AI server demand maintains momentum as PC remains sluggish: Wells Fargo

With a swath of IT hardware companies poised to present quarterly earnings reports over the next few weeks, Wells Fargo analysts previewed several, with Dell Technologies (NYSE:DELL) remaining a “top pick” due to artificial intelligence server demand and Nvidia’s (NVDA) Blackwell ramp.

“We expect Dell to reiterate its FY26 guide; leaving us/investors focused on path to +$10/share EPS,” said Wells Fargo analysts, led by Aaron Rakers, in an extensive Tuesday note.

The bank expects Dell to produce more than $15B in revenue in fiscal year 2026 from AI servers. The company is also supported by Nvidia’s GB200 NVL ramp as data centers transition from Hopper to Blackwell.

Wells Fargo reiterated its Overweight rating and $150 price target on Dell.

Dell reports its first quarter fiscal 2026 financial results post-market on Thursday, May 29. A consensus estimate calls for adjusted earnings per share of $1.68 on $23.17B in revenue.

However, consumer PC demand remains muted, while the commercial PC upgrade is coming along slower than expected. This might weigh on the earnings of HP (NYSE:HPQ), which Wells Fargo rates as Underweight with a $35 price target. But the strong server demand and Blackwell ramp bodes well for sister company Hewlett Packard Enterprise (NYSE:HPE). It has an Equal-weight rating and a $22 price target. Investors will hope to learn more about the Juniper (JNPR) acquisition, which is slated for a bench trial on July 9. HP releases its earnings post-market on May 28 and HPE on June 3.

Meanwhile, Pure Storage (NYSE:PSTG) releases its results post-market on May 28. The company was recently selected by Meta Platforms (META) to provide the foundation for its storage infrastructure.

“With hyperscalers setting the benchmark, the path forward for enterprises is clear: adopt technology proven at hyperscale to transform operations and future-proof their infrastructure,” Pure Storage said of the partnership. “By embracing the unified, all-flash solution from Pure Storage, organizations can achieve the agility, reliability, and efficiency needed to thrive in the cloud era.”

Wells Fargo rates Pure Storage at Overweight with an $80 price target.