Hewlett Packard Enterprise (NYSE: HPE) is the global edge-to-cloud company that helps organizations accelerate outcomes by unlocking value from all of their data, everywhere. Built on decades of reimagining the future and innovating to advance the way people live and work, HPE delivers unique, open and intelligent technology solutions as a service. With offerings spanning Cloud Services, Compute, High Performance Computing & AI, Intelligent Edge, Software, and Storage, HPE provides a consistent experience across all clouds and edges, helping customers develop new business models, engage in new ways, and increase operational performance. For more information, visit: www.hpe.com.
Use of non-GAAP financial information and key performance metrics
To supplement Hewlett Packard Enterprise’s condensed consolidated financial statement information presented on a generally accepted accounting principles (“GAAP”) basis, Hewlett Packard Enterprise provides financial measures, including revenue on a constant currency basis (including at the business segment level), non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP operating profit (non-GAAP earnings from operations), non-GAAP operating profit margin (non-GAAP earnings from operations as a percentage of net revenue), non-GAAP income tax rate, non-GAAP net earnings, non-GAAP diluted net earnings per share and free cash flow. Hewlett Packard Enterprise also provides forecasts of revenue growth on a constant currency basis, non-GAAP diluted net earnings per share, non-GAAP operating profit growth, and free cash flow. Reconciliations of each of these non-GAAP financial measures to their most directly comparable GAAP measures for this quarter and prior periods are included in the tables below or elsewhere in the materials accompanying this news release. In addition an explanation of the ways in which Hewlett Packard Enterprise’s management uses these non-GAAP measures to evaluate its business, the substance behind Hewlett Packard Enterprise’s decision to use these non-GAAP measures, the material limitations associated with the use of these non-GAAP measures, the manner in which Hewlett Packard Enterprise’s management compensates for those limitations, and the substantive reasons why Hewlett Packard Enterprise’s management believes that these non-GAAP measures provide supplemental useful information to investors is included further below. This additional non-GAAP financial information is not meant to be considered in isolation or as a substitute for revenue, gross profit, gross profit margin, operating profit (earnings from operations), operating profit margin (earnings from operations as a percentage of net revenue), net earnings, diluted net earnings per share, and cash flow from operations prepared in accordance with GAAP.
In addition to the supplemental non-GAAP financial information, Hewlett Packard Enterprise also presents annualized revenue run-rate ("ARR") and as-a-Service ("AAS") orders as performance metrics. ARR is a financial metric used to assess the growth of the Consumption Services offerings. ARR represents the annualized revenue of all net HPE GreenLake edge-to-cloud platform services revenue, related financial services revenue (which includes rental income for operating leases and interest income from finance leases), and Software-as-a-Service ("SaaS"), software consumption revenue, and other as-a-Service offerings recognized during a quarter and multiplied by four. AAS orders are an overlay across all business segments contributing to HPE's consumption-based services (both recurring and non-recurring revenues), and includes hardware, as well as HPE GreenLake as-a-Service, Aruba SaaS, Storage SaaS, and other Software assets. ARR & AAS orders should be viewed independently of net revenue and deferred revenue and are not intended to be combined with any of these items.
Forward-looking statements
This press release 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 or the assumptions prove incorrect, the results of Hewlett Packard Enterprise Company and its consolidated subsidiaries ("Hewlett Packard Enterprise") may differ materially from those expressed or implied by such forward-looking statements and assumptions. The words "believe", "expect", "anticipate", "optimistic", "intend", "guides", "will", "estimates", "may", "could", "should", and similar expressions are intended to identify such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any anticipated financial or operational benefits associated with the recent segment realignment; any projections or expectations of revenue, margins, expenses (including stock-based compensation expenses), investments, net earnings, net earnings per share, cash flows, liquidity and capital resources, inventory, order book, share repurchases, dividends, currency exchange rates, amortization of intangible assets, or other financial items; any projections or estimations of orders, including as-a-service orders; any projections of the amount, execution, timing, and results of any transformation or impact of cost savings or restructuring plans, including estimates and assumptions related to the anticipated benefits, cost savings, or charges of implementing such transformation and restructuring plans; any statements of the plans, strategies, and objectives of management for future operations, as well as the execution and consummation of corporate transactions or contemplated acquisitions and dispositions (including but not limited to the disposition of H3C shares and the receipt of proceeds therefrom), research and development expenditures, and any resulting benefit, cost savings, charges, or revenue or profitability improvements; any statements concerning the expected development, performance, market share, or competitive performance relating to products or services; any statements concerning technological and market trends, the pace of technological innovation, and adoption of new technologies, including artificial intelligence and other products and services offered by Hewlett Packard Enterprise; any statements regarding current or future macroeconomic trends or events and the impact of those trends and events on Hewlett Packard Enterprise and our financial performance, including but not limited to demand for our products and services; any statements of expectation or belief, including those relating to future guidance and the financial performance of Hewlett Packard Enterprise; and any statements of assumptions underlying any of the foregoing.
Risks, uncertainties and assumptions include the need to address the many challenges facing Hewlett Packard Enterprise's businesses; the competitive pressures faced by Hewlett Packard Enterprise's businesses; risks associated with executing Hewlett Packard Enterprise's strategy; the impact of macroeconomic and geopolitical trends and events, including but not limited to financial sector volatility, supply chain constraints, the inflationary environment, the ongoing conflicts between Russia and Ukraine and between Israel and Hamas, and the relationship between China and the U.S.; the need to effectively manage third-party suppliers and distribute Hewlett Packard Enterprise's products and services; the protection of Hewlett Packard Enterprise's intellectual property assets, including intellectual property licensed from third parties and intellectual property shared with its former parent; risks associated with Hewlett Packard Enterprise's international operations (including public health crises, such as pandemics or epidemics, and geopolitical events, such as, but not limited to, those mentioned above); the development of and transition to new products and services and the enhancement of existing products and services to meet customer needs and respond to emerging technological trends (including the desirability of a unified hybrid cloud offering); the execution of Hewlett Packard Enterprise’s ongoing transformation and mix shift of its portfolio of offerings; the execution and performance of contracts by Hewlett Packard Enterprise and its suppliers, customers, clients, and partners, including any impact thereon resulting from macroeconomic or geopolitical events, such as, but not limited to, those mentioned above; the prospect of a shutdown of the U.S. federal government; the hiring and retention of key employees; the execution, integration, consummation, and other risks associated with business combination, disposition, and investment transactions; the impact of changes to privacy, cybersecurity, environmental, global trade, and other governmental regulations; changes in our product, lease, intellectual property, or real estate portfolio; the payment or non-payment of a dividend for any period; the efficacy of using non-GAAP, rather than GAAP, financial measures in business projections and planning; the judgments required in connection with determining revenue recognition; impact of company policies and related compliance; utility of segment realignments; allowances for recovery of receivables and warranty obligations; provisions for, and resolution of, pending investigations, claims, and disputes; the impacts of the Inflation Reduction Act of 2022 and related guidance or regulations; and other risks that are described herein, including but not limited to the risks described in Hewlett Packard Enterprise’s Annual Report on Form 10-K for the fiscal year ended October 31, 2022, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and in other filings made by Hewlett Packard Enterprise from time to time with the Securities and Exchange Commission.
