There's a scene in Moneyball where Brad Pitt, playing Billy Beane, says something like: "Adapt or die." That's not the exact quote, but that's the gist. And it's exactly what Dell just pulled off in the face of a historic memory shortage that's grinding competitors into dust.
Let's get to the raw facts.
Dell reported adjusted earnings of $3.89 per share in the fiscal fourth quarter — while the "analyst consensus" (that crowd of people who miss more than they hit and still collect fat bonuses) was expecting $3.53. Revenue of $33.38 billion against an expectation of $31.73 billion.
Damn. Beat across the board.
But the number that nearly knocked the market out of its chair was the guidance: Dell projects revenue between $138 billion and $142 billion for fiscal 2027. FactSet was expecting $124.7 billion. This isn't "beating expectations." This is slapping consensus in the face and asking: "Any other questions?"
The bet that matters: AI servers
Dell expects revenue from artificial intelligence servers to hit $50 billion in 2027. Double the previous year. Read that again: double.
While half the world sits around debating whether AI is a bubble or not, whether ChatGPT is going to steal everyone's jobs, Dell is over there, quietly, building the infrastructure that makes the whole circus run. It's like that guy who doesn't show up to the party but owns the catering company serving all the food.
Memory chip manufacturers — and here we're talking about HBM (high-bandwidth memory), that turbocharged memory that Nvidia, AMD, and Google devour — are prioritizing AI demand. The result? Less memory left over for laptops and smartphones. Basic supply and demand. Adam Smith sends his regards.
The price of survival
Here's the part the "growth at all costs" crowd doesn't want to hear.
Dell already started raising PC prices last year. CFO David Kennedy said point-blank on the earnings call: the company priced to "offset" cost pressure. Translating from corporate-speak: "Yeah, we passed it on to the customer. So what?"
Jeff Clarke, Dell's COO, added that they're working with memory partners to be "as flexible and agile as possible." Diplomatic language for: "We're playing chess while everyone else is playing checkers."
Analyst Wamsi Mohan at Bank of America raised a legitimate concern: won't this aggressive price hike kill demand down the road? The classic price elasticity question. Even so, BofA maintained its buy recommendation and raised its price target from $135 to $155.
In other words: even the skeptics are buying. That says a lot.
Meanwhile, over at HP...
Want to see the other side of the coin? HP Inc. hit a 52-week low that same week. CFO Karen Parkhill revealed a terrifying data point: memory costs rose 100% sequentially and now represent 35% of a PC's material costs — double from a year ago.
HP is bleeding. Dell is surfing.
The difference? Execution. Positioning. Skin in the game.
It's the same old story Nassim Taleb never gets tired of repeating: in the long run, it's not the best PowerPoint that survives — it's whoever makes the hard calls at the right time. Raising prices is unpopular. Betting big on AI when the market is still questioning it is risky. But that's how you build asymmetry.
What does this mean for you?
If you've got Dell in your portfolio, congrats — but watch out for the euphoria of a +20% day. Buying after a gap that size without a strategy is like walking into a casino after watching someone else win at blackjack.
If you don't own it, the question is different: are you paying attention to who's building AI infrastructure, or are you hypnotized by the obvious names?
Buffett always said: in a gold rush, sell shovels.
Dell is selling $50 billion worth of shovels. So what are you buying?
