DELL Dell Technologies Inc.

Operator (Operator): Good afternoon, and welcome to the fiscal year 2026 second quarter financial results conference call for Dell Technologies Inc. I would like to inform all participants that this call is being recorded at the request of Dell Technologies. This broadcast is a copyright property of Dell Technologies Inc. Any rebroadcast of this information in whole or part without the prior written permission of Dell Technologies is prohibited. I will now turn the call over to Paul Frantz, Head of Investor Relations. Mr. Frantz, you may begin. Paul Frantz (Head of Investor Relations): Thanks, everyone, for joining us. With me today are Jeff Clarke, Yvonne McGill, and Tyler Johnson. Our earnings materials are available on our IR website, and I encourage you to review these materials. Also, please take time to review the presentation, which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial measures refer to non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating income, net income, diluted earnings per share, free cash flow, and adjusted free cash flow. A reconciliation of these measures to their most directly comparable GAAP measures can be found in our web deck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that relate to future results and events are forward-looking statements based on current expectations. Actual results and events could differ materially from those projected due to a number of risks and uncertainties, which are discussed in our web deck and our SEC filings. We assume no obligation to update our forward-looking statements. Now I'll turn it over to Jeff. Jeffrey W. Clarke (CEO): Thanks, Paul, and thanks, everyone, for joining us. We had a strong operational execution in the second quarter with record AI shipments. Our revenue was a record $29.8 billion, up 19%. ISG and CSG were up 22%. Earnings per share increased by 19% to $2.32, marking a Q2 record. Our modernization work continues to enable internal efficiencies, driving decoupling of revenue growth and operational expenses, which were down 4% while continuing to invest in R&D. This strong performance resulted in another quarter of robust cash generation and significant capital returns to shareholders. Now let's move to AI, which remains a significant tailwind. We continue to see strong demand for AI servers, building on the exceptional demand observed in Q1. We booked $5.6 billion in orders in the second quarter and shipped a record $8.2 billion, resulting in an ending backlog of $11.7 billion. For context, we have shipped more AI servers in the first half of this year than all of last. Our 5-quarter pipeline continued to grow sequentially with double-digit growth across enterprise and sovereign opportunities. Our pipeline remains multiples of our backlog. Enterprise orders and our buyer base grew sequentially in Q2, distributed across various industries such as financial services, health care, and manufacturing. And we're seeing strong enterprise interest in our new NVIDIA RTX Pro 6000 AI Factory solutions. These turnkey solutions provide the performance, flexibility, and power efficiency enterprises need to manage the entire AI lifecycle at any scale with air-cooled and PCIe options available. As I mentioned last quarter, our execution in AI continues to be a key differentiator. We are innovating at an unprecedented pace, engineering at scale solutions for customers while remaining agile to rapidly changing customer roadmaps and architectures. We were the first in the world to ship both the NVIDIA GB200 NVL72 solution last year and the GB300 NVL72 in July to CoreWeave, two great examples of our speed to market in an environment where speed matters. Customers are seeing real-time the value in our ability to deploy large-scale clusters quickly and reliably. Our execution, value-add through engineering, and ability to Dell design and even Dell manufacture components within our at-scale data center solutions drive margin rate improvement within AI. In traditional servers, revenue grew again. We now have six consecutive quarters of year-over-year P&L growth. From a demand perspective, international markets grew, but the April weakness we saw in North America continued. TRUs grew double digits as customers prioritize richly configured servers given their focus on density and power efficiency driven by a higher mix of our 16th generation servers. We have completed the launch of our 17th generation portfolio of servers designed for ultimate performance, reliability, and security, giving customers the ability to consolidate workloads to make room for AI and to drive broader data center efficiencies. There's still significant opportunity ahead as over 70% of the installed base is run ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Please standby. Afternoon. And welcome to the Fiscal Year 2026 First Quarter Financial Results Conference Call for Dell Technologies Inc. I'd like to inform all participants this call is being recorded at the request of Dell Technologies. This broadcast is the copyrighted property of Dell Technologies Inc. Any rebroadcast of this information in whole or part without the prior written permission of Dell Technologies is prohibited. Following prepared remarks, we will conduct a question and answer session. If you have a question, simply press star then one on your telephone keypad at any time during the presentation. I'd like to turn the call over to Paul Frantz, Head of Investor Relations. Mister Frantz, you may begin. Paul Frantz (Head of Investor Relations): Thanks everyone for joining us. With me today are Jeff Clarke, Yvonne McGill, and Tyler Johnson. Our earnings materials are available on our IR website and I encourage you to review these materials. Also, please take some time to review the presentation, which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial measures refer to non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating