Dell Technologies Reports $23.4 Billion Revenue, 5% Increase, and Strategic Divestiture

Dell Technologies Inc. reported a net revenue of $23.4 billion for the three months ended May 2, 2025, marking a 5% increase from $22.2 billion in the same period last year. The growth was primarily driven by a 9% rise in product revenue, which reached $17.6 billion, while service revenue decreased by 6% to $5.8 billion. The company's gross margin also saw a slight increase to $4.9 billion, up from $4.9 billion a year earlier, although the gross margin percentage declined to 21.1% from 21.8% due to competitive pricing pressures in the Client Solutions Group (CSG).

In terms of profitability, Dell's operating income rose 21% to $1.2 billion, compared to $965 million in the prior year, with operating income as a percentage of net revenue increasing to 5.0%. Net income attributable to Dell Technologies was $965 million, a decrease of 3% from $992 million in the previous year, while diluted earnings per share remained stable at $1.37. The company also reported a significant increase in cash flow from operations, which surged to $2.8 billion from $1.0 billion in the same quarter last year.

Strategically, Dell completed the sale of Secureworks Corp. for approximately $0.9 billion in cash, resulting in a gain of $200 million recognized in the financial statements. This divestiture aligns with Dell's focus on streamlining operations and enhancing its core business segments, namely the Infrastructure Solutions Group (ISG) and Client Solutions Group (CSG). The ISG segment reported a 12% increase in net revenue, driven by strong demand for servers and networking solutions, while the CSG segment saw a 5% increase, primarily from commercial offerings.

Operationally, Dell's total assets increased to $86.9 billion as of May 2, 2025, up from $79.7 billion at the end of January 2025. The company reported a significant rise in cash and cash equivalents, which reached $7.7 billion, compared to $3.6 billion previously. The total debt also increased to $29.0 billion, primarily due to the issuance of new senior notes. Looking ahead, Dell anticipates continued revenue growth driven by demand for AI-optimized solutions and a PC refresh cycle, although it remains cautious about potential near-term demand moderation due to macroeconomic uncertainties.