Key Takeaways
- HPE reported $12.2 billion in revenue and $1.11 adjusted EPS in Q3.
- The company raised its fiscal 2026 revenue growth outlook to 34% 37%.
- HPE expects at least $5 billion in free cash flow in fiscal 2027.
HPE reports stronger-than-expected fiscal third quarter results on Sept. 2, 2026, while its shares fell about 5% in after-hours trading.
Revenue rose 34% from a year earlier to $12.2 billion, while adjusted earnings per share reached $1.11. The company also raised its forecasts for fiscal 2026 and fiscal 2027.
HPE Beats Revenue And Earnings Expectations
HPE Reports Strong fiscal third-quarter results, with adjusted EPS coming in at $1.11, compared with the $0.92 analyst estimate. Revenue reached $12.2 billion, exceeding the $11.99 billion consensus estimate.
The company expects fourth-quarter adjusted EPS between $1.20 and $1.30. Its revenue forecast stands between $13.9 billion and $14.8 billion, compared with the $13.04 billion consensus estimate. HPE also raised its fiscal 2026 adjusted EPS forecast to $3.75 to $3.85. Its previous range was $3.35 to $3.45, while the new range is above the $3.45 consensus estimate.
The company increased its fiscal 2026 revenue growth outlook to 34% to 37%, compared with its previous forecast of 29% to 33%. Networking revenue growth expectations were also raised to 73% to 74%.
HPE expects at least $3.75 billion in free cash flow during fiscal 2026. The company also reported that supply constraints continue to limit its ability to meet customer demand.
Management expects operating margins to decline sequentially, citing a higher mix of artificial intelligence systems and pricing factors. The company said it is working with partners to secure additional supply agreements.
HPE Raises Fiscal 2027 Forecast And AI Collaboration
HPE also increased its fiscal 2027 outlook. The company now expects EPS growth of 16% to 20%, compared with its previous range of 12% to 16%.
Its fiscal 2027 revenue growth framework was raised to 13% to 17%. HPE also expects at least $5 billion in free cash flow during fiscal 2027.
The company separately announced an expanded collaboration with Oracle to support Oracle’s global artificial intelligence infrastructure. The agreement includes HPE Juniper Networking across Oracle’s AI data centers.
The networking platforms support parts of Oracle Cloud Infrastructure’s data center and edge networks. The expansion is expected to support increasing requirements for bandwidth, latency, congestion management, and network recovery as Oracle expands its AI infrastructure.
HPE Reports Strong results, with the company also issuing Oracle warrants to purchase shares of HPE common stock as part of the agreement. Despite the quarterly results and higher forecasts, HPE shares declined about 5% in after-hours trading. The stock was later trading with a gain of around 1.89% in the latest market data.
Retail investor sentiment around HPE also strengthened following the earnings announcement. Sentiment moved to extremely bullish from bullish, while message volume was classified as high.
The results leave HPE with higher revenue and earnings expectations for both fiscal 2026 and fiscal 2027. The company’s latest forecasts include stronger revenue growth, higher EPS growth, and increased free cash flow expectations.
Sources:
https://finance.yahoo.com/markets/stocks/articles/hewlett-packard-enterprise-hpe-q3-212503268.html
