The share price of Dell Technologies Inc. (DELL) suffered its worst performance since the technology firm went back on the public market in 2018.
Dell Suffers Worst Day Since 2018
A fall of almost 18% was registered on Friday despite DELL reporting an increase in revenue for the first time in two years. Expectations were high thanks to the current AI boom, so while the $22.6bn profits were better than the $21.6bn predicted and a 6.3% rise from last year, it wasn’t enough to convince investors.
Profit per share worked out as $1.27, which was better than the $1.23 that had been estimated. Among the best-performing areas of the company, revenue from their AI servers was more than double the figure from last year, at $1.7bn. DELL also reported that a backlog for the machines has risen by over 30% on a quarter-by-quarter basis and now stands at $3.8bn.
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The collapsing share price came as a surprise not only because it followed these positive results. The share price tripled in value in the last year as investors looking to benefit from the surge in the AI market jumped on board one of the few companies capable of producing the powerful servers needed for AI tasks.
The personal computer side of its business produced revenue of $12bn with little change from last year’s numbers.
CFO Yvonne McGill said:
We again demonstrated our ability to execute and deliver strong cash flow, with AI continuing to drive new growth.
She also commented that they generated a cash flow of $7.98bn in the last year.
