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(Reuters) -Dell Technologies shares surged 27% on Friday after the tech equipment maker provided an annual forecast that was largely ahead of Wall Street expectations and reinforced rising demand for AI-related gear.

At $120.34, nearly $19 billion was set to be added to the company's market capitalization if the current level holds, and would be the second straight gains of about 20% for the stock a day after quarterly results.

"We have positioned ourselves well in AI," COO Jeff Clarke said on Thursday, noting that more customers were demanding PCs and servers with AI capabilities.

Orders for the company's AI-optimized servers, including the flagship PowerEdge XE9680, jumped 40% sequentially in the fourth quarter, Clarke said.

The performance provides further evidence that AI adoption is driving gains across enterprise technology vendors, and comes as investor interest in AI has spiked following Nvidia (NASDAQ:NVDA)'s stunning rally.

At least nine brokerages raised their price targets on Dell (NYSE:DELL) after the results. Currently, over three-fourths of the analysts have a "buy" or higher rating with a median target price of $113.

"Dell's AI business showed strong progress on key metrics... commentary on the PC market was similar to HP (NYSE:HPQ)'s: that a rebound is coming, but it is being pushed out to the second half of the year," said analysts at Bernstein.

PC and enterprise technology vendor HP's sales declined for a seventh straight quarter in the most recent three-month period.

The recent upside in the business comes after Dell struggled for most part of the last two years as worldwide computer sales sharply declined. While revenue fell less-than-expected in its fourth quarter, annual revenue dropped for the first time since re-listing in 2018.

Dell forecast revenue between $91 billion and $95 billion for its current fiscal year ending January 2025, largely above analysts' average estimate of $92.07 billion.

Dell shares soar as annual forecast gets a boost from AI adoption