Dell Technologies Inc. (DELL)

Dell Technologies reported record revenue of $47.0 billion for the second quarter of fiscal 2027, the three months to 31 July 2026, up 58 percent from a year earlier 1. Net income rose to $4.1 billion from $1.2 billion 1.

The engine was the AI server business, machines built around graphics chips that train and run AI models 12. Dell booked a record $60.9 billion of AI server orders in the quarter and ended it with a $95 billion backlog of orders not yet shipped 1.

Demand for AI hardware is outrunning what memory makers can build, so the cost of memory chips has climbed steeply 2. Dell answered with higher prices, and its gross margin, the share of revenue left after production costs, rose to 20.9 percent 2.

The open question is the PC business 19. IDC estimated that Dell shipped 7.6 million PCs from July to September, 25 percent fewer than a year earlier, as shortages and higher prices weighed on buyers 19. Dell guided to $49.0 billion of revenue for its third quarter 1.

Leadership is shifting too: Richard Rothberg, general counsel since November 2013, retires on 1 February 2027, and Christopher Garcia, who joined Dell in 2006, takes his place 43.

Michael Dell founded the company in 1984 in a University of Texas dorm room in Austin, and it has been based in Round Rock, Texas, since 1994 10. He has run it ever since, apart from a break between July 2004 and January 2007 3.

In October 2013 Dell left the stock market in a going-private deal, run through a new holding company later renamed Dell Technologies 6. On 7 September 2016 it completed what it called a transformative $64 billion acquisition of EMC, the data storage company 6.

EMC brought with it a controlling stake in VMware, the software maker, and Dell had issued a tracking stock tied to part of that stake 6. On 28 December 2018 the Class V transaction retired the tracking stock and returned Dell's own Class C shares to the New York Stock Exchange 6. Dell paid $14 billion in cash and issued about 149 million Class C shares to do it 6.

On 1 November 2021 Dell spun VMware off to its own shareholders and received $9.3 billion of a special VMware dividend 7. A month earlier it had sold Boomi for about $4.0 billion, and the cash went to paying down debt until three rating agencies called Dell investment grade 7.

The pandemic years were a PC boom 7. Revenue rose 17 percent to $101.2 billion in fiscal 2022 as the client unit's revenue jumped 27 percent, with customers seeking better connectivity and productivity 7.

Then demand fell away 8. Revenue dropped 14 percent to $88.4 billion in fiscal 2024, mainly because fewer PCs were sold to businesses and consumers, while server and storage sales also slipped 8.

AI servers turned the business around 93. Revenue grew 8 percent in fiscal 2025 and 19 percent to $113.5 billion in fiscal 2026, as AI server revenue rose from $1.9 billion in fiscal 2024 to $24.7 billion 93.

The mix of that growth cost some margin: the gross margin fell to 20.0 percent in fiscal 2026 from 22.2 percent, because AI servers earn a thinner margin than the rest 3.

Cash followed with a lag 3. In fiscal 2025 AI orders tied up money in inventory and receivables and cash from operations fell to $4.5 billion, and in fiscal 2026 it rose to $11.2 billion 3.

Home buyers kept pulling back meanwhile: consumer PC revenue fell 8 percent in fiscal 2026 after a 17 percent fall the year before, on lower prices and fewer units 3.

Two old ties ended along the way 3. After Broadcom bought VMware, Dell stopped reselling VMware's standalone products in March 2024, and on 3 February 2025 it sold Secureworks, its security unit, to Sophos 3.

AI-optimized servers

These are servers packed with accelerator chips for training AI models and running them, and so far they have gone mostly to a small number of large customers and cloud providers 3. Big orders arrive in some quarters and not others, so the results swing 3.

In the second quarter of fiscal 2027 their revenue doubled to $16.4 billion, mainly because more units shipped and, to a lesser extent, because richer configurations raised average prices 2.

IDC ranked Dell first among server makers worldwide in the second quarter of 2026, with 13.4 percent of vendor revenue 18. Supermicro followed at 6.1 percent, Lenovo at 5.1 percent and Hewlett Packard Enterprise at 3.5 percent 18. Contract manufacturers selling straight to the largest cloud companies still took 53.9 percent 18.

