Dell Is Quietly Building The Backbone Of The AI Revolution — And Wall Street Hasn’t Noticed Yet!

Dell Technologies is undergoing a strategic transformation that could redefine its growth trajectory, as it aggressively scales its AI-optimized infrastructure portfolio. At the forefront of this shift is Dell’s Infrastructure Solutions Group (ISG), which saw a 44% year-over-year revenue surge in Q2 FY2026, driven primarily by soaring demand for AI servers. The company now projects over $20 billion in AI server sales in FY2026, up from just $10 billion in FY2025, with expectations of crossing the $25 billion threshold by FY2027. This pivot has already attracted marquee customers such as xAI, which placed a $5 billion order. While Dell’s legacy PC business stabilizes amid refresh cycles, its AI infrastructure operations are emerging as a potent long-term growth engine. Yet the market still values Dell at a steep discount—trading at 14.5x forward earnings versus the S&P 500’s 22x. This article examines the four key drivers shaping Dell’s outlook: the revenue upside from AI infrastructure, capital returns, valuation implications, and key execution risks.