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Dell Technologies delivers second quarter fiscal 2025 financial results
Dell Technologies announces financial results for its fiscal 2025 second quarter. Revenue was $25.0 billion, up 9% year over year. Operating income was $1.3 billion and non-GAAP operating income was $2.0 billion, up 15% and 3% year over year, respectively. Diluted earnings per share was $1.17, and non-GAAP diluted earnings per share was $1.89, up 86% and 9% year over year, respectively.
“In Q2 our combined ISG and CSG revenue was $24.1 billion, up 12% year over year, positioning us well for the second half of the year and beyond,” said Yvonne McGill, chief financial officer, Dell Technologies. “Our momentum in ISG is a significant tailwind, with record ISG revenue of $11.6 billion, up 38% year over year.”
Cash flow from operations was $1.3 billion. Dell returned $1 billion to shareholders through share repurchases and dividends and ended the quarter with $6.0 billion in cash and investments.
Second Quarter Fiscal 2025 Financial Results
|
Three Months Ended |
Six Months Ended |
||||||||||
| August 2, 2024 |
August 4, 2023 |
Change | August 2, 2024 |
August 4, 2023 |
Change | ||||||
| (in millions, except per share amounts and percentages; unaudited) | |||||||||||
| Net revenue | $ 25,026 | $ 22,934 | 9% | $ 47,270 | $ 43,856 | 8% | |||||
| Operating income | $ 1,342 | $ 1,165 | 15% | $ 2,262 | $ 2,234 | 1% | |||||
| Net income | $ 841 | $ 455 | 85% | $ 1,796 | $ 1,033 | 74% | |||||
| Change in cash from operating activities | $ 1,340 | $ 3,214 | (58)% | $ 2,383 | $ 4,991 | (52)% | |||||
| Earnings per share – diluted | $ 1.17 | $ 0.63 | 86% | $ 2.49 | $ 1.42 | 75% | |||||
| Non-GAAP operating income | $ 2,034 | $ 1,977 | 3% | $ 3,508 | $ 3,575 | (2)% | |||||
| Non-GAAP net income | $ 1,371 | $ 1,283 | 7% | $ 2,294 | $ 2,246 | 2% | |||||
| Adjusted free cash flow | $ 1,284 | $ 3,050 | (58)% | $ 1,907 | $ 3,737 | (49)% | |||||
| Non-GAAP earnings per share – diluted | $ 1.89 | $ 1.74 | 9% | $ 3.16 | $ 3.05 | 4% | |||||
Infrastructure Solutions Group (ISG) delivered record second quarter revenue of $11.6 billion, up 38% year over year. Servers and networking revenue was a record $7.7 billion, up 80%, with demand growth across AI and traditional servers. Storage revenue was $4.0 billion, down 5%. Operating income was $1.3 billion.
“Our AI momentum accelerated in Q2, and we’ve seen an increase in the number of enterprise customers buying AI solutions each quarter,” said Jeff Clarke, vice chairman and chief operating officer, Dell Technologies. “AI-optimized server demand was $3.2 billion, up 23% sequentially, and $5.8 billion year to date. Backlog was $3.8 billion, and our pipeline has grown to several multiples of our backlog.”
Client Solutions Group (CSG) delivered second quarter revenue of $12.4 billion, down 4% year over year. Commercial client revenue was flat at $10.6 billion, and Consumer revenue was $1.9 billion, down 22%. Operating income was $767 million.
Operating Segments Results
|
Three Months Ended |
Six Months Ended |
||||||||||
| August 2, 2024 |
August 4, 2023 |
Change | August 2, 2024 |
August 4, 2023 |
Change | ||||||
| (in millions, except percentages; unaudited) | |||||||||||
| Infrastructure Solutions Group (ISG): | |||||||||||
| Net revenue: | |||||||||||
| Servers and networking | $ 7,672 | $ 4,274 | 80% | $ 13,138 | $ 8,111 | 62% | |||||
| Storage | 3,974 | 4,187 | (5)% | 7,735 | 7,943 | (3)% | |||||
| Total ISG net revenue | $ 11,646 | $ 8,461 | 38% | $ 20,873 | $ 16,054 | 30% | |||||
| Operating Income: | |||||||||||
| ISG operating income | $ 1,284 | $ 1,049 | 22% | $ 2,020 | $ 1,789 | 13% | |||||
| % of ISG net revenue | 11.0 % | 12.4 % | 9.7 % | 11.1 % | |||||||
| % of total reportable segment operating income | 63 % | 52 % | 57 % | 49 % | |||||||
| Client Solutions Group (CSG): | |||||||||||
| Net revenue: | |||||||||||
| Commercial | $ 10,556 | $ 10,554 | —% | $ 20,710 | $ 20,416 | 1% | |||||
| Consumer | 1,858 | 2,388 | (22)% | 3,671 | 4,509 | (19)% | |||||
| Total CSG net revenue | $ 12,414 | $ 12,942 | (4)% | $ 24,381 | $ 24,925 | (2)% | |||||
| Operating Income: | |||||||||||
| CSG operating income | $ 767 | $ 969 | (21)% | $ 1,499 | $ 1,861 | (19)% | |||||
| % of CSG net revenue | 6.2 % | 7.5 % | 6.1 % | 7.5 % | |||||||
| % of total reportable segment operating income | 37 % | 48 % | 43 % | 51 % | |||||||
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