HPE Reports Fiscal 2025 Fourth Quarter Results

HOUSTON--( BUSINESS WIRE)-- HPE (NYSE: HPE) today announced financial results for the fourth quarter ended October 31, 2025.

“HPE finished a transformative year with a strong fourth quarter of profitable growth and disciplined execution,” said Antonio Neri, president and CEO of HPE. “During the year, we completed the Juniper Networks acquisition, further scaled our AI and Cloud businesses, and accelerated innovation across our portfolio, giving HPE momentum to advance our strategic priorities in fiscal 2026.”

“HPE continued to drive operational discipline in Q4, resulting in record gross profit and robust non-GAAP operating profit as well as free cash flow generation that exceeded our outlook,” said Marie Myers, executive vice president and CFO of HPE. “Our focus on disciplined spending, portfolio simplification, and ongoing structural cost management initiatives gives us the confidence to raise our FY26 diluted net earnings per share guidance and the midpoint of our FY26 free cash flow guidance.”

Fourth Quarter Fiscal 2025 Financial Results

Fourth Quarter Fiscal 2025 Segment Results

Dividend

The HPE Board of Directors declared a regular cash dividend of $0.1425 per share on the company’s common stock, payable on or about January 16, 2026, to stockholders of record as of the close of business on December 19, 2025.

Fiscal 2026 First Quarter Outlook

HPE estimates revenue to be in the range of $9 billion to $9.4 billion. HPE estimates GAAP diluted net EPS to be in the range of $0.09 to $0.13 and non-GAAP diluted net EPS (1) to be in the range of $0.57 to $0.61. Fiscal 2026 first quarter non-GAAP diluted net EPS estimate excludes net after-tax adjustments of approximately $0.48 per diluted share, primarily related to amortization of intangible assets, acquisition, disposition and other charges, stock-based compensation expense, and cost reduction program.

Fiscal 2026 Full Year Outlook

HPE is reaffirming its FY26 revenue outlook range of 17% to 22%, as previously provided at our Securities Analyst Meeting. HPE estimates non-GAAP operating profit growth between 32% to 40% (1)(4) and GAAP operating profit growth to be 455% to 520%. HPE is raising both GAAP diluted net EPS to be in the range of $0.62 to $0.82 and non-GAAP diluted net EPS (1) to be in the range of $2.25 to $2.45. Fiscal 2026 full year non-GAAP diluted net EPS estimate excludes net after-tax adjustments of approximately $1.63 per diluted share, primarily related to amortization of intangible assets, stock-based compensation expense, acquisition, disposition and other charges, and cost reduction program. HPE is also raising the midpoint of its free cash flow (1)(3)(5) guidance, now expected to be in the range of $1.7 billion to $2 billion.

1 A description of HPE’s use of non-GAAP financial information is provided below under “Use of non-GAAP financial information and key performance metrics.”

2 Annualized Revenue Run-Rate (“ARR”) is a financial metric used to assess the growth of the Consumption Services offerings. ARR represents the annualized revenue of all net HPE GreenLake cloud services revenue, related financial services revenue (which includes rental income from operating leases and interest income from finance leases), and software-as-a-Service, software consumption revenue, and other as-a-Service offerings, by taking such revenue recognized during a quarter and multiplying by four. To better align the calculation of ARR with Juniper Networks’ business and offerings, beginning with the quarter ended July 31, 2025, we also included revenue from software licenses support and maintenance in our ARR calculation, and will continue to do so going forward. The impact of this change was not material to the current and prior periods presented. We use ARR as a performance metric. ARR should be viewed independently of net revenue and is not intended to be combined with it.

3 Free cash flow represents cash flow from operations, less net capital expenditures (investments in property, plant & equipment (“PP&E”) and software assets less proceeds from the sale of PP&E), and adjusted for the effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash.

4 FY26 non-GAAP operating profit excludes costs of approximately $2.9 billion primarily related to amortization of intangible assets, stock-based compensation expense, acquisition, disposition and other charges, and cost reduction program.

5 Hewlett Packard Enterprise provides certain guidance on a non-GAAP basis. In reliance on the exception provided by Item 10(e)(1)(i)(B) of Regulation S-K, Hewlett Packard Enterprise is unable to provide a reconciliation to the most directly comparable GAAP financial measure without unreasonable efforts, as the Company cannot predict some elements that are included in such directly comparable GAAP financial measure. These elements could have a material impact on the Company’s reported GAAP results for the guidance period. Refer to the discussion of non-GAAP financial measures below for more information.

About HPE

HPE (NYSE: HPE) is a leader in essential enterprise technology, bringing together the power of AI, cloud, and networking to help organizations achieve more. As pioneers of possibility, our innovation and expertise advance the way people live and work. We empower our customers across industries to optimize operational performance, transform data into foresight, and maximize their impact. Unlock your boldest ambitions with HPE. Discover more at www.hpe.com.

