Dell Technologies said its revenue rose 10 percent to $24.4 billion with operating income of $1.7 billion for its fiscal 2025 third quarter.
“Interest in our portfolio is at an all-time high, driving record AI server orders demand of $3.6 billion in Q3 and a pipeline that grew more than 50 percent,” Dell’s Chief Operating Officer Jeff Clarke said on Tuesday.
“We continued to build on our AI leadership and momentum, delivering combined ISG and CSG revenue of $23.5 billion, up 13 percent year over year,” said Yvonne McGill, chief financial officer, Dell Technologies.
Dell’s Infrastructure Solutions Group (ISG) revenue surged 34 percent to $11.4 billion. Dell’s revenue from Servers and networking business increased 58 percent to $7.4 billion thanks to demand across AI and traditional servers. Dell’s storage revenue rose 4 percent to $4 billion.
Dell’s Client Solutions Group (CSG) revenue fell 1 percent to $12.1 billion, despite started selling AI PCs. Dell’s commercial client revenue rose 3 percent to $10.1 billion. Dell’s consumer revenue fell 18 percent to $2 billion.
AI optimized server
Order for AI optimized server increased 11 percent q-o-q to $3.6 billion, with growth in enterprise customers. Shipment of AI optimized server was worth $2.9 billion. AI backlog was $4.5 billion at the end of Q3.
AI optimized server pipeline grew more than 50 percent sequentially with growth across both Tier 2 CSPs and Enterprise customers. Dell added 2,000 unique Enterprise customers for AI optimized server since launch. PowerStore and PowerFlex demand both grew double digits in the quarter.
Dell says demand for traditional server improved in double digits in Q3, driven by growing units and ASPs with richer configurations. Traditional server demand was up y-o-y for the fourth consecutive quarter.
PC
Dell achieved third consecutive quarter of commercial demand growth both y-o-y and q-o-q. Dell has also achieved second consecutive quarter of y-o-y premium commercial PC share gain. Dell noted that profitability in the commercial PC space held up well as customers continue to purchase more richly configured devices. Dell Technologies has the number one share position in Commercial AI PC.
Target
In Q4, Dell is aiming for revenue of $24 billion – $25 billion with 10% growth. In FY 2026, Dell is expecting more robust AI demand with a strong five quarter pipeline going into next year. Dell is targeting new business from an aged install base in both PCs and traditional servers, prime for refresh.
Baburajan Kizhakedath
