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Dell Lifts Outlook After AI Server Orders Surge Despite Q3 Revenue Miss

A higher $25 billion AI server target signals demand strong enough to support a far-above-consensus fourth-quarter outlook.

Overview

  • Q3 results: adjusted EPS of $2.59 beat expectations while revenue of $27.01 billion was slightly below estimates.
  • Dell guided fourth-quarter revenue to $31.0–$32.0 billion with adjusted EPS of $3.50, both ahead of forecasts.
  • The company raised its full-year view to $111.2–$112.2 billion in revenue and $9.92 in adjusted EPS.
  • AI servers led the gains, with $5.6 billion shipped in Q3, an $18.4 billion backlog fueled by $12.3 billion in new orders, and roughly $9.4 billion targeted for Q4 sales.
  • Management warned that fast-rising DRAM and NAND costs may squeeze margins even as pricing power improves; shares rose after the report and David Kennedy was named permanent CFO.