HOUSTON – September 2, 2026 – HPE (NYSE: HPE) today announced financial results for the third quarter ended July 31, 2026.
“HPE’s strategy is proving itself again this quarter. Our results demonstrate the durability of our profitable growth momentum. We delivered record revenue, orders, and profitability, fueled by surging customer demand across our portfolio,” said Antonio Neri, president and CEO of HPE. “AI is becoming a multi-year growth driver for HPE, and our differentiated portfolio positions us to capture that opportunity at scale.”
“Our outstanding revenue performance and expanded profitability in the third quarter reflect robust demand across our portfolio and consistent, disciplined execution,” said Marie Myers, executive vice president and CFO of HPE. “With our Q3 results and our order backlog at a record level, we are raising our financial outlook and plan to return at least 75% of free cash flow to shareholders in Q4.”
Third Quarter Fiscal 2026 Financial Results
- Revenue: $12.2 billion, up 34% from the prior-year period
- Gross margins:
- GAAP of 40.1%, up 1,090 basis points from the prior-year period and up 360 basis points sequentially
- Non-GAAP(1) of 40.4%, up 1,050 basis points from the prior-year period and up 350 basis points sequentially
- Operating profit margins:
- GAAP of 11.4%, up 870 basis points from the prior-year period and up 440 basis points sequentially
- Non-GAAP(1) of 16.2%, up 770 basis points from the prior-year period and up 290 basis points sequentially
- Diluted net earnings per share (“EPS”):
- GAAP of $1.06, up $0.85 from the prior-year period and above our outlook range of $0.84 - $0.89
- Non-GAAP(1) of $1.11, up $0.67 from the prior-year period and above our outlook range of $0.88 - $0.93
- Cash flow from operations: $1.6 billion, an increase of $0.3 billion from the prior-year period
- Free cash flow(1)(2): $1.0 billion, an increase of $0.2 billion from the prior-year period
- Capital returns to common shareholders: $324 million in the form of dividends and share repurchases
Third Quarter Fiscal 2026 Segment Results
- Networking revenue was $2.9 billion, up 74.9% from the prior-year period, with 22.0% operating profit margin, compared to 22.1% from the prior-year period.
- Within Networking, revenue from:
- Campus & Branch was $1.4 billion, up 31.0% from the prior-year period.
- Data Center Networking was $382 million, up 112.2% from the prior-year period.
- Security was $281 million, up 75.6% from the prior-year period.
- Routing was $788 million, up 270.0% from the prior-year period.
- Within Networking, revenue from:
- Cloud & AI revenue was $9.0 billion, up 25.4% from the prior-year period, with 17.0% operating profit margin, compared to 7.0% from the prior-year period.
- Within Cloud & AI, revenue from:
- Server was $6.8 billion, up 35.3% from the prior-year period.
- Storage was $1.3 billion, up 10.2% from the prior-year period.
- Financial Services was $0.9 billion, down 0.3% from the prior-year period.
- Within Cloud & AI, revenue from:
- Corporate Investments and Other revenue was $278 million, up 3.0% from the prior-year period, with -24.1% of operating profit margin, compared to -7.0% from the prior-year period.