Computer maker Dell reported an AI server backlog of $95 billion for its second fiscal quarter of 2027, the highest level in the company’s history. Total revenue rose 58 percent to $47 billion, while revenue from AI servers doubled to $16.4 billion. Dell is now sharply raising its full-year forecast.
Orders Are Growing Faster Than Deliveries
During the quarter, new orders for AI-optimized servers reached a record $60.9 billion, according to Dell Technologies’ announcement. Because manufacturing has not kept pace with demand, the open backlog grew to $95 billion within a single quarter. Over the past twelve months, AI server orders totaled $131.7 billion. Based on these figures, Dell raised its full-year revenue guidance by $25 billion to roughly $192 billion. For AI server revenue, the company now expects $74 billion, nearly three times last year’s figure. CFO David Kennedy attributed the increase to accelerating demand for AI technology across the portfolio. The rest of the business also grew strongly: the Infrastructure Solutions Group (ISG) rose 89 percent to $31.8 billion, while traditional servers and networking grew 122 percent. The segment’s operating margin climbed 6.2 points to 15 percent, and earnings per share nearly tripled to $7.04.
Customer Base Now Extends Well Beyond Cloud Giants
More than 6,500 customers now order AI servers from Dell, spread across three groups: specialized cloud providers, government programs and traditional enterprises. Demand has thus broadened beyond the initial concentration among a handful of large hyperscalers. At the same time, Dell acknowledged ongoing supply constraints in memory, flash storage, processors and other AI components. As seen previously in Nvidia’s quarterly results, scarce memory chips are driving up costs for AI hardware makers across the industry.
Dell shares initially rose about nine percent in after-hours and pre-market trading. On the following trading day, however, the stock fell 7.3 percent to $422.72, according to 24/7 Wall St. For the current third quarter, Dell is guiding for revenue of $49 billion, also above analysts’ prior expectations. Operating expenses fell to 8.5 percent of revenue, the lowest level in the company’s history.
What will matter is whether Dell can close the gap between orders booked and volume actually delivered before its next results in December. Jeff Clarke put the AI infrastructure opportunity through 2030 at more than a trillion dollars, based on an expected 87-fold increase in AI compute workloads. Whether that forecast holds will also depend on how quickly the memory chip shortages ease.
