HPE Reports $7.5B 2Q Earnings, up 10% YoY

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5/22/2018

  • Second quarter net revenue of $7.5 billion, up 10% from the prior-year period, and up 6% when adjusted for currency
  • Second quarter GAAP diluted net earnings per share of $0.49, above the previously provided outlook of $0.10 to $0.14 per share, primarily due to separation related tax indemnification adjustments
  • Second quarter non-GAAP diluted net earnings per share of $0.34, above the previously provided outlook of $0.29 to $0.33 per share
  • Returned $1 billion to shareholders in the form of share repurchases and dividends in line with the previously announced commitment to return $7 billion to shareholders through FY19
  • Raised dividend by 50 percent starting in Q3 FY18 aligned with prior communications
  • Raised fiscal 2018 GAAP diluted net earnings per share outlook to $1.70 to $1.80, and fiscal 2018 non-GAAP diluted net earnings per share outlook to $1.40 to $1.50

PALO ALTO, Calif., May 22, 2018 (GLOBE NEWSWIRE) -- Hewlett Packard Enterprise today announced financial results for its fiscal 2018 second quarter, ended April 30, 2018.

Second Quarter Fiscal Year 2018 Results
Second quarter net revenue of $7.5 billion was up 10% from the prior year and up 6% when adjusted for currency.

Second quarter GAAP diluted net earnings per share ("EPS") from continuing operations was $0.54, up from GAAP diluted net EPS from continuing operations of ($0.29) in the prior-year period. Second quarter non-GAAP diluted net EPS from continuing operations was $0.34, up from non-GAAP diluted net EPS from continuing operations of $0.17 in the prior-year period. Second quarter non-GAAP net earnings from continuing operations and non-GAAP diluted net EPS from continuing operations exclude after-tax adjustments of $314 million and $0.20 per diluted share, respectively, primarily related to the impact of tax indemnification adjustments, U.S. tax reform, transformation costs, amortization of intangible assets, an adjustment to loss in equity interests, separation costs, acquisition and other related charges, restructuring charges, and income tax valuation allowances and separation taxes.

"I am very pleased with our strong performance in Q2," said Antonio Neri, President and CEO, HPE. "We delivered revenue growth in all business segments, expanded overall profitability, completed important milestones in our HPE Next initiative and continued to invest in innovation. I'm confident we will deliver on our annual FY18 outlook."

Outlook
For the fiscal 2018 third quarter, Hewlett Packard Enterprise estimates GAAP diluted net EPS to be in the range of $0.19 to $0.23 and non-GAAP diluted net EPS to be in the range of $0.35 to $0.39. Fiscal 2018 third quarter non-GAAP diluted net EPS estimates exclude after-tax costs of approximately $0.16 per diluted share, primarily related to transformation costs and the amortization of intangible assets.

For fiscal 2018, Hewlett Packard Enterprise now estimates GAAP diluted net EPS to be in the range of $1.70 to $1.80 and non-GAAP diluted net EPS to be in the range of $1.40 to $1.50. Fiscal 2018 non-GAAP diluted net EPS estimates exclude after-tax impact of approximately $0.30 per diluted share, primarily related to transformation costs and the amortization of intangible assets, offset by the impact of U.S. tax reform.

Fiscal 2018 second quarter segment results

  • Hybrid IT revenue was $6.0 billion, up 7% year over year and up 4% when adjusted for currency, with a 10.3% operating margin. Compute revenue was up 6%, up 2% when adjusted for currency, Storage revenue was up 24%, up 22% when adjusted for currency, DC Networking revenue was up 2%, down 1% when adjusted for currency, and Pointnext revenue was up 1%, down 1% when adjusted for currency.
  • Intelligent Edge revenue was $710 million, up 17% year over year and up 14% when adjusted for currency, with a 6.5% operating margin. HPE Aruba Product revenue was up 18%, up 14% when adjusted for currency, HPE Aruba Services revenue was up 10%, up 11% when adjusted for currency.
  • Financial Services revenue was $916 million, up 5% year over year and up 1% when adjusted for currency, net portfolio assets were up 3%, and financing volume was flat year over year. The business delivered an operating margin of 7.9%.


Hewlett Packard Enterprise

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