Dell Technologies’ Q3 results impressed with strong margins, particularly in AI-optimized servers. Operating income rate for ISG improved by 360 basis points to 12.4%, driven by a healthier mix of AI products. Adjusted earnings per share came in at $2.59, exceeding Wall Street’s expectations.

Management raised full-year EPS guidance to $9.92, a 22% increase from last year. Despite AI-driven demand, Dell stock has only risen 11.9% this year, trailing the market. With double-digit growth, stable AI server margins, and strong storage profitability, Dell may see an uptrend.

Dell remains a compelling investment in the AI hardware space, with $12.3 billion in AI server orders in Q3. Shipments reached $5.6 billion, and backlog hit $18.4 billion. Traditional server demand is rebounding, and Dell’s storage solutions show strong demand for its all-flash portfolio.

Overall, Dell is well-positioned for growth in the coming quarters. Analysts maintain a “Moderate Buy” outlook, highlighting Dell’s opportunity in AI infrastructure. With a modest valuation at 14.7x forward P/E ratio and projected earnings growth of over 18%, Dell could be a buy near current levels.

Read more at Yahoo Finance: What Dell’s Q3 Numbers Mean for Your Portfolio: Buy, Sell, or Hold?