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Dell Shares Soar As AI Adoption Boosts Annual Forecasts

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Dell Shares Soar As AI Adoption Boosts Annual Forecasts

(CTN News) – Dell Technologies (DELL.N) shares surged more than 20% on Friday after the company announced its annual earnings forecast ahead of Wall Street expectations and confirmed the surge in demand for artificial intelligence products.

With a market capitalization of $116.6 billion, the company is set to gain more than $15 billion in value if the current level holds, and it would be the second straight day of about 20% gains for the stock after the company announced its quarterly results.

During the fourth quarter of 2018, the number of orders for the company’s AI-optimized servers jumped 40% sequentially, according to COO Jeff Clarke, and the backlog has nearly doubled.

In the wake of Nvidia’s (NVDA.O) extraordinary rally, the performance of enterprise technology vendors provides further evidence that AI adoption is driving material gains across the industry and is a sign of increased investor interest in AI overall.

A total of $4.9 billion in revenue was generated by servers and networking in the fourth quarter, and Dell attributed the growth in the sequential period to AI-optimized servers.

There were at least six brokerage firms that raised their price targets in response to the results. At the current time, more than three-fourths of the analysts have a “buy” or higher rating on the stock with a median price target of $105.

” The Dell AI business showed good progress on key metrics. Commentators at Bernstein, however, predicted a slow recovery in the PC market in the second half of the year, similar to HP’s. “, they reported.

During the most recent three-month period, HP (HPQ.N), a company known for its PC and enterprise technology, saw its sales decline for the seventh consecutive quarter.

As predicted, Dell’s revenue fell by less than expected in its fourth quarter to $22.32 billion, while its adjusted profit per share of $2.20 was higher than analysts’ expectations of $1.73, according to LSEG data.

It is anticipated that revenue for the current fiscal year ending January 2025 will range from $91 billion to $95 billion, largely above analysts’ average estimate of $92.07 billion, according to the company.

Analysts at Evercore ISI have forecast that the market will grow by 65% to 70% by 2025 as a result of improved AI trends (we think $5B+ of sales) and improved performance in servers, storage and personal computers.


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Salman Ahmad is a seasoned writer for CTN News, bringing a wealth of experience and expertise to the platform. With a knack for concise yet impactful storytelling, he crafts articles that captivate readers and provide valuable insights. Ahmad's writing style strikes a balance between casual and professional, making complex topics accessible without compromising depth.

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