Dell Lifts Full-Year Revenue Outlook to $192 Billion
The technology company posted record quarterly revenue of $47.0 billion and raised its fiscal 2027 AI-server outlook to $74.0 billion.
Dell Technologies (DELL) raised its fiscal 2027 revenue outlook by $25 billion to $192.0 billion after a second quarter in which Infrastructure Solutions Group revenue reached $31.8 billion and the company booked a record $60.9 billion in AI-server orders.
The technology company said full-year revenue is now expected to be up 69% from a year earlier, versus a previous $167.0 billion outlook. It also lifted full-year AI-Optimized Servers revenue guidance to $74.0 billion, up 200% year over year, from $60.0 billion. GAAP diluted EPS guidance rose to $24.37 from $17.31, and non-GAAP diluted EPS guidance rose to $25.50 from $17.90.
Net revenue for the three months ended July 31, 2026, was $46.97 billion, up 58% from a year earlier. That followed $43.8 billion in the prior quarter, when year-over-year growth had been 88%. Diluted EPS was $6.34, up 273% from a year earlier, after $5.24 in the first quarter of the fiscal year. Non-GAAP diluted EPS was $7.04, up 203%.
ISG net revenue of $31.78 billion was up 89% year over year, after $29.0 billion in the prior quarter, when the year-over-year increase had been 181%. AI-Optimized Servers revenue was $16.40 billion, up 100% from a year earlier, after $16.1 billion in the first quarter. Traditional Servers and Networking revenue was $10.53 billion, up 122%, after $8.5 billion. Storage revenue was $4.85 billion, up 26%, after $4.3 billion.
ISG operating income was $4.78 billion, up 225% year over year, after $3.1 billion in the prior quarter. ISG operating margin was 15.0% of ISG net revenue, compared with 8.8% a year earlier. The group accounted for 81% of reportable segment operating income, versus 65% a year earlier.
Vice chairman and chief operating officer Jeff Clarke said the AI server business booked a record $60.9 billion in orders, recognized a record $16.4 billion in revenue, and exited the quarter with a record $95 billion backlog. He said traditional servers and networking were up 122%, storage was up 26%, and client solutions were up 20% year over year.
Client Solutions Group net revenue was $15.03 billion, up 20% year over year, after $14.6 billion in the prior quarter. Commercial Client revenue was $13.19 billion, up 22%. Consumer revenue was $1.84 billion, up 7%. CSG operating income was $1.14 billion, up 42%, and CSG operating margin was 7.6% of CSG net revenue, versus 6.4% a year earlier. CSG accounted for 19% of reportable segment operating income, versus 35% a year earlier.
Consolidated operating income was $5.39 billion, up 204% year over year. Operating margin was 11.5% of net revenue, versus 6.0% a year earlier. Gross margin was $9.83 billion, or 20.9% of net revenue, versus 18.3% a year earlier. Non-GAAP operating income was $5.93 billion, or 12.6% of net revenue, versus 7.7%. Products net revenue was $41.11 billion, up 72% year over year. Services net revenue was $5.86 billion, unchanged from a year earlier.
Cash flow from operations was $2.23 billion, down 13% year over year, after a record $4.1 billion in the prior quarter. Adjusted free cash flow was $8.15 billion, up 224% year over year. Dell returned a record $4.3 billion to shareholders in the quarter through share repurchases and dividends, after $2.1 billion in the prior quarter. On Sept. 1, the board declared a quarterly cash dividend of $0.63 a share, payable Oct. 30 to shareholders of record Oct. 20.
Chief financial officer David Kennedy said the company returned a record $4.3 billion to shareholders and that AI momentum was accelerating. He said the company was raising its full-year FY27 revenue outlook by $25 billion to $192 billion, up nearly 70% year over year.
For the three months ending October 30, 2026, Dell guides to revenue of $49.0 billion, up 81% year over year, GAAP diluted EPS of $6.10, up 168%, and non-GAAP diluted EPS of $6.50, up 151%.