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Dell Technologies exceeded analysts' expectations for fiscal first-quarter revenue and earnings and raised its full-year revenue guidance. Dell's AI-optimized server orders increased significantly but the company's gross margins declined due to competitive pricing and a higher mix of AI servers. Dell's AI server backlog is primarily made up of orders for Nvidia-based servers as the company works through supply chain issues. The backlog also includes large cloud customers. Extended trading saw Dell's stock price drop over 18% following the earnings call.
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