Use of non-GAAP financial information and key performance metrics

To supplement Hewlett Packard Enterprise’s condensed consolidated financial statement information presented on a generally accepted accounting principles (“GAAP”) basis, Hewlett Packard Enterprise provides financial measures, including revenue on a constant currency basis (including at the business segment level), non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP operating profit (non-GAAP earnings from operations), non-GAAP operating profit margin (non-GAAP earnings from operations as a percentage of net revenue), non-GAAP income tax rate, non-GAAP net earnings attributable to HPE and non-GAAP net earnings attributable to common stockholders, non-GAAP diluted net earnings per share attributable to common stockholders, and free cash flow (“FCF”). Hewlett Packard Enterprise also provides forecasts of revenue growth on a constant currency basis, non-GAAP operating profit growth, non-GAAP diluted net earnings per share, and FCF. Reconciliations of each of these non-GAAP financial measures to their most directly comparable GAAP measures for this quarter and prior periods are included in the tables below or elsewhere in the materials accompanying this news release. In addition an explanation of the ways in which Hewlett Packard Enterprise’s management uses these non-GAAP measures to evaluate its business, the substance behind Hewlett Packard Enterprise’s decision to use these non-GAAP measures, the material limitations associated with the use of these non-GAAP measures, the manner in which Hewlett Packard Enterprise’s management compensates for those limitations, and the substantive reasons why Hewlett Packard Enterprise’s management believes that these non-GAAP measures provide supplemental useful information to investors is included further below. This additional non-GAAP financial information is not meant to be considered in isolation or as a substitute for revenue, gross profit, gross profit margin, operating profit (earnings from operations), operating profit margin (earnings from operations as a percentage of net revenue), net earnings, diluted net earnings per share, and cash flow from operations prepared in accordance with GAAP.

In addition to the supplemental non-GAAP financial information, Hewlett Packard Enterprise also presents annualized revenue run-rate (“ARR”) as performance metric. ARR is a financial metric used to assess the growth of the Consumption Services offerings. ARR represents the annualized revenue of all net HPE GreenLake cloud services revenue, related financial services revenue (which includes rental income from operating leases and interest income from finance leases), and software-as-a-service (“SaaS”), software consumption revenue, and other as-a-service offerings by taking such revenue recognized during a quarter and multiplying by four. To better align the calculation of ARR with Juniper Networks’ business and offerings, beginning with the quarter ended July 31, 2025, we also included revenue from software licenses support and maintenance in our ARR calculation, and will continue to do so going forward. The impact of this change was not material to the current and prior periods presented. ARR should be viewed independently of net revenue and is not intended to be combined with it.

Forward-looking statements

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks, uncertainties, and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of Hewlett Packard Enterprise Company and its consolidated subsidiaries (“Hewlett Packard Enterprise”) may differ materially from those expressed or implied by such forward-looking statements and assumptions. The words “believe”, “expect”, “anticipate”, “guide”, “optimistic”, “intend”, “aim”, “will”, “estimates”, “may”, “could”, “should” and similar expressions are intended to identify such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any statements related to any anticipated financial or operational benefits associated with the segment realignment that went into effect starting the first quarter of fiscal 2026, any statements regarding the ongoing integration of Juniper Networks, Inc., and any projections, estimates, or expectations of savings or synergy realizations in connection therewith; any projections, estimations, or expectations of addressable markets and their sizes, revenue (including annualized revenue run-rate), margins, expenses (including stock-based compensation expenses), investments, effective tax rates, interest rates, the impact of tax law changes and related guidance and regulations, the impact of changes in trade policies and restrictions and the uncertainty created thereby, net earnings, net earnings per share, cash flows, liquidity and capital resources, inventory, goodwill, impairment charges, order backlog, share repurchases, currency exchange rates, repayments of debts including our asset-backed debt securities, or other financial items; recent amendments to accounting guidance and any potential impacts on our financial reporting therefrom; any projections or estimations of orders; any projections of the amount, timing, or impact of cost saving actions; any statements of the plans, strategies, and objectives of management for future operations, as well as the execution and consummation of corporate transactions or contemplated acquisitions and dispositions (including but not limited to the disposition of shares of H3C Technologies Co., Limited (“H3C”) and the receipt of proceeds therefrom), research and development expenditures, and any resulting benefit, cost savings, charges, or revenue or profitability improvements; any statements concerning the expected development, performance, market share, or competitive performance relating to our products or services; any statements concerning technological and market trends, the pace of technological innovation, and adoption of new technologies, including artificial intelligence-related and other products and services offered by Hewlett Packard Enterprise; any statements regarding current or future macroeconomic trends or events and the impacts of those trends and events on Hewlett Packard Enterprise and our financial performance, including our actions to mitigate such impacts on our business; any statements regarding future regulatory trends and the resulting legal and reputational exposure, including but not limited to those relating to environmental, social, governance, cybersecurity, data privacy, and artificial intelligence issues, among others; any statements regarding pending investigations, claims, or disputes, including but not limited to the legal proceedings relating to the acquisition of Juniper Networks; any statements of expectation or belief, including those relating to future guidance and the financial performance of Hewlett Packard Enterprise; and any statements of assumptions underlying any of the foregoing.

