Dell Shares Surge as AI Infrastructure Demand Drives Record Performance

While numerous technology stocks face market turbulence, Dell Technologies is experiencing a remarkable resurgence. The hardware specialist has quietly positioned itself as a dominant force in the artificial intelligence infrastructure sector, demonstrating that the path to AI implementation begins with robust hardware solutions through record-breaking server sales and groundbreaking product innovations.

Record Financials and Upward Guidance

Dell’s strategic emphasis on AI-optimized infrastructure is yielding substantial returns. For the second quarter of fiscal year 2026, the company reported extraordinary results with AI server revenue reaching $8.2 billion. New orders totaling $5.6 billion have expanded Dell’s AI backlog to an impressive $11.7 billion. This exceptional performance prompted management to raise full-year 2026 guidance, projecting 12% overall revenue growth year-over-year. The Infrastructure Solutions Group (ISG) achieved record quarterly revenue of $16.8 billion, representing a 44% year-over-year increase, with expected growth of 20-30% for the coming year.

Breakthrough Server Technology

On September 19, 2025, Dell introduced its revolutionary PowerEdge XE7740 Rack Server, marking a significant advancement in AI infrastructure capabilities. This innovative system can integrate up to eight Intel Gaudi 3 PCIe AI accelerators, establishing Dell as the first IT enterprise to offer such capacity. The Gaudi 3 accelerators deliver superior efficiency, enabling faster inferencing, greater silicon diversity, and reduced capital expenditure and energy consumption compared to alternative GPU solutions.

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Analyst Confidence and Price Targets

Wall Street analysts are increasingly recognizing Dell’s potential within the AI hardware market. Bernstein SocGen Group initiated coverage with an “Outperform” rating and a $175 price target, based on fiscal year 2027/2028 earnings and free cash flow projections. Multiple firms followed with upward revisions: Barclays increased its target to $133, TD Cowen raised to $130, and Raymond James elevated to $152. The current average analyst price target ranges between $147.57 and $151.

Leadership Transition During Growth Phase

Amid this period of exceptional expansion, Dell announced a leadership transition in its financial operations. Chief Financial Officer Yvonne McGill departed after nearly thirty years with the organization. David Kennedy, previously Senior Vice President of Dell Global Business Operations, Finance, has assumed the CFO role on an interim basis until a permanent successor is appointed.

Despite experiencing some short-term volatility in early September—driven by concerns regarding third-quarter profit projections and component costs—the company’s positive momentum continues. Strong demand for AI server solutions and strategic expansion of AI infrastructure capabilities remain the primary growth catalysts for this technology giant.