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Hewlett Packard Enterprise Company
CEO : Mr. Antonio Fabio Neri

Quarterly earnings growth(YoY,%)

Tarek Robbiati says,

Revenue and Growth

• HPE delivered a record Q1 revenue of $7.8 billion, a robust 12% YoY growth and 18% in constant currency.
• All business segments grew revenue YoY, excluding corporate.
• Compute revenues grew 19% YoY to $3.5 billion.
• Intelligent Edge delivered a second consecutive record revenue quarter and surpassed $1 billion in revenue for the first time, with 31% YoY growth.

As-a-Service Business Performance

• ARR surpassed $1 billion in Q1 2023, reflecting the strength of HPE’s as-a-service strategy.
• ARR growth accelerated from 25% in Q4 2022 to 31% in Q1 2023, and a robust pipeline of as-a-Service business is expected.
• The mix of higher-margin software and services recurring revenue increased by 150 basis points YoY to 65%.

Operating Margins

• Non-GAAP gross margin reached a Q1 record of 34.2%, up 30 basis points YoY and 110 basis points sequentially.
• Non-GAAP operating margins reached a record high 11.8%, up 80 basis points YoY and 30 basis points sequentially.
• Compute operating margin of 17.6% exceeded the long-term outlook of 11% to 13% for the fifth consecutive quarter.

Supply Chain

• The supply chain execution is solid, and HPE is gaining share in specific segments.
• The supply environment has improved, and the delivery times of products and services are almost back to pre-pandemic levels.
• The combination of a large order book and improved supply environment gives confidence that revenues can grow well above the previously communicated guidance of 2% to 4% revenue growth in constant currency for fiscal year 2023.

Future Strategy

• Investments will be made in software and services in all business units, including HPE GreenLake edge-to-cloud platform, HPC AI, storage, and edge, to extend share gains across segments.
• Actions will be taken to maintain momentum for the second half of 2023 and fiscal year 2024, with a focus on productivity.
• The long-term outlook includes a 2% to 4% revenue CAGR outlook over the fiscal year 2022 to fiscal year 2025 period.

Antonio Neri says,

Record Performance in Q1 2023

• HPE posted a record set in first quarter performance with the highest ever non-GAAP operating profit margin and non-GAAP diluted net earnings per share.
• Total HPE revenue climbed 18% to $7.8 billion, significantly above the high end of the outlook.
• The company generated $1 billion in annualized revenue run rate or ARR for the first time.

Revenue and EPS Guidance Raised for FY2023

• The quarterly results, combined with confidence in the strategy and execution, have led HPE to raise revenue and EPS guidance for the full fiscal year.
• The supply chain challenges continue to ease, and HPE expects more of that throughout fiscal year 2023.

Acquisitions and Partnerships

• HPE agreed to acquire cloud security provider access security, which will help fortify network security and strengthen the Secure Access Service Edge or SASE solutions.
• HPE purchased Athonet to strengthen the private networking capabilities to help enterprises and telcos accelerate 5G deployments.
• The company purchased technology from two companies that enhance cloud computing and AI offerings.
• HPE will continue to assess organic and inorganic investments that improve the competitive position in growth markets while driving a higher level of recurring revenue and profitability.

HPE GreenLake

• HPE GreenLake platform continues to attract business and drive performance across the portfolio with AI and as-a-Service total contract value higher.
• During the first quarter, HPE once again increased the new HPE Green logos, growing the customer base by 7%.

Intelligent Edge and HPC and AI Segments

• In the Intelligent Edge segment, revenue increased 31% year-over-year.
• Year-over-year revenue growth was even higher in the HPC and AI segment, up 37% as HPE booked revenue associated with Frontier, the world’s first Exascale system.
• HPE has strong IP in the case of experience that give HPE a competitive advantage in building large computing systems, which are required to increase social adoption of AI models globally.

Q & A sessions,

eryone is that we are guiding to a midpoint of $1.98 EPS for the full year, which is a 24% increase year-over-year. This is driven by the momentum we are seeing in our software and services business, with two-thirds of our momentum coming from these areas. We are also seeing strong demand for our GreenLake hybrid cloud solution, which crossed $1 billion in annual recurring revenue. In terms of specific segments, our HPC business has a strong pipeline with potential growth through an as-a-service model. We also see opportunities in the AI market, where we have a unique differentiation in our interconnect fabric, programming environment, and data pipeline automation capabilities. Our compute business has seen best-in-class performance with 90% YoY growth and 17.6% operating profit. Overall, we have a diversified portfolio and a winning strategy with HPE GreenLake, and we are confident in our ability to navigate the uneven market.