As in prior periods, the financial information set forth in this press release, including tax-related items, reflects estimates based on information available at this time. While Hewlett Packard Enterprise believes these estimates to be reasonable, these amounts could differ materially from reported amounts in the Hewlett Packard Enterprise Annual Report on Form 10-K for the fiscal year ended October 31, 2023. Hewlett Packard Enterprise assumes no obligation and does not intend to update these forward-looking statements, except as required by applicable law.
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||
| Condensed Consolidated Statements of Earnings |
||||||||||||
| (Unaudited) |
||||||||||||
|
|
|
|
||||||||||
|
|
|
For the three months ended |
||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
||||||
|
|
|
In millions, except per share amounts |
||||||||||
| Net revenue |
$ |
7,351 |
|
$ |
7,002 |
|
$ |
7,871 |
|
|||
| Costs and Expenses: |
|
|
|
|||||||||
| Cost of sales |
|
4,792 |
|
|
4,492 |
|
|
5,278 |
|
|||
| Research and development |
|
578 |
|
|
578 |
|
|
515 |
|
|||
| Selling, general and administrative |
|
1,332 |
|
|
1,302 |
|
|
1,262 |
|
|||
| Amortization of intangible assets |
|
72 |
|
|
72 |
|
|
73 |
|
|||
| Impairment of goodwill (1) |
|
— |
|
|
— |
|
|
905 |
|
|||
| Transformation costs |
|
56 |
|
|
65 |
|
|
184 |
|
|||
| Disaster (recovery) charges |
|
(4 |
) |
|
1 |
|
|
(1 |
) |
|||
| Acquisition, disposition and other related charges |
|
18 |
|
|
21 |
|
|
(6 |
) |
|||
| Total costs and expenses |
|
6,844 |
|
|
6,531 |
|
|
8,210 |
|
|||
| Earnings (loss) from operations |
|
507 |
|
|
471 |
|
|
(339 |
) |
|||
| Interest and other, net |
|
(27 |
) |
|
(50 |
) |
|
(109 |
) |
|||
| Tax indemnification and other adjustments |
|
5 |
|
|
45 |
|
|
(20 |
) |
|||
| Non-service net periodic benefit (cost) credit |
|
(1 |
) |
|
(3 |
) |
|
28 |
|
|||
| Earnings from equity interests |
|
65 |
|
|
73 |
|
|
83 |
|
|||
| Earnings (loss) before provision for taxes |
|
549 |
|
|
536 |
|
|
(357 |
) |
|||
| (Provision) benefit for taxes |
|
93 |
|
|
(72 |
) |
|
53 |
|
|||
| Net earnings (loss) |
$ |
642 |
|
$ |
464 |
|
$ |
(304 |
) |
|||
| Net Earnings (Loss) Per Share: |
|
|
|
|||||||||
| Basic |
$ |
0.50 |
|
$ |
0.36 |
|
$ |
(0.23 |
) |
|||
| Diluted |
$ |
0.49 |
|
$ |
0.35 |
|
$ |
(0.23 |
) |
|||
| Cash dividends declared per share |
$ |
0.12 |
|
$ |
0.12 |
|
$ |
0.12 |
|
|||
| Weighted-average Shares Used to Compute Net Earnings (Loss) Per Share: |
|
|
|
|||||||||
| Basic |
|
1,295 |
|
|
1,299 |
|
|
1,296 |
|
|||
| Diluted |
|
1,315 |
|
|
1,316 |
|
|
1,296 |
|
|||
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||
| Condensed Consolidated Statements of Earnings |
||||||||
| (Unaudited) |
||||||||
|
|
|
|
||||||
|
|
|
Year Ended |
||||||
|
|
|
October 31, 2023 |
|
October 31, 2022 |
||||
|
|
In millions, except per share amounts |
|||||||
| Net revenue |
$ |
29,135 |
|
$ |
28,496 |
|
||
| Costs and Expenses: |
|
|
||||||
| Cost of sales |
|
18,896 |
|
|
18,990 |
|
||
| Research and development |
|
2,349 |
|
|
2,045 |
|
||
| Selling, general and administrative |
|
5,160 |
|
|
4,941 |
|
||
| Amortization of intangible assets |
|
288 |
|
|
293 |
|
||
| Impairment of goodwill (1) |
|
— |
|
|
905 |
|
||
| Transformation costs |
|
283 |
|
|
473 |
|
||
| Disaster charges |
|
1 |
|
|
48 |
|
||
| Acquisition, disposition and other related charges |
|
69 |
|
|
19 |
|
||
| Total costs and expenses |
|
27,046 |
|
|
27,714 |
|
||
| Earnings from operations |
|
2,089 |
|
|
782 |
|
||
| Interest and other, net |
|
(156 |
) |
|
(188 |
) |
||
| Tax indemnification and other adjustments |
|
55 |
|
|
(67 |
) |
||
| Non-service net periodic benefit (cost) credit |
|
(3 |
) |
|
134 |
|
||
| Earnings from equity interests |
|
245 |
|
|
215 |
|
||
| Earnings before provision for taxes |
|
2,230 |
|
|
876 |
|
||
| Provision for taxes |
|
(205 |
) |
|
(8 |
) |
||
| Net earnings |
$ |
2,025 |
|
$ |
868 |
|
||
| Net Earnings Per Share: |
|
|
||||||
| Basic |
$ |
1.56 |
|
$ |
0.67 |
|
||
| Diluted |
$ |
1.54 |
|
$ |
0.66 |
|
||
| Cash dividends declared per share |
$ |
0.48 |
|
$ |
0.48 |
|
||
| Weighted-average Shares Used to Compute Net Earnings Per Share: |
|
|
||||||
| Basic |
|
1,299 |
|
|
1,303 |
|
||
| Diluted |
|
1,316 |
|
|
1,322 |
|
||
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||
