Dell’s Q127. Soaring After Hours On Massive AI Server Driven Beat & Raise

On 28 May 2026, Dell Technologies reported Q1 FY27 results which saw revenue come in at $43.84 billion, up 88% YoY and down 31% QoQ, in line with normal Q4-to-Q1 seasonality. Oh and it was also $8.6 billion above the midpoint of Dell’s own guide.

GAAP gross margin was 17.8% of revenue, versus 21.1% in Q1 FY26 and 20.2% in Q4 FY26, a 330bp YoY and 240bp QoQ compression. Non-GAAP gross margin was 18.1%, down from 21.6% in Q1 FY26. Dell does not formally guide gross margin, but the directionality was an accepted cost of the AI server mix shift: management has been telling investors for several quarters that AI servers carry lower hardware margins.

Commenting on the results in the press release, CEO and Vice Chairman Jeff Clarke noted:

“Our record Q1 performance reflects strong in-quarter demand, as well as our pace of innovation across the full stack of PCs, compute and storage. We booked $24.4 billion in AI orders and recognized $16.1 billion of AI server revenue. We’re increasing our AI server revenue expectations for FY27 to $60 billion, which only goes to show the AI opportunity shows no signs of slowing.”

Going into the print, DELL had already been re-rating hard. The stock closed at $242.93 on 20 May 2026, then ran $252.80, $295.19, $305.08, $305.32 in the four sessions before the print, and traded as high as $327.73 on print day before settling at $317.05 at the regular session close.

The share price then exploded after hours, and is now up ~38% at time of writing.

Let’s dig in….