Wall Street analysts do not say sorry often. After Dell's latest quarter, Morgan Stanley said it was "eating our humble pie."
That is how badly the pros missed this one.
The Numbers Behind The Jump
Dell reported the results after the market closed Thursday. The AI demand came in like a flood.
Dell sells the servers that run artificial intelligence. Right now buyers cannot get them fast enough.
AI servers are the powerful computers that train and run AI models. Big tech firms are buying them by the truckload.
The servers are packed with chips from Nvidia. Those chips power most AI tools today.
Sales from AI servers alone jumped 757% from a year ago. They hit $16.1 billion.
Total sales rose nearly 88%. That is Dell's fastest growth since it went public again in 2018.
Profit beat the forecast too. It came in at $4.86 a share, well above the $2.94 analysts expected.
The stock jumped about 32% on Friday. By the afternoon it traded near $410 a share.
Dell is one AI memory and hardware play that just proved the demand is real. We explain what earnings like this mean for investors in Market Briefs, sent every weekday, plus a free investing masterclass when you join.
Why The Pros Got It Wrong
The numbers were so far ahead that analysts had to redo their math. One research head said he had never seen anything like it.
That head was Ben Reitzes of Melius. He said Dell beat whatever anyone could have guessed.
He also said Dell beat every line in his model. This was not just an AI story, though.
Dell ran the rest of its business well too. That turned a strong quarter into a record one.
Other analysts had to rethink their take on the stock. Morgan Stanley even said its own model was now under review.
The stock is now on pace for its best day ever.
The Trump Connection
There is a side plot worth knowing. Dell stock has nearly tripled in the past year.
Part of that comes from politics. CEO Michael Dell built close ties with President Trump.
Filings show Trump bought Dell shares in February. The buy was worth between $1 million and $5 million.
It came after the Dell family pledged $6.25 billion. The gift helps fund Trump Accounts for 25 million American kids.
Trump later told a White House crowd to "go out and buy a Dell." This week, Dell also won a $9.7 billion deal to supply software to the U.S. military.
That deal gives the military a full set of Dell software. It is one of Dell's biggest wins yet.
The same chip and server spending is lifting many AI boom stocks right now.
What To Watch
The big question is simple. Will AI server demand stay this hot, or finally cool off?
For now, the boom shows no sign of slowing. Buyers keep lining up for more.
For one quarter at least, the doubters admitted they were wrong.
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