Dell's stock soars 30% after record AI server sales and Pentagon deal

Dell Technologies saw its stock surge by nearly a third on Friday, marking its best single-day gain ever. The jump followed a strong earnings report that far exceeded market expectations. Investors reacted positively to record-breaking revenue growth and an upgraded full-year forecast. The company’s first-quarter revenue rose by almost 88% compared to the same period last year. AI server sales alone hit $16.1 billion, a staggering 757% increase. Adjusted earnings per share came in at $4.86, well above the $2.94 analysts had predicted.

Dell also secured a major Pentagon contract worth $9.7 billion. Under the deal, the company will provide software solutions to support US military operations. The announcement added to investor confidence.

Before the earnings release, Dell’s stock had already tripled over the past twelve months. Now, analysts are raising their targets. Susquehanna upgraded the stock to Positive and set a new price target of $700, up from $138. J.P. Morgan lifted its target to $500 from $280, citing expectations of further guidance increases as production capacity grows. Morgan Stanley admitted it had underestimated Dell’s potential.

Looking ahead, Dell revised its full-year revenue projection to reflect roughly 50% annual growth. The company also forecast AI revenue to rise by 144% for the year. The sharp rise in Dell’s share price reflects strong financial performance and optimistic forecasts. With expanded production capacity and a major defence contract in place, the company appears positioned for continued growth. Analysts now expect further upward revisions in guidance as demand for AI servers remains high.