Dell stock extends rally as new XPS 13 challenges MacBook Neo

Dell Technologies DELL shares extended their rally on Monday after the company unveiled its most affordable XPS laptop yet, adding fresh momentum to a stock already boosted by record earnings and growing demand for artificial intelligence infrastructure.

The company introduced the new XPS 13 on Sunday, positioning it directly against Apple’s MacBook Neo in the competitive consumer laptop market.

Dell priced the device at $699, with a discounted price of $599 available to students during the back-to-school season.

The announcement came just days after Dell posted stronger-than-expected fiscal first-quarter results that sent its stock soaring 33% on Friday.

Shares rose another 1.45% in premarket trading on Monday to around $427, while Apple shares edged lower.

Dell targets Apple with lower-priced XPS 13

Dell said the new XPS 13 is aimed at students and young professionals, a segment that has become increasingly important as consumers seek more affordable computing options.

The company highlighted several features it believes differentiate the device from Apple’s MacBook Neo, including a larger display and lighter design.

“XPS 13 arrives at its most accessible price ever, contending with the MacBook Neo on price, and exceeding it on features,” Dell said in a blog.

The move follows Apple’s launch of the MacBook Neo in March, a lower-cost laptop that starts at $599 and is available to students for $499.

Analysts viewed Apple’s pricing strategy as an effort to gain market share as rising memory component costs pressure hardware pricing across the industry.

Dell’s latest offering reflects a broader effort to compete across multiple price points in the consumer PC market.

“I'll give them (Apple) credit. It's a good product, and it validates the market we've been talking about. Students and consumers deserve better options at accessible price points, and we agree,” Dell Chief Operating Officer Jeff Clarke said.

The company first signaled its intention to expand its consumer PC lineup during the Consumer Electronics Show in Las Vegas earlier this year and subsequently announced plans to revive the XPS brand.

AI servers drive record earnings growth

While the new laptop attracted attention, investor enthusiasm remains centered on Dell’s rapidly expanding AI infrastructure business.

The company reported record first-quarter revenue of $43.8 billion, up 88% from a year earlier.

Diluted earnings per share reached a record $5.24, while non-GAAP diluted EPS climbed to $4.86, well above analyst expectations of $2.93.

Much of the growth came from Dell’s Infrastructure Solutions Group.

AI-optimized server revenue surged 757% year over year to $16.1 billion, helping the division generate $29 billion in revenue, an increase of 181%.

“We booked $24.4 billion in AI orders and recognized $16.1 billion of AI server revenue. We’re increasing our AI server revenue expectations for FY27 to $60 billion, which only goes to show the AI opportunity shows no signs of slowing,” Clarke said.

The company also raised its full-year revenue forecast to $167 billion at the midpoint.

Analysts raise targets after earnings beat

The earnings report triggered a wave of bullish analyst revisions.

Susquehanna upgraded Dell to Positive from Neutral and raised its price target to $700 from $138, citing growth in the company’s AI server business and margin performance.

Barclays lifted its target to $550, while JPMorgan raised its target to $500, pointing to improved fiscal 2027 guidance and market share gains.

Mizuho maintained its Outperform rating and increased its target price from $350 to $435.

Investor sentiment also received a boost after Dell secured a Pentagon contract valued at $9.7 billion to provide software services to the US military.

With strong demand for AI infrastructure, a growing consumer hardware push, and renewed analyst optimism, Dell has emerged as one of the strongest-performing technology stocks in recent sessions.