Dell Technologies Set to Report Q3 Earnings: What to Expect

Dell Technologies Inc. (NYSE: DELL) is scheduled to release its third-quarter earnings after the market close on November 26, 2024. Analysts are anticipating significant growth, with a consensus earnings per share estimate of $2.06, representing a 9.6% year-over-year increase. The average revenue estimate stands at $27.72 billion, a 10.9% increase over the last 12 months.

The company’s performance is expected to be bolstered by its involvement in artificial intelligence (AI) infrastructure, particularly with clients like Coreweave and Elon Musk‘s xAI. Morgan Stanley has reiterated its “overweight” rating and $154 price target for Dell, further indicating positive market sentiment.

Historically, Dell’s stock has shown a tendency to rise following earnings reports. Over the last eight post-earnings sessions, the stock has increased five times, including a notable 31.6% jump in March and a 4.3% increase in August. On average, the stock has moved 11.5% in either direction after earnings, though options traders are currently pricing in a slightly smaller move of 11.1% this time around.

As of the latest trading, Dell’s shares are down 0.6% at $143.26, but the company is on track for its fourth consecutive monthly gain and has seen its stock rise by 87.8% year to date. The shares had peaked at $179.21 in May before experiencing a decline, but have been rebounding recently, partly due to the struggles of competitor Super Micro Computer with accounting issues.

Dell’s emphasis on AI growth is a key area to watch, with AI-optimized server demand reaching $3.2 billion in Q2, a 23% increase from Q1. The backlog for these servers stood at $3.8 billion at the end of Q2, and the pipeline for AI solutions has expanded significantly, indicating strong future demand.