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🖥️ Dell and HPE ride AI server boom to record revenues
AI Server Revenues Surge, Vendor Pricing Turns Volatile, Cost Control Insights from Alex Podobnik
Aimply Team & Zack Tembi
September 09, 2025
AI Server Revenues Surge, Vendor Pricing Turns Volatile, Cost Control Insights from Alex Podobnik
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Welcome to this week’s edition of CIOsurge!
This week:
Dell and HPE rode the AI server boom to record revenues, with global server sales up 134% in Q1—the sharpest increase in 25 years.
AI vendor pricing remains volatile, with hybrid subscription-plus-usage models leaving CIOs struggling to forecast costs.
Alex Podobnik shares why cost control must be designed into workflows, through guardrails, tagging, and policy-as-code, not left to late-night firefighting.
Let’s make this week a game-changer.
Stay sharp. Stay ahead.
đź’ˇ Guest Expert Insights: Alex Podobnik
đź’¸ Cost Control by Design, Not Heroics
One of Alex’s strongest points was that real cost savings don’t come from late-night firefighting, they come from building awareness into the workflow itself. Guardrails at the org level stop runaway resources before they spin up, and cost estimates in pull requests show engineers the impact of a change before it hits production.
Policy-as-code makes the thresholds explicit: bigger changes trigger reviews, while everyday right-sizing becomes part of the rhythm. Alex has seen double-digit savings from simple architectural shifts—like moving suitable workloads to ARM—that improved both performance and spend.
It all depends on hygiene. Every resource should be tagged automatically so costs roll up cleanly by team and product. Without that foundation, you’re left chasing spreadsheets. With it, cost control becomes part of how you build, not a side project.
🖥️ Dell and HPE ride AI server boom to record revenues
Enterprise adoption of AI-optimized servers powered Dell and HPE’s latest revenue growth. Dell’s quarterly revenues rose 19% to $29.8B, with server and networking sales surging 69% to $12.9B. HPE saw revenues up 18% to $9.1B, fueled by demand for richly configured, GPU-powered servers. IDC data shows global server sales spiked 134% in Q1 2025, the sharpest quarterly increase in 25 years.
This surge signals a major enterprise refresh cycle. With 70% of existing servers still legacy, CIOs face pressure to modernize for AI workloads—whether for inferencing at scale, agentic AI, or private deployments. The upside is efficiency and readiness; the downside is cost and the complexity of rearchitecting data centers around high-density, GPU-rich servers.
As these deployments scale, CIOs will need to balance vendor lock-in, power and cooling constraints, and the security implications of handling sensitive data in AI models. The AI hardware arms race is real—but so are the operational challenges that come with it.
- Zack Tembi
⚖️ AI vendor pricing volatility leaves CIOs guessing
AI vendors are shifting pricing models at an unprecedented pace, often adjusting rates monthly or even weekly, according to Chargebee. Hybrid subscription-plus-usage pricing is now common, but costs remain unpredictable due to high compute demands and reliance on third-party LLMs. CIOs face mounting risks of lock-in, cost overruns, and inconsistent value as vendors test agile monetization strategies.
For CIOs, this volatility isn’t just an accounting headache—it’s a strategic risk. Budgeting for AI becomes nearly impossible when usage-based fees spike overnight or when outcome-based pricing lacks clarity. Without predictability, it’s difficult to align investments with measurable ROI.
The path forward is proactive cost governance. CIOs need flexible contracts, consumption alerts, and FinOps-style controls for AI just as they’ve adopted for cloud. Avoiding vendor lock-in and securing credits or pricing guarantees now can prevent painful surprises later. AI pricing will eventually stabilize, but until then, vigilance is our best defense.
- Zack Tembi
🗞️ At A Glance
đź’ˇ CIO Spotlights
Southern Glazer’s appoints Steve Bronson CIO to steer digital transformation
Steve Bronson, former SVP of Global Tech Infrastructure at McDonald’s, joins Southern Glazer’s as CIO, reporting to Chief Growth Officer David Chaplin.
Bronson brings 25+ years of experience leading cloud migrations, ERP overhauls, and AI-driven personalization at global brands like Nike and AB InBev.
He will guide the distributor’s enterprise tech roadmap to support long-term growth and digital innovation.
D-Wave appoints Stan Black as CISO to strengthen security strategy
Quantum computing firm D-Wave named Stan Black its new chief information security officer, bringing 20+ years of cybersecurity leadership.
Black will align security with business goals, guide AI/ML governance, and support secure product development.
He previously held senior security roles at Citrix, Dell/EMC/RSA, VMware, and Nuance, and is a frequent industry advisor and speaker.