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Estimates vs. Actuals / Guide
Q2: Rev $29.8B vs. $29.2B ✅; EPS $2.32 vs. $2.29 ✅.
Q3 guide vs. Street: slight above on both revenue and EPS 📈.
FY26 guide vs. Street: above on both metrics 📈.
Sentiment bullets:
Bullish: AI shipments/guide up; ISG +44% YoY; strong cash generation.
Neutral: Commercial PC steady; broader CSG basically flat.
Bearish: Storage −3% YoY; margin mix still a watch-item.
Raised FY26 AI shipment target to $20B (from prior commentary).
FY26 revenue and EPS guide issued above Street.
ISG mix stronger; storage slightly down; CSG consumer softness persisted.
$1.3B returned via buybacks/dividends.
| KPI | YoY | Why it matters | |
|---|---|---|---|
| ISG revenue | $16.8B | +44% | AI infrastructure demand driving top-line. |
| Servers & Networking | $12.9B | +69% | Core AI compute engine; mix shift to higher-ticket configs. |
| Storage | $3.9B | −3% | Modest drag within ISG. |
| CSG revenue | $12.5B | +1% | Commercial PCs +2%; consumer −7%. |
| Cash from ops | $2.5B | n/a | Supports capital return & AI investment. |
Confirms backlog is converting to revenue while cash generation funds buybacks/dividends.
| Period | Metric | Company Guide | Street | Flag |
|---|---|---|---|---|
| Q3 FY26 | Revenue | $26.5–27.5B (mid: $27.0B) | ~$26.7B | 📈 |
| Q3 FY26 | Non-GAAP EPS | $2.45 | ~$2.40 | 📈 |
| FY26 | Revenue | $105–109B (mid: $107B) | $104.8B | 📈 |
| FY26 | Non-GAAP EPS | $9.55 (midpoint) | $9.37 | 📈 |
| Guide from the press release; Street from your pre-earnings brief. |
Dell reports a nice beat across the board and shares are up 2.2% after- hours. Lets take a look at the numbers.
| Metric | Actual | Consensus | Beat/Miss |
|---|---|---|---|
| Revenue | $29.8B | $29.2B | ✅ Beat |
| EPS (Non-GAAP) | $2.32 | $2.29 | ✅ Beat |
Dell came through with a clean double beat and stronger full-year guide. AI servers are the engine: ISG revenue up 44% YoY with servers/networking up 69%. Management raised AI shipment target to $20B for FY26, showing demand remains robust. Margins dipped YoY (18.3% vs. 21.4%) but cash flow was strong at $2.5B.
| Quarter | EPS Surprise | 1-Day Move | 7-Day Move | 14-Day Move |
|---|---|---|---|---|
| Q1 2026 | –8.3% | –2.08% | +0.52% | +2.58% |
| Q4 2025 | +6.4% | –4.70% | –16.22% | –8.45% |
| Q3 2025 | +4.4% | –12.25% | –12.93% | –16.55% |
| Q2 2025 | +10.5% | +4.34% | –3.70% | +6.35% |
Live coverage has ended. The full story is below.
Dell (NYSE: DELL | DELL Price Prediction) reports fiscal Q2 2026 earnings after the close. The PC and server giant has become a key player in the AI infrastructure buildout, booking more than $12 billion in AI server orders in Q1 alone. However, profitability pressures in PCs and traditional servers weighed on results, with EPS missing by 8% despite record revenue.
The key question tonight is whether Dell can turn that $14B+ backlog into profitable growth. Here are the figures Wall Street is expecting.
That implies +17% YoY revenue growth this quarter, with EPS expected to surge +21% YoY.
AI Servers & Backlog Conversion- $12.1B in AI orders booked in Q1, with shipments of $1.8B. Backlog grew to $14.4B. Management reaffirmed $15B+ AI revenue target for FY2026.
Enterprise Adoption & Sovereign AI- 3,000+ enterprise customers now deploying Dell AI Factories. Orders span Blackwell, Hopper, ARM, and x86 architectures. Department of Energy win (NERSC-10) highlights sovereign AI traction.
Traditional Server Moderation- While AI drove record ISG revenue, traditional server demand slowed in North America. Dell expects sub-seasonal performance in Q2, a key risk for gross margins.
PC Refresh & AI PCs- Commercial PC demand rose +9% YoY in Q1, driven by AI-enabled Windows 11 refresh. Consumer PCs remain weak (–19% YoY), weighing on CSG profitability.
Margins & Tariff Headwinds- Gross margin dipped 80 bps in Q1 to 21.6% due to mix and tariffs. Management guided Q2 gross margin dollars +10% QoQ, but investors will be watching AI margin dilution vs. absolute dollar accretion
Contact [email protected] for any questions or corrections.
Joel South covers large-cap stocks, dividend investing, and major market trends, with a focus on earnings analysis, valuation, and turning complex data into actionable insights for investors.
He brings more than 15 years of experience as an investor and financial journalist, including 12 years at The Motley Fool, where he served as an investment analyst, Bureau Chief, and later led the Fool.com investing news desk. He has also co-hosted an investing podcast and appeared across TV and radio discussing market trends.
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