Key Points

• Dell stock has trailed the market so far in 2025, but its poor performance doesn’t seem justified.

• Growth has been accelerating, helped by the company’s healthy share of the AI server market.

• The stock’s valuation is too cheap to ignore right now, and buying it could turn out to be a smart move.

• 10 stocks we like better than Dell Technologies ›

The healthy spending on artificial intelligence (AI) infrastructure and devices has been a tailwind for Dell Technologies (NYSE: DELL) in recent quarters, but shares of the company have struggled to gain any momentum on the market despite an improving growth profile.

Specifically, Dell stock has gained just 5% in 2025 as of this writing. That’s half of the returns clocked by the tech-laden Nasdaq Composite index this year. The stock received another shock recently as it dropped lower following the release of its fiscal 2026 second-quarter results (for the three months ended Aug. 1) on Aug. 28, losing nearly 9% of its value the following day.

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However, a closer look will tell us that Dell’s recent drop isn’t justified. Let’s look at the reasons why.

Dell’s results were better than expected, and it also raised its guidance

Dell reported record revenue of $29.8 billion last quarter, an increase of 19% from the year-ago period. Meanwhile, its non-GAAP earnings rose identically to $2.32 per share. The numbers were ahead of consensus expectations, but its earnings guidance for the current quarter was lower than expected.

The company is expecting $2.45 per share in earnings in the current quarter, which is $0.10 lower than consensus expectations. Dell’s margins have taken a hit in recent quarters as the company has been ramping up the output of its artificial intelligence (AI) servers to meet the robust end-market demand. However, the good part is that the company is expecting its margins to improve as its AI server business scales up.

That’s the reason why Dell now expects its adjusted earnings to jump by 17% in fiscal 2026 to $9.55 per share, up from the earlier expectation of 15% growth. What’s more, the company has increased its revenue guidance by four percentage points to 12% to a midpoint of $107 billion. Investors, therefore, would do well to take a look at the bigger picture as the company is clearly benefiting from the rapidly growing demand for AI servers.

Dell points out that it shipped a record $8.2 billion worth of AI servers in the previous quarter. The company’s AI server revenue of $10 billion for the first half of fiscal 2026 has already exceeded the revenue it generated from this segment last year. Importantly, the demand for Dell’s AI servers remains solid as the company received fresh orders worth $5.6 billion last quarter.

It is now sitting on an AI server order backlog worth $11.7 billion. Dell expects to finish the year with $20 billion in AI server revenue. The updated forecast is a third higher than its prior expectation and would be double the AI server revenue it generated in the previous fiscal year.

Dell’s backlog suggests that it is indeed on track to meet its full-year AI revenue target, though don’t be surprised to see the company exceed that mark as the year progresses. That’s because the AI server market is expected to clock an annual growth rate of 34% through 2030, generating a whopping $837 billion in revenue at the end of the decade.

The company’s projected AI server revenue growth indicates that it is on track to grow at a faster pace than the end market. So, the company seems to be gaining more share of this lucrative space. That’s not surprising as Dell points out that it witnessed the largest expansion in its customer base last quarter. Moreover, it is increasingly converting its proof-of-concepts into full production deployments.

As a result, Dell could continue witnessing healthy growth in its revenue in the coming years given its ability to grow at a faster pace than the lucrative AI server market. At the same time, the company’s forecast that its AI margins will start improving from the second half of the year suggests that stronger earnings growth could be in the cards.

The stock could deliver outstanding gains

Dell’s 12-month price target of $150 as per 27 analysts covering the stock points toward a potential jump of 24% from current levels. But if we take a look at the stock’s valuation and its ability to deliver stronger earnings growth in the future, it could turn out to be a solid long-term winner. In fact, it is not surprising to see that analysts have increased their earnings growth expectations from Dell following its latest report.

DELL EPS Estimates for Current Fiscal Year data by YCharts

Assuming that the company can indeed clock $12.26 per share in earnings after a couple of years and trades at 29 times forward earnings at that time, in line with the tech-laden Nasdaq 100 index (using the index as a proxy for tech stocks), its stock price could hit $358. That’s nearly triple Dell’s current stock price.

