Hewlett Packard Enterprise Co.’s quarterly revenue rose 1%, propped up by strong demand for its newer subscription-based products, though the company continues to be hampered by supply-chain disruptions.
(Bloomberg) — Hewlett Packard Enterprise Co.’s quarterly revenue rose 1%, propped up by strong demand for its newer subscription-based products, though the company continues to be hampered by supply-chain disruptions.
Sales increased to $6.95 billion and profit, excluding some items, was 48 cents a share, the Spring, Texas-based company said Tuesday in a statement.
Both figures were in line with analysts average estimates, according to data compiled by Bloomberg.
HPE said fiscal-year profit, excluding some items, will be $1.96 to $2.04 a share, a decline of 6 cents a share from the company’s highest previous estimate.
Demand remains strong and the reduction in the forecast is due to currency headwinds, the company’s business exit from Russia and supply chain challenges, Chief Executive Officer Antonio Neri said in an interview.
He cited the company’s growing backlog as evidence of steady demand, and said the company hasn’t seen any “meaningful cancellations.”
HPE is trying to reduce its reliance on sales of hardware such as data-center servers by encouraging customers to pay for additional services with subscriptions.
The company said its annualized revenue run-rate, which reflects future payments under the subscription software-as-a-service model, jumped 22% to $858 million in the quarter.
Revenue from the Intelligent Edge unit grew 8% to $941 million in the period ended July 31, topping analysts’ estimates.
The division, which is a key part of HPE’s transformation plan, covers products that let companies gather and process data where it is generated instead of sending it to an external storage center. High Performance Computing and AI revenue gained 12% to $830 million, also beating estimates.
For more on HPE’s transformation goals
Revenue generated by the company’s largest infrastructure unit declined 3% to $3 billion.
Storage revenue fell 2% to $1.15 billion.
The stock was little changed in extended trading after closing at $13.65 in New York. The shares have dropped almost 14% this year.
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