Dell Technologies shares surged nearly 12% on Friday, putting the technology company among Wall Street's top gainers as investors piled into the stock following a series of positive developments around its artificial intelligence (AI) infrastructure business.
Dell Technologies shares rose 11.15% to $563.38 as of 12:04 p.m. EDT, after climbing nearly 12% earlier in the session. The rally has taken the stock closer to its all-time high and adds to an extraordinary 309% gain over the past 12 months.
$95 Billion AI Backlog At Centre Of Rally
The biggest catalyst behind Friday's move was Dell's latest update on demand for AI servers.
Speaking at the Goldman Sachs Communacopia + Technology Conference on Sept. 10, CFO David Kennedy said second-quarter AI server bookings reached $6.1 billion. That was equal to the combined bookings recorded over the previous three quarters.
Dell's 12-month AI bookings have now reached $13.2 billion, while its AI infrastructure backlog stands at an unprecedented $95 billion. The size of the backlog is particularly important for investors because it provides visibility into future AI infrastructure demand. Analysts are viewing the backlog as a key indicator of sustained demand extending into fiscal 2028.
Record Earnings Add To Investor Confidence
The latest AI update builds on Dell's strong fiscal second-quarter fiscal 2027 performance announced on Sept. 1. The company reported record quarterly revenue of $47 billion, representing a 58% year-on-year increase. Adjusted earnings per share came in at $7.04, significantly above the consensus estimate of around $4.91.
Dell also raised its full-year guidance, forecasting 69% sales growth and a 148% increase in adjusted EPS to $25.50. The Infrastructure Solutions Group delivered a record operating margin of 15%, while Dell's PC business recorded its fastest growth in five years.
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The combination of strong earnings and accelerating AI demand has strengthened the investment case for Dell beyond its traditional PC and enterprise hardware businesses.
Investor sentiment has also been supported by growing Wall Street confidence. RBC Capital initiated coverage on Dell with an Outperform rating and a $640 price target on September 10. Morgan Stanley, Goldman Sachs and Citigroup have also raised their price targets following Dell's earnings announcement.
Why AI Is Driving Dell's Rally
The AI boom has created enormous demand for data-centre infrastructure, including servers capable of handling increasingly complex AI workloads. Dell is positioned to benefit from this spending through its AI-optimised server business. The sharp increase in bookings, combined with a $95 billion backlog, suggests that demand is not limited to a short-term surge.
For investors, the key takeaway is that Dell is increasingly being valued as an AI infrastructure play rather than simply a traditional hardware company.
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