Dell (DELL), AI Order Backlog Alone Reaches $95 Billion...Up 350% Year-to-Date and Still Rising

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As demand for artificial intelligence (AI) infrastructure construction explodes worldwide, the performance of major server manufacturer Dell (Dell Technologies Inc., DELL) is showing record growth. New order backlogs are snowballing, and the stock price is also charting a steep upward curve compared to the beginning of the year.

According to financial media outlet FX Leaders on September 26 (local time), Dell's stock closed at $562.89, up 5% from the previous trading day. It has surged more than 350% since the beginning of this year, recently hitting a 52-week high of $595.51, and its total market capitalization has swelled to approximately $358 billion.

This surge was driven by astronomical AI server orders. Dell secured new AI server orders totaling $60.9 billion last quarter, marking an all-time high. The backlog of undelivered AI server orders alone amounts to $95 billion. AI server revenue doubled year-over-year to $16.4 billion, general server revenue surged 122% to $10.5 billion, and storage revenue increased 26% to $4.9 billion. The Infrastructure Solutions Group (ISG), responsible for servers and storage, reported an overall revenue increase of 89% to $31.8 billion, with operating profit at $4.8 billion.

Driven by the record-breaking order streak, the annual performance outlook has also been significantly raised. Dell has presented an annual total revenue target of $192 billion for this year, a substantial increase from its previous target. Annual AI server revenue is expected to reach $74 billion, and the earnings per share (EPS) forecast has also been raised by 148% to $25.50. Furthermore, Dell actively pursued shareholder value enhancement by returning $4.3 billion to shareholders through share repurchases and dividends during the quarter.

Wall Street investment banks continue to raise their target prices. Analysts' average target price is set between $570 and $580, with some institutions suggesting as high as $735. Despite concerns about valuation burden due to the short-term surge and news of some executives selling shares, market experts diagnose that the $95 billion order backlog provides strong downside support, and sales performance of new AI laptops launching in early October and component supply conditions will be key drivers for further gains.

[Key Summary of Article]

-Dell's new AI server orders surged to $60.9 billion, and its order backlog reached $95 billion, leading its stock to close up 5% at $562.89.

-The annual guidance was significantly raised, with the annual revenue target increased to $192 billion and the earnings per share forecast boosted by 148%.

-With Wall Street's highest target price suggested at $735, the $95 billion order backlog is considered a strong support for the stock price.

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