Traditional servers, networking and storage

Traditional servers run everyday business software, and the networking line sells data center switches, cables and optics 2. Their revenue rose 122 percent to $10.5 billion in the quarter, mostly on higher average prices 2.

Storage, from all-flash arrays to data protection systems, grew 26 percent to $4.9 billion on demand for Dell's own designs 21. The infrastructure group as a whole earned 15.0 percent of its revenue as operating income, up from 8.8 percent 2.

PCs for business and for home

The Client Solutions Group sells notebooks, desktops and workstations plus displays, docking stations, keyboards and webcams 3. Commercial PC revenue rose 22 percent to $13.2 billion in the quarter and consumer revenue 7 percent to $1.8 billion 2.

Both gains came from higher average prices while fewer units were sold, and the group's operating margin was 7.6 percent 2.

In IDC's count for July to September 2026, Dell was third in PC shipments with 12.1 percent, behind Lenovo at 23.8 percent and HP at 16.5 percent 19.

The XPS name came back in 2026 after a short rebrand of the line as Dell Premium 21. Tom's Guide called the XPS 14 (2026) "a welcome return for the iconic laptop brand", and HotHardware called it "a great return to form" 2122.

The reviewers listed starting prices of $1,349 and $1,599 and tested an OLED model priced at $2,199 2221.

Dell Financial Services

Dell Financial Services lends to customers and leases them equipment so they can pay over time 2. New financing rose to $7.5 billion in the quarter from $2.4 billion, driven by AI server demand, and financing receivables reached $20.4 billion 2.

Plants and people

Dell owns factories in the United States, Malaysia, China, Brazil, India, Poland and Ireland, and contract manufacturers, mostly in Asia, assemble much of the rest 3. It owned or leased 18.2 million square feet of offices, plants and warehouses as of 30 January 2026 3.

It had about 97,000 employees at that date, and the count kept falling as it cut costs 3. Michael Dell is chairman and chief executive, Jeff Clarke runs both business units and the supply chain as chief operating officer, and David Kennedy has been finance chief since September 2025 3.

Current problems

Memory costs are the sharpest problem, and the company expects the steep rise in component costs to last through the rest of fiscal 2027 2. On the call for the quarter ended 30 January 2026, Clarke said Dell changed all of its tens of thousands of open PC quotes on 6 January 20.

Large AI orders also tie up cash: purchase obligations, binding commitments to buy from suppliers, stood at $34.8 billion on 31 July 2026 2.

A proposed class action filed on 28 January 2026 in federal court in Texas claims the Dell 401(k) plan kept imprudent investments too long, and the company says it intends to defend itself vigorously 2.

The umbrella, in words

Dell Technologies Inc. is a holding company, and its operating companies include Dell Inc., Dell Products, Dell International, EMC Corporation and Dell Financial Services, all on the subsidiary list filed with its annual report 16. Its material brands are Dell, Dell Technologies and Alienware, the gaming PC line 3.

The list also names Dataloop Ltd. of Israel, an AI data labeling company that Calcalist reported in December 2025 Dell was buying for $120 million in cash 1623. Dell owns it, and it invests in young technology companies through Dell Technologies Capital, its venture arm 162.

Control sits with two holders 3. Class A shares held by Michael Dell and the Susan Lieberman Dell Separate Property Trust, and Class B shares held by Silver Lake funds, carry ten votes each, against one for a Class C share 3. Together they held about 91.7 percent of the votes on 9 March 2026 3.

Silver Lake keeps converting Class B shares into Class C shares, which have one vote each, and 44,351,394 Class B shares were left after the June 2026 conversions 17. Michael Dell alone holds more than half of the votes, so Dell is a controlled company under NYSE rules and may skip some board independence requirements 10.

Since 1 July 2026 Dell has been a Texas corporation, not a Delaware one, after shareholders approved the move on 25 June 11. Under its new charter, only holders of at least 3 percent of the shares may bring a derivative suit against its directors or officers 11.

On 1 September 2026 Dell raised its revenue guidance for fiscal 2027, the year ending on 29 January 2027, to $192.0 billion, which would be a rise of 69 percent 13. In May it had guided to $167.0 billion at the midpoint 5.

It expects $74.0 billion of that from AI servers, up from its earlier $60.0 billion, and guided to $49.0 billion of revenue for the third quarter 1.

