Hewlett Packard Enterprise (NYSE:HPE) Issues Earnings Results, Beats Expectations By $0.25 EPS

Hewlett Packard Enterprise (NYSE:HPE) released its quarterly earnings data on Monday. The technology company reported $0.79 EPS for the quarter, topping analysts’ consensus estimates of $0.54 by $0.25, FiscalAI reports. The firm had revenue of $10.68 billion for the quarter, compared to the consensus estimate of $9.78 billion. Hewlett Packard Enterprise had a net margin of 3.94% and a return on equity of 11.99%. The firm’s revenue was up 40.0% on a year-over-year basis. During the same quarter in the previous year, the firm earned ($0.82) earnings per share. Hewlett Packard Enterprise updated its FY 2026 guidance to 3.350-3.450 EPS and its Q3 2026 guidance to 0.880-0.930 EPS.

Here are the key takeaways from Hewlett Packard Enterprise’s conference call:

• HPE reported record Q2 revenue of $10.7 billion, non-GAAP EPS of $0.79, and $915 million in free cash flow, all well above outlook. Management said orders more than doubled and backlog hit a record, signaling strong demand visibility.
• The company raised fiscal 2026 guidance, now expecting non-GAAP EPS of $3.35 to $3.45 and free cash flow of at least $3.5 billion. HPE also lifted consolidated revenue growth and operating profit targets, saying Catalyst savings and Juniper synergies are running ahead of schedule.
• Networking was a standout, with revenue up on a normalized basis and strong growth in campus/branch, data center switching, routing, and security. Management increased its cumulative Networks for AI order target to at least $2 billion for fiscal 2026 and said Juniper integration is strengthening its market position.
• Cloud and AI demand accelerated sharply, driven by traditional servers, AI systems, Alletra MP storage, and private cloud offerings. HPE booked $1.8 billion in new AI systems orders in the quarter and said AI revenue should improve in the back half of the year, peaking in Q4.
• Management gave an early fiscal 2027 framework calling for consolidated revenue growth of 8% to 12%, EPS growth of 12% to 16%, and free cash flow of at least $4.5 billion. HPE said it expects to reach its 2x net leverage goal by the end of fiscal 2026, one year ahead of schedule.

Hewlett Packard Enterprise Stock Performance

Shares of HPE opened at $56.05 on Wednesday. The company has a current ratio of 1.03, a quick ratio of 0.75 and a debt-to-equity ratio of 0.71. The stock has a market cap of $74.37 billion, a P/E ratio of 52.39, a PEG ratio of 1.20 and a beta of 1.42. The company has a 50-day moving average of $29.23 and a two-hundred day moving average of $24.80. Hewlett Packard Enterprise has a 12-month low of $17.16 and a 12-month high of $64.25.

Hewlett Packard Enterprise Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, July 15th. Shareholders of record on Tuesday, June 16th will be given a dividend of $0.1425 per share. The ex-dividend date is Tuesday, June 16th. This represents a $0.57 dividend on an annualized basis and a yield of 1.0%. Hewlett Packard Enterprise’s payout ratio is presently -300.00%.

More Hewlett Packard Enterprise News

Here are the key news stories impacting Hewlett Packard Enterprise this week:

• Positive Sentiment: HPE reported fiscal Q2 EPS of $0.79 versus $0.54 expected and revenue of $10.68 billion versus $9.78 billion expected, with revenue up 40% year over year. HPE Reports Fiscal 2026 Second Quarter Results
• Positive Sentiment: The company raised full-year FY2026 guidance to EPS of $3.35-$3.45 and revenue of $44.2 billion-$45.6 billion, well above consensus, and also lifted Q3 guidance, signaling momentum is continuing. HPE expects to achieve 2028 financial targets this year after record quarter on AI boom
• Positive Sentiment: Management said strong AI compute demand is accelerating the business, with networking revenue up 148% and long-term financial targets pulled forward by two years. HPE Pulls Forward Long-Term Targets as Surging AI Compute Demand Boosts Revenue
• Positive Sentiment: Multiple analysts raised price targets after the report, reflecting higher confidence in HPE’s growth outlook and valuation re-rating after the earnings beat. Analyst price target updates
• Neutral Sentiment: HPE also announced a quarterly dividend of $0.1425 per share, which may attract income-focused investors but is not the main driver of the stock move. Dividend and earnings report

