Dell Technologies is acknowledging that infrastructure and storage supply still can’t keep up with agentic AI’s insatiable appetite for resources.

The company this week reported a “record” AI backlog, with $95 billion in orders waiting to be filled. This dovetails with quarterly earnings reflecting a more than 50% year-over-year increase in AI demand.

On an earnings call, Dell COO Jeff Clarke acknowledged that supply constraints start with servers and storage, and span the stack to “just about every product going through a leading node.”

“We are doing everything we can to get more supply,” he said. “In today’s environment, that’s a very difficult task.”

A glimpse of infrastructure demands ahead

Dell reported that, in its financial quarter ending July 31, its revenue was $47 billion, reflecting 58% year-over-year growth. Moreover, revenue in its Dell Infrastructure Solutions Group (ISG) increased 89% to a record $31.8 billion.

Much of this growth is in servers, notably traditional central processing unit (CPU)-based servers that are increasingly supporting agentic AI workloads. Demand is “exceptionally strong” in this area, with earnings up 122% year-over-year.

Perhaps most tellingly when it comes to the ongoing demand, the company booked nearly $61 billion in AI server orders in the three months ending July 31; all told, over the last 12 months, it has inked more than $130 billion in AI server orders.

Clarke reported that Dell converted $131.7 billion of demand into orders over the last year, and that demand is broadening across enterprise customers, neoclouds, and sovereign cloud providers. To illustrate his point, he noted that the number of customers using Dell AI Factory, the company’s platform built to support AI workflows, has surpassed 6,500, and of those, 3,300 signed on in the last three quarters. Clarke pointed out that, by contrast, it took the company two years to sign on the first 3,200 after debuting Dell AI Factory in May 2024.

“Agentic demand is reshaping the data center,” Clarke said. Inference is “pure demand in our industry.” In fact, Dell anticipates that 3,600 quadrillion tokens will be in use by 2030, representing an 87x increase from today. Further, over that same period, training demand is predicted to grow to 850 zettaflops, a 5x jump.

“Enterprise agentic AI is expected to be the single largest workload by 2028,” Clarke said, and by 2030 will account for 75% of all data center demand.

Enterprises clamor for traditional servers

Dell is seeing a growing trend of customers requiring “meaningful CPU compute capacity” to support AI and agentic workflows. As evidence of this demand, in just its last two financial quarters, it has generated nearly as much revenue from traditional servers and networking as it has in any prior full year in company history.

Most of this growth comes from existing customers accelerating their investments in traditional IT environments to refresh, modernize, and bolster performance, efficiency, and resiliency. Dell anticipates “significant and durable” refreshes ahead, and heightened security and resiliency requirements are also increasing demand.

“AI requires modern, disaggregated architectures that keep data accessible and in motion across compute, storage, and networking,” Clarke noted. It is much more than assembling and delivering components; AI deployments require significant engineering, design, and deployment expertise. Some customer engagements, in fact, require upwards of 50 unique designs as enterprises optimize for workload performance, power, cooling and the data center environment, he claimed.

Enterprises want new servers with more cores, more dynamic random-access memory (DRAM), and more storage. However, the constraints remain the same: “DRAM, DRAM, DRAM, followed by NAND, NAND, NAND [flash memory],” Clarke said. There are “spotty” CPU and disk drive shortages, and constraints all the way down the supply chain, from microcontrollers to drives to transistors.

Large enterprises and multinational corporations across the globe “would prefer to have products now if we had the supply,” he said. “We are supply constrained in the sense of what we can build in any given quarter.”

This has led Dell to plan accordingly and optimize configurations with what “bits and bytes” they do have coming in to maximize outputs, with a focus on “getting it out the door,” Clarke said. There are associated lead times that the company is working through, but they’ve been able to “realize greater shipments.”

“We’ll continue to focus on trying to get more supply, and take the supply we have and optimize the output,” he said.

Reflecting increased need for storage as enterprises prep, manage, and protect huge volumes of data, Dell has also seen strong growth across its PowerFlex, PowerStore, PowerProtect, and PowerVault products.

