Dell Technologies (DELL) was seen as a mature PC and enterprise hardware company fighting for relevance in a rapidly changing technology landscape. Now, the rise of artificial intelligence (AI) is rewriting that history. On Thursday, Dell shares rose about 39% after the company posted extraordinary profits, driven by explosive demand for AI-optimized servers and data center infrastructure.
With orders for AI servers skyrocketing, revenue forecasts rising, and partnerships closely tied to the massive global development of AI, Wall Street increasingly sees Dell not as a legacy tech name, but as one of the biggest emerging winners in the AI infrastructure race.
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About Dell Technologies Stock
Dell Technologies is a multinational technology company headquartered in Round Rock, Texas. Operating primarily through two segments: Client Solutions Group (PCs, workstations, peripherals) and Infrastructure Solutions Group (servers, storage, networking, services), Dell provides comprehensive hardware, software and services solutions to consumers, businesses, public sector and enterprise customers globally. The company’s market capitalization is $204.7 billion.
DELL has emerged as one of the strongest AI infrastructure operations on the market in 2026, with shares delivering explosive gains as investors increasingly bet on the company’s booming AI server business. Shares are up 234.37% year to date (YTD) and 269.97% over the past 52 weeks, dramatically outperforming the broader market as demand for AI-optimized servers and data center infrastructure accelerated.
Momentum intensified in late May after Dell reported blockbuster quarterly results and sharply raised its full-year outlook. The stock had already risen to a new 52-week high of $327.73 on May 28 ahead of the earnings release, driven by bullish price target increases from Wall Street and growing optimism around Dell’s AI backlog and server demand. At the market close on Friday, the new high was $429.15.
Following the earnings announcement, Dell shares soared in after-hours trading, rising about 39% in massive post-market gains after the company posted a huge profit increase, raised revenue forecasts and revealed that orders for AI servers had increased more than 750%. The rally marked one of Dell’s biggest post-earnings moves in years and reinforced Wall Street’s growing view that the company is evolving from a legacy PC maker to a leading powerhouse in artificial intelligence infrastructure.
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The stock currently trades at 25 times forward price-to-earnings ratio, a modest discount to its industry peers.
Solid first quarter results
Dell Technologies released its first-quarter fiscal 2027 financial results on May 28, delivering one of the strongest quarters in the company’s history as demand for AI infrastructure accelerated dramatically across its server and data center business. The company reported record quarterly revenue of $43.84 billion, representing an 88% year-over-year increase, while non-GAAP EPS rose 214% to a record $4.86, beating expectations. Operating cash flow also hit a quarterly record of $4.1 billion.
Dell’s Infrastructure Solutions Group (ISG), which includes servers, networking and storage, was the primary driver of growth during the quarter. ISG’s revenue increased 181% year-over-year to a record $29 billion. Within the segment, AI-optimized server revenue soared 757% year-over-year to $16.1 billion, highlighting the extraordinary demand for AI infrastructure. Traditional server and networking revenue also remained exceptionally strong, rising 92% year over year to $8.5 billion, while storage revenue rose 8% to $4.3 billion. ISG’s operating income rose 206% year-over-year to a record $3.1 billion.
Dell’s Client Solutions Group (CSG), which houses its PC business, also posted solid growth even as the company’s growing exposure to AI dominates investor attention. CSG’s revenue increased 17% year-on-year to $14.6 billion. Business customer revenue rose 18% to a record $13 billion, benefiting from business refresh cycles and demand for AI-enabled PCs, while consumer revenue grew 9% to $1.6 billion. The segment’s operating income increased 79% year-over-year to a record $1.2 billion.
AI demand remained the defining theme of the quarter. Dell revealed that it booked $24.4 billion in AI orders during the quarter and exited the first quarter with a record AI order backlog of $51.3 billion. It is benefiting as AI demand continues to outpace supply, as hyperscalers, enterprises, sovereign customers and cloud providers rapidly expand AI data center deployments.
Additionally, for the second quarter of fiscal 2027, Dell expects revenue of between $44 billion and $45 billion and adjusted earnings per share of $4.80. For full fiscal 2027, the company raised its revenue guidance to between $165 billion and $169 billion, a dramatic increase from its previous outlook of $138 billion to $142 billion, while adjusted EPS guidance came in at $17.90.
Management raised its fiscal 2027 AI server revenue forecast to $60 billion, up from its previous expectation of $50 billion, reinforcing Wall Street’s growing belief that Dell is rapidly transforming from a traditional PC maker to one of the biggest beneficiaries of the global AI infrastructure boom.
Analysts forecast EPS of $12.21 for fiscal 2027, up 32% year-over-year, followed by a further 12.2% rise to $13.70 in 2028.
What do analysts expect from Dell Technologies stock?
Susquehanna recently upgraded Dell Technologies to “Positive” from “Neutral” and sharply raised its price target to $700 from $138, citing accelerated growth in the company’s AI server business and improving margins.
Additionally, Barclays raised its price target on Dell Technologies to $550 from $168, while maintaining an “Overweight” rating after the company delivered strong quarterly results across all major business segments.
Overall, DELL has a “Moderate Buy” consensus rating. Of the 25 analysts covering the stock, 15 recommend a “strong buy”, two suggest a “moderate buy”, seven analysts give it a “hold” rating and one recommends a “strong sell”.
DELL has already surpassed analysts’ average price target of $212.64, while Susquehanna’s high street price target of $700 suggests the stock could still rally 66.31%.
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On the date of publication, Subhasree Kar had no positions (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. This article was originally published on Barchart.com
