Dell - Trump's suggestion
Dell - Trump's suggestion
After the FY2026 Q4 earnings report (ending January 30, 2026), Dell share rose more than 100% (from $120 to $260 on May 9th).
A few catalyst to triggered this rally:
AI-related backlog dramtically increased from 18.4B to 43B. (+130% QoQ)
FY2027 full-year revenue guidance reached 140B
Dell predicted that 2026 would be a year of edge AI, suggesting that enterprises and governments may build their own AI cluster.
Dell focuses more on AI edge servers rather than edge AI itself
Non-GAAP Net margin improved from about 4% to 7.8%
On May 8th, Trump praises Dell during White House business speech.
People are expecting Dell to become the next Intel.
FOMO could continue driving the share price higher, especially after the company provided the FY2027 full year EPS guidance of $12.9.
The next earnings report will determine whether Dell deserve its current valuation. We believe AI-related backlog growth will be the key factor.
Hyperscalers historically accounted for roughly 50% of the traditional server market.
In the AI era, hyperscalers account for about 80% of the AI training server market. However, in the inference market, we would expect spending to become more evenly distributed. Dell's AI-related backlog would prove this.