Key takeaways
- Hewlett Packard Enterprise second quarter sales were lower than expected.
- Current quarter revenue expected to be lower than company and analysts. estimates.
- CEO Antonio Neri remains optimistic that the company will benefit from the AI boom.
Shares of Hewlett Packard Enterprise (HPE) fell after the information technology provider's second-quarter fiscal 2023 sales and current-quarter forecasts came in lower than expected.
HPE's reported revenue rose 3.9% to $7 billion, below analyst estimates and its own forecast of $7.1 billion to $7.5 billion. Earnings per share of $0.52 were better than expected.
The company expects sales the third quarter will be between 6.7 and 7.2 billion dollars, below forecasts. It projects full-year revenue growth of between 4% and 6%, down from its earlier forecast of a 5% to 7% increase.
The report led several analysts to cut their price target on the stock, underscoring concerns that a potential economic downturn will reduce demand for HPE's servers and storage systems.
Antonio Neri, CEO of HPE , remains optimistic, noting that the company has moved to a higher-margin portfolio mix and has had “strong demand” for its artificial intelligence (AI) offering.
Shares of Hewlett Packard Enterprise are down since the beginning of the year.
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Source: investopedia.com
