DELL's Margins Under Pressure: Will ISG Strength Drive a Rebound Ahead?

Key Takeaways DELL's gross margin fell 80 bps to 21.6% in Q1 FY26 due to pricing pressure and unfavorable server mix. ISG revenue rose 12% to $10.3B, driven by a record $6.3B in server and networking sales and AI demand. DELL plans to ship $7B in AI servers in Q2, expecting 10% quarter-over-quarter gross margin dollar growth.Dell Technologies (DELL) is suffering from a decline in gross margin, which contracted 80 basis points (bps) year over year to 21.6% in the first quarter of fiscal 2026. The dip was p ...