Dell did not, in fact, understand the assignment… 

Wall Street wanted fireworks. Dell gave them firepower. And somehow, the stock still got shot. More specifically, the company just put up a quarter most CEOs would kill for… beat earnings, beat revenue, doubled down on AI servers… and investors responded by yeeting the stock anyway. Shares sank more than 5% in after-hours, all because Q3 guidance came in a dime lighter than the Street’s fantasy model.

(Source: Giphy) 

In short, the numbers (the part traders pretend to care about before hitting “sell” anyway) are as follows: EPS: $2.32 adjusted vs. $2.30 expected Revenue: $29.78B vs. $29.17B expected Sales +19% YoY. Earnings +19% YoY. Servers and Networking revenue up 69%. Bigly. Clearly, on paper, this is Dell’s AI coronation. Management bragged they’ve already shipped $10B worth of AI solutions in the first half of FY26, blowing past their entire AI haul from last year. Now they’re guiding for $20B in AI server shipments for the year…double FY25.

But, but, but… like many disappointing wedding nights, Q3 guidance came soft. Dell expects $2.45 EPS, while the Street was looking for $2.55. Just ten pennies shy, but enough to wipe more than 5% off the stock in after-hours. 

(Source: CNBC) 

So why the poor guidance, you ask? Good question. For one, Dell’s Infrastructure Solutions Group (where all the sexy AI servers live) is cranking… $16.8B in sales, +44% YoY. However, the Client Solutions Group… aka PCs, laptops, printers, the boring stuff… managed just +1%. Meaning, investors still need Dell to be more than an AI server vending machine, and right now the consumer side is a dead weight.

With that said though, guidance for the full year was raised… now $9.55 EPS on $107B sales vs. $9.40 and $103B prior. So the business is tightening the bolts, but traders apparently only get off when something breaks. For more context on the situation, HP just reported too…with in-line EPS, sales better than expected, and AI PCs giving a boost. Shares popped 4.6%. On the other hand, Nvidia just reminded everyone this week that even perfect AI numbers can disappoint if they don’t levitate beyond Wall Street’s hallucinations. Dell’s now in the same penalty box.

(Source: Giphy) 

So yeah… that’s where we are at at the moment. Dell is making real money in AI… actual servers, shipped, installed, billed. But investors, drunk on “AI will fix everything,” punish anything that doesn’t outpace the fever dream. At some point, maybe building a $20B AI server business in one fiscal year should matter more than missing by a dime. But until then, Dell gets to eat its own cooking: build hype around AI, then deal with investors who expect infinity and beyond every quarter. What a time to be alive. Until next time, friends… 

At the time of publishing, Stocks.News holds positions in Dell Computers as mentioned in the article.