Risks, uncertainties, and assumptions include the need to address the many challenges facing Hewlett Packard Enterprise’s businesses; the competitive pressures faced by Hewlett Packard Enterprise’s businesses; risks associated with executing Hewlett Packard Enterprise’s strategy; the impact of macroeconomic and geopolitical trends and events; the need to effectively manage third-party suppliers and distribute Hewlett Packard Enterprise's products and services; the protection of Hewlett Packard Enterprise's intellectual property assets, including intellectual property licensed from third parties and intellectual property shared with its former parent; risks associated with Hewlett Packard Enterprise's international operations (including from geopolitical events and macroeconomic uncertainties); the development and transition of new products and services and the enhancement of existing products and services to meet customer needs and respond to emerging technological trends; the execution of Hewlett Packard Enterprise’s transformation and mix shift of its portfolio of offerings; the execution and performance of contracts by Hewlett Packard Enterprise and its suppliers, customers, clients, and partners, including any impact thereon resulting from macroeconomic or geopolitical events, including inflation and rising commodity costs; the hiring and retention of key employees; the execution, integration, consummation, and other risks associated with business combination, disposition, and investment transactions, including but not limited to the risks associated with the disposition of H3C shares and the receipt of proceeds therefrom and successful integration of Juniper Networks, Inc., including our ability to implement our plans and forecasts and realize our anticipated financial and operational benefits with respect to the consolidated business; the execution, timing, and results of any cost reduction actions, including estimates and assumptions related to the costs and anticipated benefits of implementing such actions; the impact of changes to privacy, cybersecurity, environmental, global trade, and other governmental regulations; changes in our product, lease, intellectual property, or real estate portfolio; the payment or non-payment of a dividend for any period; the efficacy of using non-GAAP, rather than GAAP, financial measures in business projections and planning; the judgments required in connection with determining revenue recognition; impact of company policies and related compliance; utility of segment realignments; allowances for recovery of receivables and warranty obligations; provisions for, and resolution of, pending investigations, claims, and disputes; the impacts of legal and regulatory changes and related guidance; and other risks that are described in Hewlett Packard Enterprise’s Annual Report on Form 10-K for the fiscal year ended October 31, 2024, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and in other filings made by Hewlett Packard Enterprise from time to time with the Securities and Exchange Commission.

As in prior periods, the financial information set forth in this press release, including tax-related items, reflects estimates based on information available at this time. While Hewlett Packard Enterprise believes these estimates to be reasonable, these amounts could differ materially from reported amounts in the filings made by Hewlett Packard Enterprise from time to time with the Securities and Exchange Commission. Hewlett Packard Enterprise assumes no obligation and does not intend to update these forward-looking statements, except as required by applicable law.

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(Unaudited)

For the three months ended

October 31, 2025

July 31, 2025

October 31, 2024

In millions, except per share amounts

Net revenue

9,679

9,136

8,458

Costs and Expenses:

Cost of sales (exclusive of amortization shown separately below)

6,438

6,464

5,852

Research and development

881

622

527

Selling, general and administrative

1,642

1,496

1,211

Amortization of intangible assets

310

126

Impairment charges

260

—

Transformation costs

—

Acquisition, disposition and other charges

156

181

Total costs and expenses

9,687

8,889

7,765

(Loss) earnings from operations

)

247

693

Interest and other, net (1)

(261

)

Gain on sale of a business

—

Gain on sale of equity interest

—

733

Earnings from equity interests

(14

)

(Loss) earnings before provision for taxes

(261

)

288

1,417

Benefit (provision) for taxes

436

(51

)

Net earnings attributable to HPE

175

305

1,366

Preferred stock dividends

(29

)

(29

)

(25

)

Net earnings attributable to common stockholders

146

276

1,341

Net Earnings Per Share Attributable to Common Stockholders:

Basic

0.11

0.21

1.02

Diluted

0.11

0.21

0.99

Cash dividends declared per share

0.13

Cash dividends accrued per preferred share

0.95

0.83

Weighted-average Shares Used to Compute Net Earnings Per Share:

Basic

1,332

1,325

1,312

Diluted

1,361

1,421

1,375

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(Unaudited)

Year Ended

October 31, 2025

October 31, 2024

In millions, except per share amounts

Net revenue

34,296

30,127

Costs and Expenses:

Cost of sales (exclusive of amortization shown separately below)

23,919

20,249

Research and development

2,518

2,246

Selling, general and administrative

5,704

4,871

Amortization of intangible assets

511

267

Impairment charges

1,621

—

Transformation costs

Acquisition, disposition and other charges

458

211

Total costs and expenses

34,733

27,937

(Loss) earnings from operations

(437

)

2,190

Interest and other, net (1)

(175

)

(117

)

Gain on sale of a business

248

—

Gain on sale of equity interest

—

733

Earnings from equity interests

147

(Loss) earnings before provision for taxes

(285

)

2,953

Benefit (provision) for taxes

342

(374

)

Net earnings attributable to HPE

2,579

Preferred stock dividends

(116

)

(25

)

Net (loss) earnings attributable to common stockholders

(59

)

2,554

Net (Loss) Earnings Per Share Attributable to Common Stockholders:

Basic

(0.04

)

1.95

Diluted

(0.04

)

1.93

Cash dividends declared per share

0.52

Cash dividends accrued per preferred share

3.81

0.83

Weighted-average Shares Used to Compute Net (Loss) Earnings Per Share:

Basic

1,324

1,309

Diluted

1,324

1,337

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP measures

(Unaudited)

For the three months ended

October 31, 2025

July 31, 2025

October 31, 2024

Dollars in millions

GAAP net revenue

9,679

9,136

8,458

GAAP cost of sales

6,438

6,464

5,852

GAAP gross profit

3,241

2,672

2,606

Non-GAAP Adjustments

Stock-based compensation expense

Acquisition, disposition and other charges (2)

189

)

