Dell Technologies Inc. (Dell (DELL)) is having a moment. The stock surged nearly 38% in premarket trading Friday after the company reported first-quarter results that blew past Wall Street estimates, raised its full-year outlook, and issued guidance for the current quarter that made analysts look like they were being way too conservative. The reason? Artificial intelligence infrastructure demand is showing no signs of slowing down.
Dell reported first-quarter revenue of $43.84 billion, crushing the analyst consensus of $35.45 billion. Adjusted earnings came in at $4.86 per share, far above the $2.94 per share that analysts had expected. Revenue jumped 88% from a year ago, and adjusted earnings per share surged 214%. Those are the kind of numbers that make you do a double-take.
Chief Operating Officer Jeff Clarke said demand remained strong across Dell's AI and infrastructure businesses, though component shortages continue to limit supply. The most significant constraints are in DRAM, NAND flash memory, and microprocessors. Clarke noted that this is what Dell does — it navigates supply chains for a living. "This is what we do — never run out of supply," he said, expressing confidence in the company's ability to manage the crunch.
Adjusted gross margin rose 57% year over year to $7.9 billion, while adjusted operating income climbed 154% to $4.2 billion. Dell generated a record $4.1 billion in operating cash flow during the quarter and returned $2.1 billion to shareholders through dividends and share repurchases. The company ended the quarter with $14.1 billion in cash and investments.
Infrastructure Business Reaches New High
Dell's Infrastructure Solutions Group posted a record quarter, with revenue of $29 billion, up 181% from a year earlier. That's not a typo. The growth was fueled by strong demand for AI servers, traditional servers, and storage products. Traditional server and networking revenue jumped 92% to $8.5 billion as enterprise demand continued to outpace supply amid ongoing infrastructure modernization. Storage revenue increased 8% to $4.3 billion, driven by demand for the company's PowerStore, PowerMax, PowerScale, and ObjectScale platforms.
The Client Solutions Group, which includes PCs, also had a solid quarter. Revenue rose 17% to $14.6 billion, with commercial revenue up 18% and consumer revenue gaining 9%. Enterprise PC refresh cycles and gaming demand helped drive that growth.
But the real story is AI. Dell recorded $24.4 billion in AI-related orders during the quarter and generated $16.1 billion in AI server revenue. The company ended the period with a record AI backlog of $51.3 billion. Management said its broader AI pipeline remains several times larger than its current backlog, despite strong order conversions. In other words, the demand is not just a flash in the pan — it's a wave that keeps building.
Outlook Raised
For the second quarter, Dell expects revenue of $44 billion to $45 billion and adjusted earnings of $4.80 per share. Analysts were expecting revenue of $34.99 billion and adjusted earnings of $2.98 per share. That's a massive beat on guidance alone.
The company raised its fiscal 2027 revenue outlook to a range of $165 billion to $169 billion, up from its previous forecast of $138 billion to $142 billion. Analysts had projected full-year revenue of $142.25 billion. Dell also raised its full-year adjusted earnings guidance to $17.90 per share, up from $12.90, well above analysts' projection of $13.09 per share.
Dell lifted its full-year AI server revenue forecast to $60 billion and said demand continues to outstrip supply across both AI and traditional infrastructure markets, particularly for DRAM and NAND memory components. The company is essentially saying: we can't make enough of this stuff, and that's a good problem to have.
Dell Price Action
Dell Technologies shares were up 37.99% at $437.50 during premarket trading on Friday. The stock is trading at a new 52-week high. For a company that was once seen as a legacy PC maker, Dell has reinvented itself as a key player in the AI infrastructure boom. And if the numbers are any indication, that transformation is paying off in a big way.
