Hewlett Packard Enterprise (HPE) is clearly smack in the middle of the AI profit boom.
"Customers are buying everything," Hewlett Packard Enterprise CEO Antonio Neri told Yahoo Finance in an interview, pointing to brisk demand in its most recent quarter for routers and servers.
Neri said demand for the company's products looks strong through the next decade.
HPE generated revenue of $12.21 billion in its fiscal third quarter, reported late Wednesday, up 34% year over year. Adjusted earnings per share climbed over 30% to $1.11.
Both the top- and bottom-line figures comfortably surpassed Wall Street consensus estimates.
The strong outperformance was propelled by booming enterprise appetite for AI servers and high-performance networking infrastructure, lifting orders and expanding the company's backlog to record levels.
Despite raising its full-year revenue growth outlook to as high as 37%, HPE shares dipped as investors took profits following the stock's strong run-up into the report.
The company even raised its revenue growth outlook for fiscal year 2027 to a range of 13% to 17%. Earnings are expected to increase by 16%.
HPE stock had surged about 109% on the year in the lead-up to the report amid optimism on the Juniper acquisition and strong demand for AI-related equipment.
"We remain sector weight on HPE but increasingly are becoming more constructive," KeyBanc analyst Brandon Nispel said. "Looking forward, FY26 and FY27 guidance was raised, it looks conservative, and there appears to be a number of catalysts with: 1) accelerating networking; 2) Oracle contribution; and 3) AMD Helios and the broader cyclical campus refresh, and secular AI drivers."
Brian Sozzi is Yahoo Finance's Executive Editor, host of the Power Players with Brian Sozzi podcast, and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
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