AI Infrastructure Outlook: Nvidia and Dell Positioned for Earnings Catalysts

The technology sector's recent valuation adjustment has created potential entry points for leading AI hardware suppliers, specifically Nvidia and Dell Technologies, as they prepare for their upcoming quarterly earnings announcements in May. Demand for AI compute capacity continues to outpace available resources across major cloud services, sustaining a bullish environment for the companies providing the underlying physical infrastructure. This trend is particularly evident in Nvidia's data center business, which recently reported $62 billion in revenue, representing a 75% year-over-year increase and a 22% sequential increase. Nvidia's pricing power is reflected in its 75% gross margin, driven by the necessity of its GPUs for high-quality AI model development. The company anticipates over $1 trillion in cumulative orders for its current-generation Blackwell and upcoming Rubin chips through 2027. Furthermore, its networking segment saw a 263% year-over-year revenue surge, complemented by a $20 billion licensing deal with Groq for inference technology. Dell Technologies is similarly positioned to benefit from increased capital spending by AI firms, which is projected to rise by 50% or more in 2026. Last year, Dell shipped $25 billion worth of AI servers and ended the period with a $43 billion backlog of unfulfilled AI-related orders. The company has guided AI revenue to reach $50 billion this year. With Nvidia trading at 17 times next year's expected earnings and Dell maintaining a modest earnings multiple, both companies are viewed as undervalued relative to their growth trajectories as the economy shifts toward AI-driven intelligence.