Dell Touts Gains in Cloud Server War

Shares of Dell are up nearly 10 percent this morning after the company reported sales of $16.1 billion, exceeding analysts' expectation of $15.7 billion. The strong showing is being viewed on Wall Street as Ca sign that Chief Executive Officer Michael Dell's turnaround strategy is making progress.

There is a lot of attention to Dell's gains in laptops (up 22 percent), software (up 17 percent) and storage (up 15 percent). Those are interesting, but we're all about the data centers. What about the cloud computing business? Here's a comment from Michael Dell in yesterday's conference call with analysts:

Here's the interesting wrinkle: most of those wins on cloud computing deals have been in China. "Dell's Cloud-Computing service and design model is powering about half of the fastest growing Chinese internet companies as well as the largest portal in China."

Dell has had a Cloud Computing Solutions business for two years, which focuses primarily on custom solutions for large customers. Dell recently shared some details about one of its custom server designs for cloud and hyper scale computing, known as the XS23 Cloud Server.