Michael Dell’s Wealth Plummets by $11.7 Billion as Dell Technologies Shares Tumble

Michael Dell, founder and CEO of Dell Technologies, experienced a significant single-day decline in his wealth due to a sharp drop in Dell shares. Dell’s net worth fell by $11.7 billion to $107.1 billion on Friday as Dell Technologies Inc. shares plummeted 18% in New York. This decline puts Dell on track to lose over $21 billion in market value if the losses continue.

The drop in Dell’s stock followed investor disappointment over the company’s lower-than-expected artificial intelligence (AI) server backlog and an anticipated decline in profit margins. Consequently, the 59-year-old tech billionaire now ranks 13th, with his wealth primarily derived from Dell Technologies Inc., a company he founded over 40 years ago while attending the University of Texas. Additionally, a significant portion of his net worth comes from his stake in Broadcom Inc., whose shares also declined on Friday.

In early March, Dell joined the exclusive group of individuals with fortunes exceeding $100 billion, driven by rising demand for AI computing equipment, which had propelled Dell’s shares to a record high. Major corporations increasingly require high-powered servers for training and running demanding generative AI tasks, a market that Dell and a few other companies serve.

Dell Technologies reported first-quarter earnings on Thursday, establishing the company as a leading vendor for AI servers. However, despite these strong earnings, the company’s shares dropped more than 15% in after-hours trading due to concerns that Dell’s AI servers are not yet generating substantial profits.

Before this report, Dell’s shares had more than doubled in 2024. However, Toni Sacconaghi, an analyst at Sanford Bernstein, noted that the first-quarter results were disappointing relative to the very high expectations. He highlighted that the decrease in adjusted operating margins reignited concerns that AI servers might be sold at near-zero margins.

In a post-earnings call, Dell executives indicated that gross margins had been pressured by a “more competitive pricing environment and a higher AI-optimized server mix,” further contributing to the stock’s decline.

Have you read?
Most Heavily Armed Tanks Ever Built By Russia.
Countries with the most F-15 Eagle fighter jets.
Countries with the Most F-35 Lightning II Stealth Fighter Jets.
The Role of Chief Artificial Intelligence Officers (CAIOs) – Are They Needed and What Impact Can We Anticipate?
5 Ways to Ensure You Have Cash Flow When Starting a Business.