Shares of Hewlett Packard Enterprise (HPE) surged 23.5% in premarket trading Friday, riding a wave of optimism after Dell Technologies (DELL) raised its annual revenue forecast for AI-optimized servers. The move highlights growing investor enthusiasm for hardware companies capitalizing on the artificial intelligence boom, with HPE set to report its own fiscal second-quarter results after the close on June 1.
Dell announced Thursday that its first-quarter revenue jumped 88% year-over-year to $43.8 billion, fueled by a 757% surge in AI server revenue to $16.1 billion. The company now expects full-year AI server revenue of approximately $60 billion, up from its prior outlook. "We booked $24.4 billion in AI orders and recognized $16.1 billion of AI server revenue," said Chief Operating Officer Jeff Clarke. Dell CFO David Kennedy described the quarter's performance as "exceptionally strong across the business," citing robust supply chain execution, sales momentum, and pricing discipline.
The bullish read-through sent HPE shares sharply higher, with Super Micro Computer (SMCI) also gaining 10.7% in premarket action. The rally underscores a broader market shift as investors rotate from AI software plays into hardware names. Dell shares have more than doubled in 2026, far outpacing the S&P 500's 10.5% gain, according to Reuters.
For HPE, the focus now shifts to its own earnings call on Monday. CEO Antonio Neri, CFO Marie Myers, and head of investor relations Paul Glaser are scheduled to participate. In the fiscal first quarter, HPE reported revenue of $9.3 billion, up 18% year-over-year, with its Cloud & AI segment contributing $6.3 billion and networking adding $2.7 billion. Neri previously described networking results as "outperforming" and called the period "one of our most profitable quarters on record," citing "effective operational discipline in a dynamic commodity supply environment."
Investors will be watching closely to see if HPE can match Dell's order flow while maintaining margins in its Cloud & AI and networking units. Margin pressure remains a key concern as memory and component costs continue to fluctuate. Myers noted in the prior release that HPE exceeded profit and cash flow forecasts thanks to "prudent cost management" and faster-than-expected synergies from the Juniper and Catalyst acquisitions.
The broader market context remains supportive. The S&P 500 has gained 10.5% in 2026, with technology hardware names leading the charge. However, some caution is warranted. HPE's premarket surge may partly reflect a sympathy rally that could unwind if its own numbers disappoint. Dell's results may reveal more about its own scale, customer base, and supply chain advantages rather than HPE's specific bookings. Additionally, AI server sales carry risks, including potential funding needs if inventory builds, component prices shift, or large customer deals are delayed.
HPE shares closed Thursday at $38.21, up 2.7%, just below the 52-week high of $38.58 reached earlier in the week, according to MarketWatch. Trading volume exceeded the 50-day average, indicating strong investor interest ahead of Dell's earnings. NYSE-listed shares will trade on a regular schedule May 29, with U.S. markets having been closed May 25 for Memorial Day.
Monday's earnings call will be a critical test for HPE. The market is currently treating the stock as a peer to Dell and Super Micro. The question is whether HPE can deliver the numbers to justify that status.
