[ad_1]
Brandon Bell/Getty Images
A Dell laptop on display at a Best Buy store on June 2, 2023 in Austin, Texas. Dell Technologies Inc. beat expectations in its fiscal first quarter.
new york
CNN
—
It’s not a good time to sell your PC. Dell has been grappling with declining demand in recent years. But the company’s stock still rose 20% in after-hours trading after the company excited investors about the tech industry’s favorite buzzword: artificial intelligence.
Dell’s fourth-quarter revenue fell 11%. This was better than expected, but Dell’s PC business is lagging. Still, the Texas-based company noted that demand for powerful servers to run AI workloads has surged in the past three months. The company’s Infrastructure division brought in $9.3 billion in revenue, with 10% quarter-on-quarter growth “primarily driven by AI-optimized servers” (though down 6% year over year).
Dell Technologies shares rose about 20% in after-hours trading after hitting a record high near the top of Thursday’s trading session.
“We are just beginning to address the AI opportunities before us, and we believe Dell is uniquely positioned with a broad portfolio to help our customers build GenAI solutions that meet their performance, cost, and security requirements. ,” said Jeff Clarke, the company’s chief operating officer. said in a statement Thursday.
Nvidia, the leader in AI chips, has overtaken giants like Amazon to become one of the world’s most valuable companies. But demand for the hardware to enable AI exceeds the amount Nvidia can produce. That means companies like Dell have an opportunity to fill that gap.
This is good news for Dell, as its core business has struggled since the coronavirus-era PC boom. According to consulting firm Gartner, 2023 was the worst year on record for PCs, with a decline of 14.8%. This was the second consecutive year of double-digit decline. Dell in particular fell nearly 20%.
However, PC shipments increased in the fourth quarter of 2022, marking the first increase after eight consecutive quarters of decline.
“PCs will become even more essential as most of the day-to-day tasks using AI will be done on PCs,” Clark said in prepared remarks for Thursday’s earnings call. said.
Dell’s computer sales fell 12% to $11.7 billion, “primarily due to unit volume declines,” the company said in its earnings call Thursday.
– CNN’s Krystal Hur contributed to this report.
[ad_2]
Source link
