Dell Technologies Inc.’s stock jumped 15% in extended trading Thursday after the company put up quarterly results that eclipsed Wall Street’s expectations. It also announced a 20% increase in its annual cash dividend, to $1.78 per share
The personal-computer company
DELL,
fueled by a surge in demand for AI servers, reported fiscal fourth-quarter net income of $1.16 billion, or $1.59 a share, compared with net income of $606 million, or 84 cents a share, in the same quarter a year ago. Adjusted earnings were $2.20 a share.
Net revenue slumped 11% to $22.3 billion from $25 billion in the year-ago quarter. Dell Chief Operating Officer Jeff Clarke noted $800 million in AI-server shipments during a conference call with analysts, but warned of a “soft” PC market that could extend into the second half of 2024.
AI-server demand and a rebound in PC sales in late 2024 should lead to growth of 3% to 5% in fiscal 2025, Dell executives said. They forecast fiscal 2025 annual sales of $91 billion to $95 billion. FactSet analysts are modeling for $92.2 billion.
Earlier this week, Dell announced a lineup of new laptops and PCs featuring neural-processing units designed to run AI workloads.
Analysts surveyed by FactSet had expected on average net income of $1.73 a share on revenue of $22.17 billion for Dell’s fourth quarter.
Shares of Dell have skyrocketed 136% over the past year, while the broader S&P 500 index
SPX
has increased 28%.
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