Dell’s first-half profit jumps 256% as AI servers drive demand

Dell’s AI server business has become the main engine of its growth, pushing the company’s first-half net profit to $7.571 billion, a 256% increase from the same period a year earlier. The strong demand also led Dell to raise its revenue outlook for the full financial year.

Second-quarter profit, the figure most closely watched on Wall Street, climbed 255% to $4.133 billion. Revenue rose 58% to $46.971 billion. AI-optimized servers generated $16.401 billion, up 100% year on year, while traditional servers brought in $10.531 billion, up 122%.

Jeff Clarke, Dell’s vice president and chief operating officer, said AI servers reached records for sales, orders and backlog. Orders stood at $60.9 billion and the backlog at $95 billion. Sales also grew in traditional servers, storage and customer solutions.

Dell raised its full-year revenue forecast by $25 billion to $192 billion, which would represent 69% annual growth. The company expects its AI server segment alone to generate about $74 billion during the year, three times last year’s figure.

The company’s shares fell 6.8% before the results were released at the close of regular trading, amid high expectations. They later rose about 8% in electronic trading. Dell’s market value has risen 230% since the start of the year to $274.6 billion.

The results came as founder, chairman and chief executive Michael Dell works with Donald Trump’s administration on initiatives including accounts for minors that receive his funding. Dell also won a $9.7 billion U.S. government contract to supply software to the Army, while cloud provider Iren agreed to buy $1.6 billion in products, including Nvidia-equipped servers, according to CNBC.