Dell's shares surged 30 per cent yesterday as the PC maker’s blockbuster results showed that its growing focus on AI servers was helping it capitalise on the data centre boom, making the company one of the biggest beneficiaries of the new technology.
The company, whose AI servers are crucial components in the global AI infrastructure build-out, is set to add $62 billion to its market value of about $206bn, if gains hold.
A household name in the PC market, Dell has in recent years scaled up its AI hardware business. Dell’s AI server revenue of $16.1bn surpassed its PC unit’s $14.6bn in sales in the quarter.
The company’s infrastructure solutions segment, home to both traditional and AI-optimised servers as well as other storage, software and networking solutions, has consistently eclipsed PC business revenue in the past four quarters.
“We’ve been following Dell a long time and never seen anything like this. Not only do they get an ‘A’ for execution, but you can make an argument that Dell is even the best way to play AI out there,” Melius Research analysts said.
Dell’s outlook for “AI and traditional servers are still very conservative,” as the firm has stronger prospects for selling CPU racks to AI cloud providers like CoreWeave and Nscale, the brokerage said.
The blowout quarter lifted shares of server makers Super Micro Computer and Hewlett Packard Enterprise around 14pc, while Dell’s PC rival HP also rose 10pc.
Hewlett Packard Enterprise, which reports results on Monday, has also been prioritising higher-margin product orders. But it has a smaller server business compared with Dell.
Dell chief operating officer Jeff Clarke acknowledged the ongoing “supply constrained” environment, particularly concerning memory chips, but said that its customers were actively securing supply for extended periods.
&uuid=(email))