| Reconciliation of GAAP to Non-GAAP measures |
||||||||||||
| (Unaudited) |
||||||||||||
|
|
|
|
|
|
|
|
||||||
|
|
|
For the three months ended |
||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
||||||
|
|
|
Dollars in millions |
||||||||||
| GAAP net revenue |
$ |
7,351 |
|
|
$ |
7,002 |
|
|
$ |
7,871 |
|
|
| GAAP cost of sales |
|
4,792 |
|
|
|
4,492 |
|
|
|
5,278 |
|
|
| GAAP gross profit |
|
2,559 |
|
|
|
2,510 |
|
|
|
2,593 |
|
|
| Non-GAAP Adjustments |
|
|
|
|
|
|||||||
| Amortization of initial direct costs |
|
— |
|
|
|
— |
|
|
|
1 |
|
|
| Stock-based compensation expense |
|
9 |
|
|
|
9 |
|
|
|
8 |
|
|
| Disaster recovery |
|
(10 |
) |
|
|
(3 |
) |
|
|
— |
|
|
| Non-GAAP gross profit |
$ |
2,558 |
|
|
$ |
2,516 |
|
|
$ |
2,602 |
|
|
|
|
|
|
|
|
|
|||||||
| GAAP gross profit margin |
|
34.8 |
% |
|
|
35.8 |
% |
|
|
32.9 |
% |
|
| Non-GAAP adjustments |
|
— |
% |
|
|
0.1 |
% |
|
|
0.2 |
% |
|
| Non-GAAP gross profit margin |
|
34.8 |
% |
|
|
35.9 |
% |
|
|
33.1 |
% |
|
|
|
Year Ended |
|||||||
|
|
October 31, 2023 |
|
October 31, 2022 |
|||||
|
|
Dollars in millions |
|||||||
| GAAP net revenue |
$ |
29,135 |
|
|
$ |
28,496 |
|
|
| GAAP cost of sales |
|
18,896 |
|
|
|
18,990 |
|
|
| GAAP gross profit |
$ |
10,239 |
|
|
$ |
9,506 |
|
|
| Non-GAAP Adjustments |
|
|
|
|||||
| Amortization of initial direct costs |
$ |
— |
|
|
$ |
4 |
|
|
| Stock-based compensation expense |
|
47 |
|
|
|
46 |
|
|
| Disaster (recovery) charges |
|
(13 |
) |
|
|
111 |
|
|
| Non-GAAP gross profit |
$ |
10,273 |
|
|
$ |
9,667 |
|
|
|
|
|
|
|
|||||
| GAAP gross profit margin |
|
35.1 |
% |
|
|
33.4 |
% |
|
| Non-GAAP adjustments |
|
0.2 |
% |
|
|
0.5 |
% |
|
| Non-GAAP gross profit margin |
|
35.3 |
% |
|
|
33.9 |
% |
|
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||
| Reconciliation of GAAP to Non-GAAP measures |
||||||||||||
| (Unaudited) |
||||||||||||
|
|
|
|
|
|
|
|
||||||
|
|
|
For the three months ended |
||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
||||||
|
|
|
Dollars in millions |
||||||||||
| GAAP earnings (loss) from operations |
$ |
507 |
|
$ |
471 |
|
$ |
(339 |
) |
|||
| Non-GAAP Adjustments |
|
|
|
|||||||||
| Amortization of initial direct costs |
|
— |
|
|
— |
|
|
1 |
|
|||
| Amortization of intangible assets |
|
72 |
|
|
72 |
|
|
73 |
|
|||
| Impairment of goodwill (1) |
|
— |
|
|
— |
|
|
905 |
|
|||
| Transformation costs |
|
56 |
|
|
65 |
|
|
184 |
|
|||
| Disaster recovery |
|
(14 |
) |
|
(2 |
) |
|
(1 |
) |
|||
| Stock-based compensation expense |
|
71 |
|
|
91 |
|
|
85 |
|
|||
| Acquisition, disposition and other related charges |
|
18 |
|
|
21 |
|
|
(6 |
) |
|||
| Non-GAAP earnings from operations |
$ |
710 |
|
$ |
718 |
|
$ |
902 |
|
|||
|
|
|
|
|
|||||||||
| GAAP operating profit margin |
|
6.9 |
% |
|
6.7 |
% |
|
(4.3 |
)% |
|||
| Non-GAAP adjustments |
|
2.8 |
% |
|
3.6 |
% |
|
15.8 |
% |
|||
| Non-GAAP operating profit margin |
|
9.7 |
% |
|
10.3 |
% |
|
11.5 |
% |
|||
|
|
Year Ended |
|||||||
|
|
October 31, 2023 |
|
October 31, 2022 |
|||||
|
|
Dollars in millions |
|||||||
| GAAP earnings from operations |
$ |
2,089 |
|
$ |
782 |
|
||
| Non-GAAP Adjustments |
|
|
||||||
| Amortization of initial direct costs |
|
— |
|
|
4 |
|
||
| Amortization of intangible assets |
|
288 |
|
|
293 |
|
||
| Impairment of goodwill (1) |
|
— |
|
|
905 |
|
||
| Transformation costs |
|
283 |
|
|
473 |
|
||
| Disaster (recovery) charges |
|
(12 |
) |
|
159 |
|
||
| Stock-based compensation expense |
|
428 |
|
|
391 |
|
||
| Acquisition, disposition and other related charges |
|
69 |
|
|
19 |
|
||
| Non-GAAP earnings from operations |
$ |
3,145 |
|
$ |
3,026 |
|
||
|
|
|
|
||||||
| GAAP operating profit margin |
|
7.2 |
% |
|
2.7 |
% |
||
| Non-GAAP adjustments |
|
3.6 |
% |
|
7.9 |
% |
||
| Non-GAAP operating profit margin |
|
10.8 |
% |
|
10.6 |
% |
||
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||||||||||||||
| Reconciliation of GAAP to Non-GAAP measures |
||||||||||||||||||||||||
| (Unaudited) |
||||||||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
|
|
|
For the three months ended |
||||||||||||||||||||||
|
|
|
October 31,
|
|
Diluted net earnings per share |
|
July 31,
|
|
Diluted net earnings per share |
|
October 31,
|
|
Diluted net earnings per share |
||||||||||||
|
|
|
Dollars in millions, except per share amounts |
||||||||||||||||||||||
