With its most recent results released on Thursday, Dell Technologies Inc. exceeded analyst estimates and kept up its rapid server business growth.
In the fiscal second quarter, revenue for the infrastructure solutions group—which includes servers—grew by 38% to $11.64 billion, compared to analysts’ projections of $10.79 billion, as tracked by FactSet. Revenue from servers and networking in that category increased by 80% to $7.67 billion, a record for the corporation.
The demand for artificial intelligence servers in the second quarter reached $3.2 billion, a sequential increase of 23%. According to Dell DELL -0.74%, the company’s backlog was $3.8 billion, and it currently has “several multiples” of that amount in its pipeline. Dell had stated that its pipeline was “a multiple” of its backlog a quarter prior.
According to a release, Vice Chairman Jeff Clarke stated, “Our AI momentum accelerated in Q2 and we have seen an increase in the number of enterprise customers buying AI solutions each quarter.”
On Thursday, Dell’s stock saw a 3% increase after hours.
Analysts had projected $1.12 billion in non-GAAP operating income for the company’s infrastructure solutions group, but the company reported $1.28 billion.
Analysts were expecting $24.1 billion, but overall revenue came in at $25.0 billion, up 9% from the previous year.
In comparison to the same quarter last year, Dell reported net income of $841 million, or $1.17 per share, as opposed to $455 million, or 63 cents per share.
Dell reported $1.89 earnings per share on an adjusted basis, compared to the FactSet estimate of $1.70.
Dell’s personal computer division brought in $12.4 billion in revenue in its client solutions group, a 4% decrease from the previous year. Compared to some of its peers, Dell is more exposed to the corporate market. The demand from analysts was $12.6 billion.
Analysts had been projecting $793 billion, while non-GAAP operating income in client solutions was $767 million, down from $969 million the previous year.
According to Dell’s expectation, adjusted earnings per share for the fiscal third quarter should be $2.00, give or take ten cents. Analysts had their sights set on $2.19. Additionally, the company projects sales of $24.5 billion at the halfway mark, compared to analysts’ projections of $24.6 billion.
