Financial Performance - For the three months ended January 31, 2025, GAAP net revenue was $7.854 billion, an increase from $6.755 billion in the same period of fiscal 2024, representing a growth of approximately 16.2%[266]. - GAAP gross profit for the same period was $2.295 billion, with a gross profit margin of 29.2%, down from $2.457 billion and 36.4% in fiscal 2024[266]. - The company reported a free cash flow of negative $877 million for the three months ended January 31, 2025, compared to negative $482 million for the same period in 2024[243]. - Free cash flow (FCF) decreased to $(877) million for the three months ended January 31, 2025, compared to $(482) million in the same period of fiscal 2024[273]. - Non-GAAP net earnings attributable to HPE exclude certain charges, including those related to equity interests and taxes, to provide a clearer view of operational performance[283]. Cash Flow and Liquidity - For the three months ended January 31, 2025, net cash used in operating activities increased by $0.5 billion compared to the same period in fiscal 2024, primarily due to unfavorable changes in other assets and liabilities[244]. - The company expects internally generated cash flows to be generally sufficient to support operating businesses and capital expenditures for at least the next twelve months[233]. - The company anticipates that funds from operations and access to capital markets will meet liquidity requirements for the foreseeable future[233]. - As of January 31, 2025, cash, cash equivalents, and restricted cash totaled $13.852 billion, while total debt was $17.877 billion[240]. - The cash conversion cycle increased to 5 days as of January 31, 2025, compared to a negative 12 days as of October 31, 2024[245]. Investments and Divestitures - The company completed the divestiture of its CTG business to HCLTech on December 1, 2024, receiving net proceeds of $210 million and recognizing a gain of $244 million[238]. - The company divested 30% of H3C's total issued share capital on September 4, 2024, receiving $2.1 billion in pre-tax consideration, which is expected to result in annualized cost savings of approximately $120 million[282]. - The company incurred a gain of $244 million from the sale of CTG on December 1, 2024, which is considered a discrete event for non-GAAP calculations[283]. - Future cash payments of approximately $159 million are expected in connection with approved restructuring plans, with $47 million to be paid through the remainder of fiscal 2025[260]. Debt and Financing Activities - The company issued $9.0 billion of senior unsecured notes and $1.5 billion of Preferred Stock in September 2024 to fund a portion of the acquisition of Juniper Networks[239]. - Net cash used in financing activities increased by $0.9 billion to $0.8 billion for the same period, primarily due to lower proceeds from debt[251]. - The company maintains a revolving credit facility and two commercial paper programs, with no changes since October 31, 2024[254]. Operational Metrics - Days of sales outstanding (DSO) increased to 40 days as of January 31, 2025, compared to 38 days as of October 31, 2024[245]. - DSO (Days Sales Outstanding) decreased due to higher early collections, while DOS (Days of Sales) increased due to higher inventory levels from strategic purchases for AI systems[246][247]. Cost Management - The company anticipates making contributions of approximately $143 million to non-U.S. pension plans for the remainder of fiscal 2025[259]. - The projected non-GAAP income tax rate for fiscal 2025 is set at 15%, consistent with the previous fiscal year, reflecting the company's tax structure and positions[289]. - The company expects future annualized cost savings of approximately $120 million following the H3C divestiture and related severance actions[282]. - Non-GAAP measures are used to supplement GAAP results, providing a clearer view of financial performance without the impact of non-cash expenses and discrete events[287].

