Key Takeaways
- Shares of HP Enterprise climbed more than 16% while Dell Technologies gained 10.6% following Oracle’s fiscal year 2027 capital expenditure confirmation
- Oracle’s CFO explicitly stated that AI infrastructure investments will target rack, cooling, and networking suppliers like HPE and Dell
- HP Enterprise achieved unprecedented Q3 FY2026 results with $12.2 billion in revenue, marking a 34% increase from the previous year
- Dell received an Outperform rating from RBC Capital Markets with a $640 price target, backed by a massive $95 billion AI server backlog
- RBC initiated HP coverage with a Sector Perform rating and established a $33 price objective
Shares of HP Enterprise and Dell Technologies experienced significant upward momentum Friday following Oracle’s reconfirmation of its fiscal 2027 capital allocation strategy. Oracle’s Chief Financial Officer Hilary Maxson explicitly stated that capital deployment would target AI infrastructure providers specializing in racks, cooling systems, and networking equipment, specifically highlighting HP Enterprise and Dell as primary recipients.
HP Enterprise stock surged beyond 16%, while Dell Technologies advanced approximately 10.6%. HP Inc. also experienced an upward move of over 8% during the trading session.
HP Enterprise Delivers Historic Performance
Prior to Friday’s market surge, HP Enterprise had already unveiled impressive financial results. The technology giant reported Q3 FY2026 revenue totaling $12.2 billion, representing a 34% year-over-year expansion. Non-GAAP earnings per share reached $1.11, marking the company’s inaugural breakthrough above the $1.00 threshold.
The quarter generated approximately $1 billion in free cash flow. Company leadership elevated its annual free cash flow projection to a minimum of $3.75 billion and established a fiscal 2027 objective exceeding $5 billion.
Purchase commitments experienced dramatic growth, expanding to $30 billion from the previous quarter’s $6 billion. Networking-related commitments specifically doubled on a sequential basis.
Earlier in the month, HP Enterprise and Oracle revealed a strategic collaboration. Oracle intends to implement HPE’s routing and switching technologies throughout its entire data center footprint as it expands AI infrastructure on a global scale.
Oracle’s backlog of remaining performance obligations increased by $209 billion during Q1, reaching $664 billion total, which includes over $30 billion in fresh AI cloud agreements. This expansion underscores sustained demand for hardware solutions that HP Enterprise provides.
Wall Street Endorses Dell and HP
RBC Capital Markets launched coverage of Dell with an Outperform designation and established a $640 price objective. Analyst David Paige highlighted that Dell concluded Q2 FY2027 holding $95 billion in AI server orders awaiting fulfillment, with the pipeline showing continued expansion.
Paige emphasized that the current landscape reflects supply constraints rather than demand weakness, primarily attributed to memory component availability. He anticipates the backlog will extend throughout FY27, providing revenue visibility into FY28.
RBC additionally identified agentic AI as a catalyst for increased CPU and conventional server requirements. Enterprise server modernization, PC fleet updates, and AI inference workload transitions were highlighted as supplementary growth catalysts.
Major corporations are executing multi-year agreements spanning three to five years to guarantee supply chain access, according to RBC’s analysis.
Regarding HP, RBC assigned a Sector Perform rating with a $33 price target. The firm believes HP stands to capitalize on AI-enabled PC adoption and edge computing expansion. HP aims for AI PC shipments to comprise 60 to 70% of volume by FY27, compared to approximately 45% in Q3 FY2026.
Multiple analysts revised their HP Enterprise price targets upward following the earnings announcement. Bank of America elevated its objective to $88, Truist increased its target to $70, and Evercore ISI preserved an Outperform recommendation.
HP Enterprise also revealed plans for a Networking Investor Day scheduled for September 30, 2026 in Sunnyvale, California. Market participants are monitoring this event as a possible stock catalyst.
HP Enterprise shares traded at $61.43 Friday afternoon, nearing but remaining below the 52-week peak of $64.25.
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