Dell Technologies Inc. Q4 FY2025 Earnings Call

· Earnings call transcript and AI-powered summary

Overall Performance

  • FY2025 revenue was $95.6B, up 8% year-over-year. This compares to FY2024 revenue of approximately $88.4B.
  • Record EPS of $8.14, up 10% from $7.40 in the prior year.
  • Operating income reached $8.5B; operating expenses fell 4% over the year due to modernization and efficiency programs.
  • FY2025 cash flow was $4.5B, down from FY2024 primarily due to inventory investment for AI growth and slower CSG (Client Solutions Group) performance.

Q4 2025 Highlights

  • Q4 revenue was $23.9B, up 7% year-over-year, driven by strong ISG (Infrastructure Solutions Group) performance.
  • Q4 EPS was $2.68, up 18% year-over-year, outpacing revenue growth due to operating leverage.
  • Gross margin rate of 24.3%, down 50 bps year-over-year due to competitive CSG pricing and higher AI-optimized server mix.
  • Operating income rose 22% to $2.7B, reflecting revenue growth and reduced expenses.

Infrastructure Solutions Group (ISG)

  • ISG revenue was $11.4B in Q4, up 22% year-over-year.
  • Servers & networking achieved a record $6.6B revenue, up 37% year-over-year.
  • Storage revenue rose 5% to $4.7B, the second consecutive quarter of growth.
  • AI server shipments were $2.1B in Q4 with $1.7B in AI orders. AI backlog reached $4.1B in Q4 and ~ $9B in February 2026.

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Operator: Good afternoon and welcome to the Fiscal Year 2025 Fourth Quarter Financial Results Conference Call for Dell Technologies Inc. I'd like to inform all participants that this call is being recorded at the request of Dell Technologies. This broadcast is a copyrighted property of Dell Technologies Inc. Any rebroadcast of this information in whole or part without the prior written permission of Dell Technologies is prohibited. [Operator Instructions] I'd like to turn the call over to Paul Frantz, Head of Investor Relations. Mr. Frantz, you may begin. Paul Frantz: Thanks, everyone, for joining us. With me today are Jeff Clarke, Yvonne McGill and Tyler Johnson. Our earnings materials are available on our IR website, and I encourage you to review those materials. Also, please take some time to review the presentation, which includes additional content to complement our discussion this afternoon. Guidance will be covered on today's call. During this call, unless otherwise indicated, all references to financial metrics refer to GAAP financial measures, including non- GAAP gross margin, operating expenses, operating income, net income, diluted earnings per share, free cash flow and adjusted free cash flow. A reconciliation of these measures to the most directly comparable GAAP measures can be found in our web deck and our press release. Growth percentages refer to year-over-year change unless otherwise specified. Statements made during this call that relate to future results a

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