Financial Data and Key Metrics Changes - The company reported Q1 revenue of $7.9 billion, representing a 17% year-over-year growth, marking the fourth consecutive quarter of accelerated revenue growth [36][38] - Non-GAAP diluted net earnings per share were 49 cents, consistent with the company's outlook range [41] - Non-GAAP gross margin was 29.4%, down 680 basis points year-over-year, primarily due to a higher mix of server revenue and lower contributions from Intelligent Edge [39] - Free cash flow was negative $877 million, in line with normal seasonal patterns [54] Business Line Data and Key Metrics Changes - Server revenue reached $4.3 billion, up 30% year-over-year, although it fell sequentially due to the timing of AI systems deals [42] - Intelligent Edge revenue was $1.1 billion, up 2% quarter-over-quarter but down 4% year-over-year [48] - Hybrid cloud revenue grew 11% year-over-year to $1.4 billion, although it declined 12% sequentially [50] - Financial services generated $873 million in revenue, up 2% year-over-year and flat quarter-over-quarter [53] Market Data and Key Metrics Changes - The company experienced double-digit year-over-year orders growth across all key geographies and products, including campus switching [20] - AI systems revenue was $900 million in Q1, up from about $400 million last year, but down sequentially as expected due to chip availability and customer readiness [44][24] - The AI systems backlog was $3.1 billion, up 29% quarter-over-quarter [22] Company Strategy and Development Direction - The company plans to reduce its employee base by 5% over the next twelve to eighteen months, targeting approximately 2,500 positions to better align its cost structure with its business mix and long-term strategy [16] - The company is committed to closing the Juniper acquisition, which is expected to deliver at least $450 million in gross annual run rate synergies to shareholders within three years [10] - The company aims to leverage its global supply chain to mitigate the impact of recent tariff policies [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that while Q1 performance met expectations, execution could have been better, particularly in the server segment [13][33] - The company expects continued pressure on server operating margins in the near term but anticipates improvements in the back half of fiscal 2025 [15][34] - Management expressed confidence in achieving revenue growth of 7% to 11% for fiscal 2025, with a significant portion weighted towards the second half [60] Other Important Information - The company is implementing cost-saving measures, targeting discretionary spending, and has reduced non-GAAP operating expenses to a record low of 19% of revenue [40] - The company expects to achieve at least $350 million in gross savings by fiscal 2027, with about 20% of the savings expected by the end of this year [57] Q&A Session Summary Question: How much of the operating profit dollar headwind is from tariff assumptions? - Management indicated that the guidance includes a seven cents impact from tariffs for the year, with four cents expected in Q2, primarily affecting the server business [91][92] Question: What gives confidence in revenue growth and operating margin expansion in the back half of the year? - Management highlighted three critical areas: improved server execution, mitigation of tariffs, and the impact of the cost efficiency program as drivers for profitability [122] Question: How is the customer mix changing? - Management noted a balanced approach targeting both service provider model builders and enterprise customers, with a focus on maintaining a solid pipeline and addressing the needs of various segments [110][112]

For the quarter ended January 2025, Hewlett Packard Enterprise (HPE) reported revenue of $7.85 billion, up 16.3% over the same period last year. EPS came in at $0.49, compared to $0.48 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $7.81 billion, representing a surprise of +0.55%. The company delivered an EPS surprise of -2.00%, with the consensus EPS estimate being $0.50.While investors closely watch year-over-year changes in headline numbers -- revenue and earning ...

Hewlett Packard Enterprise (HPE) came out with quarterly earnings of $0.49 per share, missing the Zacks Consensus Estimate of $0.50 per share. This compares to earnings of $0.48 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -2%. A quarter ago, it was expected that this information technology products and services provider would post earnings of $0.55 per share when it actually produced earnings of $0.58, delivering a surpris ...

Hewlett Packard Enterprise reported solid revenue growth for its first quarter of fiscal 2025, while facing pressure on cash flow and margins.Hewlett Packard Enterprise (HPE -4.92%), a technology company specializing in edge-to-cloud platforms, released its first quarter fiscal 2025 results on March 6, 2025. The report highlighted a 16% year-over-year revenue increase to $7.9 billion, surpassing analyst estimates of $7.814 billion. Despite this, the company reported non-GAAP earnings per share (EPS) of $0.4 ...

Antonio Neri, CEO of Hewlett Packard Enterprise, speaks during an interview with CNBC on the floor of the New York Stock Exchange (NYSE) in New York City, October 20, 2023.Hewlett Packard Enterprise shares slid 16% in extended trading on Thursday as the data center equipment maker issued quarterly and full-year guidance that came in below consensus.Here's how the company did in the fiscal first quarter in comparison with LSEG consensus:Earnings per share: 49 cents adjusted vs. 49 cents expectedRevenue: $7.8 ...

