Dell Technologies Inc. (DELL) stock surged 35% on Friday. The computer and server manufacturer's share price skyrocketed following the release of explosive earnings, becoming the latest example of Wall Street's AI frenzy sweeping the market.
Dell reported late Thursday that its revenue for the first quarter of fiscal year 2027 increased 88% year-over-year to $43.8 billion. The company projected full-year revenue could reach as high as $169 billion, significantly exceeding analyst forecasts of $142 billion.
The Texas-based company saw revenue from its AI servers, which utilize products from chip giant Nvidia, soar 757% to $16.1 billion in the quarter.
"The AI opportunity shows no signs of slowing down," said Jeff Clarke, Vice Chairman and Chief Operating Officer of Dell.
Dell's stock hit an all-time intraday high of $429 on Friday, marking a single-day gain of 35%. The tech-heavy Nasdaq Composite Index is on track for an 8.5% gain in May, led by the semiconductor sector.
"The market is in a full-blown mania," said Mike O'Rourke of JonesTrading. "The valuation multiples the market is assigning to high-growth AI companies are at a crazy level... Investors believe this revenue growth will continue for many years."
Analysts at Bank of America described Dell's earnings report on Friday as "historic" and projected its stock price could rise as high as $500.
The excitement on Wall Street is widespread. The Philadelphia Semiconductor Index, which tracks 30 major U.S.-listed chip companies, is poised to record its largest annual gain since the dot-com bubble at the turn of the century.
Over the past 12 months, surging demand for memory chips has propelled share prices of SK Hynix, Micron Technology, and Samsung Electronics to gains of 1000%, 900%, and 470%, respectively.
Shares of Nvidia's competitors, AMD and Intel, have risen 350% and 490%, respectively, over the past year.
Earlier this week, Dell secured a $9.7 billion contract from the U.S. Department of Defense to streamline and integrate software procurement for the Department of Defense, intelligence agencies, and the Coast Guard.
Financial disclosures for former President Donald Trump in mid-May revealed he purchased between $1 million and $5 million worth of Dell stock on February 10. Since that date, the stock has accumulated a gain of approximately 225%.
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