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Hewlett Packard Enterprise Co. shares were initially up 3% in extended trading Tuesday after the company announced fiscal first-quarter results that topped Wall Street expectations.
HPE reported net earnings of $223 million, or 17 cents a share, compared with net earnings of $333 million, or 25 cents a share, in the year-ago quarter. HPE reported adjusted earnings of $679 million, or 52 cents a share, compared with $657 million, or 50 cents a share, a year ago.
Revenue slipped 1.7% to $6.83 billion from $6.95 billion a year ago.
"Our revenue exceeded our outlook and we significantly expanded our gross and operating margins to drive strong profitability across most of our businesses," HPE Chief Executive Antonio Neri said in a statement announcing the results. HPE's board of directors declared a cash dividend of 12 cents a share on the company's common stock, payable April 7.
Analysts surveyed by FactSet had expected net income of 41 cents a share on revenue of $6.75 billion.
HPE anticipates adjusted second-quarter EPS of 38 cents to 44 cents a share. FactSet is forecasting 38 cents a share in Q2.
For the recently completed quarter, computer revenue was $3 billion, down 1% year over year; sales of storage were down 5% to $1.2 billion from a year ago.
HPE reported strong demand for its edge-to-cloud and software-as-a-service data storage solutions, as well as widespread adoption of Aruba ESP, which provides edge-to-cloud connectivity-as-a-service, and its cloud-services arm, HPE GreenLake. The company also noted gradual recovery of supply chains that reduced backlogs and fueled growth for the company's HPC business.
HPE's stock has climbed 15% over the past 12 months. The broader S&P 500 index has improved 29% in the past year.