income, net income, that lead to earnings per share, free cash flow, and adjusted free cash flow. A reconciliation of these measures to their most directly comparable GAAP measures can be found in our web deck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that relate to future results and events are forward-looking statements based on current expectations. Actual results and events could differ materially from those projected due to a number of risks and uncertainties which are discussed in our web deck and our SEC filings. We assume no obligation to update our forward-looking statements. Now I'll turn it over to Jeff. Jeff Clarke (CEO): Thanks, Paul, and thanks, everyone, for joining us. This quarter, we executed very well, achieving growth across our core markets and experiencing unprecedented demand for our AI-optimized servers. Our revenue reached $23.4 billion, up 5%, driven by growth across all of our core markets. ISG and CSG were up 8%. Earnings per share increased by 17% to $1.55, growing three times faster than revenue. This resulted in a record cash generation for the first quarter, and shareholder returns exceeding $2 billion. Turning to AI, we experienced exceptionally strong demand for AI-optimized servers, building on the momentum discussed in February and further demonstrating that our differentiation is winning in the marketplace. We booked $12.1 billion in orders in the first quarter, surpassing the entirety of shipments in all of FY 2025. We shipped $1.8 billion, leaving us with a backlog of $400 million. Our five-quarter pipeline continued to grow sequentially, across both tier two CSPs and private and public enterprise customers, and remains multiples of our backlog. Enterprise AI customers grew again sequentially, with good representation across key industry verticals including WebTech, financial services industry, manufacturing, media and entertainment, and education. AI momentum continues to remain strong. That said, given the scale of these opportunities, their ability and timing, and choices around technology, the inherent nonlinear nature of demand and associated shipments is likely to persist. This quarter is a clear indicator Dell offering resonates with customers. We are innovating at breakneck speed, designing bespoke custom solutions for customers while being agile to respond quickly to evolving next-generation architectures. Our ecosystem in this space is unmatched, with key partners such as NVIDIA, AMD, Hugging Face, Cohere, Meta, Mistral, and Google, and so many others. Our execution continues to be a key differentiator. We built a strong reputation for deploying large-scale clusters quickly and reliably, significantly reducing the time to first token and accelerating time to value for our customers. Beyond deployment, we provide ongoing comprehensive support, including managed services that ensure systems reliability and performance in customer data centers. And finally, our ability to offer flexible financing solutions enables customers to scale their AI infrastructure with confidence and efficiency. Looking ahead, we remain focused on expanding our leadership in this space by continuing to invest in innovation, deepening customer partnerships, and delivering the infrastructure and software solutions within our AI factories that will power the next wave of AI transformation. Yvonne McGill (CFO): Thanks, Jeff. Let me begin with an overview of our Q1 performance, then I'll move to ISG, CSG, cash, and guidance. In the first quarter, we saw continued P&L growth ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Good afternoon and welcome to the Fiscal Year 2025 Fourth Quarter Financial Results Conference Call for Dell Technologies Inc. I would like to inform all participants that this call is being recorded at the request of Dell Technologies. This broadcast is a copyrighted property of Dell Technologies Inc. Any rebroadcast of this information in whole or part without the prior written permission of Dell Technologies is prohibited. I would like to turn the call over to Paul Frantz, Head of Investor Relations. Mr. Frantz, you may begin. Paul Frantz (Head of Investor Relations): Thanks, everyone, for joining us. With me today are Jeff Clarke, Yvonne McGill and Tyler Johnson. Our earnings materials are available on our IR website, and I encourage you to review those materials. Also, please take some time to review the presentation, which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial metrics refer to GAAP financial measures, including non-GAAP gross margin, operating expenses, operating income, net income, diluted earnings per share, free cash flow and adjusted free cash flow. A reconciliation of these measures to the most directly comparable GAAP measures can be found in our web deck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that relate to future results and events are forward-looking statements based on current expectations. Actual results and events could differ materially from those projected due to a number of risks and uncertainties, which are discussed in our web deck and SEC filings. We assume no obligation to update our forward-looking statements. Now I'll turn it over to Jeff. Jeff Clarke (CEO): Thanks, Paul, and thanks, everyone, for joining us. I am proud of the team's execution this year. We navigated an incredibly dynamic AI environment and accelerating server consolidation, a significant pivot to Dell IP storage and a lagging PC refresh and delivered results above our long-term value-creation framework. We grew our company while reducing our operating expenditures over the course of the year. Our modernization has made us more efficient and provided us the ability to invest more in innovation and in areas of strategic differentiation. Our FY '25 revenue was $95.6 billion, up 8%, with operating income of $8.5 billion. OpEx was reduced by 4% over the course of the year. This resulted in record EPS of $8.14, up 10%, and cash flow