The Motley Foolยท2025-07-03 10:46Core Insights - The infrastructure development to support AI applications is creating significant investment opportunities, with Nvidia being a major beneficiary due to its advanced chips and software [1][2] - Nvidia's revenue has dramatically increased from $61 billion in fiscal 2024 to over $130 billion in fiscal 2025, with expectations of approximately $90 billion in the first half of fiscal 2026, driven by the data center segment [2] - Dell Technologies is also benefiting from the AI boom, with its Infrastructure Solutions Group achieving record sales of $43.6 billion in fiscal 2025, a 29% year-over-year increase [5] Nvidia's Performance - Nvidia's AI factories are contributing to Dell's backlog, with the company seeing substantial growth in its AI server business, which generated nearly $10 billion, up from $1.5 billion in fiscal 2024 [5][6] - The demand for AI infrastructure is unprecedented, with Dell reporting a $14.4 billion AI backlog and $12.1 billion in AI orders in the first quarter of fiscal 2026 [6] Dell's Strategic Position - Dell is not solely an AI company but is well-positioned to benefit from the AI revolution, with its stock rebounding due to strong growth prospects [7][8] - The Client Solutions segment is integrating AI for commercial and retail clients, providing stable cash flow and generating more revenue than the Infrastructure Solutions group last year [9] Shareholder Returns - Dell's management is committed to returning at least 80% of its adjusted free cash flow to shareholders, increasing its annual dividend by 18% and approving a $10 billion share repurchase authorization [10] - The combination of surging demand and a growing backlog for AI servers makes it an opportune time to invest in Dell stock [11]