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Dell’s stock has risen as much as Nvidia’s, but Dell’s profits haven’t

Dell has been one of the hottest AI stocks of the last year, but is it really benefiting from the AI boom?

5/16/24 2:02PM

Nvidia has been one of the biggest stock market winners over the last year, with the tech industry’s insatiable demand for AI chips sending its stock up 223%. However, another company has quietly gained 223% this year too: Dell.

Yesterday, Dell shares rose more than 11% after Morgan Stanley raised its price target and predicted the company would benefit from more demand for AI servers.

This comes two months after Nvidia CEO Jensen Huang highlighted the role that Dell is playing in the AI world, saying, “Everybody who is building these chatbots and generative AI, when you’re ready to run it, you’re going to need an AI factory. Nobody is better at building end-to-end systems of very large scale for the enterprise than Dell.”

Surprisingly, Dell’s financial performance hasn’t matched its stock returns.

Nvidia's ascension to the $2 trillion club coincided with the company growing its revenue and net income by 200% and 800%, since ChatGPT launched in November 2022.

Dell, on the other hand, has lower revenue than it did a year and a half ago, while its earnings have remained flat over the last three years. And Wall Street analysts don't expect operating performance to meaningfully inflect higher in the short term, either: estimates for where both revenues and profits will be in one year's time, if realized, would still leave results below their post-pandemic highs, per Bloomberg.

In Dell's Q4 earnings call, COO Jeffrey Clarke noted that they were seeing increased demand for their AI servers, noting, "AI-optimized server orders increased by nearly 40% sequentially. We shipped $800 million of AI-optimized servers, and our backlog nearly doubled sequentially, exiting the fiscal year at $2.9 billion."

However, that is still a small fraction of Dell's total $22.3 billion in total quarterly revenue, and it did little to slow an 11% drop in year-over-year sales.

Dell may be one of the winners of the AI boom, but so far, the stock has run far ahead of the business.

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J. Edward Moreno10h

FDA says it will take “decisive steps” against GLP-1 compounders, HHS refers Hims to DOJ for investigation

The Food and Drug Administration said it would take "decisive steps" to restrict GLP-1 compounding, a day after Hims & Hers announced that it would sell copies ofNovo Nordisk’sWegovy pill.

The FDA specifically called out Hims in the announcement. Additionally, Department of Health and Human Services' General Counsel Mike Stuart said in a post on X on Friday he has referred Hims to the Department of Justice "for investigation for potential violations by Hims of the Federal Food, Drug, and Cosmetic Act and applicable Title 18 provisions."

In a statement, Hims said the company "has always operated with a deep commitment to the safety and best interests of consumers and in compliance with applicable law."

"We have a long history of successfully working with regulators, and look forward to continuing to engage with the FDA to ensure safe access to affordable healthcare," they said.

Based on a review of the applicable facts, earlier today @HHSOGC referred Hims & Hers Health, Inc. (“Hims”) to the Department of Justice for investigation for potential violations by Hims of the Federal Food, Drug, and Cosmetic Act and applicable Title 18 provisions.
— HHS General Counsel Mike Stuart (@HHSGCMikeStuart) February 6, 2026

This marks a significant shift in tone from the FDA, which has done little to prevent companies like Hims from marketing copies of Novo's lucrative weight loss drugs.

Shares of Hims fell 14% after hours. The stock had already taken a hit after FDA Commissioner Marty Makary said in an X post on Thursday that the agency would “take swift action against companies mass-marketing illegal copycat drugs.”

Hims, long flying under regulators’ radar, finally strikes a nerve with its Wegovy pill copy

In a statement, Hims said the company "has always operated with a deep commitment to the safety and best interests of consumers and in compliance with applicable law."

"We have a long history of successfully working with regulators, and look forward to continuing to engage with the FDA to ensure safe access to affordable healthcare," they said.

Based on a review of the applicable facts, earlier today @HHSOGC referred Hims & Hers Health, Inc. (“Hims”) to the Department of Justice for investigation for potential violations by Hims of the Federal Food, Drug, and Cosmetic Act and applicable Title 18 provisions.
— HHS General Counsel Mike Stuart (@HHSGCMikeStuart) February 6, 2026

This marks a significant shift in tone from the FDA, which has done little to prevent companies like Hims from marketing copies of Novo's lucrative weight loss drugs.

