Dell Sees Higher Profits Following Strong Demand For Its Nvidia-Powered AI Servers

Dell Technologies declared higher forecasts on Thursday, following a surge in demand for its Nvidia-powered AI servers.

The new Dell servers pose real power as they have been engineered to handle complex AI systems, along with intensive computational demands.

According to MarketWatch, the price per share of the company's stock was at $114.53 at 2:03 p.m. EDT Friday, which showed an increase by 3.42%.

The infrastructure group of Dell, including its servers, saw a surge in revenues. In the second quarter alone, it hit $11.65 billion.

"Enterprise remains a significant opportunity for us, as many are still in the early stages of AI adoption," Dell COO Jeff Clarke said during a post-earnings call.

On Wednesday, Nvidia revealed that countries turn to their powerful chips as they try to build their AI models in their own languages. It also noted that such an endeavor would contribute billions to its revenue in its economic year.

Just this year, the stock of Dell has already risen by 45% and the demand for the company's AI servers has risen by about 23%.

Although the demand for the company's AI servers increased exponentially, one aspect of its business struggled. Dell's PC business has slowly been losing to its rivals in terms of market share.

However, AI PCs are expected to get a renewed boost next year, when Microsoft is scheduled to end its support for Windows 10.

"Dell lost PC shipment shares in key markets in the second quarter," said Mikako Kitagawa, director of analyst at Gartner. "It is the top vendor in the U.S. business market, but its competitors have shown growth and gained more shares than they did a year ago."