HPE Q1 FY25 Earnings |1 March 6th, 2025 Forward-looking statements Hewlett Packard Enterprise HPE provides certain forward-looking quidance on a nor-GAPP basis only. Hewlet Packard Enterprise is unable to provide a reconcliation to the most dinectly comparable GAAP unreasonable efforts, as the Company cannot predict some elements that are included in such directly comparable GARP financid measure. These elements could have a material reported GAAP results for the quidance period. Refer to the discussion of ...

Revenue Performance - Revenue for Q1 Fiscal 2025 was $7.9 billion, representing a 16% increase year-over-year in actual dollars and a 17% increase in constant currency [3]. - Annualized revenue run-rate (ARR) reached $2.1 billion, up 45% from the prior-year period in actual dollars and 46% in constant currency [3]. - Net revenue for the three months ended January 31, 2025, was $7,854 million, a decrease of 7.1% from $8,458 million in the previous quarter and an increase of 16.2% from $6,755 million in the same quarter last year [19]. - Total consolidated net revenue for the three months ended January 31, 2025, was $7,854 million, a decrease of 7% quarter-over-quarter and an increase of 16% year-over-year [31]. - The Server segment reported net revenue of $4,290 million, down 8% from the previous quarter but up 29% year-over-year [31]. - Intelligent Edge revenue was $1.1 billion, down 5% year-over-year in actual dollars, with an operating profit margin of 27.4% [7]. - Hybrid Cloud revenue was $1.4 billion, up 10% year-over-year in actual dollars, with an operating profit margin of 7.0% [7]. Earnings and Profitability - GAAP diluted net EPS was $0.44, up 52% from the prior-year period, exceeding the guidance range of $0.31 to $0.36 [7]. - Non-GAAP diluted net EPS was $0.49, up 2% from the prior-year period, within the guidance range of $0.47 to $0.52 [7]. - Earnings from operations for the same period were $433 million, down 37.5% from $693 million in the previous quarter and down 17.5% from $525 million year-over-year [19]. - Net earnings attributable to common stockholders were $598 million, a decrease of 55.5% from $1,341 million in the previous quarter and an increase of 54.3% from $387 million year-over-year [19]. - GAAP gross profit margin for the three months ended January 31, 2025, was 29.2%, down from 30.8% in the previous quarter and down from 36.4% year-over-year [21]. - Non-GAAP net earnings attributable to HPE for the three months ended January 31, 2025, were $684 million, compared to $795 million in the previous quarter and $638 million in the same quarter last year [23]. - The total segment operating profit margin decreased to 10.6% for the three months ended January 31, 2025, down from 11.9% in the previous quarter and 12.3% year-over-year [33]. Cash Flow and Expenses - Free cash flow for the three months ended January 31, 2025, was $(877) million, a significant decrease from $1,500 million in the previous quarter and $(482) million year-over-year [23]. - Research and development expenses for the quarter were $475 million, down from $527 million in the previous quarter and down from $582 million year-over-year [19]. - The total costs and expenses for the three months ended January 31, 2025, were $7,421 million, a decrease of 4.4% from $7,765 million in the previous quarter and an increase of 19.1% from $6,230 million year-over-year [19]. - The company reported a net cash used in operating activities of $390 million for the three months ended January 31, 2025, compared to a net cash provided of $64 million for the same period last year [27]. Future Projections and Guidance - HPE estimates Q2 Fiscal 2025 revenue to be in the range of $7.2 billion to $7.6 billion, with GAAP diluted net EPS estimated between $0.08 and $0.14 [6]. - HPE expects future annualized cost savings of approximately $120 million following the divestiture of 30% of H3C's total issued share capital, which generated $2.1 billion in pre-tax proceeds [43]. - HPE announced a cost reduction program expected to deliver gross savings of approximately $350 million by fiscal year 2027 [9]. Legal and Organizational Changes - The proposed merger with Juniper Networks is facing legal challenges, with a trial set to commence on July 9, 2025 [8]. - HPE implemented an organizational change effective at the beginning of fiscal 2025, transferring certain managed services to align with its current business structure [37]. Financial Reporting and Non-GAAP Measures - The company provides non-GAAP financial measures to enhance transparency and allow investors to evaluate its operating performance without the impact of foreign exchange rates [41]. - HPE's management believes that excluding certain costs from non-GAAP measures provides a clearer view of ongoing operating results [42]. - HPE excludes gains and losses on non-marketable equity investments to reflect normal business operations, impacting the evaluation of current operating performance [46]. - For fiscal 2025, HPE projects a non-GAAP income tax rate of 15%, consistent with the rate used in fiscal 2024 [46]. - HPE's Free Cash Flow (FCF) is defined as cash flow from operations minus net capital expenditures, adjusted for exchange rate fluctuations [46]. - The projected non-GAAP income tax rate may change due to the evolving global tax environment and changes in the Company's geographic earnings mix [46]. - HPE's management and investors utilize FCF to assess cash available for investments, stock repurchases, and liquidity evaluation [46].