Dell is currently trading at just 13 times forward earnings, indicating that it is substantially undervalued. That’s why investors looking for an AI stock that’s capable of clocking robust long-term growth and is trading at an attractive valuation can consider accumulating Dell, as it is in a solid position to capitalize on the tremendous growth of the AI server market.

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Geoffrey Hinton, a leading figure in the field of artificial intelligence (AI), has sounded an alarm about the technology’s potential for harm. The recent public frenzy over AI tools like ChatGPT has caused Hinton to shift from accelerating AI development to raising deep concerns about its future. He now believes that AI poses a grave threat to humanity, saying that the technology can help any person to create a nuclear bomb.Hinton described a chilling scenario where AI could enable an average person to create a bioweapon.“A normal person assisted by AI will soon be able to build bioweapons and that is terrible,” he said, adding, “Imagine if an average person in the street could make a nuclear bomb.”Hinton also discussed a range of topics, including the nuclear-level threats posed by AI, his own use of AI tools, and even how a chatbot played a role in his recent breakup.Recently, Hinton cautioned that AI could soon surpass human capabilities, including emotional manipulation. He suggested that AI’s ability to learn from vast datasets enables it to influence human feelings and behaviours more effectively than humans.

Hinton debates the definition of ‘Intelligence’

Hinton’s concern stems from his belief that AI is truly intelligent. He argued that, by any definition of the term, “AI is intelligent.” He used several analogies to explain that an AI’s experience of reality is not so different from a human’s.“It seems very obvious to me. If you talk to these things and ask them questions, it understands,” Hinton explained. “There’s very little doubt in the technical community that these things will get smarter,” he added.However, not everyone agrees with Hinton’s view. His former colleague and co-winner of the Turing Award, Yann LeCun, who is now the chief AI scientist at Meta, believes that large language models are limited and cannot meaningfully interact with the physical world.

Saturday, September 06, 2025

James Malachowski, Sports Columnist

University of Rhode Island men’s basketball coach Archie Miller is at the forefront of utilizing AI-powered technology to support the basketball program, and a URI alum is helping to make it happen.

AI technology is everywhere, and marketers love the term, with even routine, static computer programs being referred to as “AI.” The application URI is using claims to be robust, deeply technical, data-rich, with independent program learning, and is a highly advanced artificial intelligence application. 

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A URI Alum is behind this

Roby Luna graduated from URI in 2000 with a BS in MIS (Management Information Systems). He is the President and one of the founders of Aretec, Inc., which is a technology company that provides data science, cloud services, and AI-powered solutions to government agencies and commercial clients. It specializes in using data to improve decision-making.

That is what Luna does for a living. Here is what he does for fun. Luna is also a co-founder of Slam Sports AI. He and others have applied their expertise in mining, analyzing, and presenting data to support decision-making to the field of college basketball.

Miller’s comments on the value of the AI platform

When asked about their AI initiative and Luna, Coach Miller said, “The technology created by Slam Sports offers a cutting-edge tool for player-performance evaluation. On and off the court, the game is moving faster than ever. When you find a tool that can speed up various evaluation needs, it helps us become more efficient in all of our work.”

Miller continued, “As an alum, Roby Luna has a clear affinity for URI. When he presented the potential uses of Slam Sport, being a part of this pilot program made sense. His understanding of data analytics and how it could benefit the basketball program made this a very useful tool.”

How does it work?

Slam Sports harvests videos of college basketball players and uses a proprietary AI software platform that “reads” and analyzes video to produce individual scouting reports on players. Coaches no longer have to spend hours and hours watching films to develop an assessment of a prospect. Instead, they receive a detailed and customized data-driven report on every prospect they are interested in.

This time-saving service is incredibly valuable in the era of the Transfer Portal, where a team may be looking at 100 players and has a short time to make decisions.

The data analysis and report on each player includes several items, including.

