They just upped their yearly profit guess, and it sounds like it's because people are really into buying their servers that have those super powerful Nvidia chips for AI stuff. Remember Elon Musk's AI company, xAI? They're using Dell's servers, apparently. CoreWeave too. Dell's stock even went up a bit after they shared the news.
Honestly, Dell and another company called Super Micro Computer are seeing a boost because everyone wants these AI servers. But, like, making them costs a lot, and there's a bunch of competition, so that makes things a little tight on how much profit they can actually make.
Dell's Chief Operating Officer, Jeff Clarke, said something really cool: they got $12.1 billion in AI orders just in the last few months! That's more than they shipped all of last year. They've got a ton of orders still to fill too, sitting at $14.4 billion. Pretty wild, right?
Oh, and here's another interesting bit. The U.S. Department of Energy just announced this new supercomputer called Doudna. Get this, it's going to use Dell and Nvidia's fancy tech to do some seriously complicated computing. That's a big deal, for sure.
Based on all this, Dell now thinks they'll make about $9.40 per share in profit for the year. That's a little higher than what they thought before, like $9.30. They're sticking to their guess for how much money they'll bring in overall, though. And for the next few months, they're guessing they'll pull in somewhere between $28.5 billion and $29.5 billion. Most analysts thought it would be closer to $25.05 billion, so that's a decent jump. Their profit guess for the next few months is also looking good, around $2.25 per share, which beats the $2.09 guess.
They did pretty well in the first few months too, bringing in $23.38 billion, which was more than the $23.14 billion expected. But their profit for that time, $1.55 per share, was a little less than the $1.69 people were thinking. So, a bit of a mixed bag there maybe?
Someone who looks at stocks, Shreya Gheewala, mentioned that things might be a little tough on their profit margins in the short term because of other companies lowering prices, and maybe some other reasons like tariffs and where they're selling stuff. Makes sense, I guess.
Dell's business that deals with servers, storage, and software actually grew by 12%. And their computer business grew by 5% too. Jeff Clarke also said that even though people aren't buying new computers as fast as they used to, it seems like more folks are moving to those new Windows 11 computers, including the ones built for AI. So, maybe that'll pick up a bit more?
