Dell Technologies shares jumped 7% in after-hours trading Thursday after the company reported a record fourth-quarter performance driven by surging demand for AI servers. The Texas-based hardware giant posted non-GAAP earnings of $3.89 per share, beating analyst estimates of $3.52, on revenue of $33.4 billion, up 39% year-over-year.

AI-optimized server revenue from the Infrastructure Solutions Group skyrocketed 342% to $9.0 billion, with Dell revealing a record $43 billion AI server backlog. The company disclosed it closed more than $64 billion in AI-optimized server orders during the year and shipped over $25 billion worth of such products. This positions Dell as a central player in the global AI hardware build-out.

The strong results prompted Dell to raise its fiscal 2027 outlook, projecting annual revenue between $138 billion and $142 billion, well above the $124.9 billion consensus. The company also increased its EPS target to $12.90 from the expected $11.49 and announced a 20% dividend increase plus a $10 billion share repurchase expansion. These moves underscore Dell's successful transition from a traditional PC maker to an AI infrastructure leader.