Dell Technologies full-year forecast: Dell Technologies has increased its full-year revenue and profit forecasts, capitalising on the surge in artificial intelligence (AI) and a resurgence in demand for computer hardware and server products after a period of decline. The company’s shares surged 8 per cent in extended trading in response to the news.
Tech spending trends
This development signals a potential turnaround in tech spending trends, following Cisco’s recent beating of quarterly revenue estimates. Dell stands to benefit from rising investments in AI by major technology companies, driving demand for its PowerEdge servers and generative AI designs in collaboration with Nvidia.
Jeff Clarke, Chief Operating Officer of Dell, expressed confidence in AI’s sustained growth, noting, “AI is already showing it’s a long-term tailwind, with continued demand growth across our portfolio.”
Analysts’ estimates
Dell’s third-quarter revenue forecast of $22.5 billion (Rs 1.86 lakh crore) to $23.5 billion (Rs 1.94 lakh crore) surpasses analysts’ estimates of $21.67 billion (Rs 1.79 lakh crore), with projected earnings per share of $1.45 (Rs 119.90), compared to estimates of $1.38 (Rs 114.11).
For the full year, Dell now anticipates revenue between $89.5 billion (Rs 7.4 lakh crore) and $91.5 billion (Rs 7.57 lakh crore), with earnings per share of $6.30 (Rs 520.94), plus or minus 20 cents.
In the second quarter, Dell reported revenue and earnings per share above analysts’ predictions. Notably, the Servers and Networking division’s revenue surged by 11 per cent to $4.27 billion (Rs 35,303.72 crore), driven by growing demand for AI-optimised servers. The Client Solutions Group, which houses Dell’s consumer and enterprise PC businesses, also saw an 8 per cent revenue rise to $12.94 billion (Rs 1.07 lakh crore).
Dell’s positive performance contrasts sharply with competitor HP Inc, which reduced its annual forecast due to weakened PC demand and challenges in China.
(With Reuters Inputs)
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