HPE Reports Fiscal 2023 3rd Quarter Results
HOUSTON, Aug. 30, 2023 -- Hewlett Packard Enterprise (NYSE: HPE) announced financial results for the third quarter ended July 31, 2023.
“HPE delivered another solid quarter in Q3, powered by standout performances in the Intelligent Edge and HPE GreenLake,” said Antonio Neri, president and CEO of Hewlett Packard Enterprise. “Demand improved sequentially across all key business segments, with particular strength in our HPC & AI segment as customers discover HPE’s unique capabilities to power unprecedented levels of performance for AI at scale. Our strategic shift toward edge, hybrid cloud and AI delivered through our HPE GreenLake platform is working."
“The pivot in our portfolio toward higher-growth, higher-margin markets is clearly visible in our year-over-year expansion of gross margins,” said Jeremy Cox, senior vice president, interim CFO, corporate controller and chief tax officer of Hewlett Packard Enterprise. “Our differentiated edge-to-cloud strategy is fueling strong results in an uneven market.”
Third Quarter Fiscal 2023 Segment Results
Intelligent Edge revenue was $1.4 billion, up 50% from the prior-year period in actual dollars and 53% in constant currency, with 29.7% operating profit margin, compared to 16.5% in the prior-year period.
High Performance Computing & Artificial Intelligence (“HPC & AI”) revenue was $836 million, up 1% from the prior-year period in actual dollars and 3% in constant currency, with (0.8)% operating profit margin, compared to 3.4% from the prior-year period.
Compute revenue was $2.6 billion, down 13% from the prior-year period in actual dollars and 10% in constant currency, with 10.9% operating profit margin, compared to 13.5% from the prior-year period.
Storage revenue was $1.1 billion, down 5% from the prior-year period in actual dollars and down 2% in constant currency, with 10.7% operating profit margin, compared to 14.3% from the prior-year period.
Financial Services revenue was $873 million, up 7% from the prior-year period in actual dollars and in constant currency, with 8.4% operating profit margin, compared to 11.8% from the prior-year period. Net portfolio assets of $13.5 billion, up 7.5% from the prior-year period in actual dollars and up 5.2% in constant currency. The business delivered return on equity of 15.8%, down 3.8 points from the prior-year period.
Dividend
The HPE Board of Directors declared a regular cash dividend of $0.12 per share on the company’s common stock, payable on October 13, 2023, to stockholders of record as of the close of business on September 14, 2023.
Fiscal 2023 Fourth Quarter Outlook
HPE estimates revenue to be in the range of $7.2 billion to $7.5 billion. HPE estimates GAAP diluted net EPS to be in the range of $0.36 to $0.40 and non-GAAP diluted net EPS to be in the range of $0.48 to $0.52. Fiscal 2023 fourth quarter non-GAAP diluted net EPS estimates exclude after-tax adjustments of $0.12 per diluted share, primarily related to, stock-based compensation expense, amortization of intangible assets, and acquisition, disposition and other related charges.
Fiscal 2023 Outlook
HPE estimates fiscal 2023 revenue growth to be in the range of 4% to 6% in constant currency, and targets fiscal 2023 GAAP operating profit growth to be in the range of 180% to 184% and non-GAAP operating profit growth to be in the range of 6% to 7%. HPE reiterates GAAP diluted net EPS to be in the range of $1.42 and $1.46 and raises non-GAAP diluted net EPS guidance to be in the range of $2.11 and $2.15. Fiscal 2023 non-GAAP diluted net EPS estimates exclude after-tax adjustments of $0.69 per diluted share, primarily related to stock-based compensation expense, amortization of intangible assets and transformation costs.
Fiscal 2023 Free Cash Flow
Reiterates guidance of $1.9 billion to $2.1 billion.
Fiscal 2023 Capital Returns to Shareholders
Returning approximately 60% of free cash flow to shareholders in dividends and share repurchases.
Download the Q3 FY23 earnings infographic here.
About Hewlett Packard Enterprise
Hewlett Packard Enterprise (NYSE: HPE) is the global edge-to-cloud company that helps organizations accelerate outcomes by unlocking value from all of their data, everywhere. Built on decades of reimagining the future and innovating to advance the way people live and work, HPE delivers unique, open and intelligent technology solutions as a service. With offerings spanning Cloud Services, Compute, High Performance Computing & AI, Intelligent Edge, Software, and Storage, HPE provides a consistent experience across all clouds and edges, helping customers develop new business models, engage in new ways, and increase operational performance. For more information, visit: www.hpe.com.
Source: HPE
