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Jan 31, 2020

Hewlett Packard Enterprise Q1 2020 Earnings Report

HPE's first quarter results demonstrated progress against strategic priorities, shifting the company to higher-margin and more recurring revenues.

Key Takeaways

Hewlett Packard Enterprise reported Q1 2020 results with a revenue of $6.9 billion. The company's ARR grew by 19% and saw profitable growth in key areas of investment, including Intelligent Edge.

Revenue was $6.9 billion with growth in areas of investment, including Intelligent Edge and as-a-Service offerings.

Annualized revenue run-rate (ARR) was $511 million, up 19% from the prior-year period.

GAAP gross margin was 32.8%, up 170 basis points from the prior-year period and Non-GAAP gross margin was 33.2%, up 210 basis points from the prior-year period.

GAAP diluted net earnings per share was $0.25 and Non-GAAP of $0.44, up 5% from the prior-year period.

Total Revenue
$6.95B
Previous year: $7.55B
-8.0%
EPS
$0.44
Previous year: $0.42
+4.8%
ARR
$511M
Gross Margin
32.8%
Non-GAAP Gross Margin
33.2%
Gross Profit
$2.28B
Previous year: $2.35B
-2.9%
Cash and Equivalents
$3.17B
Previous year: $3.78B
-16.1%
Free Cash Flow
-$185M
Total Assets
$52.2B
Previous year: $51.8B
+0.9%

Hewlett Packard Enterprise

Hewlett Packard Enterprise

Hewlett Packard Enterprise Revenue by Segment

Forward Guidance

Hewlett Packard Enterprise maintains GAAP diluted net EPS outlook of $1.01 to $1.17 and non-GAAP diluted net EPS outlook of $1.78 to $1.94. Revises free cash flow outlook range from $1.9 to $2.1 billion to $1.6 to $1.8 billion.

Positive Outlook

  • Maintains GAAP diluted net EPS outlook of $1.01 to $1.17
  • Maintains non-GAAP diluted net EPS outlook of $1.78 to $1.94

Challenges Ahead

  • Revises free cash flow outlook range from $1.9 to $2.1 billion to $1.6 to $1.8 billion to account for current supply chain disruption impacting short-term cash conversion cycles.

Revenue & Expenses

Visualization of income flow from segment revenue to net income