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HP Enterprise Earnings Top Expectations as AI Demand Boosts Server Sales
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Main points
- HPE reported better-than-expected fourth-quarter results as strong demand for artificial intelligence boosted server sales.
- Hewlett Packard Enterprise said Thursday that the company’s revenue hit a record high and net income more than doubled from the same period last year.
- The company expects revenue to rise by more than a dozen percent this quarter, an outlook in line with analysts’ expectations.
Hewlett Packard Enterprise (HP) fiscal fourth-quarter earnings topped analysts’ expectations, driven by growth in server revenue.
The server maker posted record revenue of $8.5 billion, up 15% year over year and above the analyst consensus compiled by Visible Alpha. Net income was $1.34 billion, or 99 cents a share, up from $642 million, or 49 cents a share, a year ago.
HP Enterprise Server revenue jumped 32% to $4.7 billion, beating analysts’ expectations. In October, the company was unveiled new server Powered by Advanced Micro Devices (AMD) chip and designed to support Artificial Intelligence (AI) Clusters used for tasks such as training large language model.
Revenue from the company’s intelligent edge division fell 20% year over year to $1.1 billion, while revenue from the cloud division increased 18% to $1.6 billion.
Looking ahead, Hewlett Packard Enterprise expects first-quarter revenue growth to be in the mid-teens. Analyst consensus was for growth of 14%.
Shares of Hewlett Packard Enterprise rose slightly in recent after-hours trading. The stock was up about 27% in 2024 through Thursday’s close, in line with the S&P 500’s gains during that time.
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