DELL Gears Up to Report Q3 Earnings: Buy, Sell or Hold the Stock?

Dell Technologies DELL is scheduled to report its third-quarter fiscal 2026 results on Nov. 25, 2025.

For the third quarter of fiscal 2026, revenues are expected to be between $26.5 billion and $27.5 billion, with the mid-point of $27 billion suggesting 11% year-over-year growth. Non-GAAP earnings are expected to be $2.45 per share (+/- 10 cents), at the midpoint, indicating 11% growth year over year.

The Zacks Consensus Estimate for fiscal third-quarter revenues is pegged at $27.27 billion, suggesting 11.93% growth from the figure reported in the year-ago quarter.

The consensus mark for quarterly earnings is pegged at $2.48 per share, unchanged over the past 30 days and suggesting year-over-year growth of 15.35%.

Dell Technologies Inc. Price and EPS Surprise

Dell Technologies Inc. price-eps-surprise | Dell Technologies Inc. Quote

Dell Technologies’ earnings beat the Zacks Consensus Estimate in all the trailing three quarters, while missing the same in one quarter, with an earnings surprise of 0.21% on average.

Let’s see how things have shaped up for DELL shares prior to this announcement.

Key Factors to Note for DELL

Dell Technologies’ fiscal third-quarter results are expected to benefit from the robust demand for AI-optimized servers, driven by ongoing digital transformation and heightened interest in generative AI applications. 

In the fiscal third quarter, Dell Technologies anticipates 13% growth at the midpoint for the combined ISG and CSG, with ISG growing in the low-twenties and CSG growing in the mid-single digits.

The Zacks Consensus Estimate for DELL’s fiscal third-quarter 2026 ISG revenues is currently pegged at $13.884 billion, indicating 22% year-over-year growth. The consensus mark for CSG revenues is pegged at $12.654 billion, suggesting 4.3% year-over-year growth.

The growing AI market and Dell Technologies’ leadership in AI-optimized servers are expected to have been a tailwind in the to-be-reported quarter. The company shipped $8.2 billion in AI servers in the second quarter of fiscal 2026. The AI-optimized server momentum saw a $5.6 billion increase in orders.  The company’s AI backlog of $11.7 billion exiting the second quarter of fiscal 2026 and a growing opportunity pipeline further underscore the sustained demand for its solutions. 

However, Dell Technologies faces challenges from weaker demand for traditional servers and storage in North America, as well as slower federal spending, which does not bode well for its prospects. Fierce competition in a rapidly evolving tech landscape continues to put pressure on the company.

DELL Shares Underperform Sector, Industry

Year to date, Dell Technologies’ shares have risen 3.6% compared with the broader Zacks Computer & Technology sector’s return of 21.6%. The Zacks Computer - Micro Computers industry increased 6.6% in the same time frame.

However, Dell Technologies shares have outperformed its peer, Hewlett-Packard HPE, which is also expanding its footprint in the server space. Hewlett-Packard is benefiting from robust demand for its AI-optimized servers, resulting in significant revenue growth in its server segment. Hewlett-Packard shares have lost 3.5% in the year-to-date period.

DELL Stock Performance

DELL Shares Trading Cheap

Dell Technologies shares are cheap, as suggested by a Value Score of A.

Dell Technologies’ stock is trading at a significant discount with a forward 12-month P/S of 0.71X compared with the Computer and Technology sector’s 6.55X.

Price/Sales (F12M)

DELL Benefits From Expanding Clientele

DELL’s expanding partner base that includes the likes of NVIDIA NVDA, Microsoft MSFT, Meta Platforms, Advanced Micro Devices, and Imbue is likely to have driven growth during the fiscal third quarter.

DELL recently announced a partnership with IREN to supply racks of NVIDIA GB300 GPUs and data center equipment. This will also support IREN’s new collaboration with Microsoft. Under this agreement, IREN will give Microsoft access to NVIDIA GPUs for five years across four data centers in Texas. This move will strengthen Microsoft’s AI infrastructure and meet the growing demand for improved AI computing.

In October 2025, Dell Technologies announced advancements to its AI Data Platform, enhancing data integration, performance and scalability to accelerate enterprise AI outcomes through new storage, data engines and NVIDIA-powered innovations.

What Should Investors Do With DELL Stock?

Dell Technologies benefits from rising demand for AI-optimized servers and an expanding partner network. The company’s innovation in AI infrastructure and positive earnings outlook support long-term strength.

DELL currently has a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for a more favorable entry point to accumulate the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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