Dell Reveals Revenue Shortfall but Projects AI-Driven Growth
Round Rock, Tuesday, 25 November 2025.
Dell Technologies reports a revenue miss but anticipates strong growth through AI server solutions, highlighting its strategic focus on AI as a key growth driver.
Q3 Fiscal Year 2026 Earnings Overview
Dell Technologies Inc. (NYSE: DELL) reported its financial results for the third quarter of fiscal year 2026 on November 25, 2025. The company’s revenue fell short of Wall Street’s expectations, coming in at $27.01 billion compared to the anticipated $27.13 billion. This marks a notable event as Dell has missed revenue estimates three times over the past two years [1][2]. Despite this shortfall, Dell forecasts robust growth in the upcoming quarter, projecting Q4 revenue of $31.5 billion, significantly above the $27.59 billion expected by analysts [1].
AI as a Strategic Growth Driver
Amidst the revenue miss, Dell’s management remains optimistic about its future growth, driven primarily by the increasing demand for AI server solutions. The company has raised its AI server shipment forecast for 2025 from $20 billion to $25 billion, indicating a strategic pivot towards AI technology as a critical growth driver [1]. This move is part of Dell’s broader strategy to capitalize on the burgeoning AI market, which is seeing significant investment from businesses worldwide as they push toward digital transformation [2].
Performance by Business Segment
Dell’s Infrastructure Solutions Group, which includes its data center business, reported sales of $14.11 billion, with servers and networking contributing $10.1 billion, up 37% year-over-year. This growth was largely driven by $5.6 billion in AI server shipments [1]. Meanwhile, the Client Solutions Group, which encompasses Dell’s laptops and PCs, reported sales of $12.48 billion, a 3% increase from the previous year but slightly below the $12.65 billion analyst expectation [1].
Financial Strategies and Market Position
Beyond operational performance, Dell has been active in financial strategies, spending $1.6 billion on share repurchases and dividends in the quarter [1]. The company’s position as a top vendor for systems based on Nvidia’s graphics processors underscores its critical role in the AI infrastructure industry, serving as a bellwether for the sector’s health [1][3]. Despite current challenges, Dell’s focus on AI and infrastructure solutions positions it well for future growth, aligning with market trends and investor expectations [2].