| GAAP net earnings (loss) |
$ |
642 |
|
$ |
0.49 |
|
$ |
464 |
|
$ |
0.35 |
|
$ |
(304 |
) |
$ |
(0.23 |
) |
||||||
| Non-GAAP Adjustments: |
|
|
|
|
|
|
||||||||||||||||||
| Amortization of initial direct costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
— |
|
||||||
| Amortization of intangible assets |
|
72 |
|
|
0.05 |
|
|
72 |
|
|
0.05 |
|
|
73 |
|
|
0.06 |
|
||||||
| Impairment of goodwill (1) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
905 |
|
|
0.68 |
|
||||||
| Transformation costs |
|
56 |
|
|
0.05 |
|
|
65 |
|
|
0.05 |
|
|
184 |
|
|
0.14 |
|
||||||
| Disaster recovery |
|
(14 |
) |
|
(0.01 |
) |
|
(2 |
) |
|
— |
|
|
(1 |
) |
|
— |
|
||||||
| Stock-based compensation expense |
|
71 |
|
|
0.05 |
|
|
91 |
|
|
0.07 |
|
|
85 |
|
|
0.07 |
|
||||||
| Acquisition, disposition and other related charges |
|
18 |
|
|
0.01 |
|
|
21 |
|
|
0.02 |
|
|
(6 |
) |
|
— |
|
||||||
| Tax indemnification and other adjustments |
|
(5 |
) |
|
— |
|
|
(45 |
) |
|
(0.03 |
) |
|
20 |
|
|
0.02 |
|
||||||
| Non-service net periodic benefit cost (credit) |
|
1 |
|
|
— |
|
|
3 |
|
|
— |
|
|
(28 |
) |
|
(0.02 |
) |
||||||
| Earnings from equity interests |
|
2 |
|
|
— |
|
|
2 |
|
|
— |
|
|
3 |
|
|
— |
|
||||||
| Impairment of investment |
|
40 |
|
|
0.03 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
||||||
| Adjustments for taxes |
|
(203 |
) |
|
(0.15 |
) |
|
(32 |
) |
|
(0.02 |
) |
|
(177 |
) |
|
(0.15 |
) |
||||||
| Non-GAAP net earnings |
$ |
680 |
|
$ |
0.52 |
|
$ |
639 |
|
$ |
0.49 |
|
$ |
755 |
|
$ |
0.57 |
|
||||||
|
|
Year Ended |
|||||||||||||||
|
|
October 31,
|
|
Diluted net earnings per share |
|
October 31,
|
|
Diluted net earnings per share |
|||||||||
|
|
Dollars in millions, except per share amounts |
|||||||||||||||
| GAAP net earnings |
$ |
2,025 |
|
$ |
1.54 |
|
$ |
868 |
|
$ |
0.66 |
|
||||
| Non-GAAP Adjustments: |
|
|
|
|
||||||||||||
| Amortization of initial direct costs |
|
— |
|
|
— |
|
|
4 |
|
|
— |
|
||||
| Amortization of intangible assets |
|
288 |
|
|
0.22 |
|
|
293 |
|
|
0.22 |
|
||||
| Impairment of goodwill (1) |
|
— |
|
|
— |
|
|
905 |
|
|
0.69 |
|
||||
| Transformation costs |
|
283 |
|
|
0.22 |
|
|
473 |
|
|
0.36 |
|
||||
| Disaster (recovery) charges |
|
(12 |
) |
|
(0.01 |
) |
|
159 |
|
|
0.12 |
|
||||
| Stock-based compensation expense |
|
428 |
|
|
0.33 |
|
|
391 |
|
|
0.30 |
|
||||
| Acquisition, disposition and other related charges |
|
69 |
|
|
0.05 |
|
|
19 |
|
|
0.01 |
|
||||
| Tax indemnification and other adjustments |
|
(55 |
) |
|
(0.04 |
) |
|
67 |
|
|
0.05 |
|
||||
| Non-service net periodic benefit cost (credit) |
|
3 |
|
|
— |
|
|
(134 |
) |
|
(0.10 |
) |
||||
| Earnings from equity interests (2) |
|
18 |
|
|
0.01 |
|
|
45 |
|
|
0.03 |
|
||||
| Impairment of investment |
|
40 |
|
|
0.03 |
|
|
— |
|
|
— |
|
||||
| Adjustments for taxes |
|
(255 |
) |
|
(0.20 |
) |
|
(426 |
) |
|
(0.32 |
) |
||||
| Non-GAAP net earnings |
$ |
2,832 |
|
$ |
2.15 |
|
$ |
2,664 |
|
$ |
2.02 |
|
||||
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||
| Reconciliation of GAAP to Non-GAAP measures |
||||||||||||
| (Unaudited) |
||||||||||||
|
|
|
|
|
|
|
|
||||||
|
|
|
For the three months ended |
||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
||||||
|
|
|
In millions |
||||||||||
| Net cash provided by operating activities |
$ |
2,843 |
|
|
$ |
1,525 |
|
|
$ |
3,036 |
|
|
| Investment in property, plant and equipment |
|
(675 |
) |
|
|
(671 |
) |
|
|
(1,000 |
) |
|
| Proceeds from sale of property, plant and equipment |
|
255 |
|
|
|
102 |
|
|
|
238 |
|
|
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
(102 |
) |
|
|
(1 |
) |
|
|
(279 |
) |
|
| Free cash flow |
$ |
2,321 |
|
|
$ |
955 |
|
|
$ |
1,995 |
|
|
|
|
Year Ended |
|||||||
|
|
October 31, 2023 |
|
October 31, 2022 |
|||||
|
|
In millions |
|||||||
| Net cash provided by operating activities |
$ |
4,428 |
|
|
$ |
4,593 |
|
|
| Investment in property, plant and equipment |
|
(2,828 |
) |
|
|
(3,122 |
) |
|
| Proceeds from sale of property, plant and equipment |
|
602 |
|
|
|
602 |
|
|
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
36 |
|
|
|
(279 |
) |
|
| Free cash flow |
$ |
2,238 |
|
|
$ |
1,794 |
|
|
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||
| Condensed Consolidated Balance Sheets |
||||||||
|
|
|
|
||||||
|
|
|
As of |
||||||
|
|
|
October 31, 2023 |
