Dell's AI Servers Boost Profit Forecast
So, Dell just gave us a little update, and it seems like they're doing even better this year than they thought. They think they'll make more money, and it's all thanks to their fancy servers that use those powerful chips from Nvidia.
You know how Elon Musk is doing that AI thing with xAI? Yeah, they use Dell's servers. Also, a company called CoreWeave does too. Because of the boost from these servers, Dell's stock even went up a little bit after they shared the news.
Now, Dell and another company, Super Micro Computer, are getting a lot of orders for these special servers. But, and this is a big but, they cost a lot to make. Plus, there's a lot of competition out there, so it's not exactly easy money for them. Still, Dell's Chief Operating Officer, Jeff Clarke, said they got a ton of AI orders in just the last few months, way more than they shipped in the whole previous year. Like, $12.1 billion worth! And they still have $14.4 billion in orders waiting to be sent out. That's a lot of tech!
Get this, right after Dell's news, the U.S. Department of Energy announced they're building a new supercomputer called Doudna. And guess who they're using to help build it? Dell and Nvidia! It sounds like it's going to be a really powerful machine for doing complex stuff.
Because things are looking good, Dell is bumping up their guess for how much money they'll make this year, from $9.30 per share to $9.40 per share. They're keeping their guess for overall sales the same though. For the next few months, they think they'll make between $28.5 billion and $29.5 billion in sales, which is actually more than the experts thought. And their guess for their profit per share for the next few months is also higher than the experts expected.
They did pretty well last quarter too, with sales of $23.38 billion, which was more than expected. Their profit per share was a little less than the experts thought though, just so you know. One expert, Shreya Gheewala, mentioned that Dell might face some pressure on how much profit they make in the near future because of things like how competitive pricing is, tariffs, and where they're selling their stuff.
Looking at their different businesses, the part that sells servers, storage, and software saw sales go up by 12%. Their PC business also did better, with sales going up by 5%. Dell's COO also said that people aren't buying new computers as quickly as they used to, but it looks like more people are starting to get those newer computers that run Windows 11, including the ones with AI built in.
It makes you wonder, what kind of cool things will people do with all this new AI power?
