We recently published Jim Cramer’s 20 Bold AI Predictions – See How They Played Out! Dell Technologies Inc. (NYSE:DELL) is one of the stocks Jim Cramer recently discussed.
Dell Technologies Inc. (NYSE:DELL) is a well-known hardware company that operates in the AI industry by providing companies with server equipment. Since Cramer commented on the firm in September 2024, the shares have gained 20.9%. However, the ride has been far from smooth. Dell Technologies Inc. (NYSE:DELL)’s shares fell by 12.3% in November as investors questioned the firm’s exposure to AI demand. The stock then lost 17% in February 2025 after its fourth quarter revenue and first quarter guidance both missed analyst estimates. Dell Technologies Inc. (NYSE:DELL)’s stock was hit by a 25% fall during April’s Liberation Day selloff, and after climbing 97% to its August peak, it is down by 7.6% since then. Here’s what Cramer said about Dell Technologies Inc. (NYSE:DELL) in September 2024:
“This story is all about Dell making servers for the data centers that power artificial intelligence, along with new lines of AI-infused PCs. Unfortunately, the numbers were somewhat confusing, but I think that Wall Street got this one right—at least initially—as the stock timely rallied more than 4% last Friday before giving back all those gains today. Yep, Dell’s still worth owning here, and I’m going to tell you why. Let’s start with the numbers: Dell delivered a meaningful revenue beat driven by 38% growth from its Infrastructure Solutions division. Much better than expected, mostly thanks to heavy investment in AI infrastructure by corporate clients. In fact, their server and networking sales were up 80% year-over-year.
“Dell’s other business, the Client Solutions Group, which includes the PC business, came in a little light, but not light enough to offset the strength in the infrastructure side. In the earnings release, Dell Vice Chairman and COO Jeff Clarke, an old hand, explained that “our AI momentum accelerated in Q2, and we’ve seen an increase in the number of enterprise customers buying AI solutions each quarter.” Notice the word “solutions”—I think that’s really important. It’s more than just a box. He added that AI-optimized server demand jumped by 23% compared to the previous quarter.
“Now, last time Dell reported, some investors didn’t like the margins from Dell’s infrastructure business. Long story short, their earlier AI hardware sales mainly came from selling servers to large hyperscalers—here we’re thinking about Alphabet, Amazon, Meta—and those companies can drive a hard bargain. Dell was confident that the margins would improve later on as they sold more networking and storage equipment along with services, but hardly anyone was willing to give them the benefit of the doubt. Except me, maybe. That’s because I saw that Jeff was with Jensen—of course, Jensen Huang, CEO of Nvidia—at the GTC conference I attended.”
While we acknowledge the risk and potential of DELL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DELL and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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