Dell Technologies Is Making More Money From AI Servers Than Anything Else It Sells – The Numbers Are Stunning

Around the third or fourth earnings call, a company begins to sound as though it truly can’t keep up with itself rather than as though it’s telling a growth story. Between booking $34 billion in new AI orders in a single quarter and projecting revenue that would have seemed unreal eighteen months ago, Dell Technologies reached that milestone quietly and without much fanfare. Without exaggeration, the numbers are astounding.

In the fourth quarter of fiscal 2026 alone, Dell’s AI server revenue reached $9 billion, a 342% increase from the previous year. That is neither a favorable accounting period nor a rounding error. That’s a business being driven forward by demand that it didn’t fully develop and maybe didn’t fully anticipate at this scale. With a $43 billion order backlog at the end of the fiscal year, clients are essentially waiting in line. It’s difficult to ignore the fact that this is a very different type of business for a company that has long been associated with commodity hardware and razor-thin margins.

In this cycle, Dell actually sells AI-optimized servers, which are intricate, dense devices that incorporate accelerator chips from firms like Nvidia, storage systems, high-speed networking, and progressively more advanced cooling infrastructure. They’re not laptops. They’re not business printers or desktop towers. They serve as the structural backbone of every hyperscaler data center currently under construction, and Dell has been able to secure about a fifth of that market. According to ABI Research, which keeps a close eye on these developments, Dell’s market share in 2024 is estimated to be around 20%, and the market for AI servers could reach $524 billion yearly by 2030.

Even those estimates might be conservative. According to Goldman Sachs, the total amount spent on AI infrastructure could increase from $765 billion this year to $1.6 trillion by 2031. Businesses like Dell that operate at the physical layer of AI deployment are positioned to grow faster than almost everyone gives them credit for if that trajectory continues, and there are good reasons to think it will. Dell is already growing faster than the market as a whole, indicating that it is gaining market share rather than merely following the trend.

Some of this has been reflected in the stock, which has increased 68% so far in 2026. Nevertheless, it continues to trade at about 24 times earnings, which is a significant discount to the multiple of about 34 for the larger Nasdaq-100. Some investors believe that the market still views Dell as a PC manufacturer, a services provider, and a B2B mainstay rather than as it seems to be evolving. Given the growth trajectory under discussion, the forward earnings multiple falls even further, to about 16, which seems almost incongruous.

As you watch this happen, it seems like Dell’s transformation is one of those changes that only become apparent in hindsight. Over the course of several years, the company has discreetly increased the revenue from AI servers from $2 billion to $10 billion to $25 billion, with a target of $50 billion for the current fiscal year. Michael Dell, the company’s CEO, has discussed this arc in public, and his description of it has a steadiness to it. It’s not exactly triumphant, but certain in a way that reads as earned rather than performed.

It’s still unclear if the conventional aspects of Dell’s business—PCs, storage, and IT services—will continue to play a significant role in the company’s value to investors or if they will just fade into the background. There is tension, and it is unlikely to be resolved amicably. However, the AI server business isn’t currently Dell’s fastest-growing division. It’s turning into the whole narrative.