Dell Blows Past Q2 Estimates and Raises Full-Year Revenue Outlook to $192 Billion on Record AI Server Demand

Dell Technologies reported fiscal second-quarter revenue of $47.0 billion, up 58% year over year and well above the Wall Street consensus of $44.92 billion, while adjusted earnings per share of $7.04 crushed the $4.91 estimate by more than two dollars. The results were driven by AI-optimized server revenue of $16.4 billion, doubling from a year earlier, and Infrastructure Solutions Group revenue of $31.8 billion, up 89% year over year. Net income rose 255% to $4.1 billion, adjusted free cash flow jumped 224% to $8.1 billion, and the company returned $4.3 billion to shareholders including a quarterly dividend of $0.63 per share.

Dell booked a record $60.9 billion in AI server orders during the quarter and exited with a record backlog of $95 billion, reflecting accelerating demand from neoclouds, sovereign governments and large enterprises. The company's customer count in AI infrastructure surpassed 6,500, and management noted that a majority of the installed base remains on 14th-generation or older servers, which it described as a significant and durable refresh opportunity.

The company sharply raised its full-year fiscal 2027 guidance, lifting revenue to $192 billion from a prior range of $165 billion to $169 billion and well above the analyst consensus of $172.7 billion. AI server revenue guidance moved to $74 billion from $60 billion, representing a tripling of the business year over year; just six months ago Dell had projected only a doubling. Adjusted EPS guidance rose to $25.50 from $17.90, against a Street estimate of $18.90. For the fiscal third quarter, Dell guided revenue of $49 billion, roughly $7.5 billion above consensus, with adjusted EPS of $6.50.

Dell stock fell about 4% during the regular session as broader market weakness and rising bond yields weighed on technology shares ahead of the print, but surged roughly 10% in after-hours trading following the results. Management said on the conference call that the company expects AI to represent 75% of all data center demand by 2030, with inference token demand growing 87 times to 3,600 quadrillion tokens by that year, and enterprise agentic AI becoming the single largest workload by 2028. The full-year operating expense rate of approximately 8% of revenue is the lowest in the company's 42-year history.