Revenue growth has accelerated to 57.7% year-over-year in Q2 FY2027, but gross margin has compressed to 20.9% from a 23.0% peak, suggesting the AI server mix is diluting profitability despite strong operating leverage.
Dell Technologies Inc. (DELL) annual income statement — 13-year revenue, gross profit & net income history
| Metric | TTM | Jan'26 | Jan'25 | Feb'24 | Feb'23 | Jan'22 | Jan'21 | Jan'20 | Jan'19 | Jan'18 | Jan'17 | Jan'16 | Jan'15 | Jan'14 |
|---|
| Sales/Revenue | 151.2B | 113.54B | 95.57B | 88.42B | 102.3B | 101.2B | 86.67B | 84.81B | 90.62B | 79.04B | 62.16B | 50.91B | 53.98B | 56.38B |
| Revenue Growth % | 49.22% | 18.8% | 8.08% | -13.56% | 1.09% | 16.76% | 2.19% | -6.41% | 14.65% | 27.15% | 22.1% | -5.68% | -4.25% | - |
| Cost of Goods Sold | 121.14B | 90.83B | 74.32B | 67.36B | 79.61B | 79.31B | 66.53B | 64.18B | 65.57B | 58.5B | 48.52B | 42.52B | 45.24B | 46.89B |
| COGS % of Revenue | - | 80% | 77.76% | 76.17% | 77.82% | 78.37% | 76.76% | 75.67% | 72.35% | 74.02% | 78.04% | 83.53% | 83.81% | 83.18% |
| Gross Profit | 30.06B | 22.71B | 21.25B | 21.07B | 22.69B | 21.89B | 20.14B | 20.64B | 25.05B | 20.54B | 13.65B | 8.39B | 8.74B | 9.48B |
| Gross Margin % | 19.88% | 20% | 22.24% | 23.83% | 22.18% | 21.63% | 23.24% | 24.33% | 27.65% | 25.98% | 21.96% | 16.47% | 16.19% | 16.82% |
| Gross Profit Growth % | - | 6.86% | 0.86% | -7.13% | 3.63% | 8.69% | -2.42% | -17.62% | 21.99% | 50.47% | 62.74% | -4.03% | -7.87% | - |
| Operating Expenses | 15.66B | 14.26B | 15.01B | 15.66B | 16.91B | 17.23B | 16.45B | 18.27B | 25.24B | 22.95B | 16.04B | 8.9B | 9.19B | 10.77B |
| OpEx % of Revenue | - | 12.56% | 15.71% | 17.71% | 16.53% | 17.03% | 18.99% | 21.54% | 27.86% | 29.04% | 25.8% | 17.48% | 17.02% | 19.09% |
| Selling, General & Admin | 11.9B | 11.12B | 11.95B | 12.34B | 13.77B | 14.56B | 14B | 15.82B | 20.64B | 18.57B | 13.4B | 7.85B | 8.27B | 8.91B |
| SG&A % of Revenue | - | 9.79% | 12.51% | 13.95% | 13.46% | 14.38% | 16.15% | 18.65% | 22.78% | 23.49% | 21.56% | 15.42% | 15.32% | 15.8% |
| Research & Development | 3.64B | 3.14B | 3.06B | 2.8B | 2.78B | 2.58B | 2.46B | 2.45B | 4.6B | 4.38B | 2.64B | 1.05B | 920M | 1.27B |
| R&D % of Revenue | - | 2.77% | 3.2% | 3.17% | 2.72% | 2.55% | 2.83% | 2.89% | 5.08% | 5.55% | 4.24% | 2.06% | 1.7% | 2.26% |
| Other Operating Expenses | 1000K | 0 | 0 | 522M | 363M | 98M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 586M |
| Operating Income | 14.39B | 8.45B | 6.24B | 5.41B | 5.77B | 4.66B | 3.69B | 2.37B | -191M | -2.42B | -2.39B | -514M | -448M | -1.28B |
| Operating Margin % | 9.52% | 7.44% | 6.53% | 6.12% | 5.64% | 4.6% | 4.25% | 2.79% | -0.21% | -3.06% | -3.84% | -1.01% | -0.83% | -2.27% |
| Operating Income Growth % | - | 35.42% | 15.27% | -6.24% | 23.87% | 26.43% | 55.75% | 1338.74% | 92.09% | -1.09% | -364.98% | -14.73% | 65% | - |
| EBITDA | 16.33B | 11.47B | 9.36B | 8.71B | 8.93B | 9.21B | 9.07B | 8.51B | 7.55B | 6.22B | 2.55B | 2.36B | 2.53B | 472M |
| EBITDA Margin % | 10.8% | 10.11% | 9.79% | 9.85% | 8.73% | 9.1% | 10.47% | 10.03% | 8.34% | 7.87% | 4.1% | 4.63% | 4.69% | 0.84% |
| EBITDA Growth % | 96.68% | 22.6% | 7.41% | -2.39% | -3.07% | 1.49% | 6.65% | 12.63% | 21.5% | 144.03% | 8.06% | -6.76% | 435.81% | - |
