Dell Technologies looks beyond computers to focus on AI servers, software

Dell bets on AI-optimised servers and its AI Factory to drive enterprise adoption in India, with Zoho among key customers using its stack for large-scale AI workloads

Dell Technologies is focusing heavily on its servers and storage business in India, looking to position itself not just as the seller of eponymous computers but also a go-to enterprise for artificial intelligence (AI) solutions and services in the hardware industry.

 

The company is banking big on its AI-optimised servers that are powered by Nvidia’s advanced chips, capable of handling computational needs of AI workloads. Global revenue from sale of such servers is expected to reach $20 billion this fiscal, from nothing just two years ago. Texas-based Dell follows a February to January fiscal.

 

“Our aim is to ensure how we as an organisation help customers accelerate their innovation cycle. The priority is to show our whole self; not just products but solutions and services that we have to help our customers innovate, be more productive, create more revenue stream, cut cost and improve customer experience,” Manish Gupta, president and managing director of Dell India, told Business Standard in his first interaction since being elevated to the role earlier this year.

 

Gupta said Dell has got end-to-end solutions that go from edge and core to the cloud, which is its first big differentiator. The other is the technology of AI, multi-cloud, edge, and data storage, and the company holds an edge considering it is the largest storage company globally, he added.

 

That is being bolstered by the company’s AI factory; a self-contained stack of server, storage, networking, and software that can take data in its structured or unstructured format and turn it into use-cases for customers for desirable outcomes.

 

Dell has 3,000 global customers of the AI factory, though it declined to say how many Indian enterprises are part of that list. A key customer, however, includes Zoho, which is leveraging the Dell AI Factory with Nvidia for its enterprise and agentic AI capabilities. This collaboration, which powers Zoho’s proprietary and multimodal large language models (LLMs) and other AI offerings, makes enterprise AI and agentic AI adoption practical and accessible for businesses.

 

“Indian customers are ahead in adoption of AI versus its peers in the APAC,” said Gupta, adding that the adoption is not limited to large enterprises but extends to medium-sized businesses too. Adoption is most common in the banking, financial services, and insurance (BFSI), healthcare and retail sectors.

 

This business, known as infrastructure solutions group (ISG) – which include storage, software, and server offerings – reported revenue of $27 billion for the six months ending August 1, up 30 per cent from the same period last year. The client solution group, which includes laptops and desktops, however, is growing at a much smaller rate.

 

Dell’s growth over the last few years has largely been driven by this business as sales remain sluggish in its laptops and desktop business. ISG contributed about 46 per cent to the annual top line of $95.5 billion last fiscal, from 37 per cent in 2020.

 

“We have shipped more AI servers in the first half of this year than all of last. Our five-quarter pipeline continued to grow sequentially, with double-digit growth across enterprise and sovereign opportunities. Our pipeline remains multiples of our backlog,” Jeffrey Clarke, Dell’s vice chairman and chief operating officer, said in a conference call with analysts last month.