|
October 31, 2022 |
||||
|
|
|
(Unaudited) |
|
(Audited) |
||||
|
|
|
In millions, except par value |
||||||
| ASSETS |
|
|
||||||
| Current Assets: |
|
|
||||||
| Cash and cash equivalents |
$ |
4,270 |
|
$ |
4,163 |
|
||
| Accounts receivable, net of allowances |
|
3,481 |
|
|
4,101 |
|
||
| Financing receivables, net of allowances |
|
3,543 |
|
|
3,522 |
|
||
| Inventory |
|
4,607 |
|
|
5,161 |
|
||
| Other current assets |
|
3,047 |
|
|
3,559 |
|
||
| Total current assets |
|
18,948 |
|
|
20,506 |
|
||
| Property, plant and equipment |
|
5,989 |
|
|
5,784 |
|
||
| Long-term financing receivables and other assets |
|
11,377 |
|
|
10,537 |
|
||
| Investments in equity interests |
|
2,197 |
|
|
2,160 |
|
||
| Goodwill and intangible assets |
|
18,642 |
|
|
18,136 |
|
||
| Total assets |
$ |
57,153 |
|
$ |
57,123 |
|
||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
||||||
| Current Liabilities: |
|
|
||||||
| Notes payable and short-term borrowings |
$ |
4,868 |
|
$ |
4,612 |
|
||
| Accounts payable |
|
7,136 |
|
|
8,717 |
|
||
| Employee compensation and benefits |
|
1,724 |
|
|
1,401 |
|
||
| Taxes on earnings |
|
155 |
|
|
176 |
|
||
| Deferred revenue |
|
3,658 |
|
|
3,451 |
|
||
| Accrued restructuring |
|
180 |
|
|
192 |
|
||
| Other accrued liabilities |
|
4,161 |
|
|
4,625 |
|
||
| Total current liabilities |
|
21,882 |
|
|
23,174 |
|
||
| Long-term debt |
|
7,487 |
|
|
7,853 |
|
||
| Other non-current liabilities |
|
6,546 |
|
|
6,187 |
|
||
|
|
|
|
||||||
| Stockholders’ Equity |
|
|
||||||
| Common stock, $0.01 par value (9,600 shares authorized; 1,283 and 1,281 shares issued and outstanding as of October 31, 2023 and October 31, 2022, respectively) |
|
13 |
|
|
13 |
|
||
| Additional paid-in capital |
|
28,199 |
|
|
28,299 |
|
||
| Accumulated deficit |
|
(3,946 |
) |
|
(5,350 |
) |
||
| Accumulated other comprehensive loss |
|
(3,084 |
) |
|
(3,098 |
) |
||
| Total HPE stockholders’ equity |
|
21,182 |
|
|
19,864 |
|
||
| Non-controlling interests |
|
56 |
|
|
45 |
|
||
| Total stockholders’ equity |
|
21,238 |
|
|
19,909 |
|
||
| Total liabilities and stockholders’ equity |
$ |
57,153 |
|
$ |
57,123 |
|
||
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||
| Condensed Consolidated Statements of Cash Flows |
||||||||
| (Unaudited) |
||||||||
|
|
|
Year Ended |
||||||
|
|
|
October 31, 2023 |
|
October 31, 2022 |
||||
|
|
|
In millions |
||||||
| Cash Flows from Operating Activities: |
|
|
|
|||||
| Net earnings |
$ |
2,025 |
|
|
$ |
868 |
|
|
| Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: |
|
|
|
|||||
| Depreciation and amortization |
|
2,616 |
|
|
|
2,480 |
|
|
| Impairment of goodwill |
|
— |
|
|
|
905 |
|
|
| Stock-based compensation expense |
|
428 |
|
|
|
391 |
|
|
| Provision for inventory and credit losses |
|
230 |
|
|
|
262 |
|
|
| Restructuring charges |
|
242 |
|
|
|
214 |
|
|
| Deferred taxes on earnings |
|
(67 |
) |
|
|
(249 |
) |
|
| Earnings from equity interests (2) |
|
(245 |
) |
|
|
(215 |
) |
|
| Dividends received from equity investees |
|
200 |
|
|
|
197 |
|
|
| Other, net |
|
31 |
|
|
|
310 |
|
|
| Changes in Operating Assets and Liabilities, Net of Acquisitions: |
|
|
|
|||||
| Accounts receivable |
|
577 |
|
|
|
(186 |
) |
|
| Financing receivables |
|
(607 |
) |
|
|
694 |
|
|
| Inventory |
|
400 |
|
|
|
(713 |
) |
|
| Accounts payable |
|
(1,655 |
) |
|
|
1,707 |
|
|
| Taxes on earnings |
|
(34 |
) |
|
|
150 |
|
|
| Restructuring |
|
(275 |
) |
|
|
(334 |
) |
|
| Other assets and liabilities |
|
562 |
|
|
|
(1,888 |
) |
|
| Net cash provided by operating activities |
|
4,428 |
|
|
|
4,593 |
|
|
| Cash Flows from Investing Activities: |
|
|
|
|||||
| Investment in property, plant and equipment |
|
(2,828 |
) |
|
|
(3,122 |
) |
|
| Proceeds from sale of property, plant and equipment |
|
602 |
|
|
|
602 |
|
|
| Purchases of investments |
|
(15 |
) |
|
|
(55 |
) |
|
| Proceeds from maturities and sales of investments |
|
9 |
|
|
|
262 |
|
|
| Financial collateral posted |
|
(1,443 |
) |
|
|
(148 |
) |
|
| Financial collateral received |
|
1,152 |
|
|
|
374 |
|
|
| Payments made in connection with business acquisitions, net of cash acquired |
|
(761 |
) |
|
|
— |
|
|
| Net cash used in investing activities |
|
(3,284 |
) |
|
|
(2,087 |
) |
|
| Cash Flows from Financing Activities: |
|
|
|
|||||
