Dell Q2 Revenue Grows 58% as AI Server Demand Drives Higher Outlook

Dell Technologies reported record fiscal second-quarter revenue of $47.0 billion, up 58% from a year earlier, as demand for AI infrastructure continued to drive rapid growth in its server business. GAAP net income increased to $4.1 billion from $1.2 billion, while diluted earnings rose to $6.34 per share from $1.68. Non-GAAP earnings increased to $7.04 per share. Dell shares rose about 6% in after-hours trading Tuesday following the results.

Infrastructure Solutions Group revenue increased 113% to a record $35.7 billion. Servers and networking revenue rose 138% to $30.8 billion, while storage revenue increased 26% to $4.9 billion. Dell shipped $16.4 billion of AI-optimized servers during the quarter and said its AI server backlog reached $95 billion. The company now expects approximately $74 billion of AI server revenue for fiscal 2027, up from its previous forecast of about $60 billion.

Dell's Client Solutions Group, which includes its PC business, reported revenue of $15.0 billion, up 20%. Commercial client revenue increased 22% to $12.9 billion, while consumer revenue rose 7% to $2.1 billion. Dell generated $3.2 billion of cash flow from operations during the quarter and returned $1.8 billion to shareholders through share repurchases and dividends.

Dell significantly raised its fiscal 2027 outlook following the quarter. The company now expects $192 billion of revenue, up $25 billion from its previous forecast of $167 billion, and non-GAAP earnings of approximately $25.50 per share, compared with $17.90 previously. For the third quarter, Dell expects revenue of approximately $49 billion and non-GAAP earnings of $6.50 per share.