Reported 4 months ago
Dell's profit margins were impacted by higher costs related to building servers for Artificial Intelligence workloads, leading to a forecast of lower-than-expected current-quarter profit and a decline in annual margin. The company's shares dropped over 17% in extended trading as Dell expects its adjusted gross margin rate to decrease by about 150 basis points in fiscal 2025. Despite strong demand for AI-capable products, Dell's competitors' pricing strategies in the market have contributed to the margin decline. Dell's revenue for the first quarter rose by 6% to $22.24 billion, with the company raising its revenue forecast for fiscal 2025.
Source: YAHOO