| Short-term borrowings with original maturities less than 90 days, net |
|
(47 |
) |
|
|
100 |
|
|
| Proceeds from debt, net of issuance costs |
|
4,725 |
|
|
|
3,296 |
|
|
| Payment of debt |
|
(4,887 |
) |
|
|
(3,992 |
) |
|
| Cash settlement for derivative hedging debt |
|
(7 |
) |
|
|
(8 |
) |
|
| Net payments related to stock-based award activities |
|
(106 |
) |
|
|
(53 |
) |
|
| Repurchase of common stock |
|
(421 |
) |
|
|
(512 |
) |
|
| Cash dividends paid to non-controlling interests, net of contributions |
|
— |
|
|
|
(6 |
) |
|
| Cash dividends paid to shareholders |
|
(619 |
) |
|
|
(621 |
) |
|
| Net cash used in financing activities |
|
(1,362 |
) |
|
|
(1,796 |
) |
|
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
36 |
|
|
|
(279 |
) |
|
| (Decrease) increase in cash, cash equivalents and restricted cash |
|
(182 |
) |
|
|
431 |
|
|
| Cash, cash equivalents and restricted cash at beginning of period |
|
4,763 |
|
|
|
4,332 |
|
|
| Cash, cash equivalents and restricted cash at end of period |
$ |
4,581 |
|
|
$ |
4,763 |
|
|
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||
| Segment Information |
||||||||||||
| (Unaudited) |
||||||||||||
|
|
|
|
||||||||||
|
|
|
For the three months ended |
||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
||||||
|
|
|
In millions |
||||||||||
| Net Revenue: |
|
|
|
|
|
|
||||||
| Compute (3) |
|
$ |
2,595 |
|
|
$ |
2,624 |
|
|
$ |
3,768 |
|
| High Performance Computing & Artificial Intelligence |
|
|
1,181 |
|
|
|
836 |
|
|
|
862 |
|
| Storage (3) |
|
|
1,111 |
|
|
|
1,074 |
|
|
|
1,274 |
|
| Intelligent Edge |
|
|
1,358 |
|
|
|
1,415 |
|
|
|
965 |
|
| Financial Services |
|
|
876 |
|
|
|
873 |
|
|
|
857 |
|
| Corporate Investments and other |
|
|
343 |
|
|
|
318 |
|
|
|
303 |
|
| Total segment net revenue |
|
|
7,464 |
|
|
|
7,140 |
|
|
|
8,029 |
|
| Elimination of intersegment net revenue |
|
|
(113 |
) |
|
|
(138 |
) |
|
|
(158 |
) |
| Total consolidated net revenue |
|
$ |
7,351 |
|
|
$ |
7,002 |
|
|
$ |
7,871 |
|
|
|
|
|
|
|
|
|
||||||
| Earnings Before Taxes: |
|
|
|
|
|
|
||||||
| Compute (3) |
|
$ |
255 |
|
|
$ |
285 |
|
|
$ |
560 |
|
| High Performance Computing & Artificial Intelligence |
|
|
55 |
|
|
|
(7 |
) |
|
|
30 |
|
| Storage (3) |
|
|
90 |
|
|
|
115 |
|
|
|
196 |
|
| Intelligent Edge |
|
|
401 |
|
|
|
420 |
|
|
|
128 |
|
| Financial Services |
|
|
78 |
|
|
|
73 |
|
|
|
95 |
|
| Corporate Investments and other |
|
|
(32 |
) |
|
|
(38 |
) |
|
|
(26 |
) |
| Total segment earnings from operations |
|
|
847 |
|
|
|
848 |
|
|
|
983 |
|
|
|
|
|
|
|
|
|
||||||
| Unallocated corporate costs and eliminations |
|
|
(137 |
) |
|
|
(130 |
) |
|
|
(81 |
) |
| Stock-based compensation expense |
|
|
(71 |
) |
|
|
(91 |
) |
|
|
(85 |
) |
| Amortization of initial direct costs |
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
| Amortization of intangible assets |
|
|
(72 |
) |
|
|
(72 |
) |
|
|
(73 |
) |
| Impairment of goodwill |
|
|
— |
|
|
|
— |
|
|
|
(905 |
) |
| Transformation costs |
|
|
(56 |
) |
|
|
(65 |
) |
|
|
(184 |
) |
| Disaster recovery |
|
|
14 |
|
|
|
2 |
|
|
|
1 |
|
| Acquisition, disposition and other related charges |
|
|
(18 |
) |
|
|
(21 |
) |
|
|
6 |
|
| Interest and other, net |
|
|
(27 |
) |
|
|
(50 |
) |
|
|
(109 |
) |
| Tax indemnification and other adjustments |
|
|
5 |
|
|
|
45 |
|
|
|
(20 |
) |
| Non-service net periodic benefit (cost) credit |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
28 |
|
| Earnings from equity interests |
|
|
65 |
|
|
|
73 |
|
|
|
83 |
|
| Total pretax earnings (loss) |
|
$ |
549 |
|
|
$ |
536 |
|
|
$ |
(357 |
) |
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||
| Segment Information |
||||||||
| (Unaudited) |
||||||||
|
|
|
|
||||||
|
|
|
Year Ended |
||||||
|
|
|
October 31, 2023 |
|
October 31, 2022 |
||||
|
|
|
In millions |
||||||
| Net Revenue: |
|
|
|
|
||||
| Compute (3) |
|
$ |
11,436 |
|
|
$ |
12,850 |
|
| High Performance Computing & Artificial Intelligence |
|
|
3,913 |
|
|
|
3,192 |
|
| Storage (3) |
|
|
4,415 |
|
|
|
4,603 |
|
| Intelligent Edge |
|
|
5,204 |
|
|
|
3,674 |
|
| Financial Services |
|
|
3,480 |
|
|
|
3,339 |
|
| Corporate Investments and other |
|
|
1,250 |
|
|
|
1,255 |
|
| Total segment net revenue |
|
|
29,698 |
|
|
|
28,913 |
|
| Elimination of intersegment net revenue |
|
|
(563 |
) |
|
|
(417 |
) |
| Total consolidated net revenue |
|
$ |
