Dell shares fell 13% while HP dropped 9% in premarket trading today following the release of both companies latest quarterly results.
Industry experts claim that the PC makers’ latest forecasts are causing doubt about whether AI-enabled PCs can help drive a market recovery. Investors are concerned that the industry has yet to mass-adopt the newest technology.
Both companies benefitted from a boom earlier in the year, which saw Dell shares rise by 85% and HP increase by 30%. Since then, the market has slowed, however both companies remain positive that they can push future sales.
“We continued to build on our AI leadership and momentum, delivering combined ISG and CSG revenue of $23.5 billion, up 13% year over year,” said Yvonne McGill, Dell Technologies CFO. “Our continued focus on profitability resulted in EPS growth that outpaced revenue growth, and we again delivered strong cash performance.”
“AI is a robust opportunity for us with no signs of slowing down,” said Jeff Clarke COO of Dell Technologies, “Interest in our portfolio is at an all-time high, driving record AI server orders demand of $3.6 billion in Q3 and a pipeline that grew more than 50%, with growth across all customer types.”
Some analysts cautioned that a slow rollout of Nvidia’s next-generation AI chip could negatively impact Dell’s sales.
HP reported “fiscal 2024 net revenue of $53.6 billion, down 0.3% (down 0.2% in constant currency) from the prior-year period.”
“We are pleased with our Q4 performance where we saw revenue growth for the second consecutive quarter, driven by steady progress in Personal Systems and Print,” commented Enrique Lores, HP President and CEO. “With momentum heading into FY25, we are well-positioned to capitalize on the commercial opportunity and lead the future of work.”
For Dell and HP, the end of support for Windows 10 and the shift to Windows 11 were expected to increase new PC sales. However, the adoption of Windows 11 has been slower than expected.
By CEO NA Editorial Staff
