Dell Technologies DELL and Everpure P, formerly known as Pure Storage, are major competitors in the enterprise data storage and management market. Both companies are expanding their capabilities to address growing demand for AI-ready infrastructure, high-performance flash storage and hybrid cloud solutions.
Dell is strengthening its storage portfolio through innovations in PowerStore, PowerScale and PowerMax, while Everpure is advancing its unified storage and data management platform through its Enterprise Data Cloud architecture. As enterprises modernize data centers, deploy AI workloads and prioritize efficient data management, both companies are positioned to benefit from increasing infrastructure investments.
The Case for P
Everpure's expanding enterprise footprint remains central to its growth strategy. In second-quarter fiscal 2027, revenues increased 38% year over year to approximately $1.2 billion, supported by strong demand across products, geographies and customer segments.
Product revenues advanced 54% to $687 million, reflecting favorable pricing, stronger demand for high-performance configurations and larger customer transactions. Operating profit surged 77% to $230 million, demonstrating improving operating leverage.
The subscription business offers another compelling opportunity. Subscription services revenues rose 20% to $499 million, representing 42% of total revenues. Annual recurring revenues exceeded $2 billion, while remaining performance obligations climbed 44% to more than $4 billion.
Evergreen//One, the company's consumption-based storage offering, continues to attract enterprises seeking predictable costs and infrastructure flexibility. Its annualized total contract value run rate exceeded $1 billion, strengthening future revenue visibility.
Everpure is increasingly benefiting from growing enterprise investment in AI-ready data infrastructure. Its FlashBlade platforms support demanding AI workloads, while Enterprise Data Cloud and Data Intelligence solutions help organizations consolidate, manage and utilize fragmented information.
The company has also secured a supply agreement with a second top-five hyperscaler, validating its DirectFlash technology. This agreement is expected to contribute meaningfully to revenues beginning in fiscal 2028.
Reflecting strong demand, management increased fiscal 2027 revenue guidance to $5.03-$5.07 billion and operating profit expectations to $940-$960 million. These upward revisions reinforce confidence in continued business expansion.
Despite impressive fundamentals, Everpure faces several risks. Increasing semiconductor and NAND component costs could pressure profitability, while aggressive competition may restrict pricing flexibility.
Second-quarter operating cash flow was $136 million, mainly due to strategic inventory purchases. Free cash flow was negative $238 million, highlighting working-capital pressures associated with rapid expansion. Although management anticipates a cash flow recovery, execution remains important.
The Case for DELL
Dell continues to experience AI server demand outpacing supply as customers accelerate deployments across neocloud, sovereign and enterprise environments. In the second quarter of fiscal 2027, AI orders totaled $60.9 billion, bringing trailing-12-month bookings to $131.7 billion, while backlog reached $95 billion. Management emphasized that most backlog orders are noncancelable following rigorous customer credit, financing, technical design and data-center readiness assessments, providing greater shipment visibility. The opportunity pipeline remains several times larger than backlog, while enterprise AI customers increased more than 60% over six months to exceed 6,500.
Demand is also expanding into inference, security and resiliency applications, alongside strengthening traditional server requirements. Dell maintains its fiscal 2027 AI server revenue outlook of approximately $74 billion. Although supply constraints persist, substantial backlog, a growing customer base and expanding applications reinforce Dell's multiyear growth prospects.
Dell's integrated infrastructure capabilities, spanning servers, networking, storage and data management, position it to capitalize on increasingly complex enterprise AI deployments. Management highlighted its engineering expertise and global supply-chain capabilities, which enable large-scale deployments four to six weeks faster in terms of time-to-token, with systems achieving 99.9% uptime after installation. Growing AI and inference workloads are also increasing storage requirements, creating opportunities for higher-margin revenues.
Dell IP storage registered its sixth consecutive quarter of demand growth at nearly twice the market rate in the second quarter of fiscal 2027. PowerStore achieved its tenth consecutive quarter of double-digit growth, while PowerScale and ObjectScale extended their growth streaks to five and four quarters, respectively. Management projects approximately $2.5 billion in additional storage revenues for fiscal 2027, with double-digit annual growth expected. A richer mix of proprietary storage products, software and services should support margin expansion and diversify Dell's growth drivers beyond AI servers.
How Do Zacks Estimates Compare for P & DELL?
The Zacks Consensus Estimate for P’s fiscal 2027 sales and EPS indicates year-over-year growth of 38% and 41.6%, respectively. EPS estimates have been trending downwards over the past 60 days.
The Zacks Consensus Estimate for DELL’s fiscal 2027 sales and EPS indicates year-over-year growth of 72.4% and 153.3%, respectively. EPS estimates have been trending upwards over the past 60 days.
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DELL’s Valuation More Attractive Than P
While DELL has a forward 12-month P/E of 16.93X versus its median of 16.80X, suggesting that the stock could be slightly overvalued relative to its historical range, P trades at a forward 12-month P/E of 35.36X, below its 12-month median of 83.61X.
DELL Emerges as the Better Buy
Dell appears to be a more compelling investment choice than Everpure, supported by robust AI server demand, an expanding storage portfolio and strong earnings growth prospects. Its substantial AI backlog, improving storage momentum and diversified infrastructure offerings provide greater revenue visibility. Moreover, Dell's attractive valuation relative to Everpure strengthens its investment appeal. While Everpure benefits from strong subscription growth and AI-driven storage demand, its premium valuation, cash flow pressures and downward earnings estimate revisions warrant caution.
Dell's upward earnings estimate revisions and Zacks Rank #1 (Strong Buy) compared with Everpure's Zacks Rank #3 (Hold), make DELL the better buy currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
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