“Demand remains broad based; enterprises continue to modernize their storage environments as data growth increases the importance of keeping data available and secure,” Clarke said.

How customers respond to shortages

Clarke acknowledged that modernization is driving higher core counts, more DRAM, and more storage. Those configurations “cost more than they did last quarter, and the quarter before, and the quarter before.”

Customers are adjusting to these price increases, he noted, deferring purchases because they are unable to sufficiently flex existing budget dollars. In other cases, enterprises are placing orders further in advance to ensure they have access to constrained supplies. “Large, sophisticated customers are acting, first and foremost,” Clarke said. Some are collaboratively planning with Dell to gain a view of their needs further into the future.

“That is a new phenomenon,” he said. “We are working through this demand environment that’s well ahead of supply, helping customers manage.”

This article originally appeared on Network World.

Brands like Snickers, M&M’s, and Twix are familiar to most consumers, but Mars Inc. doesn’t just produce snacks. The family-owned company, with a revenue of approximately $65 billion, is also one of the largest manufacturers of pet food and ready meals, and its more than 100 production facilities operate around the clock. Of course, this places considerable demands on its IT.

“Our team must ensure that every system, including production lines, runs at maximum performance so we can continuously deliver the products and services our customers value,” says Luciano Batista, the company’s VP of enterprise services delivery.

However, Batista and his team realized that the existing data infrastructure could no longer reliably support operations, especially during peak periods such as Halloween and the pre-Christmas shopping season. So with the support of hybrid, multi-cloud data storage service Everpure, Mars is rebuilding its data and IT infrastructure.

“The Everpure platform met all our requirements,” says Batista. “It’s a scalable platform that futureproofs our operations and integrates seamlessly with our hybrid cloud infrastructure.”

Unified storage environment 

Mars initially consolidated its complex network of storage systems for business-critical databases like Oracle and applications like SAP onto a single Everpure Flash Array system. These software-defined, all-flash storage arrays are available in versions for different workloads, and typical use cases include databases, virtualized environments, SAP applications, and AI and analytics applications. 

Mars has since expanded its flash array infrastructure and now supports mixed workloads, including VMware, Windows, and Linux in areas of production, development, and quality assurance. It also uses Everpure Flash Blade as the basis for the global SAP file system. And while Flash Array is optimized for structured data, the scale-out systems of the Flash Blade series are designed for unstructured information.

“At peak times, Everpure supports up to 300,000 IOPS without any performance degradation,” says Lincoln Silva, product owner for Linux and on-prem storage at Mars. From his perspective, another point speaks favorably of the new platform in that he estimates his team saves approximately three months of planning time thanks to the Evergreen subscription model. This is because the vendor provides regular updates for the storage platform’s hardware and software. As a result, Mars’ IT professionals can focus on more critical tasks. 

Basis for hybrid cloud strategy

Mars also works with choice vendors to implement its approach to cloud. Dedicated local storage capabilities, for instance, are being integrated into Microsoft Azure cloud workloads, which simplifies restore processes and increases resilience.

Snapshots from the local environment can be replicated to the cloud, too. Recovery point objectives (RPEs) of four to 24 hours are available, depending on system priority. “Our success is also the success of our partners,” Batista says. “We embrace a spirit of reciprocity to get the most out of our collaboration.”

The hybrid cloud allows Mars to run VMware workloads and extend its IT infrastructure to the cloud as needed. And the company aims to expand its use of cloud-native applications via Microsoft Azure at a lower cost.

“We’re seeing a data reduction ratio of 18 to one. That’s nine times the expected compression rate,” Batista adds. “This puts us on track to save up to 50% on cloud storage costs. We can now work more efficiently and make better decisions thanks to intelligent solutions and automation.”

Fewer racks and lower power consumption

By consolidating on the flash platform, Mars has also reduced the space requirements and power consumption of its data centers so they only use one sixth of the power, and the number of racks has decreased significantly.

“We’re shaping a sustainable future by changing the way we work,” says Batista. “The decisions we make today will impact the world we leave behind, and Everpure aligns with our commitment to thinking in generations, not just business quarters.”