29,135 |
|
|
$ |
28,496 |
|
|
|
|
|
|
|
||||
| Earnings Before Taxes: |
|
|
|
|
||||
| Compute (3) |
|
$ |
1,569 |
|
|
$ |
1,821 |
|
| High Performance Computing & Artificial Intelligence |
|
|
47 |
|
|
|
11 |
|
| Storage (3) |
|
|
429 |
|
|
|
641 |
|
| Intelligent Edge |
|
|
1,419 |
|
|
|
549 |
|
| Financial Services |
|
|
317 |
|
|
|
399 |
|
| Corporate Investments and other |
|
|
(172 |
) |
|
|
(92 |
) |
| Total segment earnings from operations |
|
|
3,609 |
|
|
|
3,329 |
|
|
|
|
|
|
|
||||
| Unallocated corporate costs and eliminations |
|
|
(464 |
) |
|
|
(303 |
) |
| Stock-based compensation expense |
|
|
(428 |
) |
|
|
(391 |
) |
| Amortization of initial direct costs |
|
|
— |
|
|
|
(4 |
) |
| Amortization of intangible assets |
|
|
(288 |
) |
|
|
(293 |
) |
| Impairment of goodwill (1) |
|
|
— |
|
|
|
(905 |
) |
| Transformation costs |
|
|
(283 |
) |
|
|
(473 |
) |
| Disaster recovery (charges) |
|
|
12 |
|
|
|
(159 |
) |
| Acquisition, disposition and other related charges |
|
|
(69 |
) |
|
|
(19 |
) |
| Interest and other, net |
|
|
(156 |
) |
|
|
(188 |
) |
| Tax indemnification and other adjustments |
|
|
55 |
|
|
|
(67 |
) |
| Non-service net periodic benefit (cost) credit |
|
|
(3 |
) |
|
|
134 |
|
| Earnings from equity interests (2) |
|
|
245 |
|
|
|
215 |
|
| Total consolidated earnings before taxes |
|
$ |
2,230 |
|
|
$ |
876 |
|
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||||||||
| Segment Information |
||||||||||||||||||
| (Unaudited) |
||||||||||||||||||
|
|
|
|
|
|
||||||||||||||
|
|
|
For the three months ended |
|
Change (%) |
||||||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
|
Q/Q |
|
Y/Y |
||||||||
|
|
|
Dollars in millions |
||||||||||||||||
| Net Revenue: |
|
|
|
|
|
|||||||||||||
| Compute (3) |
$ |
2,595 |
|
$ |
2,624 |
|
$ |
3,768 |
|
(1 |
%) |
(31 |
%) |
|||||
| High Performance Computing & Artificial Intelligence |
|
1,181 |
|
|
836 |
|
|
862 |
|
41 |
|
37 |
|
|||||
| Storage (3) |
|
1,111 |
|
|
1,074 |
|
|
1,274 |
|
3 |
|
(13 |
) |
|||||
| Intelligent Edge |
|
1,358 |
|
|
1,415 |
|
|
965 |
|
(4 |
) |
41 |
|
|||||
| Financial Services |
|
876 |
|
|
873 |
|
|
857 |
|
— |
|
2 |
|
|||||
| Corporate Investments and other |
|
343 |
|
|
318 |
|
|
303 |
|
8 |
|
13 |
|
|||||
| Total segment net revenue |
|
7,464 |
|
|
7,140 |
|
|
8,029 |
|
5 |
|
(7 |
) |
|||||
| Elimination of intersegment net revenue |
|
(113 |
) |
|
(138 |
) |
|
(158 |
) |
(18 |
) |
(29 |
) |
|||||
| Total consolidated net revenue |
$ |
7,351 |
|
$ |
7,002 |
|
$ |
7,871 |
|
5 |
% |
(7 |
%) |
|||||
|
|
Year Ended |
||||||||||
|
|
October 31, 2023 |
|
October 31, 2022 |
|
Y/Y |
||||||
|
|
Dollars in millions |
||||||||||
| Net Revenue: |
|
|
|
|
|
||||||
| Compute (3) |
$ |
11,436 |
|
|
$ |
12,850 |
|
|
(11 |
%) |
|
| High Performance Computing & Artificial Intelligence |
|
3,913 |
|
|
|
3,192 |
|
|
23 |
|
|
| Storage (3) |
|
4,415 |
|
|
|
4,603 |
|
|
(4 |
) |
|
| Intelligent Edge |
|
5,204 |
|
|
|
3,674 |
|
|
42 |
|
|
| Financial Services |
|
3,480 |
|
|
|
3,339 |
|
|
4 |
|
|
| Corporate Investments and other |
|
1,250 |
|
|
|
1,255 |
|
|
— |
|
|
| Total segment net revenue |
|
29,698 |
|
|
|
28,913 |
|
|
3 |
|
|
| Elimination of intersegment net revenue |
|
(563 |
) |
|
|
(417 |
) |
|
35 |
|
|
| Total consolidated net revenue |
$ |
29,135 |
|
|
$ |
28,496 |
|
|
2 |
% |
|
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
|||||||||||||||
| Segment Operating Margin Summary Data |
|||||||||||||||
| (Unaudited) |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
For the three months ended |
|
Change in operating profit margin (pts) |
|||||||||||
|
|
|
October 31,
|
|
July 31,
|
|
October 31,
|
|
Q/Q |
|
Y/Y |
|||||
| Segment Operating Profit Margin: |
|
|
|
|
|
||||||||||
| Compute (3) |
9.8 |
% |
10.9 |
% |
14.9 |
% |
(1.1 |
) |
(5.1 |
) |
|||||
| High Performance Computing & Artificial Intelligence |
4.7 |
% |
(0.8 |
)% |
3.5 |
% |
5.5 |
|
1.2 |
|
|||||
| Storage (3) |
8.1 |
% |
10.7 |
% |
15.4 |
% |
(2.6 |
) |
(7.3 |
) |
|||||
| Intelligent Edge |
29.5 |
% |
29.7 |
% |
13.3 |
% |
(0.2 |
) |
16.2 |
|
|||||
| Financial Services |
8.9 |
% |
8.4 |
% |
11.1 |
% |
0.5 |
|
(2.2 |
) |
|||||
| Corporate Investments and other |
(9.3 |
%) |
(11.9 |
%) |
(8.6 |
%) |
2.6 |
|
(0.7 |
) |
|||||
| Total segment operating profit margin |
11.3 |
% |
11.9 |
% |
12.2 |
% |
(0.6 |
) |
