Enterprise technology company Hewlett Packard Enterprise Co. (HPE) on Monday reported a swing to profit in the second quarter as revenues grew, driven by strong growth in networking and AI-related infrastructure demand. The company also raised its full-year outlook.
Net earnings attributable to common stockholders were $595 million, or $0.44 per share, compared with a loss of $1.08 billion, or $0.82 loss per share, in the prior-year quarter.
Adjusted net earnings attributable to common stockholders increased to $1.11 billion, or $0.79 per share, from $516 million, or $0.38 per share, a year earlier.
Revenue surged 40.0% to a record $10.68 billion from $7.63 billion last year.
Gross margin improved to 36.5% from 28.4%. Adjusted gross margin improved to 36.9% from 29.4%.
Networking revenue jumped 148.2% to $2.7 billion, reflecting contributions from the Juniper acquisition. Cloud & AI revenue increased 22.9% to $7.7 billion, led by a 32.7% rise in server revenue to $5.5 billion.
For the third quarter, HPE expects revenue between $11.5 billion and $12.1 billion, with adjusted earnings projected between $0.88 and $0.93 per share.
For fiscal 2026, the company raised its revenue growth outlook to 29% - 33% and increased adjusted earnings guidance to $3.35 - $3.45 per share.
HPE also introduced a fiscal 2027 framework calling for revenue growth of 8% - 12%, adjusted earnings per share growth of 12% - 16%, and free cash flow of at least $4.5 billion.
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