HPE Reports Record Quarter, Raises Outlook on AI Demand

Hewlett Packard Enterprise reported record quarterly results on Wednesday, driven by surging demand for artificial intelligence infrastructure, and raised its financial outlook for the current and next fiscal years. The company's fiscal third-quarter revenue reached $12.2 billion, a 34% increase from a year earlier, while adjusted earnings per share came in at $1.11, surpassing analyst expectations. Despite the strong performance, HPE shares fell more than 5% in after-hours trading as investors weighed supply constraints and potential margin pressures. The results underscored the accelerating adoption of AI across enterprises. CEO Antonio Neri stated that customers are buying everything the company can produce, with orders outpacing shipments. "We have not seen any pull in. We do not see a cliff," Neri said, dismissing concerns about a potential slowdown in AI spending. The company's cloud and AI revenue climbed 25% to $9 billion, and server revenue set a record, rising 35% to $6.8 billion. A significant driver of growth was HPE's networking business, which saw revenue jump nearly 75% to $2.9 billion following its $14 billion acquisition of Juniper Networks.