Dell Technologies Positioned to Benefit From AI Infrastructure Spending Cycle, RBC Says

10:48 AM EDT, 09/11/2026 (MT Newswires) -- Dell Technologies (DELL) is well positioned to benefit from the multi-year artificial intelligence infrastructure spending cycle, which should help the computer maker to sustain results above long-term targets, RBC Capital Markets said in a client note emailed Friday. The brokerage initiated its coverage of Dell with an outperform rating and a price target of $640. The company's shares gained 11% in Friday trade. The stock has gained 347% so far this year. Earlier this month, Dell lifted its full-year outlook and reported stronger-than-expected second-quarter results amid record AI server demand. The company ended its fiscal second quarter with an AI server backlog of $95 billion and a continuously growing pipeline, despite converting about $132 billion into orders for the last 12 months, RBC analyst David Paige wrote in the note. The brokerage sees the current environment as constrained mainly by memory supplies rather than demand, and expects "meaningful" backlog to continue through fiscal 2027, providing visibility into the following fiscal year. "Enterprise demand for AI investments, compute modernization, storage expansion and PC refresh should sustain results above long-term targets," Paige wrote. Dell's portfolio across compute, personal computers, storage and servers should allow it to continue gaining market share, while its full-stack capabilities combined with key partnerships put it in a position to capture enterprise demand for turnkey AI infrastructure, RBC said. The brokerage believes the company's proprietary storage portfolio is a "direct" profitability generator for its infrastructure solutions group, given that it carries structurally higher margins versus third-party or legacy solutions. "We expect storage margins to expand as Dell IP mix rises, with the legacy transition largely complete by year-end," Paige said. The emergence of agentic AI is reinforcing the durability of Dell's AI demand, with senior management believing it's fundamentally expanding the total addressable market for graphics and traditional central processing units, according to RBC. "We are seeing a growing trend of customers that require meaningful CPU compute capacity to support AI and agentic workflows," Chief Operating Officer Jeffrey Clarke said during an earnings call earlier this month. "These workloads are creating incremental demand for traditional servers." Clarke said Dell has gained more than 10 points of traditional server market share over the past two quarters and expects to continue gaining share in the current quarter. Price: 564.63, Change: +58.01, Percent Change: +11.45