Could Dell's (DELL) Armenia AI Venture Signal a New Phase in Its Global Expansion Strategy?

• Firebird, Inc. recently announced it has received U.S. export authorization and is partnering with Dell Technologies and NVIDIA to launch a $500 million investment, developing cutting-edge AI supercomputing infrastructure in Armenia as the project's initial phase.
• This collaboration is set to position Armenia as a regional leader in AI innovation and highlights Dell’s expanding global role in enabling next-generation AI infrastructure.
• We'll explore how Dell's major new AI infrastructure partnership announced by Firebird could influence its investment narrative and earnings outlook.

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Dell Technologies Investment Narrative Recap

To be a Dell Technologies shareholder today, I believe you have to be confident in the company’s ability to seize the global AI infrastructure opportunity, despite near-term concerns about margin pressure from the rapid shift toward lower-margin AI server sales and rising memory costs. The recent $500 million Firebird/Dell/NVIDIA supercomputing partnership in Armenia underscores Dell’s global relevance in enabling AI innovation, but it does not immediately impact the critical margin and earnings challenge highlighted by analysts as the biggest risk in the short term.

Among Dell’s latest moves, its enhanced AI Factory offering, now featuring deeper NVIDIA integration and new server models, is most relevant. This announcement shows Dell’s effort to streamline enterprise AI adoption, and could play an influential role in how the company addresses both the demand-side catalyst and the margin compression risk facing the business.

By contrast, investors will want to remain aware of the risk that AI server growth could remain margin dilutive for longer than expected, especially if...

Read the full narrative on Dell Technologies (it's free!)

Dell Technologies is projected to achieve $122.2 billion in revenue and $7.4 billion in earnings by 2028. This outlook assumes annual revenue growth of 6.4% and a $2.6 billion increase in earnings from the current $4.8 billion.

Uncover how Dell Technologies' forecasts yield a $164.00 fair value, a 40% upside to its current price.

Exploring Other Perspectives

Seventeen individual fair value estimates from the Simply Wall St Community range from US$112.19 to US$184.81 per share. Some see upside potential, but margin compression from AI server expansion remains a key uncertainty for Dell’s performance, see how your outlook aligns with others.

Explore 17 other fair value estimates on Dell Technologies - why the stock might be worth just $112.19!

Build Your Own Dell Technologies Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Dell Technologies research is our analysis highlighting 5 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Dell Technologies research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Dell Technologies' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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