Q2 2026 Hewlett Packard Enterprise Co Earnings Call Transcript
Key Points
- Hewlett Packard Enterprise Co (HPE) delivered record-breaking results with a 40% increase in revenue, reaching $10.7 billion.
- Non-GAAP earnings per share increased by 108%, significantly exceeding the high end of the company's outlook.
- The company generated $915 million in free cash flow, an improvement of $1.8 billion, driven by strong cash from operations.
- HPE's Networking segment showed strong performance with revenue of $2.7 billion, up double-digits, and significant order growth.
- The Cloud and AI business segment saw revenue growth of 23%, driven by strong demand in AI systems, Alletra MP Storage, and GreenLake software and services.
- Supply constraints and timing of AI server shipments impacted the Cloud and AI segment's performance.
- The company faces ongoing inflationary component costs, particularly in DRAM and NAND, affecting pricing strategies.
- Despite strong demand, supply chain constraints continue to limit the conversion of orders into revenue, particularly in the Networking segment.
- The company anticipates continued elevated costs in 2027 due to supply chain challenges.
- HPE's storage revenue growth was modest at 2%, indicating potential challenges in aligning storage growth with server growth.
Good day, and welcome to the fiscal 2026 second-quarter Hewlett Packard Enterprise earnings conference call. (Operator Instructions) Please note, this event is being recorded.
I would now like to turn the conference over to Paul Glaser, Head of Investor Relations. Please go ahead, sir.
Good afternoon. I am Paul Glaser, Head of Investor Relations for Hewlett Packard Enterprise. I would like to welcome you to our fiscal 2026 second-quarter earnings conference call with Antonio Neri, HPE's President and Chief Executive Officer; and Marie Myers, HPE's Chief Financial Officer.
Before handing the call to Antonio, let me remind you that this call is being webcast. A replay of the webcast will be available shortly after the call concludes. We have posted the press release and the slide presentation accompanying the release on our HPE Investor Relations web page.
Elements of the financial information referenced on this call are forward-looking and are based on our best
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