Cost reduction program

—

Non-GAAP gross profit

3,519

2,732

2,612

GAAP gross profit margin

33.5

29.2

30.8

Non-GAAP adjustments

2.9

0.7

0.1

Non-GAAP gross profit margin

36.4

29.9

30.9

Year Ended

October 31, 2025

October 31, 2024

Dollars in millions

GAAP net revenue

34,296

30,127

GAAP cost of sales

23,919

20,249

GAAP gross profit

10,377

9,878

Non-GAAP Adjustments

Stock-based compensation expense

Acquisition, disposition and other charges (2)

236

(34

)

Cost reduction program

126

—

H3C divestiture related severance costs

—

Non-GAAP gross profit

10,805

9,893

GAAP gross profit margin

30.3

32.8

Non-GAAP adjustments

1.2

—

Non-GAAP gross profit margin

31.5

32.8

For the three months ended

October 31, 2025

July 31, 2025

October 31, 2024

Dollars in millions

GAAP (loss) earnings from operations

)

247

693

Non-GAAP Adjustments

Amortization of intangible assets

310

126

Impairment charges

260

—

Transformation costs

—

Stock-based compensation expense

196

177

Cost reduction program

127

—

Acquisition, disposition and other charges (2)

298

225

Non-GAAP earnings from operations

1,183

777

938

GAAP operating profit margin

(0.1

2.7

8.2

Non-GAAP adjustments

12.3

5.8

2.9

Non-GAAP operating profit margin

12.2

8.5

11.1

Year Ended

October 31, 2025

October 31, 2024

Dollars in millions

GAAP (loss) earnings from operations

(437

)

2,190

Non-GAAP Adjustments

Amortization of intangible assets

511

267

Impairment charges

1,621

—

Transformation costs

Stock-based compensation expense

643

430

H3C divestiture related severance costs

—

Cost reduction program

275

—

Acquisition, disposition and other charges (2)

641

188

Non-GAAP earnings from operations

3,353

3,168

GAAP operating profit margin

(1.3

7.3

Non-GAAP adjustments

11.1

3.2

Non-GAAP operating profit margin

9.8

10.5

For the three months ended

October 31, 2025

Diluted Net EPS 7

July 31, 2025

Diluted Net EPS

October 31, 2024

Diluted Net EPS

Dollars in millions, except per share amounts

GAAP net earnings attributable to common stockholders

146

0.11

276

1,341

Preferred stock dividends

GAAP net earnings attributable to HPE

175

305

0.21

1,366

0.99

Non-GAAP Adjustments:

Amortization of intangible assets

310

0.23

126

0.09

0.05

Impairment charges

260

0.19

—

Transformation costs

—

0.02

Stock-based compensation expense

196

0.14

177

0.12

0.06

Gain on sale of a business

)

—

)

—

Cost reduction program

127

0.09

—

Acquisition, disposition and other charges (2)

298

0.22

225

0.17

0.04

Gain on sale of equity interest

—

(733

)

(0.53

)

Adjustments for equity interests

—

0.02

Litigation judgment

—

(52

)

(0.04

)

—

Loss (gain) on equity investments, net

148

0.10

—

(34

)

(0.02

)

Adjustments for taxes

(594

)

(0.44

)

(128

)

(0.09

)

(89

)

(0.06

)

Other adjustments (3)(8)

(24

)

(0.02

)

(24

)

(0.02

)

0.01

Non-GAAP net earnings attributable to HPE (4)

893

0.62

631

0.44

795

0.58

Preferred stock dividends

(29

)

(29

)

(25

)

Non-GAAP net earnings attributable to common stockholders

864

602

770

Year Ended

October 31, 2025

Diluted Net EPS 7

October 31, 2024

Diluted Net EPS

Dollars in millions, except per share amounts

GAAP net (loss) earnings attributable to common stockholders

(59

)

(0.04

)

2,554

Preferred stock dividends

116

GAAP net earnings attributable to HPE

2,579

1.93

Non-GAAP Adjustments:

Amortization of intangible assets

511

0.39

267

0.20

Impairment charges

1,621

1.22

—

Transformation costs

—

0.07

Stock-based compensation expense

643

0.49

430

0.32

Gain on sale of a business

(248

)

(0.19

)

—

H3C divestiture related severance costs

0.07

—

Cost reduction program

275

0.21

—

Acquisition, disposition and other charges (2)

641

0.49

188

0.15

Gain on sale of equity interest

—

(733

)

(0.55

)

Litigation judgment

(52

)

(0.04

)

—

Loss on equity investments, net

140

0.10

(94

)

(0.07

)

Adjustments for taxes

(828

)

(0.64

)

(95

)

(0.07

)

Other adjustments (3)(8)

(106

)

(0.12

)

0.01

Non-GAAP net earnings attributable to HPE (4)

2,753

1.94

2,655

1.99

Preferred stock dividends

(116

)

(25

)

Non-GAAP net earnings attributable to common stockholders

2,637

2,630

For the three months ended

October 31, 2025

July 31, 2025

October 31, 2024

In millions

Net cash provided by operating activities

2,465

1,305

2,030

Investment in property, plant and equipment and software assets

(641

)

(576

)

(608

)

Proceeds from sale of property, plant and equipment

126

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(30

)

(29

)

(12

)