| D&A (Non-Cash Add-back) | 1.65B | 3.03B | 3.12B | 3.3B | 3.16B | 4.55B | 5.39B | 6.14B | 7.75B | 8.63B | 4.94B | 2.87B | 2.98B | 1.75B |
| EBIT | 14.75B | 8.82B | 6.46B | 5.59B | 4.51B | 7.46B | 4.4B | 2.35B | 258M | -2.25B | -2.35B | -584M | -408M | -644M |
| Net Interest Income | -455M | -1.28B | -1.25B | -1.17B | -1.18B | -1.48B | -1.9B | -2.3B | -2.31B | -2.31B | -1.69B | -663M | -760M | -351M |
| Interest Income | 388M | 279M | 160M | 329M | 100M | 62M | 148M | 99M | 313M | 207M | 102M | 39M | 47M | 0 |
| Interest Expense | 843M | 1.56B | 1.41B | 1.5B | 1.28B | 1.54B | 2.05B | 2.4B | 2.62B | 2.52B | 1.8B | 702M | 807M | 351M |
| Other Income/Expense | -573M | -1.18B | -1.19B | -1.32B | -2.55B | 1.26B | -1.34B | -2.42B | -2.17B | -2.35B | -2.1B | -772M | -767M | -402M |
| Pretax Income | 13.82B | 7.26B | 5.05B | 4.09B | 3.23B | 5.92B | 2.35B | -51M | -2.36B | -4.77B | -4.49B | -1.29B | -1.22B | -1.68B |
| Pretax Margin % | 9.14% | 6.4% | 5.28% | 4.62% | 3.15% | 5.85% | 2.71% | -0.06% | -2.61% | -6.03% | -7.23% | -2.53% | -2.25% | -2.98% |
| Income Tax | 2.44B | 1.33B | 472M | 715M | 803M | 981M | 101M | -572M | -180M | -1.84B | -1.42B | -118M | -107M | 23M |
| Effective Tax Rate % | 17.66% | 18.27% | 9.35% | 17.49% | 24.9% | 16.56% | 4.31% | 1121.57% | 7.62% | 38.65% | 31.6% | 9.18% | 8.81% | -1.37% |
| Net Income | 11.38B | 5.94B | 4.59B | 3.39B | 2.44B | 5.56B | 3.25B | 4.62B | -2.31B | -2.85B | -1.17B | -1.1B | -1.22B | -1.71B |
| Net Margin % | 7.53% | 5.23% | 4.81% | 3.83% | 2.39% | 5.5% | 3.75% | 5.44% | -2.55% | -3.6% | -1.88% | -2.17% | -2.26% | -3.02% |
| Net Income Growth % | 137.34% | 29.27% | 35.54% | 38.74% | -56.1% | 71.17% | -29.59% | 299.83% | 18.92% | -144.13% | -5.71% | 9.58% | 28.39% | - |
| Net Income (Continuing) | 11.38B | 5.94B | 4.58B | 3.37B | 2.42B | 4.94B | 2.25B | 521M | -2.18B | -2.93B | -3.07B | -1.17B | -1.11B | -1.71B |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 615M | 1B | 5.01B | 0 | 0 | 1.92B | 64M | -113M | 0 |
| Minority Interest | 0 | 0 | 95M | 95M | 97M | 105M | 5.07B | 4.73B | 4.82B | 5.77B | 5.77B | 0 | 0 | 0 |
| EPS (Diluted) | 17.45 | 8.68 | 6.38 | 4.60 | 3.24 | 7.02 | 4.22 | 6.03 | -2.96 | -3.70 | -1.62 | -1.54 | -1.70 | -4.22 |
| EPS Growth % | 153.38% | 36.05% | 38.7% | 41.98% | -53.85% | 66.35% | -30.02% | 303.72% | 20% | -128.4% | -5.19% | 9.41% | 59.72% | - |
| EPS (Basic) | - | 8.96 | 6.51 | 4.71 | 3.33 | 7.30 | 4.37 | 6.38 | -2.96 | -3.70 | -1.62 | -1.54 | -1.55 | -4.22 |
| Diluted Shares Outstanding | 652M | 683.87M | 724M | 736M | 753M | 791M | 767M | 751M | 719M | 718.43M | 718.43M | 718.43M | 718.43M | 404M |
| Basic Shares Outstanding | 645M | 662.69M | 696.13M | 736M | 734M | 762M | 744M | 724M | 719M | 770M | 718.43M | 718.43M | 718.43M | 403.95M |
| Dividend Payout Ratio | - | 24.58% | 27.77% | 31.64% | 39.48% | - | - | - | - | - | - | - | - | - |
Quick answers to the most common questions about buying DELL stock.
For fiscal year 2026, Dell Technologies Inc. (DELL) reported total revenue of $113.54B. This represents a 101.4% increase compared to $56.38B in 2014.
Dell Technologies Inc. (DELL) is profitable, generating $5.94B in net income for the fiscal year ending 2026 with a net profit margin of 5.2%.
