Dell Shares Fall, Profits Fall, and Revenue Growth Fails to Impress on Surging Demand for AI Servers

Key takeaways

Dell Technologies reported first-quarter revenue and earnings that beat analyst estimates.
This was helped by rising demand for AI servers, driving Dell’s server and network revenues to record levels.
However, Dell’s operating income was down 14% compared to the same period last year.
Dell’s shares fell more than 17% in extended trading on Thursday as the company’s results failed to impress.

Dell Technologies (DELL) reported first-quarter revenue and earnings that topped analyst estimates of growing demand for artificial intelligence (AI) servers, though the company’s shares fell more than 17% in extended trading Thursday as Dell’s results failed to impress.

Dell reported revenue of $22.24 billion for the fiscal first quarter of 2025, up 6% from the year-ago period and above analyst expectations, according to estimates compiled by Visible Alpha.

Net income was $955 million, or $1.32 per share, compared to $578 million, or 79 cents per share, in the same period a year earlier, which also beat analyst forecasts.

	1st quarter of fiscal year 25	Analyst estimates for the first quarter of FY25	1st quarter of fiscal year 24
Income	$22.24 billion	$21.51 billion	$20.92 billion
Diluted earnings per share	$1.32	57 cents	79 cents
Net income	$955 million	$428.59 million	$578 million

Despite revenues and profits exceeding analyst expectations, Dell reported a double-digit decline in operating income. Operating income was $920 million, down 14% from the year-ago period.

Last quarter, AI momentum sent Dell’s stock price soaring following the company’s earnings release. Dell Chief Operating Officer (COO) Jeff Clarke assured investors of Dell’s AI potential, saying that “no company is in a better position than Dell to bring AI to the enterprise.”

He added that “servers and networks achieved record revenues in the first quarter, with orders for our AI-optimized servers increasing sequentially to $2.6 billion, shipments up more than 100% to $1.7 billion, and backlog increasing by over 30% to $3.8 billion.”

Dell shares fell 17.2% to $140.73 in extended trading as of 5 p.m. ET on Thursday following the company’s earnings release.