“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 strongest since March 1, when the computer maker's stock soared after its earnings showed it was benefiting from the AI boom.
Dell's stock is now up more than 95% in 2024, lagging rival AI server maker Super Microcomputer's 220% rise, but ahead of Hewlett Packard Enterprise's 5% rise this year. There is.
Most AI servers are built around Nvidia's chips, which are highly regarded in the tech industry as they are used to build and deploy advanced AI models for 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. “No one does it better than Dell when it comes to 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 manufacturing are increasing exponentially,” Woodring wrote, but the strengthening demand for AI servers. I have confidence in Dell's business for a variety of reasons. This is a model that will increase Dell's market share.
He wrote that Dell could upsell customers to “plug in” additional hardware, such as data storage.
Dell is scheduled to release its April quarter results later this month. Nvidia will report its earnings for the quarter ending in April next week.
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 and is outpacing 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.