Free cash flow

1,920

790

1,500

Year Ended

October 31, 2025

October 31, 2024

In millions

Net cash provided by operating activities

2,919

4,341

Investment in property, plant and equipment and software assets

(2,292

)

(2,367

)

Proceeds from sale of property, plant and equipment

380

370

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(21

)

(47

)

Free cash flow

986

2,297

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

As of

October 31, 2025

October 31, 2024

(Unaudited)

(Audited)

In millions, except par value

ASSETS

Current Assets:

Cash and cash equivalents

5,773

14,846

Accounts receivable, net of allowances

5,290

3,550

Financing receivables, net of allowances

3,826

3,870

Inventory

6,352

7,810

Assets held for sale

—

Other current assets

3,753

3,380

Total current assets

24,994

33,457

Property, plant and equipment, net

6,002

5,664

Long-term financing receivables and other assets

13,817

12,616

Investments in equity interests

955

929

Goodwill and intangible assets

30,138

18,596

Total assets

75,906

71,262

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:

Notes payable and short-term borrowings

4,609

4,742

Accounts payable

7,731

11,064

Employee compensation and benefits

1,871

1,356

Taxes on earnings

319

284

Deferred revenue

5,358

3,904

Liabilities held for sale

—

Other accrued liabilities

4,755

4,591

Total current liabilities

24,643

25,973

Long-term debt

17,756

13,504

Other non-current liabilities

8,753

6,905

Commitments and Contingencies

HPE stockholders' Equity:

7.625% Series C mandatory convertible preferred stock, $0.01 par value (30 shares issued and outstanding as of October 31, 2025 and October 31, 2024)

—

Common stock, $0.01 par value (9,600 shares authorized; 1,319 and 1,297 shares issued and outstanding as of October 31, 2025 and October 31, 2024, respectively)

Additional paid-in capital

30,234

29,848

Accumulated deficit

(2,811

)

(2,068

)

Accumulated other comprehensive loss

(2,748

)

(2,977

)

Total HPE stockholders’ equity

24,688

24,816

Non-controlling interests

Total stockholders’ equity

24,754

24,880

Total liabilities and stockholders’ equity

75,906

71,262

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

Year Ended

October 31, 2025

October 31, 2024

In millions

Cash Flows from Operating Activities:

Net earnings attributable to HPE

2,579

Adjustments to Reconcile Net Earnings Attributable to HPE to Net Cash Provided by Operating Activities:

Depreciation and amortization

2,737

2,564

Impairment charges

1,621

—

Stock-based compensation expense

643

430

Provision for inventory and credit losses

511

175

Restructuring (credits) charges

(13

)

Cost reduction program

275

—

Deferred taxes on earnings

(565

)

(64

)

Earnings from equity interests

(90

)

(147

)

Gain on sale of a business

(248

)

—

Gain on sale of equity interest

—

(733

)

Dividends received from equity investees

H3C divestiture related severance costs

—

Amortization of inventory fair value adjustment

244

—

Loss on equity investments, net

147

Other, net

181

136

Changes in Operating Assets and Liabilities, Net of Acquisitions:

Accounts receivable

(700

)

(83

)

Financing receivables

(153

)

(909

)

Inventory

1,783

(3,358

)

Accounts payable

(3,468

)

3,927

Taxes on earnings

(200

)

190

Restructuring

(58

)

(164

)

Other assets and liabilities

(291

)

Net cash provided by operating activities

2,919

4,341

Cash Flows from Investing Activities:

Investment in property, plant and equipment and software assets

(2,292

)

(2,367

)

Proceeds from sale of property, plant and equipment

380

370

Purchases of equity investments

)

(16

)

Proceeds from sale of available-for-sale securities

934

Proceeds from maturities and redemptions of available-for-sale securities

—

Proceeds from sale of equity interest

—

2,143

Financial collateral posted

(764

)

(1,020

)

Financial collateral received

581

978

Payments made in connection with business acquisitions, net of cash acquired

(12,278

)

(147

)

Proceeds from sale of a business

210

—

Net cash used in investing activities

(13,190

)

(53

)

Cash Flows from Financing Activities:

Short-term borrowings with original maturities less than 90 days, net

)

(31

)

Proceeds from debt, net of issuance costs

9,188

11,245

Payments of debt

(6,837

)

(5,475

)

Net payments related to stock-based award activities

(289

)

(84

)

Proceeds from issuance of 7.625% Series C mandatory convertible preferred stock, net of issuance costs

—

1,462

Repurchases of common stock

(202

)

(150

)

Cash dividends paid to preferred stockholders

(112

)

—

Cash dividends paid to common stockholders

(684

)

(676

)

Other

(10

)

Net cash provided by financing activities

1,046

6,283

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(21

)

(47

)

Change in cash, cash equivalents and restricted cash

(9,246

)

10,524

Cash, cash equivalents and restricted cash at beginning of period

15,105

4,581

Cash, cash equivalents and restricted cash at end of period

5,859

15,105

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Segment Information

(Unaudited)

For the three months ended

October 31, 2025

July 31, 2025

October 31, 2024

In millions

Net Revenue:

Server (4)

4,457

4,940

4,681

Hybrid Cloud (4)

1,412

1,484

1,607

Networking 6)

2,812

1,730

1,124

Financial Services

889

886

893

Corporate Investments and other

191

194

262

Total segment net revenue

9,761

9,234

8,567

Elimination of intersegment net revenue

(82

)