Dell Technologies Inc. (DELL) reported an operating income of $8.45B, resulting in an operating profit margin of 7.4%. This margin reflects the operational efficiency of the business before interest and taxes.
Dell Technologies Inc. (DELL) generated $22.71B in gross profit for the year, representing a gross profit margin of 20.0%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
AI server mix diluting margins
Metrics are mathematically derived from official filings.
AI-Driven Revenue Surge Masks PC Cyclicality
Dell's revenue growth has accelerated dramatically, with Q2 FY2027 revenue of $47.0B representing a 57.7% year-over-year increase, driven by the Infrastructure Solutions Group's AI server backlog, while the Client Solutions Group faces a more mature PC refresh cycle.
The explosive growth trajectory, particularly the 87.5% year-over-year increase in Q1 FY2027, appears heavily weighted toward the ISG segment's AI server deployments, which are likely carrying lower gross margins than traditional storage. This creates a potential durability question: as the initial wave of AI infrastructure spending normalizes, Dell's growth rate may decelerate sharply unless the PC business experiences a concurrent cyclical upswing. The company's ability to sustain this pace hinges on converting its substantial AI backlog into recurring revenue streams through its APEX model.
Gross Margin Volatility Reflects Product Mix Shift
Dell's gross margin has exhibited significant volatility, ranging from 17.8% in Q1 FY2027 to 23.0% in Q4 FY2025, suggesting that the rapid influx of lower-margin AI servers is actively compressing the blended margin profile despite strong top-line growth.
The Q2 FY2027 gross margin of 20.9% represents a recovery from the prior quarter's trough but remains below the 23.0% peak seen in Q4 FY2025, indicating that favorable component pricing cycles are being offset by an unfavorable product mix. This margin behavior suggests Dell possesses limited pricing power in the commoditized AI server market, where competition from hyperscalers and white-box assemblers is intense. Investors should monitor whether the company can leverage its services and software attach rates to stabilize margins as the hardware mix evolves.
Operating Leverage Demonstrated at Scale
Dell's operating income grew 168% year-over-year in Q2 FY2027 to $5.4B, significantly outpacing the 57.7% revenue growth, indicating strong operating leverage as SG&A expenses remained relatively fixed at approximately 7% of revenue.
The expansion of operating margin from 4.3% in Q1 FY2025 to 11.5% in Q2 FY2027 demonstrates that Dell's cost structure is highly scalable, with incremental revenue flowing disproportionately to the bottom line. This leverage appears driven by disciplined overhead management rather than structural cost reductions, as absolute SG&A spending has remained in the $2.6B-$3.3B range across the period. The key question is whether this operating efficiency can be maintained as the business mix shifts toward lower-margin AI infrastructure, which may require higher support and integration costs.
Component Costs Dominate, R&D Investment Stable
Cost of goods sold consistently represents approximately 79-82% of revenue, confirming Dell's high-variable-cost model where DRAM, NAND, and CPU procurement directly dictates gross margin performance, while R&D spending has remained stable at 2.2-2.5% of revenue.
The stability of R&D spending at around $1.0B per quarter suggests Dell is maintaining its investment in software-defined infrastructure and APEX platform development without significant expansion, which may limit its ability to differentiate from pure-play competitors. The primary cost management lever appears to be component procurement timing and inventory positioning, as evidenced by the margin swings that correlate with memory pricing cycles. This cost structure leaves Dell vulnerable to supply chain disruptions and geopolitical risks in the semiconductor supply chain, particularly given its reliance on Asian ODMs for assembly.
Profitless Prosperity in AI Server Boom
The market may be overlooking that Dell's 57.7% revenue growth in Q2 FY2027 is likely driven by lower-margin AI servers, as evidenced by the gross margin compression from 23.0% to 20.9% over the past 18 months despite massive scale increases.
Short-sellers would focus on the disconnect between revenue growth and margin trajectory, arguing that Dell is capturing volume in a commoditized market while ceding profitability to hyperscale customers who negotiate aggressively on price. The Q2 FY2027 EPS miss of $6.34 versus the $6.56 estimate, despite strong revenue, suggests that cost pressures or mix headwinds are more significant than management's guidance implies. Furthermore, the company's substantial debt load from the EMC acquisition creates interest expense risk in a rising rate environment, potentially eroding the benefits of operating leverage.
AI Infrastructure Demand Creates Structural Shift
The period from Q4 FY2026 to Q2 FY2027 represents a clear inflection point where revenue growth accelerated from 40.2% to 57.7% year-over-year, driven by the AI server backlog converting to recognized revenue within the Infrastructure Solutions Group.
This inflection appears to be driven by a fundamental shift in enterprise IT spending priorities toward AI infrastructure, as evidenced by the simultaneous acceleration in revenue growth and the compression in gross margins. The lasting impact may be a permanent change in Dell's revenue mix, with ISG potentially becoming the dominant growth driver at the expense of the more stable but slower-growing PC business. However, this inflection also introduces new risks around customer concentration, as AI server deployments may be concentrated among a smaller number of large hyperscale customers.