All right I'm yaho Finance executive Editor Brian sazy and we're here at City's Global TMT conference in New York City and we were able to to grab a few Minutes with someone that probably Doesn't need an introduction I'm sure He's heard that before butel I'm going To give him one uh dell technology Founder CEO and chairman Michael D it's A real honor to have you here I Appreciate it great to be with you Michael I feel as though I've grown up With you like I just now you're sitting Like right next to me so I appreciate That you know I want to talk about all Things AI which you talked at length About in your in your fireside chat but How is AI is going to change my my PC Experience we're talking a little bit About it off camera but I haven't seen It yet in the computers I use but like Blow my mind a little bit so look I Think anything that you want to do with Your PC is going to be enhanced with AI And you're already seeing this in a lot Of the software applications that you're Using on your PC you see little AI Assistance pop up in the corner and Imagine being able to you know uh you You you receive an email you're trying To figure out how to respond well now Your response can be informed with all The documents and emails and everything That your you know computer has has
Experienced you might not be able to Remember those all those things or put Them together in a coherent way but the AI is going to be much more able to do That and help you be way more productive You've just been in this meeting with With me right well now you go back to Your aipc and ask it what's the most Important thing that I need to respond To right now well your your PC is going To learn from you it's going to Understand those things and again every Software developer in the world that is Developing software is using AI to Enhance the user experience to to make It more effective you're making a key Point because I recently talked to Salesforce co-founder Mark benof and I Think his contention was AI will be a Compliment to humans I think he called They would be an agent so a little Different than Microsoft's co-pilot I Mean would you agree with That yeah I think it's I think it's Largely going to be a compliment where It helps you be more successful at Whatever you're trying to Do where is the AI buildout or how would You compare it to the PC buildout and And the age of the internet and and the Infrastructure buildout related to Those in Enterprise and Commercial Customers which are you know the Customers that we generally uh serve
Serve and and have the largest business In and leading share it's pretty early You know they're they're still figuring Out how to organize their data they're Picking the two or Three use cases that make the most Difference to them and they're figuring Out which large language models to use How they need to enhance these systems With other real time data they're Working on the the regulation and the Security and and ultimately what Organizations are seeing is this is a Historic opportunity to make their Businesses way more productive and Efficient while at the same time kind of Reimagining them given all this Capability and so uh you know every Customer almost every customer we talk To is super interested in learning more About how to do that they're starting on That journey and they need a lot of help Is it different than so I think back to The internet boom the late 90s every Every day see a new website seem to pop Up doing something does it feel like That and have you been surprised by the Speed at which AI is taking Off I think it's I think it's actually Happening faster than the worldwide web Rolled out and of course now we have This incredible Foundation of data and Infrastructure and capability to inform These systems you know there's a lot of
Data in the world and it is doubling you Know roughly every six to 7 months and As you begin to use these models as they Get better and better right right now The models are uh pretty great but it's The worst they'll ever be they're only Going to get better so you know the the Most advanced models in the world today Are trained on about one pyte of Data we as Dell technologies will Provide our customers this year and last Year about 120,000 pedabytes so you know Quite a bit more than the one petabyte That the most sophisticated model was Trained on so 5 years from now uh you Know the models are way better we have Agents we have Multimodal we're using these models Against all the data in the world that's A very different an exciting future a Future that enables human potential and Capability in you know uh health care And education in solving all the Unsolved problems in the world and Driving a lot more uh success in Everything that humans Endeavor to do I Mean that's some mind-blowing stuff I Mean so 5 years from now what what does A chat GPT look like or what does a Llama model over at meta look Like you know I I really don't know and I don't think anybody does it is Evolving that quickly but they're Certainly going to be way better uh
They're they're moving to multimodal They're moving to agents they're moving Certainly to to real time and you know The the AI will be able to complete more Complex tasks for you and anticipate Things and again uh make you more Successful at whatever you're trying to Do as a human I tell investors that ask Me about Dell I'm like Dell is a Different company the stock is up 45% Year-to date for a reason I mean it's Not just a PC maker for those that may Not understand where the company is Today compared to a couple years ago Give us the the the 10-second elevator Pitch how have you changed as a company So well you know last quarter our server And networking business which includes Both traditional servers that you see in Clouds and data centers and the AI Servers which you hear all about that Very large business for us grew 80% Year-over-year So uh you know we still make PCS right That's a great business for us generates A lot of cash flow but we are a very Different company driven by Data and the enormous wave of Infrastructure that's being built around AI today in the world can you get the Chips you need I mean all we hear when It when it comes to AI chips is is there Shortage prices are going up I mean what Does that look like for
You there there's great demand for this Technology and you know usually uh you Know customers need a lot of help we Have a fantastic supply chain we have Great relationships with the providers Of the You know silicon and we build you know The the world leading systems that that They go inside so it's it's always a Challenge and certainly when there's This much uh capability and customers Want to have access to that um you know It's a it's a it's a challenge and an Opportunity is there anything that you Hear that would suggest that AI is Slowing I was on your earnings call I Heard acceleration from Jeff Clark or or Co I didn't hear anything about a Slowdown I hop on all these hyperscale Qu quarters uh nothing about a Slowdown I mean is the market wrong are they Missing something here are they just Scared about Nothing well you know there there always Are bumps in the road as you you know Launch a rocket right and and and create New Capabilities and you know the you have New product Cycles you have you know new Inductions of things and some customers Want the existing one faster some want To wait for the for the new one we have We have all the above but the macro Picture here is very very clear and that
