Texas-headquartered Dell Technologies (DELL:NYSE) stock has been making strides since the end of the summer and investors will be anticipating a strong end to 2024 as its AI servers business ramps up activity. Next week’s quarterly earnings are a potential test of this confidence.

Dell is already a key manufacturer in tech infrastructure and that edge is being sharpened by strong demand for next generation of AI-powered servers. Chair and CEO Michael Dell recently tweeted that the world’s first Nvidia (NVDA:NASDAQ) liquid-cooled GB200 NVL72 server racks are now shipping. ‘The AI rocket just got a massive boost!’ he wrote.

Projections from Dell call for 48,000 AI servers to ship through 2025 featuring eight Nvidia GPU cores (graphics processing units) reflecting the firm’s expanding role in the AI market.

These shipments are expected to generate approximately $20.6 billion in AI server revenue, representing a 56% upward revision from earlier forecasts. AI servers are projected to account for nearly 20% of Dell’s revenue in fiscal 2026, analysts note, underscoring their significance as a key driver of growth.

Expect Dell to provide more detail next week, but also look out for gross margin hints, which could face pressure if higher manufacturing costs aren’t fully reflected in early pricing. 

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