Dell Technologies' record AI server revenue of $16.1 billion, up 757% from a year earlier, confirmed the enterprise AI spending thesis behind Palantir's partnership with the hardware maker.
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Palantir jumps 10% to $158 as Dell's AI server sales surge 757%
Palantir Technologies surged 10% to $158 after Dell Technologies' blockbuster earnings confirmed their AI factory partnership and sparked a broader software rally.
"The AI opportunity shows no signs of slowing," Jeff Clarke, chief operating officer at Dell Technologies, said in the earnings statement. Dell booked $24.4 billion in AI orders during the quarter.
Dell shares surged 29% to $409, while Hewlett Packard Enterprise climbed 14% and Super Micro Computer gained 10%. The S&P 500 rose 0.4% to 7,592, with technology leading all 11 sectors at plus 1.5%. Consumer defensive stocks fell 1.9% as investors rotated out of safe havens, while energy slipped 0.9% as oil prices declined on hopes of a US-Iran ceasefire deal. The Dow Jones Industrial Average closed above 50,000 for the first time, gaining 0.7%, while the Nasdaq Composite added 0.4%. Decliners outpaced advancers 2,794 to 2,595, though 180 stocks hit new 52-week highs versus 67 new lows.
The read-across confirms a partnership Dell and Palantir unveiled May 18 at Dell Technologies World, bringing Palantir's Foundry and AIP platforms on-premises to the Dell AI Factory with Nvidia. Palantir's Ontology layer will run on Dell ObjectScale and PowerFlex storage, while Palantir Rubix and Apollo handle the zero-trust runtime layer. For Palantir, which trades at 203 times earnings, the deal opens a new distribution channel into sovereign, defense and regulated workloads — markets where on-premise deployment is often a requirement.
Dell reported first-quarter revenue of $43.8 billion, beating estimates by 23% and growing 88% year over year. Non-GAAP earnings per share came in at $4.86 versus a $2.96 consensus, a 64% beat. AI-optimized server revenue jumped 757% year over year to $16.1 billion. The company raised its full-year AI server revenue guidance to approximately $60 billion.
Snowflake's earnings earlier in the week added momentum. The data cloud company reported $1.39 billion in first-quarter revenue, up 34% year over year, and raised its full-year product revenue guidance to $5.84 billion. More than 13,600 accounts now use Snowflake's AI capabilities, CEO Sridhar Ramaswamy said, calling the quarter "a clear inflection point" in the company's AI journey. ServiceNow rose 14% and CrowdStrike gained 8% as the software rally broadened.
Gartner forecasts AI software spending will grow 60% to $453 billion in 2026, a forecast that frames Palantir's AIP platform as a beneficiary of one of the largest enterprise software spending waves in years. Nvidia CEO Jensen Huang said earlier this month that the "buildout of AI factories, the largest infrastructure expansion in human history, is accelerating."
Brent crude fell 1.6% to below $93 a barrel, extending a monthly decline of 18% as traders priced in a potential reopening of the Strait of Hormuz. Lower oil prices eased cost pressure across cyclical sectors and complemented the broader risk-on tone.
Even with today's rally, Palantir stock remains down 12% year to date, suggesting the move represents a recovery leg rather than a clean breakout. The next major Palantir-specific event is the company's own earnings report, but until then the stock will likely trade as a derivative of the broader AI infrastructure tape.
This article is for informational purposes only and does not constitute investment advice.
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