Dell Technologies reported quarterly earnings on Tuesday that beat analyst expectations for earnings per share but came up light on overall revenue. Shares fell 5% in after-hours trading.

Here’s how Dell did for the fiscal third quarter versus LSEG consensus estimates for the quarter ending Nov. 1:

• Earnings per share: $2.15 adjusted versus $2.06 expected
• Revenue: $24.4 billion versus $24.67 billion expected

Net income climbed 12% to $1.12 billion, or $1.58 per share, from about $1 billion, or $1.36 per share, in the year-ago period. Overall revenue increased about 10% from $22.25 billion a year ago.

Dell will give a forecast for how it sees the current quarter shaping up on the call.

The company’s shares have risen 86% so far in 2024 as investors realize it’s one of the most important companies selling tools and systems for artificial intelligence developers.

Dell is a top vendor for computer clusters required to develop and deploy artificial intelligence, especially computers based around Nvidia chips. It competes against other server makers such as Supermicro and HPE, as well as manufacturers in Asia.

Demand for Nvidia’s AI accelerators remains high from cloud providers, enterprises, and government institutions, who often buy systems installed with tens of thousands of AI chips. Dell sells the completed systems.

This year, Nvidia CEO Jensen Huang hailed Dell and its founder Michael Dell as the company to contact to place orders for its new Blackwell AI chips.

“AI is a robust opportunity for us with no signs of slowing down,” said Dell chief operating officer Jeff Clarke in a statement.

Dell’s AI server sales are reported in the company’s Infrastructure Solutions Group (ISG), which includes AI servers, storage, networking components, and traditional servers. The group’s revenue rose 34%, mostly driven by AI sales, to $11.4 billion.

The strongest part of Dell’s ISG business was its Servers and Networking subsidiary, which includes AI systems. Revenue rose 58% to $7.4 billion. Dell shipped $2.9 billion in AI servers during the quarter, and the company said during the quarter that customers had booked $3.6 billion Dollars of future AI server orders.

The company said increased AI server orders boosted demand by “double digits” for its traditional servers, which are less power-hungry and based around CPU chips from Intel or AMD, and can free up room or power inside data centers for companies investing heavily into AI infrastructure.

The company’s computer storage systems grew less strongly than servers, rising 4% to $4 billion. The overall ISG unit is more profitable, thanks to sales of pricier AI systems.

Dell’s Client Solutions Group, which sells PCs and laptops to consumers and enterprises, declined 1% on an annual basis to $12.1 billion.

While commercial clients buying PCs for their workforce rose 3% on an annual basis to $10.1 billion, the company’s sales from PCs to consumers fell 18% on an annual basis to $2 billion.