Dell Technologies (NYSE: DELL) stock rose on Thursday after the company posted better-than-expected fiscal 2025 fourth quarter and full year earnings.
After declaring US$95.6 billion in revenue and recording diluted fourth-quarter earnings per share (EPS) of $2.15, up 30% year on year, the company announced a cash dividend increase of 18% and a US$10 billion increase in share repurchase authorisation.
Earnings, excluding some items, are expected to be $9.30 a share on sales of US$101 billion to US$105 billion in the fiscal year ending in January 2026, up on analysts’ projected profit of US$9.24 a share on revenue of US$103 billion.
Overall, the company declared full-year revenue growth of 8% (US$95.6 billion), diluted EPS growth of 23% and non-GAAP diluted EPS growth of 14%.
In Q4 the Texas-based company grew its Infrastructure Solutions Group revenue by 22% and personal computer sales to businesses gained 5% to US$10 billion.
Full-year operating income of $6.2 billion was up 15% year on year and cash flow from operations was US$4.5 billion.
Meanwhile, fourth-quarter (4Q) revenue of $23.9 billion was up 7% year on year, 4Q operating income of US$2.2 billion was up 40% year over year, and non-GAAP operating income of US$2.7 billion was also up 22% for the quarter.
Strong AI leverage
The company said it was well positioned to capture growth across every segment of the business and guided to a full-year profit outlook exceeding market estimates.
The company guided FY26 revenue growth of 8%, diluted EPS growth of 23% and non-GAAP diluted EPS growth of 14%.
Having booked large deals for AI servers, the company is preparing for long-term growth during the AI boom and projects US$15 billion in AI server shipments this year.
"Our prospects for AI are strong, as we extend AI from the largest cloud service providers, into the enterprise at-scale, and out to the edge with the PC. The deals we’ve booked with xAI and others puts our AI server backlog at roughly US$9 billion as of today,” said Jeff Clarke, vice chairman and chief operating officer, Dell Technologies.
Other key numbers
Other highlights within Dell’s results included full-year revenue of US$43.6 billion for the Infrastructure Solutions Group (ISG), up 29% year on year; and full-year revenue of US$48.4 billion for the Client Solutions Group (CSG), down 1% year on year.
While full-year operating income was up 30% year on year in Infrastructure Solutions, it was down 20% in Client Solutions.
During the fourth quarter, Servers and Networking revenue of US$6.6 billion was up 37% due to AI and traditional server demand.
Yesterday’s results follow the recent unveiling of Dell’s Open Telecom Transformation Program and expanded AI capabilities, which signalled the company’s robust push into the telecom sector.
The company is collaborating with industry leaders like Nokia and AMD to address evolving telecom needs, enhancing its appeal in the competitive tech space.
This strategic move aligns with the market trend towards AI-optimised solutions, and has contributed to Dell’s share price increase of 11% over the past month.