(98

)

(109

)

Total consolidated net revenue

9,679

9,136

8,458

Earnings Before Taxes:

Server (5)

437

317

541

Hybrid Cloud (5)

126

Networking (6)

648

360

274

Financial Services

102

Corporate Investments and other

)

(14

)

Total segment earnings from operations

1,252

838

1,021

Unallocated corporate costs and eliminations

(69

)

(61

)

(83

)

Stock-based compensation expense

(196

)

(177

)

(89

)

Amortization of intangible assets

(310

)

(126

)

(69

)

Impairment charges

(260

)

—

Transformation costs

—

(26

)

Gain on sale of a business

—

H3C divestiture related severance costs

—

Cost reduction program

(127

)

—

Acquisition, disposition and other charges (2)

(298

)

(225

)

(61

)

Interest and other, net (1)

(261

)

Gain on sale of equity interest

—

733

Earnings (loss) from equity interests

(14

)

Total pretax (loss) earnings

(261

)

288

1,417

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Segment Information

(Unaudited)

Year Ended

October 31, 2025

October 31, 2024

In millions

Net Revenue:

Server (5)

17,745

16,104

Hybrid Cloud (5)

5,754

5,487

Networking (6)

6,850

4,532

Financial Services

3,504

3,512

Corporate Investments and other

776

1,014

Total segment net revenue

34,629

30,649

Elimination of intersegment net revenue

(333

)

(522

)

Total consolidated net revenue

34,296

30,127

Earnings Before Taxes:

Server (5)

1,343

1,804

Hybrid Cloud (5)

335

259

Networking (6)

1,596

1,115

Financial Services

361

316

Corporate Investments and other

(32

)

(25

)

Total segment earnings from operations

3,603

3,469

Unallocated corporate costs and eliminations

(250

)

(301

)

Stock-based compensation expense

(643

)

(430

)

Amortization of intangible assets

(511

)

(267

)

Impairment charges

(1,621

)

—

Transformation costs

)

(93

)

Gain on sale of a business

248

—

H3C divestiture related severance costs

(97

)

—

Cost reduction program

(275

)

—

Acquisition, disposition and other charges (2)

(641

)

(188

)

Interest and other, net (1)

(175

)

(117

)

Gain on sale of equity interest

—

733

Earnings from equity interests

147

Total pretax (loss) earnings

(285

)

2,953

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Segment Information

(Unaudited)

For the three months ended

Change (%)

October 31, 2025

July 31, 2025

October 31, 2024

Q/Q

Y/Y

Dollars in millions

Net Revenue:

Server (5)

4,457

4,940

4,681

(10%)

(5%)

Hybrid Cloud (5)

1,412

1,484

1,607

(5)

(12)

Networking (6)

2,812

1,730

1,124

150

Financial Services

889

886

893

—

Corporate Investments and other

191

194

262

(2)

(27)

Total segment net revenue

9,761

9,234

8,567

Elimination of intersegment net revenue

(82

)

(98

)

(109

)

(16)

(25)

Total consolidated net revenue

9,679

9,136

8,458

14%

Year Ended

October 31, 2025

October 31, 2024

Y/Y

Dollars in millions

Net Revenue:

Server (5)

17,745

16,104

10%

Hybrid Cloud (5)

5,754

5,487

Networking (6)

6,850

4,532

Financial Services

3,504

3,512

—

Corporate Investments and other

776

1,014

(24)

Total segment net revenue

34,629

30,649

Elimination of intersegment net revenue

(333

)

(522

)

(36)

Total consolidated net revenue

34,296

30,127

14%

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Segment Operating Margin Summary Data

(Unaudited)

For the three months ended

Change in operating profit margin (pts)

October 31, 2025

July 31, 2025

October 31, 2024

Q/Q

Y/Y

Segment Operating Profit Margin:

Server (5)

9.8

6.4

11.6

3.4

(1.8

)

Hybrid Cloud (5)

5.0

5.9

7.8

(0.9

)

(2.8

)

Networking (6)

23.0

20.8

24.4

2.2

(1.4

)

Financial Services

11.5

9.9

9.2

1.6

2.3

Corporate Investments and other

(3.1

(7.2

(0.8

4.1

(2.3

)

Total segment operating profit margin

12.8

9.1

11.9

3.7

0.9

Year Ended

Change in operating profit margin (pts)

October 31, 2025

October 31, 2024

Y/Y

Segment Operating Profit Margin:

Server (5)

7.6

11.2

(3.6

)

Hybrid Cloud (5)

5.8

4.7

1.1

Networking (6)

23.3

24.6

(1.3

)

Financial Services

10.3

9.0

1.3

Corporate Investments and other

(4.1

(2.5

(1.6

)

Total segment operating profit margin

10.4

11.3

(0.9

)

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Calculation of Diluted Net Earnings Per Share

(Unaudited)

For the three months ended

October 31, 2025

July 31, 2025

October 31, 2024

In millions, except per share amounts

Numerator:

GAAP net earnings attributable to common stockholders - Basic

146

276

1,341

Plus: 7.625% Series C mandatory convertible preferred stock dividends

—

GAAP net earnings attributable to HPE - Diluted

146

305

1,366

Non-GAAP net earnings attributable to common stockholders - Basic

864

602

770

Plus: 7.625% Series C mandatory convertible preferred stock dividends

Non-GAAP net earnings attributable to HPE - Diluted

893

631

795

Denominator:

