AI Server Revenue Rockets 757%! Dell Delivers Blockbuster Earnings Print, Shares Surge Blindly Near 40% After-Hours

Riding a continuous wave of unprecedented demand for artificial intelligence infrastructure, U.S. server and personal computer manufacturer Dell Technologies Inc. delivered a powerhouse quarterly report Thursday that handily shattered market expectations, sending its stock soaring nearly 40% in extended trading.

 

For the first quarter of fiscal 2027 ended May 1, Dell pulled in aggregate revenue of $43.8 billion, marking a blistering 88% year-over-year expansion that easily outpaced the $35.7 billion consensus compiled by FactSet.

 

Adjusted earnings per share (EPS) surged 214% year-over-year to $4.86, substantially beating FactSet projections of $2.96. FactSet historical tracking dating back to February 2021 confirms this stands as the firm's largest net profit upside surprise in at least five years.

 

 

Following the stellar release, Dell equity skyrocketed nearly 40% in after-hours trading Thursday. During the regular session, the stock had secured its sixth consecutive day of gains, clinching its fourth straight all-time closing high.

 

Dell Vice Chairman and Chief Operating Officer Jeff Clarke noted in a statement that the company’s record Q1 execution "reflects exceptionally strong underlying demand during the quarter alongside our continuous pace of innovation across the entire PC, compute, and storage pipeline."

 

According to Clarke, Dell captured a massive $24.4 billion in AI-related orders during the period, while AI server revenue surged an astronomical 757% year-over-year to $16.1 billion. The infrastructure vendor closed out the first quarter with its AI order backlog climbing to a historic high-water mark of $51.3 billion.

 

Backed by this explosive momentum, Dell lifted its full-year fiscal 2027 AI server revenue projection to $60.0 billion, representing a 144% expansion over the prior fiscal year. "This simply underscores that the broader AI macro opportunity shows zero signs of decelerating," Clarke emphasized.

 

Management concurrently raised its midpoint full-year fiscal 2027 revenue guidance to $167.0 billion, implying a top-line expansion rate of nearly 50%.

 

During the first quarter, Dell's Infrastructure Solutions Group (ISG)—which encompasses its server, networking, and storage portfolios—surged 181% year-over-year to reach $29.0 billion.

 

Within that segment, traditional server and networking revenue jumped 92% to $8.5 billion, while storage revenue edged up 8% to settle at $4.3 billion.

 

Analysts anticipate that Dell's recent rollout of its 18th-generation enterprise-grade PowerEdge server line will catalyze a major hardware upgrade cycle, given that a significant portion of its current corporate install base remains on 14th-generation nodes.

 

Crucially, global demand for traditional server architectures is experiencing a secondary renaissance as enterprise agentic AI and inference workloads increasingly rely heavily on central processing units (CPUs) for structural execution.

 

Meanwhile, Dell's Client Solutions Group (CSG)—covering commercial and retail personal computing devices—expanded 17% year-over-year to $14.6 billion in Q1. Commercial client revenue ticked up 18% to $13.0 billion, while the consumer client segment grew 9% to $1.6 billion.

 

Looking ahead to the second quarter of fiscal 2027, Dell provided a robust revenue guidance band of $44.0 billion to $45.0 billion.

 

The midpoint of that range represents a 49% growth trajectory, handily topping the $35.1 billion Wall Street consensus. The tech giant also forecasts Q2 adjusted EPS to climb 107% year-over-year to $4.80, vastly outpacing the $2.99 analyst estimate.

 

Heading into the first-quarter print, Bank of America research analyst Wamsi Mohan noted that demand configurations across AI hardware, traditional compute, and consumer PCs looked "quite substantial" for the first half of 2026, adding that he expects AI server momentum to remain highly durable throughout the calendar year.

 

Further backstopping Dell’s near-term fundamental growth profile, the U.S. Department of Defense formally announced Wednesday that it has awarded the firm a major five-year, $9.7 billion enterprise software and services contract to deploy Microsoft solutions across agency networks.