Insiders Place Their Bets

In other news, CFO Marie Myers sold 93,583 shares of the business’s stock in a transaction that occurred on Tuesday, May 5th. The shares were sold at an average price of $30.01, for a total value of $2,808,425.83. Following the completion of the transaction, the chief financial officer owned 204,754 shares of the company’s stock, valued at $6,144,667.54. The trade was a 31.37% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Neil B. Macdonald sold 112,652 shares of the business’s stock in a transaction that occurred on Wednesday, March 25th. The shares were sold at an average price of $25.09, for a total transaction of $2,826,438.68. Following the completion of the transaction, the executive vice president directly owned 56,494 shares of the company’s stock, valued at approximately $1,417,434.46. This represents a 66.60% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders have sold 702,402 shares of company stock valued at $18,440,171. 0.44% of the stock is currently owned by insiders.

Hedge Funds Weigh In On Hewlett Packard Enterprise

A number of institutional investors have recently modified their holdings of HPE. Headlands Technologies LLC acquired a new position in shares of Hewlett Packard Enterprise in the second quarter valued at approximately $26,000. IFC & Insurance Marketing Inc. acquired a new position in shares of Hewlett Packard Enterprise in the fourth quarter valued at approximately $40,000. DV Equities LLC acquired a new position in shares of Hewlett Packard Enterprise in the fourth quarter valued at approximately $45,000. Quarry LP acquired a new position in shares of Hewlett Packard Enterprise in the third quarter valued at approximately $45,000. Finally, Geneos Wealth Management Inc. raised its position in shares of Hewlett Packard Enterprise by 44.7% in the first quarter. Geneos Wealth Management Inc. now owns 4,456 shares of the technology company’s stock valued at $69,000 after buying an additional 1,377 shares during the last quarter. Institutional investors and hedge funds own 80.78% of the company’s stock.

Wall Street Analyst Weigh In

A number of analysts recently commented on the stock. Barclays boosted their price objective on shares of Hewlett Packard Enterprise from $28.00 to $67.00 and gave the stock an “overweight” rating in a report on Tuesday. Morgan Stanley lifted their target price on shares of Hewlett Packard Enterprise from $33.00 to $71.00 and gave the stock an “equal weight” rating in a research report on Tuesday. Truist Financial restated a “buy” rating and set a $69.00 target price (up from $31.00) on shares of Hewlett Packard Enterprise in a research report on Tuesday. Weiss Ratings restated a “hold (c-)” rating on shares of Hewlett Packard Enterprise in a research report on Wednesday, March 25th. Finally, Loop Capital upgraded shares of Hewlett Packard Enterprise from a “hold” rating to a “buy” rating and lifted their target price for the stock from $23.00 to $75.00 in a research report on Tuesday. Eleven equities research analysts have rated the stock with a Buy rating and ten have assigned a Hold rating to the stock. According to data from MarketBeat.com, Hewlett Packard Enterprise has an average rating of “Moderate Buy” and a consensus target price of $59.47.

About Hewlett Packard Enterprise

Hewlett Packard Enterprise (HPE) is an enterprise technology company that designs, develops and sells IT infrastructure, software and services for business and government customers. Its core offerings span servers, storage, networking, and related software, together with consulting, integration and support services aimed at modernizing and managing enterprise IT environments. HPE’s product portfolio includes systems for traditional data centers as well as solutions for high-performance computing, edge computing and telecommunications infrastructure.

A major focus for HPE is hybrid cloud and consumption-based IT.