Hewlett Packard Enterprise (HPE) has reported Fiscal fourth-quarter financial results that beat Wall Street targets across the board.
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The company, which specializes in servers and computer storage, reported earnings per share $0.58 a share, which beat the consensus forecast among analysts of $0.56. Revenue in the quarter came totaled $8.46 billion, which topped Wall Street estimates of $8.25 billion. Sales were up 15% from a year ago.
The company’s management team said the stellar results were driven largely by growth in the company’s hybrid cloud segment. It increased 18% year-over-year following several down quarters. Hybrid cloud is becoming more profitable, with its margins having doubled over the past year.
Inline Guidance
Hewlett Packard Enterprise also announced that revenue from its servers reached $4.71 billion in the latest quarter, up 32% from a year earlier. That was also ahead of Wall Street forecasts that called for $4.66 billion in server sales. The business is rising sharply alongside demand for servers to train artificial intelligence (AI) models. HPE’s networking segment saw sales shrink by 20% from a year earlier.
In terms of guidance, HPE issued an outlook for the first quarter of 2025 that was inline with Wall Street expectations. The inline guidance may explain why HPE stock is flat in after hours trading. So far in 2024, the company’s share price has gained 30%.
Is HPE Stock a Buy?
The stock of Hewlett Packard Enterprise has a consensus Moderate Buy rating among 10 Wall Street analysts. That rating is based on four Buy and six Hold recommendations issued in the last three months. The average HPE price target of $23.30 implies 7.62% upside from current levels.
