Dell Technologies Expects To Sell $15B In AI Servers This Year Amid ‘Optimistic’ Outlook For 2025, COO Jeff Clarke Says

'These reasoning models will consume more computational capability. They’re moving to be multimodal, which even consumes more. I kind of like where this is going. We’re optimistic,' says Dell Technologies Vice Chairman and COO Jeff Clarke.

Dell Technologies Vice Chairman and COO Jeff Clarke said that the company is “optimistic” about AI adoption by cloud service providers and enterprises as it looks to the year ahead with a plan to sell $15 billion in AI servers alone in the coming fiscal year.

“These large-scale systems are accelerating and getting bigger. Models are quickly moving to reasoning models, which consume and require more computational capability, i.e., more computers,” Clarke told investors during the company’s recent fourth quarter 2025 earnings call. “These reasoning models will consume more computational capability. They’re moving to be multimodal, which even consumes more. I kind of like where this is going. We’re optimistic.”

Clarke said while “everybody” is pursuing cloud service providers and enterprise customers, Dell Technologies is winning those deals with its all-in-one approach that includes not just hardware, but set-up, services and financing. He said the lessons Dell learns as it stands up AI deployments with the “top 30 or so” cloud service providers helps Dell scale to the enterprise.

“We have a global service footprint, professional services can show up anywhere to solve any related problem or hands-on in these very large deployments with full-time teams,” he said. “Literally, they're 24/7 trying to get them up and running. I think about the financing capabilities that we have in our company and the ability to help these CSPs, these fast-growing companies grow at the rates they want with our financing capabilities.”

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Dell is already off to a fast start to meet its ambitious AI server growth sales projection with a 54 percent leap in server sales in the most recent quarter compared to the year ago period.

Dell’s overall revenue for the fiscal year ended February 2 was $95.6 billion for growth of 8 percent versus last year with net income of $4.57 billion. For the fourth quarter, Dell sales reached $23.9 billion for growth of 7 percent year over year. Net income for the quarter was $1.53 billion, a year-over-year increase of 27 percent.

The Round Rock, Texas-based company is telling Wall Street that in the coming fiscal year its total revenue will return to record territory with expected sales of between $101 billion and $105 billion.

As to the $15 billion in projected AI server sales this year, Clarke stressed that Dell is winning by helping customers deploy the large-scale AI clusters faster than competitors.

“We help these large-scale clusters get deployed faster than anybody else,” he said. “I'll remind you, I probably did last time as well, we were the first to bring to market a (Nvidia Blackwell) GB200 rack. That's not by luck. It's by a lot of hard work, detailed engineering, collaborating in this case with Nvidia and our customer to be able to take out every ounce of time and run at the speed of light, so to speak. So we’re going to continue to invest in that differentiation. We’re going to continue to make us stand out to be different.”

Below is a look at some of the insights Clarke shared related to the “optimistic” outlook for a year ahead including a look at server sales, storage sales and how Dell is mitigating the impact of tariffs.

Confident Server Refresh Will Fuel Growth

Clarke is confident that the ongoing refresh of servers will keep fueling Dell’s sales in the coming year

In fact, he said, Dell has a “very large” installed base of 13th and 14th generation Dell servers. He said those are “ripe to be replaced” with Dell releasing its 17th generation servers this year.

Clarke said a single 16th generation machine is capable of the work of three to four older devices, while Dell’s newest 17th generation server can replace six to seven of the older models.

“They have more cores. There’s more memory, more storage. They're more energy-efficient. And again, that continues, we believe, throughout the fiscal '26, calendar '25,” he said. “We've seen no signs that is going to go away from us in that period of time.”

Clarke’s optimism comes after a robust 54 percent growth in server sales to $27.1 billion during the last fiscal year. He said servers and networking revenue was a Q4 record at $6.6 billion, up 37 percent, with demand across both AI and traditional servers.

‘Significant Advancements’ To PowerStore

Clarke said the “significant advancements” Dell has made to PowerStore with PowerStore Prime is helping win deals in the midmarket, “the fastest growing” portion of the storage landscape.