Is that there's enormous demand it's Growing it's expanding out from the Hyperscalers to the you know service Providers to Enterprise to commercial to Sovereign AI to embeded AI to the edge To retail to manufacturing to your PC to Here There and Everywhere and you know We we think it's a great opportunity Over the next several years I follow you On uh LinkedIn and x and somewhere you Made a mention about Sovereign AI how do You define sovereign Ai and what is the I guess Tam or total addressable market For that overall it's not a subject you Hear about much in the United States but Every other country you hear about it And the idea is that every country wants To express its own unique culture and Language and values and beliefs inside Their own country and they actually Don't want their data to leave the Country and be trained by AI model Somewhere else or specifically maybe in California for example right and so These countries are investing in AI Infrastructure to be able to do that and We're seeing this in you know most Countries in the world that that have You know a reasonably developed economy And and it it is a large opportunity for Us and certainly you know plays to our Strengths Engineering uh relationships the Services you know be being you know
Present in 170 countries and already Being the leading provider of servers And storage uh in in those countries We're in a great position to stand up These Sovereign AI systems I hear Nothing about slowing at all I mean what Does your backlog look like for the next 12 to 18 months in all things related to AI our backlog at the end of the quarter Was 3.8 billion uh and you know our Shipments uh in the second quarter were Up 80% quarter on quarter and the Pipeline of opportunities is many many Multiples greater than the backlog so We're seeing you know a ton of New Opportunities uh from not just the Csps but also sovereigns and of course You know Enterprises growing so you're Really I think captivating a lot of Folks what you're you're saying about What aips may do I why the push out on The uptake of these Computers so there's a very large Installed base a billion and a half PCS We've sold 200 million of them just in The last four years you got the windows 10 end of Life coming in October of of Next year and so you know if you're Installing a new Fleet of PCS to replace The ones that are 3 four 5 years old Well you want them to be enabled with These new capabilities that are going to Make your Workforce and your people more Productive and so there's tremendous
Interest in this the refresh has been a Bit delayed but we believe it's coming And it'll certainly be uh favorable for Us given our leading position number one In revenues number one in profits in Commercial PCS and you know we're geared Up for it who leads that that buildout Is it commercial or Enterprises or is it I don't know the commoner like me who Needs a new aipc because I saw it on TV And it looks like it might change my Life I I think I think it'll be both I Mean if if you're buying a PC whether It's in your business or for your own Use you're not going to not want to have This capability and so we think it'll be Pervasive and certainly all the Processor suppliers that we use are Putting these new capabilities in their Latest and Next Generation processors I Really liked what the city uh Team how They introduced you uh dell one of most Ethical companies in business how are You building that into what you are Working in in terms of AI you know everything we do in AI kind Of goes through a lens of how do we do This responsibly and make sure that you Know we're using data in the correct way Now we're different from uh you know We're not a social media company we Don't use customers data and so in that Context the challenge is a little bit Easier we're helping customers use their
Data to to be more effective but we Certainly have our own disciplines and Uh rules inside the company about how we Protect user security and Confidentiality and we never use our Customer data do you have a concern About about Ai and how it may shape our Future well I think to have no concern Wouldn't be a good strategy but I'm Generally very optimistic about how this Is going to enable human potential in Tremendous ways so we have to take Precautions to make sure that you know Bad things don't happen but I think it's Much more likely that good things will Happen with AI than than bad things is Regulation possible what do that Framework even look like to someone like You I think it's a tricky uh you know um Thing to do and and the reason is that Technology is changing so quickly if if The smartest people in the world came up With a regulation a year Ago chances are it kind of looks a Little bit silly now because the Technolog is moving so quickly So I I I think I think we we we need to Uh have some guard rails uh you know and Again these are questions for each Society to figure Out um and you know we're certainly Involved in those conversations But you know again these are kind of Society level questions the technology
Doesn't wake up in the morning and say I Want to be good or I want to be bad it Does whatever we tell it to do yes yes It's true Before I Let You Go I I saved A couple minutes um on this one because I I I I just like I said I grew up Watching you know reading magazine Covers about you and stories about Dell Do you ever think about the early days Of the company I mean how it was founded And I mean now you're just I you're here You know you're at a conference talking About AI I mean you could not imagin a Lot of these things when you started Dell no no no we we didn't imagine all These things uh I do think about those Those days uh some sometimes you know we We celebrated our 40th anniversary of The company founding earlier this year Congratulations thank you I I I wrote a Book play nice butwin where I talk about The founding of the company all the way Through to the present and some of the You know adventures and things that Worked really well things it didn't work As well and some of the learnings along The way uh but it's fun to reflect you Know if I think about all that you know Rela to the Future I'm I'm way more excited about The future and I think we're just Getting started with our company and With technology and the role it can play To enable human potential that's what
We're focused on as a company I imagine You have to Mentor some folks in in Tech I what do you tell this next generation Of tech startup founders Well um I actually have dinner with a Bunch of them Tonight did not know we'll see we'll see What the discussion is about uh you know They they they tend they tend to want to Talk about uh some of the softer things Like you know your family and and uh you Know how you how you how you sort of you Know raise kids and and those kind of Topics uh you know the great thing about Our society is we we encourage we enable People to take risks and start Businesses and dream up new ideas and You know young people that have a New Perspective are in a great Advantage Because they're sort of unencumbered by Uh you know sort of the the previous Ideas and so they can dream up new new Businesses and and way we go and I'm Also very optimistic about uh you know Uh how this wave of Change is Going to Be POS positive for uh our our country Because I think our country Embraces Change more than some other societies And um you know our our our company and And and the US I think are in a good Spot
