Bengaluru: Dell Technologies on Thursday (August 31) raised its full-year revenue and earnings guidance, benefiting from the artificial intelligence (AI) boom and months of stabilizing demand for computer hardware and server products I was.
Shares of the Round Rock, Texas-based company rose 8% in after-hours trading.
The results are the latest sign that the downturn in technology spending may be coming to an end after Cisco, the leading networking equipment provider, also beat quarterly revenue estimates.
The company expects increased investment in artificial intelligence by big tech companies to drive demand for generative AI designs with PowerEdge servers and Nvidia.
“AI is already showing long-term tailwinds, with demand continuing to grow across our portfolio,” said COO Jeff Clarke.
The company expects third-quarter sales of US$22.5 billion to US$23.5 billion (MYR104.5 billion to MYR109.1 billion), beating analyst estimates of US$21.67 billion, according to Refinitiv data. Dell expects earnings per share to be US$1.45, plus or minus 10 cents compared to his forecast of US$1.38.
For the full year, Dell expects revenue of $89.5 billion to $91.5 billion and earnings per share of $6.30 plus or minus 20 cents.
Dell reported second-quarter revenue and EPS beat analyst expectations.
The company’s revenue for the quarter ending Aug. 4 is expected to be US$22.93 billion, with reported US$20.85 billion, according to Refinitiv data.
Server and networking revenue in the second quarter increased 11% from the first quarter to $4.27 billion, driven by increased demand for AI-optimized servers, Dell said.
Revenue from the company’s Client Solutions Group (CSG), home to its consumer and enterprise PC business, increased 8% from the first quarter to US$12.94 billion.
Gartner analyst Mikako Kitagawa said Dell’s sustained 7.5% operating profit on sales (CSG) is impressive in this challenging market environment, demonstrating the company’s “profitability first approach.” I said yes. – Reuters
