10-Q - Hewlett Packard Enterprise Co (0001645590) (Filer)

Fri, Mar 7, 1:23 PM (51 days ago)

Hewlett Packard Enterprise Company (HPE) reported a strong performance for the quarter ending January 31, 2025, with net revenue increasing 16.3% to $7,854 million, driven by growth in the Server and Hybrid Cloud segments. Gross profit margin declined to 29.2%, primarily due to rising costs in several segments. Operating profit decreased 17.5% to $433 million, reflecting lower margins but was partially offset by a significant gain from the sale of its Communications Technology Group, contributing $244 million to earnings before tax. Cash flow from operations turned negative at $(390) million, influenced by unfavorable changes in working capital. HPE's total assets decreased slightly to $70,327 million, with cash and equivalents at $13,431 million. The company is navigating uncertainties, including supply chain pressures and geopolitical factors, while also pursuing a proposed acquisition of Juniper Networks, facing regulatory scrutiny. HPE has initiated a cost reduction program targeting $350 million in savings by 2027, anticipating cash charges of $350 million over the next two years. The company maintains a robust liquidity position with available resources of approximately $5.9 billion, although it has faced challenges related to rising input costs and competitive pricing pressures.