There is more to AI than NVIDIA – What about Dell?

By Greg Lai and Alex Hsiao, Co-Chief Investment Officers 

There is more to AI than NVIDIA – What about Dell?

Dell Technologies Inc. (DELL) has experienced steady growth over the past year. Its stock price has surged by more than 160% in the past year and over 90% in the past six months. This consistent growth can be attributed to the company’s strategic positioning to capitalize on the booming artificial intelligence revolution, presenting a promising opportunity for investors in the global technology landscape. Dell’s strategic vision and extensive industry experience have solidified its leadership in the AI domain.

With rapid advancements in AI technology globally, related stocks have attracted considerable investor interest. As a pioneer in deeply integrating AI into consumer markets, Dell Technologies commands a substantial market share in critical hardware segments like servers and workstations. The company distinguishes itself from other AI-focused stocks through its solid financial base and diversified business model. Dell’s comprehensive portfolio, spanning personal computers, enterprise solutions, cloud computing, and edge computing, allows it to adapt seamlessly to market changes, underpinning its potential for sustained growth. Over the past six months, Dell has increased R&D investments, launching innovative products such as AI-optimized high-performance servers and smart workstations, strengthening its leadership in the AI hardware market. Recent market reports indicate a rise in Dell’s global server market share, especially in AI-specific segments, highlighting its competitive edge.

A pivotal development on June 21st, 2024, further underscored Dell’s capabilities, highlighting its collaboration with Elon Musk’s supercomputer project. Dell provides state-of-the-art technical support and serves as a key rack supplier for Musk’s AI chatbot, Grok. The collaboration led to the introduction of the Dell PowerEdge XE9680L server, which features direct liquid cooling and eight NVIDIA Blackwell Tensor Core GPUs. This innovation addresses the escalating demand for high-performance computing in a compact form factor, which is crucial for applications in AI and data-intensive operations. This partnership showcases Dell’s expertise in high-performance computing and signals a future of expansive cooperation within the AI sector, offering significant market potential. Dell’s enduring partnership with NVIDIA has also resulted in successful collaborations across GPU development and data center solutions. This synergy enhances Dell’s AI hardware capabilities, positioning it as a formidable player in the AI market as AI applications continue to grow. These strategic alliances and advancements reinforce Dell’s role as a leader in the evolving AI.

Dell’s success in the AI industry is one of many factors attracting investors. In addition to its focus on developing cutting-edge technologies, the company prioritizes Environmental, Social, and Governance (ESG) initiatives and promotes equality in the job market. On July 2nd, Dell Technologies released its 2024 fiscal year ESG report, highlighting achievements in “Advancing Sustainability,” “Improving Lives,” “Fostering Inclusion,” and “Upholding Trust.” Key highlights include an over 40% reduction in greenhouse gas emissions and sourcing over 60% of the electricity for Dell’s global factories from renewable sources. Furthermore, Dell has supported over 500 non-profit organizations in digital transformation efforts, with 48% of employees participating in community donations and volunteering. The company also boasts a workforce of 35% female employees and over 29% of women in management roles. These efforts have earned Dell a perfect score on the Disability Equality Index and recognition as the “Best Workplace in 2023.” By excelling in multiple areas, Dell is committed to a holistic approach to growth and social responsibility.

Michael Dell, Chairman and CEO of Dell Technologies, emphasized that Dell is rooted in innovation and progress, creating limitless opportunities for our ecosystem of customers, partners, and team members. As AI heralds a new era, Dell Technologies is committed to accelerating innovation, exploring the vast potential of AI, and ensuring its technology benefits humanity and the planet. In conclusion, Dell Technologies stands at the forefront of the AI age, leveraging its technological prowess, diversified business portfolio, and robust financial performance, making it an optimal choice for investors seeking to capitalize on the AI sector.

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