The company expects gross profit dollars to grow while the margin rate comes under pressure, because AI servers, which earn thinner margins, keep taking a larger share of sales 2. It also anticipates strong growth in PCs this year 2.

Much of the coming revenue is already contracted: the company expects to recognize about 77 percent of its $132 billion of remaining performance obligations, sales booked but not yet delivered, within twelve months 2.

At its analyst meeting on 7 October 2025 Dell raised its long-term goal for annual revenue growth to 7 to 9 percent, from 3 to 4 percent 15. It also committed to raise its quarterly dividend by 10 percent or more a year through fiscal 2030 15.

The company says it intends to keep returning cash through buybacks and dividends while keeping its investment grade credit rating 2. On 1 September the board declared a quarterly dividend of $0.63 a share, payable on 30 October to holders of record on 20 October 1.

In June 2026 Dell replaced its revolving credit line with a $6 billion facility that matures on 10 June 2031 14.

Its units then sold $3.0 billion (computed) of notes in June and $5.0 billion (computed) in September, the second sale mainly to repay notes due in 2026 131224.

Rothberg hands over the legal department on 1 February 2027 and stays on to help with the transition through 30 April 2027 4. Over the long term, the company anticipates that PCs able to run AI work on the machine itself may lift demand 2.

Past

Dell Technologies revenue grew from $79 billion in fiscal 2018 to $114 billion in fiscal 2026, up 4.6% a year over nine filed years, rising in six of eight years. Net income was positive in seven of nine of those years. The deepest fall was 14% from fiscal 2023 to fiscal 2024. Over the three fiscal years to 2026-01-30, the diluted share count shrank about 3.2% a year, and dividends and buybacks returned about 59% of its operating cash flow over those three years. Officers and directors filed 2708 sales and 0 purchases of their own stock on the open market in the year to 2026-10-19. The past tense reads 5.6 of 10. 12

Present

In its latest annual figures on file, for the fiscal year ended 2026-01-30, Dell reported revenue of $114 billion and a profit of $5.9 billion. Return on equity is not read because shareholders' equity was below zero; gross profitability was about 22 cents per dollar of everything the company owns; leverage was about 102 cents per dollar of assets; and net share issuance showed the share count shrank 5.0% over the year. Dell's revenue of $114 billion in fiscal 2026 ranks in the top 21% by size among seven graded names in its industry family; a net margin of 5.2% ranks in the top 50%; revenue growth of 3.5% a year over the last three filed years ranks in the top 21%. 21

The chief executive on the record is Michael S Dell, filing under that title since 2016-09-07, 10.1 years; the 17 officers and directors filing in the last fifteen months have been on the record a median of 7.5 years; six officer or director changes were reported on Form 8-K since 2023-10-21, against the 17 people in charge now. The present tense reads 5.9 of 10. 12

Future

A quarterly report (Form 10-Q) for the quarter ending 2026-10-31 is due by 2026-12-10. An annual report (Form 10-K) for the fiscal year ending 2027-01-29 is due by 2027-03-30. Dell's room to grow leaves cash of $12 billion against debt of $32 billion, which is negative 19.7% of its assets; cash from operations less capital spending is 7.5% of revenue; a gross margin of 20%; research spending of 2.8% of revenue. Revenue growth over the last three filed years is 3.5% a year against 4.6% over all nine years, slowing; the newest year grew 18.9%; research spending grew 4.2% a year; capital spending declined 4.3% a year. The future tense reads 4.7 of 10. 312

How the company operates

Dell reported product and service lines: product 80%, service 20%; by geography: United States 56%, foreign countries 44%. Research and development spending was $3.14 billion in fiscal 2026. 24

New moves

On 2026-09-15, Dell filed Form 8-K reporting a major agreement signed and new debt or an obligation taken on. On 2026-09-08, Dell filed a quarterly report (Form 10-Q) for the period ended 2026-07-31. On 2026-06-17, Dell filed Form 8-K reporting shares sold without registration. On 2026-06-16, Dell filed Form 8-K reporting a major agreement signed and new debt or an obligation taken on. On 2026-06-10, Dell filed Form 8-K reporting a major agreement signed, a major agreement ended, and new debt or an obligation taken on. On 2026-10-01, a story reported that imports jumped and the goods trade gap is the widest since March 2025; Dell is adjacent to the event through the AI buildout in capital goods imports. 35