Hewlett Packard Enterprise stock falls 5% despite reporting record fiscal third-quarter revenue and raising growth forecasts
Hewlett Packard Enterprise reported fiscal third-quarter revenue of $12.2 billion, a 34% year-over-year increase. The company's adjusted earnings reached $1.11 per share, exceeding previous expectations. Hewlett Packard Enterprise also raised its fiscal 2026 revenue-growth forecast to a range of 34% to 37%, up from a previous range of 29% to 33%. Despite these strong results and the raised guidance, Hewlett Packard Enterprise stock fell 5% to $27.92. Investors are reacting to supply constraints involving memory, CPUs, and drives that limit the company's ability to ship orders. While demand for AI infrastructure remains high, component shortages are pressuring margins and preventing the company from converting its large backlog into near-term revenue. To address long-term growth, Hewlett Packard Enterprise expanded its collaboration with Oracle to deploy networking equipment across AI data centers. The company also set fiscal 2027 targets, including $5 billion in free cash flow and adjusted earnings-per-share growth of 16% to 20%.
Sources
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