of $4.5 billion. We continue to differentiate ourselves with consistent performance through numerous economic cycles, different technology buying and adoption cycles and our rapidly innovating technology ecosystem. Some examples of the innovation from this past year. We added five platforms to our AI-optimized portfolio, including support of the oil architectures, the highlight being the PowerEdge XE9712 supporting NVIDIA's NVL72 GB200, which we were the first to ship in the world. We launched the Dell Infrastructure Rack Sobel system, our IR7000 and 5000 in both 21-inch and 19-inch versions, providing up to 96 GPUs in a rack and 786 GPUs in a scalable unit. We have made significant advancements of CPUs, cold plates metals and power distribution with our IR7000 supporting up to 480 kilowatts per rep. We introduced our direct-to-chip liquid cooling version of the 9680, providing 33% density improvement and 2.5 times improvement in energy efficiency. We made significant advancements to PowerStore with PowerStore Prime, our mid-range storage solution addressing the fastest-growing portion of the market. And we introduced the PowerScale F910 and F710 in our unstructured portfolio that is prime to support unstructured and AI workloads. We introduced the most Copilot+ PCs powered by ARM-based Qualcomm Snapdragon processors and also launched the broadest portfolio of Intel Meteor Lake commercial PCs, furthering our number one leadership position in commercial AI PCs worldwide. We continued our number one leadership in PC monitors with the world's first 4k monitors to achieve 5-star Eye Comfort certification. focused on expanding our peripherals portfolio selling everything around the PC docking stations, cameras, mice, keyboards and headsets, including the first and only holistic solution to manage your fleet of PCs and peripherals remotely, creating the best possible customer experience. And finally, we simplified our branding, redesigned our PC portfolio and broadened our silicon options across Intel, AMD and Qualcomm, setting us up well for the PC refresh. We are extremely well positioned to capture growth across every segment of our business and extend AI from the largest at-scale CSPs to enterprise workloads and out to the edge with the PC. These tailwinds and our unique operating model that leverages our leading product positio ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Ladies and gentlemen, good afternoon, and welcome to the Fiscal Year 2025 Third Quarter Financial Results Conference Call for Dell Technologies Inc. I want to let all participants know that this call is being recorded at the request of Dell Technologies. This broadcast is a copyrighted property of Dell Technologies Inc. Any rebroadcast of this information in whole or in part without prior written permission from Dell Technologies is not allowed. After the prepared remarks, we will have a question-and-answer session. Now, I will hand the call over to Paul Frantz, Head of Investor Relations. Mr. Frantz, you may begin. Paul Frantz (Head of Investor Relations): Thanks everyone for joining us. With me today are Jeff Clarke, Yvonne McGill, and Tyler Johnson. Our earnings materials are available on our IR website and I encourage you to review these materials. Also, please take some time to view the presentation which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial measures refer to non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating income, net income, diluted earnings per share, free cash flow, and adjusted free cash flow. A reconciliation of these measures to their most directly comparable GAAP measures can be found in our webdeck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that relate to future results and events are forward-looking statements, based on current expectations. Actual results and events could differ materially from those projected due to a number of risks and uncertainties, which are discussed in our webdeck and our SEC filings. We assume no obligation to update our forward-looking statements. Now, I'll turn it over to Jeff. Jeff Clarke (CEO): Thanks, Paul, and thanks everyone for joining us. We continued to execute well and delivered strong performance in Q3. Revenue was $24.4 billion, up 10%, on strong ISG revenue growth. Diluted EPS was $2.15, up 14%, and cash flow from operations was $1.6 billion. Our focus on balanced profitability paid off, with improved operating income, earnings per share, and cash flow. We're proud of the fact that year-to-date, our team has delivered 10% revenue growth in ISG and CSG combined and overall EPS of $5.31. In ISG, our AI server momentum continued, and we saw substantial expansion in our five quarter pipeline. Orders demand was a record $3.6 billion, up 11% sequentially, primarily driven by Tier 2 cloud service providers with continued growth in Enterprise customers. We have seen sequential orders demand growth every quarter since the launch of the XE9680. We shipped $2.9 billion of AI servers in Q3, resulting in AI server backlog of $4.5 billion. Our five quarter pipeline grew more than 50% sequentially with growth across all customer types. We continue to gain traction with Enterprise customers, large and small, with over 2,000 unique Enterprise customers since launch. Increasingly, Enterprises see the disruptive nature and the innovation opportunities with GenAI resulting in growing GenAI experimentation and proof-of-concepts. Underpinning our success is broad enterprise coverage, professional services, engineering leadership, and large-scale system design, all done with incredible speed and time to market. These highly specialized workloads and deployments require high-value engineering and a solutions mindset where custom designs and fast deployments are the norm. Beyond the AI servers, we like the profit pools that surround them, like power management and distribution, cooling solutions, network switches, network