- Quarterly $12.1 billion AI server revenues top last year’s total
- Orders uneven as tariffs uncertainty persists
- Analysts reckon stock could hit $155 this year
Dell Technologies’ (DELL:NYSE) earnings were the very definition of contrast after its rival HP’s (HPQ:NYSE) big flop. HP reported better-than-expected revenue on Wednesday (28 May), but the company missed on earnings and issued disappointing guidance.
Not so Dell, which lifted full-year guidance despite soft demand thanks to Trump tariffs. For Q1, the company reported adjusted EPS (earnings per share) of $1.55 on revenue of $23.38 billion, compared with estimates for $1.69 and $23.13 billion respectively.
Dell stock rose around 2% in after-market trading to $115.75, a contrast indeed to HP’s 12% post earnings share price slump.
Crucially, Dell reported AI server orders of $12.1 billion, well above expectations, with a $14.4 billion order backlog also well ahead.
‘Dell reported a mixed Q1, but the highlight was AI orders of $12.1 billion, more than all AI revenues last full year’, wrote analysts at Barclays.
BUMPY ROAD
The company ‘continues to perform well in AI servers, but orders are translating to revenues at an uneven pace, at least in the near term with Blackwell transition and rack scale push-out.’
Looking ahead to the full-year (to end Jan 2026), the company lifted diluted EPS guidance to $9.40 from $9.30 previously, at the midpoint on revenue between $101 billion and $105 billion, both putting upward pressure on consensus pitched at $9.17 on $103 billion.
‘At the highest level, we see the potential for Dell to deliver significantly higher AI server revenues over the next two years with strong upside to EPS’, wrote Bank of America analysts in a post-earnings note, lifting their Dell price target to $155 from $150.