GAAP Weighted-average shares used to compute basic net EPS

1,332

1,325

1,312

Dilutive effect of employee stock plans (7)

Dilutive effect of 7.625% Series C mandatory convertible preferred stock (7)

—

GAAP Weighted-average shares used to compute diluted net EPS

1,361

1,421

1,375

Non-GAAP Weighted-average shares used to compute basic net EPS

1,332

1,325

1,312

Dilutive effect of employee stock plans (7)

Dilutive effect of 7.625% Series C mandatory convertible preferred stock (7)

Non-GAAP Weighted-average shares used to compute diluted net EPS

1,437

1,421

1,375

GAAP Net EPS

Basic

0.11

0.21

1.02

Diluted

0.11

0.21

0.99

Non-GAAP Net EPS

Basic

0.65

0.45

0.59

Diluted (4)

0.62

0.44

0.58

Year Ended

October 31, 2025

October 31, 2024

In millions, except per share amounts

Numerator:

GAAP net (loss) earnings attributable to common stockholders - Basic

(59

)

2,554

Plus: 7.625% Series C mandatory convertible preferred stock dividends

—

GAAP net (loss) earnings attributable to HPE - Diluted

(59

)

2,579

Non-GAAP net earnings attributable to common stockholders - Basic

2,637

2,630

Plus: 7.625% Series C mandatory convertible preferred stock dividends

116

Non-GAAP net earnings attributable to HPE - Diluted

2,753

2,655

Denominator:

Weighted-average shares used to compute basic net EPS

1,324

1,309

Dilutive effect of employee stock plans (7)

—

Dilutive effect of 7.625% Series C mandatory convertible preferred stock (7)

—

Weighted-average shares used to compute diluted net EPS

1,324

1,337

Denominator(Non-GAAP):

Weighted-average shares used to compute basic net EPS

1,324

1,309

Dilutive effect of employee stock plans (7)

Dilutive effect of 7.625% Series C mandatory convertible preferred stock (7)

Weighted-average shares used to compute diluted net EPS

1,418

1,337

GAAP Net EPS

Basic

(0.04

)

1.95

Diluted

(0.04

)

1.93

Non-GAAP Net EPS

Basic

1.99

2.01

Diluted (4)

1.94

1.99

(1)

Interest and other, net includes tax indemnification and other adjustments, non-service net periodic benefit credit, and interest and other, net. The three and twelve months ended October 31, 2025, includes $135 million loss on investments, net and a $52 million litigation settlement which HPE received in the third quarter of fiscal 2025.

(2)

Includes disaster recovery and divestiture related exit costs. For the three and twelve months ended October 31, 2025, Acquisition, disposition and other charges include non-cash amortization of fair value adjustment for inventory in connection with the acquisition of Juniper Networks, which was recorded in cost of sales.

(3)

Other adjustments includes non-service net periodic benefit credit and tax indemnification and other adjustments.

(4)

For purposes of calculating diluted net EPS, the preferred stock dividends are added back to the net earnings attributable to common stockholders and the diluted weighted average share calculation assumes the preferred stock was converted at issuance or as of the beginning of the reporting period.

(5)

Effective at the beginning of the first quarter of fiscal 2025, in order to align its segment financial reporting more closely with its current business structure, HPE implemented an organizational change with the transfer of certain managed services, previously reported within the Server reportable segment, to the Hybrid Cloud reportable segment.

(6)

During the third quarter of fiscal 2025, the Intelligent Edge segment was renamed to Networking. The segment name change did not result in any change to the composition of the Company’s segments and therefore no prior information was recast; further, the designation change did not impact the Company’s condensed consolidated financial statements.

(7)

The impact of dilutive effect of employee stock plans is calculated under the treasury stock method, and the impact of dilutive effect of the preferred stock is calculated under the if-converted method. For the three months ended October 31, 2025, the effect of preferred stock is excluded as it would be anti-dilutive. For the twelve months ended October 31, 2025, the effect of employee stock plans and preferred stock is excluded when calculating diluted net loss per share as it would be anti-dilutive.

(8)

For the three months ended October 31, 2025, the diluted net EPS adjustment includes the impact to Non-GAAP net earnings attributable to HPE for the dilutive effect of preferred stock. For fiscal 2025, the diluted net EPS adjustment includes the impact to Non-GAAP net earnings attributable to HPE for the dilutive effect of preferred stock and the employee stock plans.

Use of non-GAAP financial measures

To supplement Hewlett Packard Enterprise’s condensed consolidated financial statement information presented on a GAAP basis, Hewlett Packard Enterprise provides non-GAAP financial measures including revenue on a constant currency basis (including at the business segment level), non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP operating profit (non-GAAP earnings from operations), non-GAAP operating profit margin (non-GAAP earnings from operations as a percentage of net revenue), non-GAAP income tax rate, non-GAAP net earnings attributable to HPE, non-GAAP net earnings attributable to common stockholders, non-GAAP diluted net earnings per share attributable to common stockholders, and FCF. Hewlett Packard Enterprise also provides forecasts of revenue growth on a constant currency basis, non-GAAP diluted net earnings per share, non-GAAP operating profit growth, and FCF.

