HP posts upbeat results, boosts outlook

Source: Financial Times 

Hewlett Packard Enterprise posted upbeat quarterly results and issued a rosier outlook that topped analyst forecasts, sending shares higher.

HPE — the enterprise technology business that split off from HP Inc’s PCs and printers unit — says its fiscal third quarter net revenue climbed 4% from a year ago to $7.76-billion — or a 1% rise when adjusted for currency effects.

That topped analyst forecasts for $7.68-billion, according to a Thomson Reuters survey.

Revenues in hybrid IT — its largest division, which includes computer systems with storage and networking functions — rose 3% from a year ago to $6.2-billion.

In its so-called Intelligent Edge division, which is developing decentralised “Internet of things” technology that allows data to be processed at the point of collection, revenues were up 10% from a year ago to $785m, while financial services revenues rose 3% to $928-million.

Net income rose to $451-million or 29 cents a share in the three months ended in July, up from $165-million or 10 cents a share in the year ago quarter.

Adjusting for one-time items, earnings of 44 cents a share, handily topped forecasts of 37 cents.

“HPE has delivered a strong Q3 and our results prove we have the right strategy to deliver in the areas of highest value for our customers,” says Antonio Neri, chief executive officer.

“Solid execution across each of our business segments, combined with market momentum, will enable us to deliver FY18 revenue and earnings well beyond our original outlook,” he adds.

The company also lifted its full-year earnings outlook again, to a range of $1.85 to $1.90, up from $1.70 to $1.80 previously.

On an adjusted basis, the company now expects to report earnings of between $1.50 to $1.55 a share, up from $1.40 to $1.50 previously. That also exceeded Wall Street’s projections of $1.46.

For the current quarter, HPE forecast adjusted earnings of between 39 to 44 cents a share.

The Palo Alto-based company also says it appointed Tarek Robbiati as its new finance chief effective September 17. Mr Robbiati, who most recently served as finance chief at Sprint, will succeed Tim Stonesifer, who will remain with the company through the end of October.

HPE shares, which are up nearly 17% year-to-date, climbed 1.4% in extended trade to $16.98.

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