(0.9 |
) |
|||||
|
|
Year Ended |
|
Change in operating profit margin (pts) |
||||||
|
|
October 31,
|
|
October 31,
|
|
Y/Y |
||||
| Segment Operating Profit Margin: |
|
|
|
|
|
||||
| Compute (3) |
13.7 |
% |
|
14.2 |
% |
|
(0.5 |
) |
|
| High Performance Computing & Artificial Intelligence |
1.2 |
% |
|
0.3 |
% |
|
0.9 |
|
|
| Storage (3) |
9.7 |
% |
|
13.9 |
% |
|
(4.2 |
) |
|
| Intelligent Edge |
27.3 |
% |
|
14.9 |
% |
|
12.4 |
|
|
| Financial Services |
9.1 |
% |
|
11.9 |
% |
|
(2.8 |
) |
|
| Corporate Investments and other |
(13.8 |
%) |
|
(7.3 |
%) |
|
(6.5 |
) |
|
| Total segment operating profit margin |
12.2 |
% |
|
11.5 |
% |
|
0.7 |
|
|
| HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES |
||||||||||||
| Calculation of Diluted Net Earnings Per Share |
||||||||||||
| (Unaudited) |
||||||||||||
|
|
|
|
||||||||||
|
|
|
For the three months ended |
||||||||||
|
|
|
October 31, 2023 |
|
July 31, 2023 |
|
October 31, 2022 |
||||||
|
|
|
In millions, except per share amounts |
||||||||||
| Numerator: |
|
|
|
|
|
|||||||
| GAAP net earnings (loss) |
$ |
642 |
|
|
$ |
464 |
|
|
$ |
(304 |
) |
|
| Non-GAAP net earnings |
$ |
680 |
|
|
$ |
639 |
|
|
$ |
755 |
|
|
|
|
|
|
|
|
|
|||||||
| Denominator: |
|
|
|
|
|
|||||||
| Weighted-average shares used to compute basic net earnings per share |
|
1,295 |
|
|
|
1,299 |
|
|
|
1,296 |
|
|
| Dilutive effect of employee stock plans (4) |
|
20 |
|
|
|
17 |
|
|
|
18 |
|
|
| Weighted-average shares used to compute diluted net earnings per share |
|
1,315 |
|
|
|
1,316 |
|
|
|
1,314 |
|
|
|
|
|
|
|
|
|
|||||||
| GAAP Net Earnings (loss) Per Share |
|
|
|
|
|
|||||||
| Basic |
$ |
0.50 |
|
|
$ |
0.36 |
|
|
$ |
(0.23 |
) |
|
| Diluted (4) |
$ |
0.49 |
|
|
$ |
0.35 |
|
|
$ |
(0.23 |
) |
|
|
|
|
|
|
|
|
|||||||
| Non-GAAP Net Earnings Per Share |
|
|
|
|
|
|||||||
| Basic |
$ |
0.53 |
|
|
$ |
0.49 |
|
|
$ |
0.58 |
|
|
| Diluted |
$ |
0.52 |
|
|
$ |
0.49 |
|
|
$ |
0.57 |
|
|
|
|
Year Ended |
|||||||
|
|
October 31, 2023 |
|
October 31, 2022 |
|||||
|
|
In millions, except per share amounts |
|||||||
| Numerator: |
|
|
|
|||||
| GAAP net earnings |
$ |
2,025 |
|
|
$ |
868 |
|
|
| Non-GAAP net earnings |
$ |
2,832 |
|
|
$ |
2,664 |
|
|
|
|
|
|
|
|||||
| Denominator: |
|
|
|
|||||
| Weighted-average shares used to compute basic net earnings per share |
|
1,299 |
|
|
|
1,303 |
|
|
| Dilutive effect of employee stock plans |
|
17 |
|
|
|
19 |
|
|
| Weighted-average shares used to compute diluted net earnings per share |
|
1,316 |
|
|
|
1,322 |
|
|
|
|
|
|
|
|||||
| GAAP Net Earnings Per Share |
|
|
|
|||||
| Basic |
$ |
1.56 |
|
|
$ |
0.67 |
|
|
| Diluted |
$ |
1.54 |
|
|
$ |
0.66 |
|
|
|
|
|
|
|
|||||
| Non-GAAP Net Earnings Per Share |
|
|
|
|||||
| Basic |
$ |
2.18 |
|
|
$ |
2.04 |
|
|
| Diluted |
$ |
2.15 |
|
|
$ |
2.02 |
|
|
| ____________________ | |||
| (1) |
The Company recorded a goodwill impairment charge of $905 million in the fourth quarter of fiscal 2022 as it was determined that the fair value of the HPC & AI and Software reporting units was below the carrying value of their net assets. Software is under the Corporate Investments and Other reportable segment. |
||
| (2) |
Represents the amortization of basis difference adjustments related to H3C. The twelve months ended October 31, 2023 also included the Company's portion of intangible asset impairment charges from H3C of $8 million. |
||
| (3) |
Effective at the beginning of the first quarter of fiscal 2023, the Company implemented certain organizational changes to align its segment financial reporting more closely with its current business structure. This resulted in the transfer of certain storage networking products, previously reported within the Storage reportable segment, to the Compute reportable segment. The Company reflected these changes to its segment information retrospectively to the earliest period presented, which primarily resulted in the transfer of net revenue and operating profit for each of the businesses as described above. These changes had no impact on the Company's previously reported consolidated results. |
||
| (4) |
Diluted net earnings per share reflects any dilutive effect of restricted stock awards, stock options and performance based awards, but the effect is excluded when calculating GAAP diluted net loss per share because it would be anti-dilutive. |
||
