Introduction
Dell Technologies Inc (NYSE: DELL) recently released its fiscal 2025 fourth-quarter and full-year financial results, painting a picture of a transformative year marked by notable growth and strategic maneuvers. As the company looks forward to fiscal 2026, it's poised to continue its growth trajectory with promising revenue forecasts and an increased focus on artificial intelligence (AI).
Dell Technologies Inc Earnings Summary
In fiscal 2025, Dell Technologies achieved significant milestones, posting a full-year revenue of $95.6 billion, an 8% year-over-year increase. The company recorded a full-year operating income of $6.2 billion, up 15% year-over-year, with a non-GAAP operating income of $8.5 billion, reflecting an 8% increase. Importantly, Dell reported a record diluted earnings per share (EPS) of $6.38, a remarkable 39% rise from the previous year, alongside a non-GAAP diluted EPS of $8.14, which was up 10%.
Dell Technologies Inc Results
The table below presents key financial metrics for Dell Technologies, highlighting the year-over-year and quarter-over-quarter growth. These metrics underscore the company's robust fiscal performance.
| Metric | FY2025 (in $ billions) | YoY Change (%) | FY2025 Q4 (in $ billions) | YoY Change (%) |
|---|---|---|---|---|
| Total Revenue | 95.6 | 8 | 23.9 | 7 |
| Operating Income | 6.2 | 15 | 2.2 | 40 |
| Non-GAAP Operating Income | 8.5 | 8 | 2.7 | 22 |
| Diluted EPS | 6.38 | 39 | 2.15 | 30 |
| Non-GAAP Diluted EPS | 8.14 | 10 | 2.68 | 18 |
Revenue Breakdown
Dell Technologies' revenue for fiscal 2025 was driven by distinct business segments, as illustrated below:
| Segment | Full-Year Revenue (in $ billions) | YoY Change (%) | Q4 Revenue (in $ billions) | YoY Change (%) |
|---|---|---|---|---|
| Infrastructure Solutions Group (ISG) | 43.6 | 29 | 11.4 | 22 |
| Client Solutions Group (CSG) | 48.4 | -1 | 11.9 | 1 |
In-Depth Analysis of Segment Performance
Infrastructure Solutions Group (ISG): ISG performed exceptionally well, with full-year revenue reaching $43.6 billion, a 29% increase year-over-year. The group's Q4 revenue was also impressive at $11.4 billion, marking a 22% increase. Growth in this segment was largely driven by high demand for AI and traditional server solutions, evidenced by the ISG's Servers and Networking revenue, which rose 37% to $6.6 billion in the fourth quarter.
Client Solutions Group (CSG): Despite challenges, the CSG generated $48.4 billion in revenue for the year, experiencing a slight 1% decline. The fourth quarter saw CSG revenue at $11.9 billion, marking a modest 1% increase year-over-year. Notably, the Commercial Client revenue within this segment grew by 5% to $10.0 billion, while the Consumer revenue decreased by 12% to $1.9 billion.
Key Developments
In fiscal 2025, Dell Technologies made strategic advances to position itself for future growth. The company notably progressed in its AI endeavors, securing deals with organizations, such as xAI, that bolstered its AI server backlog to approximately $9 billion. Dell's strategic expansion into AI signifies its commitment to meeting increasing enterprise demand and tapping into emerging markets.
Comments from Company Officers
Yvonne McGill, Dell Technologies' Chief Financial Officer, remarked on fiscal 2025 as a breakthrough year for the company. "FY25 was a transformative year – we hit $95.6 billion in revenue, grew our core business double digits, unlocked efficiencies, and drove record EPS," she said. Jeff Clarke, Vice Chairman and Chief Operating Officer, expressed optimism about Dell's AI prospects, seeing strong growth potential in extending AI capabilities to cloud services, enterprises, and edge devices.
Dividends and Share Repurchases
To reward shareholders, Dell announced an 18% increase in its annual cash dividend, setting it at $2.10 per common share, with an initial distribution of $0.525 per common share scheduled for May 2, 2025. Additionally, Dell's board of directors sanctioned a $10 billion expansion in the company’s share repurchase authorization, reflecting confidence in long-term growth prospects.
Dell Technologies Inc Stock Forecast
Based on Dell Technologies' impressive fiscal performance, strategic AI investments, and sustained revenue growth, the company presents a promising outlook for investors. The company expects fiscal 2026 revenue to range between $101.0 and $105.0 billion, at an 8% increase year-over-year. Furthermore, Dell anticipates a 23% increase in its GAAP diluted EPS and a 14% rise in non-GAAP diluted EPS, demonstrating robust earnings potential.
Stock Price Projection
Considering Dell Technologies' current market capitalization of approximately $98.9 billion and its prospective growth avenues, the stock price could experience notable fluctuations. High projection estimates suggest that the stock could reach around $85, contingent on sustained growth in AI and strategic execution. Conversely, conservative estimates pegged at around $70 reflect potential market volatility and operational challenges.
Conclusion
Dell Technologies' fiscal 2025 results underscored a period of transformative growth accompanied by strategic advancements in AI. With promising fiscal 2026 guidance, increased shareholder returns, and a proactive approach toward emerging technologies, Dell stands poised to capitalize on its achievements and strengthen its market position in the coming years. As the company continues to adapt and innovate, Dell Technologies remains a formidable player in the technology sector, inspiring confidence in investors and stakeholders alike.
