Shares of Dell Technologies (NYSE:DELL) surged more than 4% in U.S. premarket trading on Wednesday after the company issued upbeat forecasts for both its current quarter and full fiscal year, bolstered by surging demand for its AI-focused server lineup.
The company said it expects fourth-quarter revenue between $31 billion and $32 billion—well above the $27.59 billion estimated by LSEG, according to Reuters. Dell also projected adjusted earnings of $3.50 per share, beating expectations of $3.21.
The tech giant raised its full-year outlook as well. Dell now sees fiscal 2026 revenue in the range of $111.2 billion to $112.2 billion, up from its prior projection of $105 billion to $109 billion. Its new adjusted earnings-per-share target of $9.92 also came in ahead of earlier guidance. Morgan Stanley analysts noted that the company’s preliminary projection for at least 15% per-share profit growth was “well ahead of Wall Street.”
During a call with analysts, Chief Operating Officer Jeff Clarke emphasized the company’s intention to shield customers from rising costs, stating Dell would “do everything” it can to mitigate price increases tied to higher production expenses. Investors have been concerned about potential margin pressure stemming from those costs as well as fiercer competition from rivals such as Super Micro Computer.
“Management acknowledged the memory cycle is unprecedented, but also spoke to better preparedness,” Morgan Stanley wrote in a note. “We don’t doubt Dell will manage this cycle better than peers, but we still believe growth and/or margins will be impacted.”
Even so, Dell remains confident in the momentum behind its AI server business. The company now expects AI-related server shipments to generate roughly $25 billion in fiscal 2026 revenue—an increase from its earlier estimate of $20 billion.
Analysts at BofA Securities said the latest results “re-affirmed our confidence in Dell continuing to drive upside to AI server consensus revenue estimates, while also navigating a difficult commodity environment.”
Fresh orders helped push Dell’s third-quarter AI server backlog to $18.4 billion. For the quarter itself, Dell reported adjusted earnings per share of $2.59 on revenue of $27 billion.