Dell Technologies witnessed a surge of more than 15% in its stock price during extended trading on Thursday, subsequent to the release of fourth-quarter results that exceeded analysts’ expectations and showcased robust demand for its artificial intelligence (AI) servers.
Here’s a breakdown of the company’s performance:
Earnings per share (adjusted): $2.20, surpassing the $1.73 anticipated by LSEG, formerly known as Refinitiv.
Revenue: $22.32 billion, exceeding the $22.16 billion projected by LSEG.
Dell’s revenue for the fiscal fourth quarter of 2024 experienced an 11% decline from $25.04 billion reported in the corresponding quarter of the previous year. However, the company reported a net income of $1.16 billion, marking an impressive 89% increase from the $614 million recorded in the same period last year.
Yvonne McGill, Chief Financial Officer of Dell, emphasized in a statement that the company is enhancing its annual dividend by 20% to $1.78 per share, illustrating confidence in the business’s trajectory.
The Infrastructure Solutions Group (ISG) of Dell reported $9.3 billion in revenue for the quarter, indicating a 6% decline year over year but a notable 10% increase from the third quarter. The bulk of this revenue stemmed from servers and networking, totaling $4.9 billion, driven primarily by “AI-optimized servers.” Storage revenue amounted to $4.5 billion.
Meanwhile, the Client Solutions Group (CSG) reported $11.7 billion in revenue for the quarter, representing a 12% decline year over year. Within CSG, commercial client revenue stood at $9.6 billion, reflecting an 11% decrease since the fourth quarter of the previous year, while consumer revenue amounted to $2.2 billion, down 19% year over year.
Jeff Clarke, Chief Operating Officer of Dell, highlighted the company’s strong momentum in AI-optimized servers, with orders witnessing nearly a 40% sequential increase and backlog nearly doubling, reaching $2.9 billion by the end of the fiscal year.
Looking ahead, Dell anticipates reporting revenue between $21 billion and $22 billion for the first quarter. The company expressed optimism about the momentum surrounding AI and expects to resume growth for fiscal 2025. However, Dell acknowledged that the macroeconomic environment is prompting some customers to exercise caution regarding infrastructure costs.
