HPE revenue grows 0.2% despite $3 bn from Compute business

Hewlett Packard Enterprise (HPE) announced financial results for the second quarter, ended April 30, 2022.
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HPE reported second quarter revenue of $6.7 billion (+0.2 percent) and gross margin of 32.4 percent (–170 basis points) from the prior-year period, primarily due to $105 million of Russia-related charges.

HPE announced in February that it stopped all shipments to and sales in Russia and Belarus. During the second quarter of 2022, HPE recorded total charges of $126 million related to the Russia conflict’s impact on our business.

“Persistent demand led to another quarter of significant order growth and higher revenue for HPE, underscoring the accelerating interest customers have in our unique edge-to-cloud portfolio and our HPE GreenLake platform,” said Antonio Neri, president, and CEO of Hewlett Packard Enterprise, in a news statement.

HPE’s Intelligent Edge revenue was $867 million (+8 percent), with 12.6 percent operating profit margin. Aruba Services revenue was up double-digits. Intelligent Edge as-a-Service ARR was up 50 percent+ from the prior-year period.

HPE’s High Performance Computing & Artificial Intelligence (HPC & AI) revenue was $710 million (+4 percent), with (5.6 percent) operating profit margin. The operating loss was driven by supply constraints and delayed customer acceptances.

HPE’s Compute revenue was $3 billion, flat from the prior-year period, with 13.9 percent operating profit margin. Margin expansion was driven by strategic pricing actions more than offsetting input cost increases.

HPE’s Storage revenue was $1.1 billion (–3 percent), with 12.6 percent operating profit margin, reflecting higher supply chain costs and unfavorable mix shift.

HPE’s Financial Services revenue was $823 million (–2 percent), with 12.6 percent operating profit margin.