Hewlett Packard Enterprise is projecting second-quarter revenue to surpass Wall Street expectations, fueled by escalating demand for its artificial intelligence-powered servers. The company, a key supplier of servers utilizing Nvidia's chips, has also increased its fiscal 2026 forecasts for earnings per share and its networking segment.
Big Tech companies are expected to invest heavily in AI infrastructure this year, driving significant demand for server and data center equipment from major vendors like HPE. "Demand for our products and solutions was strong, with orders increasing double digits year over year across all segments," stated HPE CEO Antonio Neri.
Shares saw a modest rise in extended trading. HPE is navigating a competitive landscape, contending with rivals like Dell and Super Micro Computer amidst surging memory chip costs essential for AI applications. The company anticipates quarterly revenue to fall between $9.6 billion and $10.0 billion, exceeding the analyst average estimate of $9.58 billion. HPE's AI backlog has now surpassed $5 billion, with enterprise and sovereign customers making up a substantial portion of these orders. The company also raised its fiscal 2026 adjusted EPS forecast and its annual revenue growth expectations for the networking segment.