“Overall, we're hearing that Dell is seeing more AI server momentum than any other OEM,” Woodring wrote, adding that the company's 2025 fiscal year (ending next February) will see about $10 billion in AI server momentum. He said that server revenue is expected.
Wednesday's price move was the biggest since March 1, when the company's stock soared after earnings showed it was benefiting from the AI boom.
Dell stock is now up more than 99% in 2024, lagging rival AI server maker Super Microcomputer's 233% rise but ahead of Hewlett Packard Enterprise's 6% rise this year. There is.
Most AI servers are built around Nvidia chips, which are highly regarded in the technology industry as they are used to deploy advanced AI models from companies like Google, OpenAI, and Meta. Dell sells servers using his latest Nvidia AI chips, including the H100 GPU and the latest Blackwell generation chips.
At NVIDIA's annual conference in March, NVIDIA CEO Jensen Huang appeared to be sending customers looking for the latest AI chips to Dell for orders.
“We're going to need an AI factory,” Huang said. “And no one does it better than Dell at building very large end-to-end systems for enterprises.”
“Michael [Dell] are here and will be happy to take your order,” Huang continued.
“It is difficult to pinpoint the exact growth rate, as Nvidia GPU shipments and AI server builds are increasing almost exponentially,” Woodring wrote, but Dell's I have confidence in my business. That's because demand for AI servers is increasing, and he models Dell's market share increasing.
He wrote that Dell could upsell customers to “plug in” additional hardware, such as data storage.
Dell is scheduled to report April quarter earnings on May 30th. NVIDIA he will announce earnings for the quarter ending in April on May 22nd.
Dell's other business, which makes consumer and business PCs running Microsoft Windows, is expected to see Microsoft roll out new features, including long-awaited AI capabilities, that many analysts expect will drive demand for new PCs. Momentum could pick up next week when it's revealed at a conference.
PC sales slumped for two years amid a post-pandemic hangover, as consumers and businesses who bought new machines in 2020 and 2021 postponed their next upgrade schedule.
But the PC industry is back on track for growth, exceeding lowered expectations, which should benefit Dell, Woodring wrote.
“We remain bullish on the recovery of the PC market, not only from what we've been hearing about upgrade/refresh demand in recent CIO and VAR checks, but also from the upward revision of notebook ODM builds in recent months.” Woodring he wrote.
