Dell Technologies Q2 Earnings Call Highlights

Fiscal Q2 revenue rose 58% year over year to $47 billion, while non-GAAP EPS surged 203% to $7.04. Infrastructure Solutions Group revenue jumped 89% to $31.8 billion, with $60.9 billion in AI orders and a $95 billion AI backlog. Traditional server and networking revenue more than doubled to $10.5 billion, storage revenue increased 26% to $4.9 billion, and Client Solutions Group revenue rose 20% to $15 billion. The company now expects fiscal-year revenue of $192 billion and non-GAAP EPS of $25.50, reflecting approximately 70% and 150% growth, respectively. Dell also returned a record $4.3 billion to shareholders during the quarter despite ongoing component supply constraints.

Dell Technologies NYSE: DELL reported record fiscal 2027 second-quarter revenue and earnings, driven by accelerating demand for AI servers, traditional data-center infrastructure, storage and commercial PCs. The company also raised its full-year outlook, citing momentum across each of its major business lines. Revenue rose 58% year over year to $47 billion, while diluted non-GAAP earnings per share increased 203% to a record $7.04, according to Vice Chairman and Chief Operating Officer Jeff Clarke. Non-GAAP operating income grew 160% to $5.9 billion, and operating margin reached 12.6%.

Dell’s Infrastructure Solutions Group, or ISG, generated record revenue of $31.8 billion, up 89% from a year earlier. The segment delivered operating income of $4.8 billion and a 15% operating margin.

AI server demand was a central driver. Dell booked $60.9 billion in AI orders during the quarter and recognized $16.4 billion in AI server revenue. It ended the period with $95 billion in AI backlog. Clarke said Dell’s AI pipeline continued to grow sequentially and remained multiples of its backlog, even after the company converted $131.7 billion into orders during the past 12 months. The company said its AI infrastructure customer count surpassed 6,500.

Clarke said demand was broadening across neocloud providers, sovereign customers and enterprises, while deployments increasingly require engineering, design and installation expertise related to performance, power, cooling and data-center configurations. Dell also said it became the first company to ship rack systems engineered on NVIDIA’s Vera Rubin platform. During the question-and-answer session, Clarke said enterprise participation in Dell’s AI infrastructure business continued to increase. The company added 3,300 Dell AI Factory customers in the past three quarters, after taking eight quarters to reach its first 3,200 customers. He said enterprise customer growth, repeat buyers and enterprise revenue all increased sequentially and year over year.

Traditional server and networking revenue increased 122% to $10.5 billion, with demand outpacing available supply. Clarke attributed the growth primarily to existing enterprise customers refreshing older infrastructure, consolidating data centers and addressing security and resiliency requirements. He said Dell still has 1.2...