Tasha Matsumoto

11h

Tech rebound propels stocks to best day since May

The S&P 500, Nasdaq 100, and Russell 2000 all climbed higher as the AI trade was back on.

Chicago Bulls Dennis Rodman (91) and Michael Jordan (23) in action, rebounding vs Charlotte Hornets

Max Knoblauch15h

Airlines rise, continuing their volatile 2026, as US-Iran talks may foreshadow some oil supply relief

Airline stocks are surging on Friday, as the market appears to be pricing in some medium-term oil pricing relief following talks between the US and Iran. Iranian officials referred to the meeting as “a good beginning.”

Shares of budget carriers, which have tighter margins and are more sensitive to fluctuations in fuel costs, are leading the surge. Frontier Airlines and Allegiant up more than 13%, while major airlines like United Airlines, American Airlines, and Delta Air Lines are also up at least 6%. JetBlue and Alaska Air are similarly up about 6%.

The market more broadly is rebounding on Friday, with the S&P 500 up 1.6% and bitcoin recovering some of this week’s losses.

Airlines have been volatile to start 2026 amid geopolitical tensions, varying annual forecasts, and the impact of winter storms.

Luke Kawa16h

The AI supply chain is soaring thanks to Amazon’s capex budget

If tech companies are going to spend way more than expected on capex, well, that means other companies are poised to benefit from that massive spending spree.

Amazon’s plan for $200 billion in business investment this year was the exclamation point to end a reporting period that saw every Magnificent 7 hyperscaler that provides guidance offer a 2026 capex budget well above what Wall Street had anticipated.

Here’s a look at the different parts of the supply chain that are soaring on the persistent demand for, and seeming scarcity of, AI compute:

Data center/neocloud companies: Applied Digital, CoreWeave, Cipher Mining, and Nebius, with some of these seemingly getting an extra lift from their legacy role as crypto miners.
Chips: the usual suspects — Nvidia, Broadcom, and Advanced Micro Devices.
Racks: Super Micro Computer, which is continuing its strong run following earnings, and Dell.
Power: Oklo, Nuscale, and Plug Power.

Big Tech capital expenditure soared in 2025. It’s going up another 50% in 2026.

Here’s a look at the different parts of the supply chain that are soaring on the persistent demand for, and seeming scarcity of, AI compute:

Data center/neocloud companies: Applied Digital, CoreWeave, Cipher Mining, and Nebius, with some of these seemingly getting an extra lift from their legacy role as crypto miners.
Chips: the usual suspects — Nvidia, Broadcom, and Advanced Micro Devices.
Racks: Super Micro Computer, which is continuing its strong run following earnings, and Dell.
Power: Oklo, Nuscale, and Plug Power.

Matt Phillips17h

For memory chips, the “parabolic price hike” is continuing to ramp higher

The remarkable run-up in prices for memory chips continued into early February, analysts at Bernstein Research say, driven largely by data center demand from hyperscalers and cloud service providers (CSP).

Prices for NAND flash memory wafers — a type of memory used in devices, as it retains data even when powered down — soared 35% between the end of 2025 and February 2.

Spot prices for DRAM — ubiquitous short-term data storage chips — jumped about 28% in that period. But that massively understates the remarkable shift in pricing for what were long seen as commodity tech hardware inputs. DRAM prices are more than 2,000% over the last year, while NAND prices are up more than 600% in that period.

The ongoing momentum provides still more support for memory chip plays like Micron and Sandisk, which have been big market winners in recent months.

In a note published earlier this week, Bernstein Research analysts wrote:

“The parabolic price hike continued in Jan. Indicated price increase for 1QCY26 is much stronger than we expected and we hence see upside to our near term memory pricing projection. Unrelenting CSP demand remained the main driver. PC and Mobile demand hasn’t been destroyed yet because of lean inventory & pull-forward purchase. Going forward price hike is expected to continue but likely at a slower rate, as PC and Mobile demand should contract meaningfully this year. Price however may stay elevated throughout this year, supported by CSP demand.”

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