# Hewlett Packard Enterprise (HPE) Q3 2025 Financial Results Summary
On September 3, 2025, Hewlett Packard Enterprise (HPE) announced its financial results for the third quarter ending July 31, 2025. The company reported record revenue and improved profitability during this period, driven by strong customer demand, particularly in its Server and Networking segments.
### Key Highlights:
– **Revenue:** $9.1 billion, up **19%** from the prior-year period in actual dollars and **18%** in constant currency.
– **Annualized Revenue Run-Rate (ARR):** $3.1 billion, up **77%** from the prior-year period in actual dollars and **75%** in constant currency.
– **Gross Margins:**
– **GAAP:** 29.2%, down **240 basis points** year-over-year, but up **80 basis points** sequentially.
– **Non-GAAP:** 29.9%, down **190 basis points** year-over-year, but up **50 basis points** sequentially.
– **Diluted Net Earnings Per Share (EPS):**
– **GAAP:** $0.21, down **$0.17** from the prior-year period.
– **Non-GAAP:** $0.44, down **$0.06** from the prior-year period, within the expected range of $0.40 – $0.45.
– **Cash Flow from Operations:** $1,305 million, an increase of **$151 million** from the prior-year period.
– **Free Cash Flow (FCF):** $790 million, up **$121 million** from the prior-year period.
### Segment Performance:
– **Server Revenue:** $4.9 billion, up **16%** from the prior-year period with an operating profit margin of **6.4%**, down from **10.8%** year-over-year.
– **Networking Revenue:** $1.7 billion, up **54%** from the prior-year period, with an operating profit margin of **20.8%**, down from **22.4%** year-over-year.
– **Hybrid Cloud Revenue:** $1.5 billion, up **12%** from the prior-year period, with an operating profit margin of **5.9%**, compared to **5.2%** the previous year.
– **Financial Services Revenue:** $886 million, up **1%** from the prior-year period, with a steady operating profit margin of **9.9%**, up from **9.0%** year-over-year.
### Capital Returns to Shareholders:
– The HPE Board of Directors declared a regular cash dividend of **$0.13** per share, payable on or about **October 17, 2025**, to stockholders of record as of the close of business on **September 18, 2025**.
### Financial Outlook:
– For the fourth quarter of fiscal 2025, HPE estimates revenue in the range of **$9.7 billion to $10.1 billion**.
– It expects GAAP diluted net EPS to be in the range of **$0.50 to $0.54**, and non-GAAP diluted net EPS in the range of **$0.56 to $0.60**.
– HPE projects fiscal 2025 revenue growth of **14% to 16%** in constant currency, with a GAAP operating profit growth forecasted to be in the range of **negative 112% to negative 109%** and non-GAAP operating profit growth of **4% to 7%**.
### Acquisition Updates:
– HPE closed its acquisition of **Juniper Networks Inc.** on **July 2, 2025**. The financial results for Q3 included the consolidation of Juniper’s financial results for the period from the acquisition date to the quarter-end.
### Summary of Percent Changes:
– Revenue: **+19%** (actual); **+18%** (constant currency)
– ARR: **+77%** (actual); **+75%** (constant currency)
– Server Revenue: **+16%** (actual)
– Networking Revenue: **+54%** (actual)
– Hybrid Cloud Revenue: **+12%** (actual)
– Financial Services Revenue: **+1%** (actual)
– GAAP Gross Margin: **-240 basis points** YoY
– Non-GAAP Gross Margin: **-190 basis points** YoY
– GAAP EPS: **-$0.17** YoY
– Non-GAAP EPS: **-6%** YoY
– Cash Flow from Operations: **+151 million** YoY
– Free Cash Flow: **+121 million** YoY
HPE’s solid performance and strategic acquisition of Juniper Networks underscore its commitment to enhancing shareholder value and driving growth in the enterprise technology sector.
