On Thursday, Dell Technologies increased its full-year revenue and profit prediction as a result of the artificial intelligence (AI) boom and recovering consumer demand for server and computer gear following a prolonged decline. In extended trading, shares of the Round Rock, Texas-based corporation increased 8%. The results come after major networking equipment provider Cisco also exceeded quarterly revenue projections, providing the latest evidence that a decline in technology expenditure may be nearing an end.
Rising investments in artificial intelligence by big tech companies are anticipated to increase demand for the company’s PowerEdge servers and generative AI designs with Nvidia.
With ongoing demand growth throughout our portfolio, AI is already proving to be a long-term tailwind, according to Chief Operating Officer Jeff Clarke.
According to Refinitiv data, the company outperformed analysts’ projections of $21.67 billion (approximately Rs. 1,79,129 crore) by predicting third-quarter revenue between $22.5 billion (about Rs. 1,86,025 crore) and $23.5 billion (roughly Rs. 1,94,251 crore). In comparison to projections of $1.38 (approximately Rs. 114), Dell expects earnings per share of $1.45 (about Rs. 120), plus or minus 10 cents.
Dell now anticipates revenue for the entire year to range between $89.5 billion and $91.5 billion, or roughly Rs. 7,40,057 crore and Rs. 7,56,595 crore, respectively, and earnings per share of $6.30, or nearly Rs. 521, plus or minus 20 cents.
Dell’s second-quarter revenue and earnings per share (EPS) exceeded the anticipated figures.
According to Dell, increasing demand for AI-optimised servers was the primary factor in the second quarter’s $4.27 billion (approximately Rs. 3,52,953 crore) increase in server and networking revenue.
Client Solutions Group (CSG) revenue, which houses the company’s consumer and business PC businesses, increased by 8% from the first quarter to $12.94 billion (approximately Rs. 1,06,974 crore).
In this difficult market climate, preserving 7.5 percent of operational profits as a percentage of revenue (CSG) is noteworthy, according to Gartner analyst Mikako Kitagawa, demonstrating the company’s “profitability first approach.”
The outcomes stand in stark contrast to rival HP’s yearly projection being slashed as a result of a decline in PC demand and weakness in China.