TLDR
- Q4 adjusted earnings per share reached $3.89, surpassing the $3.52 forecast, while revenue climbed to $33.4 billion — representing 39% annual growth.
- Revenue from AI-optimized servers exploded 342% to reach $9.0 billion, accompanied by an unprecedented $43 billion backlog.
- FY2027 revenue guidance ranges from $138 billion to $142 billion, significantly exceeding the $124.9 billion Wall Street consensus.
- Shares climbed more than 13% during after-hours sessions, hitting $137.40.
- The company boosted its dividend payout by 20% while adding $10 billion to its buyback authorization.
Dell Technologies delivered an impressive fiscal fourth-quarter performance that exceeded Wall Street’s projections across key metrics. The announcement triggered a surge of more than 13% in after-hours market activity.
The technology giant reported adjusted earnings per share of $3.89, comfortably surpassing the $3.52 analyst consensus. Quarterly revenue reached $33.4 billion, marking a substantial 39% increase compared to the prior-year period and exceeding the anticipated $31.41 billion.
However, the standout figure emerged from the AI server segment. Dell’s Infrastructure Solutions Group generated $9.0 billion in AI-optimized server revenue — an extraordinary 342% year-over-year surge.
Yes, you read that correctly.
Additionally, the company disclosed a record-breaking AI server backlog totaling $43 billion. Dell secured over $64 billion in AI-optimized server contracts throughout the complete fiscal year while delivering more than $25 billion in shipments.
“The AI revolution is fundamentally reshaping our business,” stated Jeff Clarke, vice chairman and chief operating officer. “We’re beginning FY27 with an unprecedented $43 billion backlog — compelling evidence that our engineering excellence and distinctive AI offerings are capturing market share.”
FY2027 Outlook
Dell’s forward-looking projections demonstrated similar strength. Management forecast FY2027 revenue spanning $138 billion to $142 billion — substantially higher than the $124.9 billion Street estimate.
Full-year EPS guidance landed at $12.90, versus analyst projections of $11.49. First-quarter revenue is anticipated to surge 51% year-over-year.
The company anticipates AI server revenue will approach $50 billion during the current fiscal year, representing a 103% jump from FY2026.
Regarding shareholder returns, Dell increased its quarterly cash dividend by 20% and authorized an additional $10 billion for share repurchases.
A Note of Caution
Despite the optimism, some market observers expressed reservations. BofA Securities analysts highlighted concerns regarding demand elasticity, noting “rapid and substantial pricing adjustments” implemented by Dell recently.
Server pricing was adjusted upward on December 10, partly attributed to escalating memory chip expenses. Personal computer pricing modifications were enacted on January 6.
Clarke recognized the price adjustments but characterized them as necessary responses to rising input costs rather than demand-management tactics.
After-hours activity propelled DELL shares to $137.40, representing a 13.21% gain following the earnings announcement. By Friday’s premarket session, the stock maintained gains exceeding 12%.
The historic $43 billion AI server backlog entering FY2027 represented the company’s most concrete forward-looking indicator.
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