Whitman thanks partnerships for strong HPE Q1

HPE street logoHewlett Packard Enterprise (HPE) has claimed earnings of $300 million in its first quarter of 2016 show it is shaping up for the cloud more strongly than expected.

HPE CEO Meg Whitman claimed that the success of the company was a consequence of a strong product offering. “Our portfolio is truly the best we’ve had in years and is driving strong customer traction,” said Whitman, who claimed the company was in better shape for the cloud, describing it as ‘agile and nimble’. In January BCN reported how HPE is faced with making 72,000 more redundancies this year, according to IT market watcher Trip Chowdhry at Delaware-based Global Equities Research.

The results created earnings of 41 cents per share in HPE, exceeding the expectations of Wall Street analysts, who reportedly expected non-GAAP earnings of 40 cents a share. While Wall Street had estimated HPE’s revenue to be $12.68 billion, the unexpectedly good revenue figure was marginally higher, at $12.7 billion.

According to HPE, the earnings for the next quarter could be as high as 43 cents a share.

Whitman told analysts that HPE is in a much better position, being the main infrastructure provider for SAP HANA with double the number of shipments of its nearest competitor. Another important deal, with Canadian comms company Rogers, helped HPE establish its credential as a leader in creating hybrid cloud infrastructures for enterprises as the move away from their existing traditional IT systems. In January BCN reported how hybrid cloud management is the main focus of HPE’s cloud strategy.

Meanwhile, HPE’s networking revenue showed 62% growth on the same period last year. This was attributed to the acquisition of wireless networking specialist Aruba Networks in March 2015, which has created record revenue from China revenue performed well in other regions. “We are seeing strength in China,” said Whitman. Aruba also grew double digits at an operational level and the vendor enjoyed demand for HPE’s switching portfolio to complement Aruba’s wireless offerings.

Enterprise group revenue was up 1% on the equivalent period in 2015, at $7.1 billion. Networking revenue grew by 54%, through Aruba’s wireless tech sales, however server and storage sales declined, falling by 1% and 3%. More worryingly perhaps, enterprise service revenue is also in decline, falling by 6% to $4.7 billion, while software revenue dropped by 10%.