cables, optics, storage, deployment, maintenance, professional services and financial services. We have accelerated the speed of innovation to respond to our customers' GenAI needs over the past year. A few highlights from the past two months. We launched our 21-inch ORv3 Integrated Rack 7000, in both a 44 and 50 OU rack design with integrated cooling, power and networking that is multi-generational and future-proofed up to 480 kilowatts per rack. This rack falls in our Integrated Rack Scaleable Solutions, which are focused on at-scale deployment ensuring Dell's AI Factories can meet the demands of foundational training at the Data Center scale. We are shipping the industry's first enterprise ready GB200 NVL72 server racks with our new XE9712, with direct liquid cooling that holds up to 72 GPUs per rack. We also announced at SuperCompute 24, a new AI server supporting NVL-4, also with liquid cooling, supporting up to 144 GPUs per rack, one of the industry's most dense designs. And we have the M7725, a dense compute design, which supports up to 27,000 CPU cores per rack to meet high-performance computing demands. Our IR5000 can achieve up to 96 GPUs per rack ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Good afternoon, and welcome to the Fiscal Year 2025 Second Quarter Financial Results Conference Call for Dell Technologies, Inc. I would like to inform all participants that this call is being recorded at the request of Dell Technologies. This broadcast is the copyrighted property of Dell Technologies, Inc. Any rebroadcasting of this information in whole or in part without prior written permission from Dell Technologies is prohibited. After the prepared remarks, we will have a question-and-answer session. I would like to turn the call over to Rob Williams, Head of Investor Relations. Mr. Williams, you may begin. Rob Williams (Head of Investor Relations): Thanks, everyone, for joining us. With me today are Jeff Clarke, Yvonne McGill and Tyler Johnson. Our earnings materials are available on our IR website, and I encourage you to review these materials and the presentation, which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial measures refer to non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating income, net income, diluted earnings per share and adjusted free cash flow. A reconciliation of these measures to their most directly comparable GAAP measures can be found in our web deck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that relate to future results and events are forward-looking statements based on current expectations. Actual results and events could differ materially from those projected due to a number of risks and uncertainties, which are discussed in our web deck and our SEC filings. We assume no obligation to update our forward-looking statements. Now, I'll turn it over to Jeff. Jeff Clarke (CEO): Thanks, Rob, and thanks everyone for joining us. We executed well in Q2, and I'm really proud of our team and our performance. Revenue was $25 billion, up 9%, with another record for our servers and networking business. Diluted EPS was $1.89, up 9%, and cash-flow from operations was $1.3 billion. Our AI momentum accelerated in Q2 and our results and outlook demonstrate that we are uniquely positioned to help customers leverage the benefits of artificial intelligence. In ISG, our AI server orders and shipments increased again sequentially. Our unique capability to deliver leading-edge air and liquid cooled AI servers, networking and storage tuned and optimized for maximum performance at the node and rack level combined with leading ecosystem partners and world-class services and support continues to resonate with customers. Orders demand was $3.2 billion, primarily driven by Tier-2 cloud service providers. Encouragingly, we continue to see an increase in the number of enterprise customers buying AI solutions each quarter. Enterprise remains a significant opportunity for us as many are still in the early stages of AI adoption. We are also excited about the emerging sovereign AI opportunity, which plays to our strengths given our position with governments around the world. We shipped $3.1 billion of AI servers in Q2. As we exited the quarter, our AI server backlog remains healthy at $3.8 billion. Most exciting, our AI server pipeline expanded across both Tier-2 CSPs and enterprise customers again in Q2, and now has grown to several multiples of our backlog. As we begin the second-half of the year, we have optimized our sales coverage to better focus on AI opportunities across CSPs, and both large and small customer segments and geographies. In addition, we have added substantial engineering capabilities, including data center networking and design to support these AI pursuits. Traditional server demand continues to improve and we saw strong demand again in Q2, our third consecutive quarter of growth and our fifth consecutive quarter sequentially as customers invest in both traditional and AI infrastructure. Dell IP core storage demand, including PowerMax, PowerScale, PowerStore and PowerProtect Data Domain grew double-digits in the quarter, a positive sign as we move into the second-half of the year. In CSG, we saw modest commercial PC demand growth in the quarter with healthy operating profitability and we expect growth in the second half of the year. In CSG, we continue to pursue profitable share focusing on commercial PCs, high-end consumer and gaming with our strong attach motion. We are optimistic about the coming PC refresh cycle, as the installed base continues to age, Windows 10 reaches end-of-life later next year and the significant advancements in AI-enabled architectures and applications continue. In closing, we are leveraging our strengths to extend our leadership positions and lean into new opportunities like AI. We are offering customers choice, flexibility and control of how and where they build, train and ... [transcript truncated at 5,000 chars — full text available via API]