Dell Technologies Stock Surges 20% on Blowout Q4 Earnings, AI Server Boom Drives Record Results

Dell Technologies Inc. (NYSE: DELL) shares soared more than 20% on February 27, 2026, after the company reported record fourth-quarter and full-year fiscal 2026 results, fueled by explosive demand for AI-optimized servers. The performance capped a transformative year for the technology giant, with executives highlighting surging enterprise and cloud provider orders as evidence of Dell’s leadership in the artificial intelligence infrastructure market.

Dell closed the trading day up approximately 21.9% at around $148, with intraday highs reaching $148.25, marking one of the stock’s strongest single-day gains in recent history. Volume exceeded 18 million shares, more than double the average. The rally followed the February 26 after-hours release of fiscal fourth-quarter results ended January 30, 2026, which significantly exceeded Wall Street expectations.

For the quarter, Dell posted revenue of $33.38 billion, a 39.5% increase from the prior year and well above the consensus estimate of about $31.6 billion to $31.9 billion. Adjusted earnings per share came in at $3.89, topping analyst forecasts of $3.53 and representing a 45% year-over-year jump. Net income rose to $2.25 billion, or $3.37 per share, from $1.53 billion, or $2.15 per share, a year earlier.

The Infrastructure Solutions Group (ISG), which includes servers and storage, led the charge with revenue of $19.6 billion, up 73% year over year. Within that segment, AI-optimized server revenue hit a record $9 billion for the quarter — a staggering 342% increase — while traditional servers and networking grew 27% to $5.9 billion. Executives noted that the company booked $34.1 billion in AI orders during the period and shipped more than $9.5 billion in AI servers, entering fiscal 2027 with a record $43 billion backlog. Full-year fiscal 2026 AI-optimized server revenue reached about $24.7 billion, with cumulative orders surpassing $64 billion.

For the full fiscal year 2026, Dell achieved record revenue of $113.5 billion, up 19% from the previous year, and non-GAAP diluted EPS of $10.30, a 27% increase. The company generated record cash flow from operations, returning $7.5 billion to shareholders through buybacks and dividends, and ended the year with $13.3 billion in cash and investments.

Looking ahead, Dell provided aggressive guidance that further fueled investor enthusiasm. For fiscal 2027, the company projects revenue between $138 billion and $142 billion — far exceeding analyst expectations around $124.7 billion — and expects AI server revenue to approximately double to $50 billion, representing 103% growth. First-quarter fiscal 2027 revenue is guided to between $34.7 billion and $35.7 billion, with adjusted EPS around $2.90.

CEO Michael Dell and COO Jeff Clarke emphasized the AI opportunity as a defining force. “FY26 was a defining year in our company’s history,” Clarke said in the earnings release. “We delivered record full-year revenue and EPS… The AI opportunity is transforming our company.” Management highlighted differentiated engineering, broad-based demand from enterprises and Tier 2 cloud providers, and disciplined execution amid supply constraints, including a noted memory shortage impacting the industry.

Analysts responded swiftly with upward revisions. Mizuho raised its price target to $180 from $175 with an “outperform” rating, implying significant upside. J.P. Morgan increased its target to $165, forecasting at least 36% potential rally from prior levels, while Barclays lifted to $168 and Piper Sandler adjusted to $167, both maintaining overweight or equivalent ratings. Morgan Stanley, however, hiked its target modestly to $110 while keeping an “underweight” stance, citing valuation concerns despite the strong results.

The surge comes amid broader market dynamics in AI infrastructure. Dell benefits from partnerships with Nvidia and others, positioning it to capture share in data center expansions. Challenges persist, including rising memory costs and supply tightness for high-bandwidth memory (HBM) used in AI systems, but executives expressed confidence in navigating these through strategic sourcing and backlog management.

Dell also announced shareholder-friendly moves: a 20% dividend increase and an additional $10 billion share repurchase authorization, signaling strong conviction in sustained cash generation and growth.

The stock’s performance reflects a shift from earlier 2025 volatility, when shares traded as low as $66.25, to new momentum driven by AI tailwinds. Year-to-date in calendar 2026, DELL has shown resilience, with the post-earnings pop pushing it toward recent highs around $168.

Investors and analysts will watch upcoming quarters for confirmation that AI server margins remain healthy and shipments track toward the ambitious $50 billion target. Dell’s next earnings are expected in late May or early June for the first quarter of fiscal 2027.

As AI adoption accelerates globally, Dell’s results underscore its pivot from traditional PC and enterprise hardware to a high-growth AI infrastructure player, potentially reshaping its valuation trajectory in the years ahead.