Hewlett Packard Enterprise Company · NYSE:HPE

Hewlett Packard Enterprise — Q2 2026 Earnings Presentation

32 slides from Hewlett Packard Enterprise's earnings presentation, Jun 1, 2026

  1. Slide 1: HPE Q2 Fiscal 2026 Earnings

    HPE Q 2 F iscal 2026 Earnings June 1 st , 2026

  2. Slide 2: Forward-looking statements

    Forward -looking statements This presentation contains forward -looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 . Such statements involve risks, uncertainties, and assumptions . If the risks or uncertainties ever materialize

  3. Slide 3: Record second quarter results puts HPE two years ahead of fiscal 2028 long-term financial plan

    Record second quarter results puts HPE two years ahead of fiscal 2028 long -term financial plan HPE COMPANY • Record -breaking revenue of $10.7 billion, up 40% year -over -year. • N on -GAAP diluted net earnings per share 1 of $0.79, up 108% year -over -year . • F ree cash flow 1,3 of $915 million ,

  4. Slide 4: Q2 FY26 financial results

    Q2 FY26 financial results • Net revenue of $10.7 billion is up 40% from the prior -year period, up 15% sequentially; above our Q2 fiscal 20 26 outlook range • Non -GAAP gross margin 1 of 36.9% was up 7.5 pts from the prior -year period and up 0.3 pts sequentially • Non -GAAP operating profit 1 of $1

  5. Slide 5: Q2 FY26 business segment results

    Q2 FY26 business segment results Operating Profit Year -over -Year Sequential Net Revenue Year -over -Year (Loss) $ Operating Profit C hange in (in millions) % Revenue C hange in Revenue Growth (in millions) OP % Revenue OP % Revenue Networking $2,690 148% $581 21.6% (3.4) pts (2.1) pts Cloud & AI $

  6. Slide 6: Record AI backlog driven by strength in AI orders

    Record AI backlog driven by strength in AI orders AI Orders 1,2 Cumulative Sovereign/ Ent Customer Mix 3 $ in billions 61% Accelerating Networks Strong AI Systems $2.5 70% $2.1 $2.1 for AI Demand Demand $1.9 60% $2.0 $1.6 Increasing cumulative Generated $1.8 billion $1.6 $1.5 50% $1.5 Networks$for A

  7. Slide 7: Raising fiscal 2026 free cash flow guidance to at least $3.5 billion

    Raising fiscal 2026 free cash flow 1 guidance to at least $3.5 billion 2 $ in Cash Flow Common Shareholder Return $ in billions millions $4.0 $800 At least $ 3 .5 $691 $3.0 $600 $2.6 $312 $348 $343 $2.0 $400 $1.6 $1.4 $158 $154 $0.9 $1.0 $200 $379 $190 $189 $0.0 $0 Q2'26 3 YTD'26 FY'26 Guide Q1'26 Q

  8. Slide 8: Expect to achieve ~2x net leverage by end of fiscal 2026

    Expect to achieve ~2x net leverage by end of fiscal 2026 Net Debt to Adjusted EBITDA 1 Leverage Total net debt 1 at quarter end totaled $16.0B 3 , including $ in billions $25 3.5x $10.5B 4 associated with the financing company. 3.1x 3.0x $20 2.3x 2.5x ~2.0x Targeting fiscal 20 26 free cash flow 1,5

  9. Slide 9: Fiscal 2026 Outlook

    Fiscal 2026 Outlook Q3 Fiscal 20 26 Full Year Fiscal 20 26 29% – 33% as reported Revenue $11.5 – $12.1 billion Revenue growth 3 H igh teens normalized GAAP diluted net EPS $0.84 – $0.89 GAAP operating profit growth 885% – 930% as reported Non -GAAP operating profit Non -GAAP diluted net EPS 1,2 $0.8

  10. Slide 10: Fiscal 2026 outlook details

    Fiscal 2026 outlook details Q3 F iscal 20 26 Full Year Fiscal 202 6 • Revenue: $11.5 billion to $12.1 billion • Revenue growth: 29% to 33% on a reported basis, or high • Non -GAAP operating expenses 1: increase teens normalized 3 sequentially • Free Cash Flow 1,4 : At least $3.5 billion • Non -GAAP

