Shares of Hewlett Packard Enterprise (HPE.US)
surged more than 25% at Tuesday's market open, reaching a new all-time high and extending its year-to-date gain to 147%. The dramatic price movement followed the company's release of a fiscal second-quarter earnings report that significantly exceeded expectations, along with a substantial upward revision of its full-year guidance, driven by surging demand for servers and networking equipment fueled by the artificial intelligence infrastructure boom.
For its fiscal second quarter ended in April, HPE reported revenue of $10.7 billion, a 40% increase year-over-year, which was substantially higher than the analyst consensus estimate of $9.8 billion. The company posted a net profit of $624 million, a sharp turnaround from a net loss of $1.05 billion in the same period last year. Adjusted earnings per share came in at $0.79, more than double the $0.38 reported a year ago and also surpassing the consensus estimate of $0.53.
Revised Financial Outlook
Bolstered by the strong second-quarter performance, HPE significantly raised its financial guidance for both fiscal years 2026 and 2027. The company now anticipates full-year revenue growth for fiscal 2026, ending in October, to be in the range of 29% to 33%, a major increase from its previous forecast of 17% to 22%. The midpoint of this new range exceeds the analyst consensus expectation of 19% growth. The growth outlook for its network business was also raised, from a range of 68%-73% to 72%-75%.
For the full 2026 fiscal year, HPE now projects adjusted earnings per share to be between $3.35 and $3.45, a significant jump from its prior guidance of $2.30 to $2.50. The midpoint of this new forecast is well above the analyst consensus estimate of $2.43.
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