Dell Technologies Inc.

Dell said total Q1 revenue was $43.8 billion, up 88% year over year, gross margin dollars rose 57% to $7.9 billion, gross margin rate was 18.1%, operating income increased 154% to $4.2 billion, net income increased 194% to $3.2 billion, and diluted EPS rose 214% to a record $4.86. ISG revenue was $29 billion, up 181%, with $24.4 billion in AI orders, $16.1 billion of AI server revenue, and $51.3 billion of AI backlog; traditional server and networking revenue was $8.5 billion, up 92%, and storage revenue was $4.3 billion, up 8%. CSG revenue was $14.6 billion, up 17%, and CSG operating income was $1.2 billion or 8% of revenue. For Q2, Dell guided revenue to $44 billion-$45 billion and non-GAAP EPS to $4.80 +/- $0.10, with ISG expected to grow roughly 75% and AI server revenue around $15.5 billion. For FY27, Dell guided revenue to $165 billion-$169 billion and non-GAAP EPS to $17.90 +/- $0.25, with ISG up roughly 80% and AI server revenue at a $60 billion midpoint.

Jeff Clarke described Q1 as a strong start to FY27 and emphasized that Dell is benefiting from a broad portfolio, customer preference for integrated infrastructure, and AI expansion from the data center to the desktop. He repeatedly framed the quarter as demand-driven but supply-constrained, saying customers are buying ahead to secure capacity and that Dell is winning share across AI, servers, storage and PCs. His tone was confident and constructive, but he stressed that the company is operating in a difficult supply environment with ongoing constraints in DRAM, NAND and CPUs.

David Kennedy highlighted record revenue, gross margin dollars of $7.9 billion, operating income of $4.2 billion, and cash flow from operations of $4.1 billion. He said OpEx was $3.7 billion, or 8.4% of revenue, the lowest level in over 20 years, and that ISG operating margin was 10.5% while AI server profitability was in line with Dell's mid-single-digit operating income rate target. He also noted $14.1 billion in cash and investments, core leverage of 1.2x, and $2.1 billion returned to shareholders, including repurchases of 11 million shares at an average price of $147 and a dividend of about $0.63 per share. On guidance, he said gross margin outlook ex-AI was better than 90 days ago and that margin rate expansion should continue through the year.

Analysts focused on whether the big quarter reflected pull-forward, how durable the demand is, and what is limiting the upside. Management said demand is broad-based and durable, driven by installed-base refreshes, AI, agentic workloads and share gains, while acknowledging some buy-ahead behavior and faster pricing moves in PCs. They also said the back half is constrained by supply rather than demand, that backlog should remain meaningful exiting the year, and that financing can help customers secure equipment even amid budget pressure.