Analyst(s): Futurum Research
Publication Date: September 9, 2026
Dell Technologies’ Q2 FY 2027 earnings show AI server demand reshaping its infrastructure business, while PCs and storage also contributed to the quarter. The results point to a larger FY 2027 opportunity as Dell converts backlog into revenue and manages supply constraints across AI systems.
What Is Covered in This Article:
- Dell Technologies’ Q2 FY 2027 financial results
- AI server backlog and order strength
- Traditional server and networking pull-through
- Storage attach and Lightning progress
- Guidance and Final Thoughts
The News: Dell Technologies (NYSE: DELL) reported Q2 FY 2027 revenue of $46.97 billion, up 58% year-over-year (YoY), compared with Wall Street consensus of $44.78 billion. Infrastructure Solutions Group (ISG) revenue was $31.78 billion, up 89% YoY, including AI-optimized server revenue of $16.40 billion (+100% YoY), traditional servers and networking revenue of $10.53 billion (+122% YoY), and storage revenue of $4.85 billion (+26% YoY). Client Solutions Group (CSG) revenue was $15.03 billion, up 20% YoY, with commercial revenue of $13.19 billion (+22% YoY) and consumer revenue of $1.84 billion (+7% YoY). Non-GAAP operating income was $5.93 billion, up from $2.28 billion YoY. Non-GAAP operating income margin expanded from 7.7% in Q2 FY 2026 to 12.6% in Q2 FY 2027. Non-GAAP diluted earnings per share was $7.04, compared with $2.32 YoY and Wall Street consensus of $4.90.
“Over the past 12 months, we have booked more than $130 billion in AI server orders,” said Jeff Clarke, vice chairman and chief operating officer of Dell Technologies. “In just the past two quarters, we have generated almost as much revenue from traditional servers and networking as we have in any prior full year in company history.”
Dell Technologies Q2 FY 2027: AI Orders Fuel Server and Storage Growth
Analyst Take: Dell Technologies’ Q2 FY 2027 results show that AI infrastructure demand is expanding across more of its portfolio than AI-optimized servers alone. The quarter also shows the operating model benefit of scale, with Q2 operating expenses standing at 8.5% of revenue, while Dell expects the full-year FY 2027 rate to be approximately 8%, the lowest in its 42-year history. Supply availability remains the main constraint, but Dell’s guidance implies better second-half visibility than it had earlier in the year.
AI Server Orders Create Revenue Visibility
Dell’s AI server business continues to build forward visibility through orders and backlog rather than one-quarter revenue alone. The company booked $60.9 billion in AI server orders during Q2 FY 2027 and exited the quarter with $95 billion in AI server backlog. Over the past 12 months, AI server orders exceeded $130 billion, which gives Dell a longer conversion runway if supply remains available. Customer demand includes CoreWeave, Nscale Global Holdings, corporate clients, and major AI providers, showing demand across cloud-native AI builders and enterprise buyers. The scale of the backlog also gives Dell more room to plan component procurement, rack integration, and delivery sequencing. Dell’s AI server business now has enough order depth to shape FY 2027 revenue cadence rather than simply respond to quarterly demand.
Traditional Servers and Networking Benefit from AI Adjacency
Traditional servers and networking are benefiting as AI infrastructure deployments require more than GPU-heavy systems. Revenue in traditional servers and networking reached $10.53 billion in Q2 FY 2027, up 122% YoY, supported by renewed demand for central processing unit (CPU)-based systems tied to AI agent management and adjacent workloads. The company generated nearly as much traditional server and networking revenue in the past two quarters as in any prior full year. That matters because it reduces Dell’s dependence on only one AI hardware configuration. AI deployments still require orchestration, management, storage access, networking capacity, and enterprise integration around the accelerator layer. The broader server mix gives Dell a stronger path to capture enterprise AI budgets that extend beyond accelerated compute.
Storage Pull-Through Expands the AI Infrastructure Opportunity
Storage performance shows Dell can attach more infrastructure to AI and enterprise server demand. Storage revenue reached $4.85 billion in Q2 FY 2027, up 26% YoY, supported by more profitable storage system sales and a more focused product portfolio. Dell’s Lightning parallel file system remains early, but it is in beta at several customers and is being tested against competing offerings. That product matters because native AI workloads require file systems that can support model training, inference, and data-intensive workflows. Stronger storage attach can also improve the economic profile of AI infrastructure deals by increasing account-level breadth. Dell’s storage progress gives the company a second monetization path as customers move AI projects into production environments.
Guidance and Final Thoughts
Dell guided Q3 FY 2027 revenue to $48.5 billion to $49.5 billion, well above Wall Street consensus of $41.91 billion, with adjusted EPS expected at $6.40 to $6.60. The company also raised its FY 2027 revenue outlook by $25 billion to approximately $192 billion, above consensus of $173.8 billion. FY 2027 AI-optimized server revenue is now expected to reach $74 billion, representing a threefold increase from the prior year, while non-GAAP diluted EPS is expected to reach $25.50, compared with consensus of $19.10. The magnitude of the increase shifts the focus from demand generation toward Dell’s ability to fulfill its expanding order book.
Dell’s opportunity is broadening as AI deployments create pull-through across traditional servers, networking, storage, and supporting infrastructure rather than remaining concentrated in accelerator-heavy systems. The $95 billion AI server backlog provides substantial revenue visibility, but it also raises the importance of procurement and deployment execution as constraints extend across semiconductors, substrates, optics, cooling, and power infrastructure. Greater storage attachment and continued strength in traditional servers could improve the breadth of revenue captured from each AI deployment as workloads move into production. If Dell can secure enough critical components to convert its backlog on schedule while increasing infrastructure pull-through around AI servers, then FY 2027 could establish a larger and more diversified AI infrastructure growth base.
See the full press release on Dell Technologies’ Q2 FY 2027 financial results on the company website.
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