Dell Technologies (0A7D) AI Stock Analysis

Company Guidance

For Q3, Dell expects revenue to be $49 billion at the midpoint, up roughly 80% year-on-year, ISG to grow roughly 145% supported by $19 billion in AI server revenue, CSG revenue to be up roughly 15%, operating expenses to be down low single digits sequentially, operating income to grow roughly 120%, ISG operating income rate to be up just over 1 point year-over-year, CSG operating income rate to moderate to roughly 6%, diluted share count to be approximately 651 million shares, and diluted non-GAAP earnings per share to be $6.50, up over 150% at the midpoint; for the full year, revenue is guided to $192 billion at the midpoint, up roughly 70%, diluted non-GAAP EPS is expected to be $25.50, up approximately 150%, ISG is expected to grow roughly 120%, AI server revenue is expected to be up 3x year-over-year to $74 billion, traditional servers to grow just over 100%, storage to be up in the mid-teens, CSG revenue to grow in the mid-teens, operating expenses to be approximately 8% of revenue, operating income to grow approximately 120% with over 2 points of rate improvement year-over-year, and I&O is expected to be between $1.4 billion and $1.5 billion.