Core Viewpoint - Analysts forecast that Hewlett Packard Enterprise (HPE) will report quarterly earnings of $0.50 per share, reflecting a year-over-year increase of 4.2%, with revenues expected to reach $7.81 billion, an increase of 15.6% compared to the previous year [1] Earnings Projections - The consensus EPS estimate for the quarter has been adjusted downward by 0.6% over the past 30 days, indicating a reassessment by covering analysts [2] - Revisions to earnings projections are crucial for predicting investor behavior, as empirical studies show a strong correlation between earnings estimate trends and short-term stock price performance [3] Revenue Estimates - Revenue from Financial Services is projected to be $884.51 million, a year-over-year change of +1.3% [5] - Revenue from Corporate Investments and other is estimated at $244.54 million, indicating a +2.8% change from the prior year [5] - Revenue from Intelligent Edge is expected to be $1.14 billion, reflecting a -5.2% change from the year-ago quarter [5] - Revenue from Americas is forecasted to reach $3.38 billion, suggesting a +20.7% year-over-year change [6] - Revenue from Asia Pacific and Japan is estimated at $1.59 billion, indicating a +4.8% change from the previous year [6] - Revenue from Europe, Middle East and Africa is expected to be $2.72 billion, reflecting an +11.7% change from the prior year [6] Earnings from Operations - Earnings from Operations in Financial Services are projected to be $80.25 million, compared to $74 million reported in the same quarter last year [7] - Earnings from Operations in Intelligent Edge are expected to reach $250.58 million, down from $353 million reported in the same quarter of the previous year [7] Stock Performance - Shares of Hewlett Packard Enterprise have shown a return of -6.5% over the past month, compared to a -1.3% change in the Zacks S&P 500 composite [7] - HPE holds a Zacks Rank 3 (Hold), indicating expectations to mirror overall market performance in the near future [7]

Core Viewpoint - Wall Street anticipates a year-over-year increase in earnings for Hewlett Packard Enterprise (HPE) due to higher revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - HPE is expected to report earnings of $0.50 per share, reflecting a +4.2% change year-over-year, with revenues projected at $7.81 billion, up 15.6% from the previous year [3]. - The earnings report is scheduled for March 6, 2025, and could lead to stock price increases if results exceed expectations [2]. Estimate Revisions - The consensus EPS estimate has been revised down by 0.6% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for HPE is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -2.36%, suggesting a bearish outlook from analysts [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive reading is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank of 1, 2, or 3 [8]. - HPE currently holds a Zacks Rank of 3, making it challenging to predict an earnings beat conclusively [11]. Historical Performance - HPE has beaten consensus EPS estimates in the last four quarters, with a +5.45% surprise in the most recent quarter [12][13]. Conclusion - While HPE may not appear to be a compelling earnings-beat candidate, investors should consider other factors influencing stock performance ahead of the earnings release [16].