Dell Technologies, Inc. Class C (DELL.US) plans to issue $4 billion in investment-grade bonds. The AI server boom is strengthening the credit fundamentals, and the stock price has soared 340% this year.

Dell Technologies, Inc. Class C (DELL.US) plans to raise approximately $4 billion by issuing investment-grade bonds to repay maturing debt and for general corporate purposes. With the ongoing surge in demand for AI servers, Dell Technologies, Inc. Class C has significantly improved its operating performance this year, and this bond issuance will also allow it to join a new wave of financing in the recent U.S. investment-grade bond market. According to informed sources, Dell Technologies, Inc. Class C plans to issue bonds with maturities ranging from 3 to 10 years. The final issuance size has yet to be determined and may be adjusted based on market demand. Among these, the longest-maturity bonds are preliminarily expected to yield up to about 1.4 percentage points higher than comparable U.S. Treasury bonds. The proceeds from this bond issuance will primarily be used to repay outstanding bonds maturing in 2026, with the remaining funds allocated for general corporate purposes. Dell Technologies, Inc. Class C is one of the world's major manufacturers of server and data center equipment. This year, as global tech companies ramp up investments in AI infrastructure, the demand for AI servers and related computing devices has surged, making Dell Technologies, Inc. Class C a key beneficiary of this capital expenditure boom. Driven by this trend, Dell Technologies, Inc. Class C's stock price has surged approximately 340% year to date. Earlier this month, the company raised its sales forecast for the current fiscal year by $25 billion, significantly exceeding analysts' expectations and further highlighting the strong growth momentum driven by demand for AI servers. Currently, Dell Technologies, Inc. Class C is receiving a large number of orders for servers equipped with NVIDIA Corporation (NVDA.US) AI chips, while there is also a resurgence in demand for traditional server business. Notably, the demand for central processing units (CPUs) used in traditional servers is regaining growth momentum. With the rapid development of AI Agent applications, CPUs are playing an increasingly important role in managing and coordinating the tasks of AI agents, further expanding Dell Technologies, Inc. Class C's benefit from the AI infrastructure investment cycle. This bond issuance is being underwritten by Barclays PLC Sponsored ADR, Bank of America Corp, Citigroup, Goldman Sachs Group, Inc., HSBC, JPMorgan Chase, Toronto-Dominion Bank, and Wells Fargo & Company. Bloomberg industry research analyst Robert Schiffman stated that this bond issuance is expected to further consolidate Dell Technologies, Inc. Class C's already solid credit position, while the AI business is driving the companys performance to record levels. Schiffman noted that Dell Technologies, Inc. Class C currently has sufficient financial space to refinance maturing debt while maintaining its moderate BBB credit rating and further enhance shareholder returns. This financing occurs at a time when the issuance of U.S. investment-grade bonds is experiencing a revival. Following a brief lull at the end of summer, many companies are re-entering the bond market to seek financing. According to informal surveys among traders, around 17 companies are expected to issue bonds on Wednesday, including medical device manufacturer Smith & Nephew, Blue Owl Credit Income, Canadian telecom company Rogers Communications, and U.S. utility company Southern, with several companies planning to refinance existing debt using the current market window.