Foot speed
Athleticism
Acceleration
Passing accuracy
Decision making
Shooting from different distances
Movement without the ball
Off-ball defense
Transition from offense to defense
Transition from defense to offense
Reaction to missed shots
And more

The report on a player also includes “Sentiment Analysis.” Under this heading, factors such as body language, the player’s reaction when they are beaten on defense, their reaction when taken out of a game, a player’s mannerisms after a coach talks with them, how a player behaves on the bench, and other physical responses to activities on the court.

Wait, there is more

The player analysis and reports are not simply based on the athlete’s general performance. The analysis is based on a customized platform of Miller’s specific preferences for each aspect of playing basketball.

After lengthy discussions with Miller, Slam Sports creates a digital agent – an avatar, if you will, which represents Miller’s thesis for every component of playing basketball. A player’s performance is analyzed against Miller’s digital agent.

The software program that completes this task is high-level AI as it self-learns, refining its program and evolving as it analyzes players against the avatar.

Example of the AI platform in use

During this transfer period, URI was looking for a big man. They were aware of a center that played overseas. Traveling overseas to see a player firsthand is not something URI is going to do. Traditionally, coaches would review game films. However, a player’s performance is highly dependent on the talent level they are playing against, which can sometimes be difficult to determine when only watching film.

Slam Sports ran the player’s game film through their program and within minutes produced an analysis. The report revealed that the player’s foot speed and athleticism were insufficient to be competitive in the A-10, and his decision-making was suspect. URI moved off this player, saving time and avoiding the waste of NIL money and a roster spot.

Recruiting from the portal

This year, 2,700 college basketball players entered the transfer portal. That is an enormous number of players to look at and analyze. The first step for a basketball program is to identify the players it has the potential to recruit. The coaching staff then focuses on a selected group of players. If last year, URI focused on 100 to 200 players with the AI tool, they can look at twice as many and do it quickly.

Slam Sports also provides the service of identifying players whom URI may have overlooked. In harvesting their player data, Slam Sports may find a qualified player that URI did not have on its list to explore.

URI player evaluations

The AI analytics tool is also being used to evaluate current URI players for the purpose of player development. Basketball practices are videotaped and, along with game footage, are run through the AI program. Coaches and players receive detailed reports, which are used to identify specific areas for improvement that will be tracked throughout the year.

Scouting opponents

Slam Sports has been collecting videos of players on the teams URI will be competing against this year. These videos, along with current game videos, will be used to analyze opponents, producing a data-rich but consumable scouting report prior to every game.

More about Luna

Luna provides Slam Sports AI services to URI at no cost. It’s his way of giving back to the University he loves and feels indebted to.  Luna’s parents immigrated to the United States from the Dominican Republic when he was a young boy. He grew up in Providence, attending Central High School.

He was a gifted athlete with dreams of playing in Major League Baseball. However, he lost his singular focus on this goal and succumbed to distractions. So, it was off to the U.S. Army after high school.

After his time in the armed services, URI’s Talent Development Program, which is designed to give students from underperforming high schools or with disadvantaged backgrounds the opportunity to attend URI, became aware of Luna and accepted him into the program.

In talking about the Talent Development Program, Luna said, “I was ill-prepared for the rigors of college. But my advisor at the time, Sharon Forleo, was instrumental in helping me to stay the course. I am forever grateful to her for helping me push forward and try to achieve my dream of making a dent in the universe.”

Luna further said, “I will forever bleed Rhody blue.” In addition to these latest efforts with the basketball team, Luna serves on the URI Board of Trustees and Chairs the Committee on Institutional Risk and Compliance.

What’s next

Luna believes his AI program and analysis system are capable of providing real-time in-game analysis. The first five minutes of a game are generally a time when teams are feeling each other out, and coaches are evaluating how their game strategy is working. Although Slam Sports does not currently have the functionality, Luna envisions that in the near future, after the first five minutes of a game, the coaching staff will be given a detailed analysis of the game generated by its AI platform.

Real or magic

So, is this all real, or is it magic? Was Luna the lucky one who was walking across the Quad and found the pouch of magic dust some wizard left behind? Or has this all happened due to the intersection of hard work, perseverance, and the award-winning Talent Development Program at URI?

You will need to decide.

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