TLDR
- HPE reported Q2 adjusted EPS of $0.79 on revenue of $10.7B, beating estimates of $0.53 EPS and $9.78B revenue
- The company raised its fiscal 2026 revenue growth outlook to 29%–33%, up from 17%–22%
- Cloud & AI segment revenue hit $7.71B, topping Wall Street’s $6.93B estimate
- Networking revenue surged 148% to $2.69B following the Juniper Networks acquisition
- HPE plans to return approximately 75% of free cash flow to shareholders in fiscal 2027
Hewlett Packard Enterprise (HPE) stock surged roughly 30% in after-hours trading Monday after the company delivered a strong fiscal second-quarter earnings beat and sharply raised its full-year outlook.
Hewlett Packard Enterprise Company, HPE
HPE reported adjusted earnings of $0.79 per share on revenue of $10.7 billion. Analysts had expected $0.53 per share on $9.78 billion in revenue.
In the same quarter a year ago, HPE posted $0.38 per share on $7.63 billion in revenue. The year-over-year jump tells the story of how fast the business has moved.
$HPE Q2’26 EARNINGS HIGHLIGHTS
🔹 Revenue: $10.68B (Est. $9.76B) 🟢; +40% YoY
🔹 Adj. EPS: $0.79 (Est. $0.53) 🟢FY Guide:
🔹 Adj. EPS: $3.35-$3.45 (Est. $2.42) 🟢, up from $2.30-$2.50
🔹 Revenue Growth: +29% to +33%
🔹 Networking Revenue Growth: +72% to +75%
🔹 Non-GAAP… pic.twitter.com/rZO5DZHmWb— Wall St Engine (@wallstengine) June 1, 2026
The stock had already climbed 96% year-to-date heading into the print, and is up 171% over the past 12 months.
Cloud & AI revenue — the segment that includes its server business — came in at $7.71 billion, above the $6.93 billion Wall Street had penciled in.
CEO Antonio Neri pointed to the durability of the results. “We are creating significant shareholder value through innovation,” he said, adding a thank-you to investors who stayed through the Juniper acquisition process.
Outlook Gets a Big Upgrade
HPE raised its fiscal 2026 revenue growth forecast to a range of 29%–33%, up from the prior guidance of 17%–22%. Its networking segment growth outlook also moved higher, to 72%–75% from 68%–73%.
The company said its revised fiscal 2026 ranges for adjusted EPS and free cash flow are already higher than what it had originally projected to achieve by fiscal 2028 — effectively pulling forward its long-term targets by two years.
CFO Marie Myers told Reuters the key shift this quarter was enterprise customers adopting agentic AI as a core workload. That’s a pattern HPE expects to continue.
Morgan Stanley analysts noted that customers are absorbing materially higher server prices with little sign of demand softening. “The biggest takeaway from the quarter was that HPE is benefiting from the same pricing dynamic that has recently driven upside at Dell,” they wrote.
Juniper Acquisition Paying Off
HPE’s networking revenue hit $2.69 billion, up 148% year-over-year. That jump is largely thanks to the Juniper Networks acquisition, which closed in July 2025 after regulatory delays.
The number came in just ahead of analyst estimates of $2.68 billion, but the story is the scale of the gain versus the prior year period.
Neri added that HPE expects to return about 75% of free cash flow to shareholders in fiscal 2027.
HPE’s 12-month forward price-to-earnings ratio sits at 15.93 — well below Dell at 24.14 and Cisco at 25.56. That gap has caught the attention of some on Wall Street who see room to re-rate.
Dell also had a strong recent quarter, reporting better-than-expected results on May 28 and raising its own revenue outlook. Super Micro Computer rose around 5% in sympathy Tuesday, while Dell climbed roughly 3%.
Hyperscalers including Alphabet and Amazon are projected to spend more than $700 billion on AI infrastructure this year, a spending wave that continues to flow through to HPE’s order book.
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