From Financial Modeling Prep: 2025-02-28 12:08:00

Dell Technologies (NYSE:DELL) shares dropped over 5% due to projected decline in adjusted gross margins for fiscal 2026. Rising costs from AI server expansion and weak PC demand are impacting profitability.

Dell expects full-year adjusted gross margin rate to decrease by around 100 basis points. They are also assessing possible cost impacts from proposed U.S. tariffs, hinting at potential price adjustments.

Despite margin worries, Dell is positive about AI growth, predicting a 53% year-over-year increase in AI server shipments, aiming for $15 billion in annual sales.

In Q4, Dell reported adjusted EPS of $2.68 on revenue of $23.93 billion, beating EPS estimates but missing revenue expectations.

Looking forward, Dell’s outlook is mixed with current-quarter adjusted EPS of $1.65 and revenue between $22.5 billion and $23.5 billion, falling short of consensus estimates.

For fiscal 2026, Dell anticipates adjusted EPS of $9.30 on revenue between $101.0 billion and $105.0 billion, in line with expectations. Margin compression and economic uncertainty remain concerns for investors.



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