| July 31, 2025 | April 30, 2025 | July 31, 2024 | |
|---|---|---|---|
| Net revenue | $9,136 | $7,627 | $7,710 |
| Costs and Expenses: | |||
| Cost of sales (exclusive of amortization shown separately below) | 6,464 | 5,458 | 5,271 |
| Research and development | 622 | 540 | 547 |
| Selling, general and administrative | 1,496 | 1,298 | 1,229 |
| Amortization of intangible assets | 126 | 37 | 60 |
| Impairment of goodwill | — | 1,361 | — |
| Transformation (credit) costs | — | -13 | 14 |
| Acquisition, disposition and other charges | 181 | 55 | 42 |
| Total costs and expenses | 8,889 | 8,736 | 7,163 |
| Earnings (loss) from operations | 247 | -1,109 | 547 |
| Interest and other, net(1) | 8 | 39 | -12 |
| Gain on sale of a business | 1 | — | — |
| Earnings from equity interests | 32 | 25 | 73 |
| Earnings (loss) before provision for taxes | 288 | -1,045 | 608 |
| Benefit (provision) for taxes | 17 | -5 | -96 |
| Net earnings (loss) attributable to HPE | 305 | -1,050 | 512 |
| Preferred stock dividends | -29 | -29 | — |
| Net earnings (loss) attributable to common stockholders | $276 | $-1,079 | $512 |
| Net Earnings (Loss) Per Share Attributable to Common Stockholders: | |||
| Basic | $0.21 | $-0.82 | $0.39 |
| Diluted | 0.21 | -0.82 | 0.38 |
| Cash dividends declared per share | 0.13 | 0.13 | 0.13 |
| Cash dividends accrued per preferred share | $0.95 | $0.95 | $— |
| Weighted-average Shares Used to Compute Net Earnings (Loss) Per Share: | |||
| Basic | 1,325 | 1,322 | 1,312 |
| Diluted | 1,421 | 1,322 | 1,332 |
| July 31, 2025 | October 31, 2024 | |
|---|---|---|
| ASSETS | ||
| Current Assets: | ||
| Cash and cash equivalents | $4,571 | $14,846 |
| Accounts receivable, net of allowances | 5,656 | 3,550 |
| Financing receivables, net of allowances | 3,777 | 3,870 |
| Inventory | 7,163 | 7,810 |
| Assets held for sale | — | 1 |
| Other current assets | 4,835 | 3,380 |
| Total current assets | 26,002 | 33,457 |
| Property, plant and equipment, net | 6,118 | 5,664 |
| Long-term financing receivables and other assets | 13,817 | 12,616 |
| Investments in equity interests | 999 | 929 |
| Goodwill and intangible assets | 30,404 | 18,596 |
| Total assets | $77,340 | $71,262 |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
| Current Liabilities: | ||
| Notes payable and short-term borrowings | $6,799 | $4,742 |
| Accounts payable | 8,662 | 11,064 |
| Employee compensation and benefits | 1,549 | 1,356 |
| Taxes on earnings | 256 | 284 |
| Deferred revenue | 5,311 | 3,904 |
| Liabilities held for sale | — | 32 |
| Other accrued liabilities | 4,770 | 4,591 |
| Total current liabilities | 27,347 | 25,973 |
| Long-term debt | 16,854 | 13,504 |
| Other non-current liabilities | 8,672 | 6,905 |
| Commitments and Contingencies | ||
| Stockholders’ Equity | ||
| HPE stockholders’ Equity: | ||
| 7.625% Series C mandatory convertible preferred stock, $0.01 par value (30 shares issued and outstanding as of July 31, 2025 and October 31, 2024, respectively | — | — |
| Common stock, $0.01 par value (9,600 shares authorized; 1,319 and 1,297 shares issued and outstanding as of July 31, 2025 and October 31, 2024, respectively | 13 | 13 |
| Additional paid-in capital | 30,199 | 29,848 |
| Accumulated deficit | -2,786 | -2,068 |
| Accumulated other comprehensive loss | -3,024 | -2,977 |
| Total HPE stockholders’ equity | 24,402 | 24,816 |
| Non-controlling interests | 65 | 64 |
| Total stockholders’ equity | 24,467 | 24,880 |
| Total liabilities and stockholders’ equity | $77,340 | $71,262 |
