NEW YORK, August 5, 2026, 11:11 a.m. EDT — U.S. markets open.
- Dell’s stock climbed 2.0% to $476.81, having reached a session high of $485.33.
- The company’s AI backlog represents 117% of projected sales left for fiscal 2027.
- GF Securities has set a target of $403, suggesting a potential decline of 15.5% from the most recent price.
Dell Technologies NYSE:DELL reported an AI backlog that amounts to 117% of the additional revenue required to meet its fiscal 2027 server goal. Shares advanced 2.0% to $476.81 during late-morning trading in New York.
The ratio alters the investor discussion. Order visibility remains robust. Focus turns to margin growth and maintaining market share.
Dell reported $16.1 billion in AI server revenue for its first quarter and is forecasting approximately $60 billion for the full year. This means it needs to generate another $43.9 billion, compared with a backlog of $51.3 billion.
| Dell fiscal 2027 AI revenue breakdown | Amount | Investor takeaway |
|---|---|---|
| Guidance for full-year AI server sales | $60.0 billion | Management goal |
| Revenue booked in Q1 | $16.1 billion | 27% of goal achieved |
| Revenue needed to meet goal | $43.9 billion | Calculated figure |
| Backlog at end of Q1 | $51.3 billion | $7.4 billion more than required gap |
| Backlog as share of unmet target | 117% | Calculated figure |
| Target margin on AI server sales | Mid-single-digit percent | Profit test ongoing |
The ratio does not represent a revenue projection. Changes in shipment schedules and component supplies may affect conversion. Dell anticipates maintaining a significant backlog at the end of the year.
Dell identifies memory as the primary limitation in supply. Chief Operating Officer Jeff Clarke stated the AI opportunity “shows no signs of slowing.” Dell Technologies Investors
Profit performance was less notable. Operating income from AI servers aligned with Dell’s mid-single-digit goal, while the overall infrastructure division posted an operating margin of 10.5%.
Comparable peers have reported similar demand, although their financial dynamics vary. Hewlett Packard Enterprise NYSE:HPE stated its total AI backlog was over $6.3 billion. Super Micro Computer NASDAQ:SMCI announced that its preliminary quarterly orders surpassed $60 billion.
| Company | Wednesday trading | Latest AI demand indicator | Profitability signal |
|---|---|---|---|
| Dell | $476.81, up 2.0% | Backlog at $51.3 billion as of close | AI server margin in mid-single digits |
| HPE | $53.15, rising 1.5% | AI backlog exceeds $6.3 billion | Cloud & AI margin stands at 12.4% |
| Super Micro | $30.68, down 3.2% | Q4 orders preliminary above $60 billion; backlog at record high | Gross margin preliminarily at 15%–17% |
The timing, coverage, and accounting criteria for demand and margin measures are not the same.
Peer data do not support claims of a slowdown in industry demand. The more pressing issue is allocation: determining which supplier secures each system and the associated profit margin.
GF Securities (HKG:1776) analyst Evan Lee reiterated his Hold rating and lowered his price target to $403 from $445. Lee stated that Dell is expected to “face competitive pressures starting with Rubin platform.” Seeking Alpha
Analysts overall maintain a positive outlook. However, the consensus average target is just under Dell’s current market value.
| Latest recommendation | Date | Rating | Target | Return from $476.81 |
|---|---|---|---|---|
| GF Securities | Aug. 4 | Hold | $403 | -15.5% |
| Citigroup NYSE:C | July 24 | Buy | $515 | +8.0% |
| Evercore NYSE:EVR | July 8 | Outperform | $500 | +4.9% |
| Morgan Stanley NYSE:MS | June 23 | Equal-weight | $477 | 0.0% |
| BofA Securities, part of Bank of America NYSE:BAC | May 29 | Buy | $500 | +4.9% |
| Compiled consensus: 16 analysts | Current | Buy; 13 Buy, 3 Hold | $472 average | -1.0% |
Higher profit forecasts are a factor behind the tension. According to Investor’s Business Daily, referencing FactSet NYSE:FDS, projected fiscal 2027 EPS stands at $18.48, marking a 79% increase.
| Earnings yardstick | EPS | Expected growth | Implied price/EPS |
|---|---|---|---|
| Dell non-GAAP forecast, fiscal 2027 | $17.90 | 74% | 26.6 times |
| Analyst projection, fiscal 2027 | $18.48 | 79% | 25.8 times |
| Analyst projection, fiscal 2028 | $22.36 | 21% | 21.3 times |
Multiples are calculated using Dell’s most recent price of $476.81. Company guidance and analyst projections may apply alternate methods of adjustment.
Dell trades at about 26 times projected earnings for this year, reflecting expectations of solid conversion. The valuation does not factor in a significant decline in AI server market share.
HPE presents a different approach. The Cloud & AI unit delivered a 12.4% operating margin, with 61% of total AI orders attributed to enterprise and sovereign clients. Chief Executive Antonio Neri stated HPE is prioritising “profitable growth and prudent working capital management.”
Super Micro’s results are still considered preliminary and have not been audited. The company cautioned that certain orders might be canceled or delayed prior to shipment.
Dell is set to announce its fiscal second-quarter earnings on September 3. Key factors include backlog conversion, the composition of its customer base, and performance of AI margins.
Risks: Key risks include memory supply, timing of shipments, dependence on major customers, and ongoing price competition. Any supplier change may impact Dell’s sales conversion rates or keep margins in the mid-single digit range.
Dell’s $60 billion target appears well-backed by current orders in the near term. For the next re-rating, improved unit economics will be necessary, rather than just an increase in backlog.
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