These non-GAAP financial measures are not computed in accordance with, or as an alternative to, GAAP in the United States. The GAAP measure most directly comparable to net revenue on a constant currency basis is net revenue. The GAAP measure most directly comparable to non-GAAP gross profit is gross profit. The GAAP measure most directly comparable to non-GAAP gross profit margin is gross profit margin. The GAAP measure most directly comparable to non-GAAP operating profit (non-GAAP earnings from operations) is earnings from operations. The GAAP measure most directly comparable to non-GAAP operating profit margin (non-GAAP earnings from operations as a percentage of net revenue) is operating profit margin (earnings from operations as a percentage of net revenue). The GAAP measure most directly comparable to non-GAAP income tax rate is income tax rate. The GAAP measure most directly comparable to non-GAAP net earnings attributable to HPE and non-GAAP net earnings attributable to common stockholders is net earnings. The GAAP measure most directly comparable to non-GAAP diluted net earnings per share attributable to common stockholders is diluted net earnings per share attributable to common stockholders. The GAAP measure most directly comparable to FCF is cash flow from operations. Reconciliations of each of these non-GAAP financial measures to their most directly comparable GAAP measures for this quarter and prior periods are included in the tables above or elsewhere in the materials accompanying this news release.

Usefulness of non-GAAP financial measures to investors

Hewlett Packard Enterprise believes that providing the non-GAAP financial measures stated above, in addition to the related GAAP measures provides investors with greater transparency to the information used by Hewlett Packard Enterprise’s management in its financial and operational decision making and allows investors to see Hewlett Packard Enterprise’s results “through the eyes” of management. Hewlett Packard Enterprise further believes that providing this information provides Hewlett Packard Enterprise’s investors with a supplemental view to understand the Company’s historical and prospective operating performance and to evaluate the efficacy of the methodology and information used by Hewlett Packard Enterprise’s management to evaluate and measure such performance. Disclosure of these non-GAAP financial measures also facilitates the comparisons of Hewlett Packard Enterprise’s operating performance with the performance of other companies in the same industry that supplement their GAAP results with non-GAAP financial measures that may be calculated in a similar manner.

Economic substance of and material limitations associated with non-GAAP financial measures used by Hewlett Packard Enterprise

Net revenue on a constant currency basis assumes no change to the foreign exchange rate utilized in the comparable prior-year period. This measure assists investors with evaluating the Company’s past and future performance, without the impact of foreign exchange rates, as more than half of our revenue is generated outside of the U.S. Non-GAAP gross profit and non-GAAP gross profit margin are defined to exclude charges related to the stock-based compensation expense, acquisition, disposition and other charges, severance costs associated with the cost reduction program, and H3C divestiture related severance costs. Non-GAAP operating profit (non-GAAP earnings from operations) and non-GAAP operating profit margin (non-GAAP earnings from operations as a percentage of net revenue) consist of earnings from operations or earnings from operations as a percentage of net revenue excluding the items mentioned above and charges relating to the amortization of intangible assets, impairment charges, and transformation (credit) costs. Non-GAAP net earnings, net earnings attributable to HPE and non-GAAP net earnings attributable to common stockholders and non-GAAP diluted net earnings per share attributable to common stockholders consist of net earnings or diluted net earnings per share excluding the charges previously stated, as well as gain on sale of a business, adjustments for equity interests, litigation judgments, gain or loss on equity investments, other adjustments, and adjustments for taxes. Non-GAAP net earnings attributable to HPE and non-GAAP diluted net earnings per share attributable to common stockholders includes preferred stock dividends added back to non-GAAP net earnings attributable to HPE. The Adjustments for taxes line item includes certain income tax valuation allowances and separation taxes, the impact of tax reform, structural rate adjustment, excess tax benefit from stock-based compensation, and adjustments for additional taxes or tax benefits associated with each non-GAAP item.

Hewlett Packard Enterprise believes that excluding the items mentioned above from the non-GAAP financial measures provides a supplemental view to management and investors of its consolidated financial performance and presents the financial results of the business without costs that Hewlett Packard Enterprise’s management does not believe to be reflective of ongoing operating results. Exclusion of these items can have a material impact on the equivalent GAAP measure and cash flows thus limiting their use as analytical tools. These limitations are discussed below or elsewhere in the materials accompanying this news release. More specifically, Hewlett Packard Enterprise’s management excludes each of those items mentioned above for the following reasons:

Compensation for material limitations with use of non-GAAP financial measures

These non-GAAP financial measures have limitations as analytical tools, and these measures should not be considered in isolation or as a substitute for analysis of Hewlett Packard Enterprise’s results as reported under GAAP. Some of the limitations in relying on these non-GAAP financial measures are that they can have a material impact on the equivalent GAAP earnings measures and cash flows, they may be calculated differently by other companies (limiting the usefulness of those measures for comparative purposes) and may not reflect the full economic effect of the loss in value of certain assets. Hewlett Packard Enterprise compensates for these limitations on the use of non-GAAP financial measures by relying primarily on its GAAP results and using non-GAAP financial measures only as a supplement. Hewlett Packard Enterprise also provides a reconciliation of each non-GAAP financial measure to its most directly comparable GAAP financial measure for this quarter and prior periods within this news release and in other written materials that include these non-GAAP financial measures, and Hewlett Packard Enterprise encourages investors to review those reconciliations carefully.