Dell Technologies and Hewlett Packard Enterprise face shortages of memory components as demand for artificial intelligence servers surges among enterprises and data centers, executives said recently on separate earnings calls.
Although facing similar challenges, the two computer makers are taking slightly different tacks toward the memory constraints. Dell is prioritizing large strategic customers, while HPE is working with memory partners to secure supply and lock in capacity through long-term agreements.
A historic structural disruption in the memory market is driving the current supply crunch, according to the Global Electronics Association. Manufacturers are shifting production to high-bandwidth memory for AI infrastructure, reducing the output of conventional server memory that enterprises rely on to run software, per the GEA’s 2026 memory market report.
“This is not a familiar cyclical correction,” the industry trade group said. “It is a fundamental reordering of how the world’s largest memory manufacturers are allocating constrained wafer capacity.”
Dell is responding to the shortage by passing commodity cost increases on to customers while maintaining tight control over pricing and margins, even as it pushes to gain share, Vice Chairman and COO Jeffrey Clarke told investors on the May 29 earnings call.
“We’re repricing, it feels like, every day,” Clarke said. “And I’m sure our customers feel that pain.”
Rising memory and component costs have also pushed up HPE prices and strained customer budgets, President and CEO Antonio Neri said, yet companies still feel compelled to buy.
“We have not seen any pull in. We don’t see a cliff,” Neri said in the June 1 earnings call. “And in many ways, I think customers are prioritizing getting access to technology now faster than ever before because nobody wants to be left behind when it comes down to deploying AI.”
Despite higher prices, Dell’s largest customers are still locking in information technology infrastructure supplies through three- to five-year deals, Clarke said.
“Demand continues to exceed supply with memory as the primary constraint, and we expect to exit the year with meaningful backlog,” Clarke said, adding, “we in the supply chain have to go find more parts for the businesses and for our customers to fulfill the demand.”
HPE is working closely with memory partners to secure capacity through long-term agreements, Neri said. The company is also coordinating with customers and channel partners on lead times and configuration options.
As customers juggle budgets amid higher prices for AI and traditional servers, Dell and HPE are reporting strong revenue growth, fueled by memory inflation and supply constraints.
Last fiscal quarter, Dell’s total revenue jumped 88% year over year to $43.8 billion. Revenue for HPE hardware sold to AI cloud providers rose 15% sequentially, reflecting higher average selling prices within the company’s server business, EVP and CFO Marie Myers said.
