Dell shares gain after strong AI server demand boosts annual forecast (updated)

Dell Technologies

02/09/2026 14:50

Updates shares, details in paragraphs 1,9 and 10
Sept 2 (Reuters) - Dell Technologies' DELL.N shares climbed nearly 11% on Wednesday, as strong demand for its AI-optimized servers powered an increase in its annual revenue and profit forecasts.
AI infrastructure companies have benefited from rising demand as tech firms and hyperscalers ramp up investments in data centers to support large language models and other AI applications. Peer Super Micro Computer had also reported upbeat results last month.
"The AI momentum spoke for itself," said analysts at J.P. Morgan, noting Dell's record $60 billion of orders and $95 billion backlog in the quarter.
Dell's servers, equipped with Nvidia's NVDA.O chips, are sought by clients, including AI cloud providers Nscale and CoreWeave CRWV.O, to build computing clusters for training and running AI models.
"Storage strength is really playing a role and it seems sustainable as AI is driving fundamental growth in Dell's most profitable business," said analysts at Melius Research.
The brokerage raised its price target on the stock to $735, the highest among the analysts tracked by LSEG.
 
Dell raised its annual revenue forecast to $192 billion from $167 billion, and adjusted earnings per share target to $25.50 from $17.90 earlier.
Its second-quarter revenue jumped 58% to a record $47 billion, surpassing Wall Street estimates of $44.92 billion.
Shares of other AI server makers, including Super Micro SMCI.O and Hewlett Packard Enterprise HPE.N, were up 2.2% and 1.4%, respectively, following Dell's results.
Dell is set to add about $23.26 billion in market value at the current share price of $461, if gains hold.
Its shares were trading at 18.12 times expected earnings over the next 12 months, according to LSEG data. That compares with 12.56 and 8.06 for HPE and Super Micro, respectively.

 (Reporting by Kanchana Chakravarty and Prathik Jayaprakash in Bengaluru; Editing by Shilpi Majumdar)
 ((Kanchana.Chakravarty@thomsonreuters.com;))