According to Woofun AI, Barclays (BCS.US) downgraded the Dell Technology (DELL.US) rating from “overrated” to “neutral,” causing its stock price to drop 11.27% in a single day. This move directly challenged the optimistic signals Michael Dell had previously conveyed to CNBC, and the rivalry between the two sides about AI infrastructure needs was made public as a result. Barclays (BCS.US) believes that the current market has not seen a substantial inflection point in corporate AI spending; instead, short-term supply chain factors have distorted the appearance of growth.
An in-depth analysis of Barclays (BCS.US)'s bearish logic lies at the core of the reattribution of revenue drivers. On October 14, analyst Tim Lang simultaneously downgraded the ratings of HP Enterprise Group (HPE.US) and NetApp (NTAP.US), pointing out that the growth of these three companies was not due to the explosion of AI applications, but was constrained by a global shortage of memory.
According to data compiled by Woofun AI, companies usually only invest 5% of their IT budget in artificial intelligence, and hardware accounts for only one-quarter of total AI spending. Lang emphasized in the report that strong revenue is more a result of high memory costs. Once memory prices return to normal and decline, related infrastructure revenue will be under pressure. Based on this, Barclays (BCS.US) lowered the target price of Dell Technologies (DELL.US) from $603 to $574, which is still about 13% higher than the closing price of $507.93 on October 14;
Meanwhile, the HP Enterprise Group (HPE.US) price target fell from $83 to $77, and there is still room for an increase of about 22% compared to the closing price of $63.11.
Faced with the agency's cautious attitude, Dell (DELL.US) executives insisted on a strong demand-side narrative. Although the stock price has soared 303.5% since 2026, and the current price is nearly 14% lower than the all-time high closing price of $588.40 set on September 17, Michael Dell still denies that a bubble exists. In an interview with CNBC on October 13, he pointed out that demand in the field of artificial intelligence computing still exceeds supply, and insufficient supply is the norm. He observed that large-scale AI use, which was previously limited to cutting-edge laboratories and specific enterprises, is now spreading to the wider enterprise community, but this is only the beginning; there will be plenty of infrastructure in use in the future.
This current state of imbalance between supply and demand forms the core basis for his refusal to worry about the bubble.
Market focus has now turned to the upcoming third quarter results verification. Barclays (BCS.US) predictions and the CEO's judgment on who is more accurate will depend on the disclosure of actual financial data. Dell Technologies (DELL.US) expects revenue for the quarter to reach $49 billion, up 81% year over year.
This impressive increase, if realized, will strongly support management's view that demand continues to expand; conversely, if growth is weak, it may confirm Barclays (BCS.US)'s concerns about the explosion of memory costs rather than AI applications.