  11. Slide 11: Fiscal 2027 financial framework

    Fiscal 2027 financial framework Networking Cloud & AI HPE REVENUE GROWTH 8 % to 12% 8 % to 12% 8 % to 12% OPERATING MARGI N Networking Cloud & AI HPE 1,2 RATE Mid to high 20%s 10 % to 15% 12% to 16% NON -GAAP DILUTED NET EPS GROWTH 2 Expect growth rate of 12% to 16% from fiscal 2026 FREE CASH FLOW 2

  12. Slide 12: Supplemental slides

    Supplemental slides 12

  13. Slide 13: Networking – Q2 FY26

    Networking – Q 2 FY26 Revenue by product category Revenue Operating profit 1 Rev $ Y/Y 3 $2, 690 million $ 581 million 29% ◼ ◼ Campus & Branch Data Center Networking 1,322 320 10% 6% 148 .2% y/y 2 0.6% q/q 21.6% of revenue 49% ◼ Security 273 18% ◼ Routing 775 9% 10% Total 2,690 10% $ in billions 1

  14. Slide 14: Cloud & AI – Q2 FY26

    Cloud & AI – Q 2 FY26 Revenue Operating profit 1 $ 7,707 million $ 954 million Revenue by product category 22.9% y/y 21.7% q/q 12.4 % of revenue 2% 12% Rev $ Y/Y ◼ Server 5,454 33% $ in billions ◼ Storage 2 1,175 2% 15% ◼ Financial Services 904 6% ◼ Other 3 174 10% OP % revenue Total 7,707 23% Rev

  15. Slide 15: Q2 FY26 balance sheet

    Q2 FY26 balance sheet Operating Company 1,2 Financing Company 1,2 Net Cash 3 $(5.6)B $12.7B $10.3B $11.0B $4.7B 4 $0.5B Cash Debt Net Porfolio Assets 4 Capital Structure 5 FS Cash FS Gross Debt Committed to investment -grade rating and healthy balance sheet Reference endnotes slides in Appendix 2 fo

  16. Slide 16: Appendix 1

    Appendix 1 16

  17. Slide 17: Revenue Disaggregation - As Reported

    Revenue Disaggregation - As Reported Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 in millions Amount Amount Amount Amount Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Networking: Campus & Branch $956 $832 $858 $851 $864 (10%) $880 6% $1,101 28% $1,284

  18. Slide 18: Customer Segmentation - Networking As Reported

    Customer Segmentation - Networking As Reported Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 in millions Amount Amount Amount Amount Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Networking (Customer): Enterprise $1,097 $977 $1,006 $993 $1,027 (6%) $1,04

  19. Slide 19: Revenue Disaggregation & Customer Segmentation - Networking Normalized

    Revenue Disaggregation & Customer Segmentation - Networking Normalized 1 Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 in millions Amount Amount Amount Amount Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Amount Y/Y % Networking (Product): Campus & Branch $1,279 $1,0

  20. Slide 20: Reconciliation of Segment Operating Profit to GAAP & Non-GAAP Operating Profit

    Reconciliation of Segment Operating Profit to GAAP & Non -GAAP Operating Profit In millions Q1’24 Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 Q3’25 Q4’25 Q1’26 Q2’26 $357 $240 $259 $278 $320 $271 $365 $638 $640 $581 Networking 508 525 612 756 547 414 504 620 645 954 Cloud & AI (14) (12) (12) (6) (8) (7) (19) 5 (1

  21. Slide 21: Reconciliation of Operating Cash Flow to Free Cash Flow

    Reconciliation of Operating Cash Flow to Free Cash Flow 1 in millions Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 Net cash (used in) provided by operating activities ($461) $1,305 $2,465 $1,178 $1,410 Investment in property, plant and equipment and software assets (547) (576) (641) (569) (583) Proceeds from sale

