Shares in AI server maker Dell Technologies (DELL) climbed about 6% on Friday morning following an update to the scandal rocking its rival Super Micro Computer (SMCI). The rally reverses the roughly 4% drop seen the previous day.
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New trading tool for NVDA bearsSMCI Smuggling Scandal Boosts Dell Stock
Earlier in March, Super Micro Computer’s shares collapsed after one of its co-founders, Yih-Shyan “Wally” Liaw, and two other employees were accused of smuggling restricted Nvidia (NVDA) chips to China through AI servers, generating $2.5 billion in sales during the process.
The scandal propelled Dell’s shares to a one-year high, with investors likely betting that the computer and IT infrastructure company will be able to boost its sales as its competitor battles legal and operational challenges from the controversy. Dell hit an all-time high profit in 2025 on solid demand for its AI servers, with the company hoping to push sales in this segment to $50 billion by the end of its fiscal year 2027.
Alibaba Denies Relationship with Super Micro Computer
The latest rise in its stock comes as Alibaba Group (BABA) on Friday responded to a Bloomberg report that suggested the Chinese internet giant was among multiple end customers that received some of the servers at the center of the probe.
The company, which has not been accused of any wrongdoing in the investigation, noted that it does not, and has never used, any restricted Nvidia chips. Alibaba told Reuters it had no business relationship with Super Micro Computer and emphasized its “compliance-first” approach.
Nonetheless, the report and Alibaba’s response drew attention again to the scandal.
Is DELL a Good Stock to Buy Now?
On Wall Street, Dell Technologies’ shares carry a Moderate Buy consensus rating from analysts. This is based on 11 Buys, three Holds, and one Sell issued over the last three months.
Moreover, the average DELL price target of $195.85 implies roughly 20% downside risk in the months ahead.
