Dell reports Q2 FY27 earnings as AI server demand reshapes the company

Dell Technologies is scheduled to report its fiscal second quarter 2027 results on September 1, 2026. Dell’s AI-optimized server business has become the gravitational center of the entire operation, and this quarter will test whether that momentum is accelerating or approaching a ceiling.

In Q1 FY27, Dell posted record revenue of $43.8 billion, representing an 88% jump compared to the same period a year earlier. AI-optimized server revenue alone hit $16.1 billion, a 757% increase year-over-year.

What analysts are expecting

Dell’s own guidance for Q2 calls for revenue between $44 billion and $45 billion, which would translate to roughly 50% year-over-year growth at the midpoint. Analysts are clustering toward the upper end of that range, with consensus estimates sitting around $45 billion in revenue and an adjusted earnings per share of approximately $4.91.

The infrastructure solutions group, or ISG, posted $29 billion in revenue during Q1, a 181% surge. Dell’s AI orders during the quarter totaled $24.4 billion, and the company’s AI backlog swelled to $51.3 billion, up from $43 billion in the prior period.

Management raised its full-year FY27 AI server revenue guidance to approximately $60 billion, up from a prior target of $50 billion.

The customer base and competitive position

Dell’s AI customer base has expanded to more than 5,000 clients, a figure the company says represents over 50% growth in just six months.

Much of the demand is being driven by the latest generation of accelerators from Nvidia, which remain the dominant chips powering AI training and inference workloads. Dell builds servers optimized for these GPUs, and as Nvidia releases increasingly powerful architectures, each new cycle pulls forward another wave of server orders.

The risks investors are watching

The most immediate risk is supply chain friction, specifically around memory components. Demand for high-bandwidth memory, the type required in AI servers, has consistently outpaced available supply across the industry.

Margins are the other focal point. AI servers carry a different cost structure than traditional enterprise hardware. The components are more expensive, competition for supply is fierce, and customers with enormous purchasing power can negotiate aggressively on pricing.

The September 1 report will also provide updated guidance for the remainder of FY27, giving investors a forward-looking view of whether Dell expects the current trajectory to hold.