  22. Slide 22: Reconciliation of TTM Operating Profit to Non-GAAP Operating Profit and Adjusted EBITDA

    Reconciliation of TTM 1 Operating Profit to Non -GAAP Operating Profit and Adjusted EBITDA Pro Forma Pro Forma HPE Juniper Networks Q3'25 TTM HPE Juniper Networks Q2'26 TTM GAAP Operating Profit $264 $399 $663 $1,456 ($2) $1,454 Acquisition, disposition and other charges 2 432 108 540 790 43 833 Sto

  23. Slide 23: Consolidated GAAP Results

    Consolidated GAAP Results $ in millions, except percentages and per share amounts Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 Y/Y Q/Q Revenue $7,627 $9,136 $9,679 $9,301 $10,678 40.0 % 14.8 % Cost of sales 5,458 6,464 6,438 5,961 6,778 24.2 % 13.7% Gross profit 2,169 2,672 3,241 3,340 3,900 79.8 % 16.8 % Gross pr

  24. Slide 24: Consolidated Non-GAAP Results

    Consolidated Non -GAAP Results $ in millions, except percentages and per share amounts Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 Y/Y Q/Q Revenue $7,627 $9,136 $9,679 $9,301 $10,678 40.0 % 14.8 % Cost of sales 5,383 6,404 6,160 5,898 6,741 25.2 % 14.3 % Gross profit 2,244 2,732 3,519 3,403 3,937 75.4 % 15.7% Gro

  25. Slide 25: Supplemental Reconciliations: GAAP to Non-GAAP Gross Profit and Operating Profit

    Supplemental Reconciliations: GAAP to Non -GAAP Gross Profit and Operating Profit $ in millions Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 GAAP gross profit $2,457 $2,376 $2,439 $2,606 $2,295 $2,169 $2,672 $3,241 $3,340 $3,900 Non -GAAP adjustments: Stock -based compensation expense

  26. Slide 26: Supplemental Reconciliations: GAAP to Non-GAAP Net Income

    Supplemental Reconciliations: GAAP to Non -GAAP Net Income Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 $ in millions, except per share amounts Amount per share Amount per share Amount per share Amount per share Amount per share Amount per share GAAP net earnings (loss) attributable to common stockholders $5

  27. Slide 27: Supplemental Reconciliations: GAAP to Non-GAAP Operating Expenses

    Supplemental Reconciliations: GAAP to Non -GAAP Operating Expenses $ in millions Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 Q2'25 Q3'25 Q4'25 Q1'26 Q2'26 GAAP operating expenses $1,932 $1,951 $1,892 $1,913 $1,862 $3,278 $2,425 $3,249 $2,870 $3,153 Amortization of intangible assets (71) (67) (60) (69) (38) (37) (

  28. Slide 28: Appendix 2

    Appendix 2 28

  29. Slide 29: Endnotes

    Endnotes Slide 3: Record second quarter results puts HPE two years ahead of fiscal 2028 long -term financial plan 1. A reconciliation of specific adjustments to GAAP results for the current and prior periods are included in the “Appendix 1" s ect ion. 2. HPE provides certain guidance on a non -GAAP

  30. Slide 30: Endnotes

    Endnotes Slide 8: Expect to achieve ~2x net leverage by end of fiscal 2026 1. HPE provides certain guidance on a non -GAAP basis. The Company is unable to provide a reconciliation to the most directly compar able GAAP financial measure without unreasonable efforts, as it cannot predict some elements

  31. Slide 31: Endnotes

    Endnotes Slide 10 : Fiscal 2026 outlook details 1. HPE provides certain guidance on a non -GAAP basis. The Company is unable to provide a reconciliation to the most directly compar able GAAP financial measure without unreasonable efforts, as it cannot predict some elements that are included in such

  32. Slide 32: Endnotes

    Endnotes Slide 14 : Cloud & AI - Q 2 FY 26 1. Segment operating profit is calculated based on total segment operating profit, which excludes unallocated corporate operating costs and other adjustments that are managed only at the HPE corporate level . 2. Storage includes revenue from GreenLake Flex

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