Tech HPE skyrockets 30% on biggest earnings beat since 2018

Key Points

• Hewlett Packard Enterprise reported blockbuster second-quarter earnings results.
• Revenue was up 40% from a year ago and the tech company posted its biggest earnings beat since 2018.
• Server revenue was particularly strong, coming in at $5.45 billion, nearly $1 billion ahead of estimates.

Hewlett Packard Enterprise shares skyrocketed 30% on Monday after the tech company posted blockbuster second-quarter results that blew away estimates.

Here’s how the company did compared to LSEG estimates:

• Earnings per share: 79 cents adj. vs. 53 cents expected
• Revenue: $10.68 billion vs. $9.79 billion expected

It was the company’s biggest EPS beat since February 2018.

Revenue was up 40% over a year ago.

Overall Cloud & AI revenue came in at $7.71 billion, topping the StreetAccount estimate of $6.87 billion, but it was the company’s server unit that really impressed. Server revenue, which is a sub-division of the Cloud & AI unit, came in at $5.45 billion, blowing away the $4.66 billion expected by analysts.

HPE bumped its full-year EPS guidance by a full dollar, projecting fiscal year 2026 EPS of $3.35 to $3.45, up from $2.30 to $2.50. The company said it is now tracking two years ahead of its own long-term financial plan.

CEO Antonio Neri told CNBC that traditional server bookings are up triple digits, and it is the biggest backlog the company has ever seen.

“Customers continue to invest in modernizing their infrastructure and scaling AI, and our performance shows the strength of our combined networking portfolio,” Neri said in a release announcing the quarterly results.