Furthermore, Clarke said Dell introduced the PowerScale F910 and F710 in its unstructured portfolio, which is providing a boost to support unstructured and AI workloads.

Dell PowerStore sales were up double-digits in the fourth quarter. Overall storage revenue was up 5 percent to $4.7 billion, a second consecutive quarter of growth,

For the year storage growth was flat with $16.4 billion in sales for growth of 1 percent.

Dell still holds number one market positions across eight categories of storage including: external RAID enterprise storage with 24.9 percent share; high end raid storage, with a 38.2 percent share and midrange RAID storage with a 22 percent share.

Clarke said Dell is focused on pivoting to build its own storage IP, which improves profitability.

“We also saw double-digit demand growth in PowerScale, our leading unstructured storage platform, and continued growth in our buyer base with PowerFlex,” he said. “We are well positioned in some of the fastest-growing categories within storage as customers shift towards disaggregated architectures.”

Bullish On PC Refresh

While Clarke is bullish on the refresh, and able to cite several statistics that back up his confidence, Dell CFO Yvonne McGill said the company still sees PC growth of low- to mid-single digits in fiscal year 2026 and the bulk of that spend not happening until later in the fiscal year.

“We do expect to grow in the mid-single digits coming up for the year that's just begun with that refresh cycle that we're expecting to be more weighted towards the second half of the year,” she told investors.

Revenue for the fourth quarter in Dell’s PC business was up one percent to $11.9 billion, with $10 billion in sales coming via commercial sales, which grew 5 percent, McGill said.

The company saw “promising signs” in November and December with some large deals, but sales slowed down in January.

“As Jeff mentioned, we saw strength in small and medium business, which is historically a leading indicator. Profitability in commercial was weaker than expected as demand continued to push into the next fiscal year,” said McGill.

On the consumer side of PC “profitability remains challenged” with a soft demand environment, McGill said. Consumer sales were down 12 percent to $1.9 billion.

“We are ready and well positioned for a PC refresh with our simplified rebrand, leading go-to-market engine and focus on commercial PCs, the most profitable segments of the market,” she said.

Using AI To Mitigate Tariffs

Clarke said Dell Technologies is using AI modeling to mitigate the impact of tariffs. He called the current environment “pretty darn dynamic” and “fluid,” but he said Dell has built a digital twin of its supply chain and it is using that to model what could happen next and to minimize the impact of trade to its customers and shareholders.

“We’ve been monitoring this for some time. We've taken our digital supply chain, our digital twins actually using some AI modeling to look at every possible scenario that you might imagine of what might happen,” he told investors. “This country, that country, restrictions here, rates here, to help us understand how we optimize our network and how we do that in the least amount of time at the speed of Dell. And whatever tariff we cannot mitigate, we view that as an input cost and as our input costs go up, it may require us to adjust prices. That’s what we've done in the past. I can't imagine we're going to do anything differently.”

As one of the leading device makers in the world, Dell is a large supplier of products to the U.S. federal government. Clarke said while there is a shift in spending underway, the company believes the federal government will need more technology putting Dell in a position to capture that spend.

“We've had numerous times in our history where a country or a particular segment demand was suppressed for various reasons. We've been able to navigate the cycles, I think, pretty successfully. Our underlying belief is the United States government will need technology. AI plays a pretty significant role in our nation. And I think the demand will materialize. We'll get through whatever is happening today. And we have a broad business to be able to do that.”

The Year Ahead

McGill said IT spending is expected to grow this year based on three trends that Dell sees: organizations using AI as a competitive advantage, data center modernization and a PC refresh.

The resulting spend on Dell’s line of Infrastructure Solutions Group (ISG) and Client Solutions Group (CSG) products will lead to combined revenue growth with revenue of between $101 billion and $105 billion with a midpoint of $103 billion, up 8 percent.

Dell is targeting growth of 3 percent in the first quarter with revenues between $22.5 billion and $23.5 billion.

“We began a transformation to future-proof the company, focusing on supplying, automating and modernizing how we work,” McGill said. “And as we look forward, I'm excited about the sustainable growth we see and the value we will continue to deliver to our customers and our shareholders.”