AI servers reshape the revenue base

01 Drivers by business

AI server revenue was $16.1 billion and new AI orders were $24.4 billion. ISG revenue reached $29.0 billion, up 181%, while CSG reached $14.6 billion, up 17%. Traditional servers, networking and commercial PCs also contributed.

02 Margins and earnings quality

The earnings assessment separates ISG segment profit from consolidated operating income. Net income additionally includes non-operating and tax effects. Revenue growth alone does not establish the same rate of recurring earnings growth.

03 Cash conversion and funding

Quarterly OCF was $4.081 billion, cash CapEx $0.963 billion and analytical OCF-minus-CapEx $3.118 billion. Cumulative flows with the same fiscal-year start are subtracted; acquisition payments are excluded from CapEx.

Company FCF was $3.118 billion. It is separate from adjusted FCF, which excludes DFS financing-receivable and operating-lease equipment effects. Consolidated cash flow is not standalone AI-server cash flow.

04 RPO versus order backlog

Filed RPO was $97.000 billion. It includes deferred revenue and unbilled contractual obligations, excluding cancellable contracts without substantive penalties. Its scope differs from AI server backlog; the two should not be added.

05 Guidance at the announcement date

On May 28, FY27 revenue guidance was $165–169 billion, with $60 billion of AI server revenue. The next-quarter revenue outlook was $44–45 billion. These forecasts are retained at their original announcement date.

06 Investment checkpoints

Demand translated into revenue and operating cash flow. The next checks are how backlog evolves as shipments rise and whether cash profitability holds after customer financing and working-capital requirements.

Quarterly results · CY-aligned view

CY denotes the calendar quarter with the greatest overlap with the fiscal period. If the first period has no start date, 89 days before its end is used only for calendar mapping. Financial values are not recalculated into calendar quarters. Incomplete years show totals of included quarters; cash, liabilities, borrowings and net cash use the last period-end balance. QoQ and YoY show absolute changes; margin changes are percentage points. Dashes indicate missing evidence or incomparable periods or definitions. Total liabilities never substitute for borrowings.

Definitions and evidence coverage

A dash means unavailable or undisclosed, not zero. Company-defined FCF may differ from total operating cash flow less common-basis CapEx. Total liabilities are accounting liabilities, not interest-bearing debt.

Tables use SEC-filed comparative values verified through 2026-10-17. Guidance retains the original announcement date; later outcomes are not backdated into past forecasts. This report does not claim a complete conference-call Q&A review.