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Yahoo
8 hours ago
- Business
- Yahoo
HPE Q1 Earnings Call: Revenue Misses Expectations, Adjusted EPS Beats, AI and Hybrid Cloud Growth Highlighted
Enterprise technology company Hewlett Packard Enterprise (NYSE:HPE) fell short of the market's revenue expectations in Q1 CY2025, but sales rose 5.9% year on year to $7.63 billion. Its non-GAAP EPS of $0.38 per share was 16.3% above analysts' consensus estimates. Is now the time to buy HPE? Find out in our full research report (it's free). Revenue: $7.63 billion (5.9% year-on-year growth) Adjusted EPS: $0.38 vs analyst estimates of $0.33 (16.3% beat) Adjusted Operating Income: $613 million vs analyst estimates of $549.5 million (8% margin, 11.6% beat) Revenue Guidance for Q2 CY2025 is $8.35 billion at the midpoint, above analyst estimates of $8.18 billion Management raised its full-year Adjusted EPS guidance to $1.84 at the midpoint, a 2.2% increase Operating Margin: -14.5%, down from 5.9% in the same quarter last year Annual Recurring Revenue: $2.25 billion at quarter end, up 47.2% year on year Market Capitalization: $23.24 billion Hewlett Packard Enterprise's first quarter results reflected a mix of headwinds and operational improvements across its core segments, as management targeted execution issues in its server business and capitalized on expanding demand for AI-driven infrastructure. CEO Antonio Neri highlighted that the company 'addressed the operational challenges we experienced in our service segment last quarter,' referencing the implementation of new pricing analytics and increased discount scrutiny. Growth was led by higher AI system revenue, improved performance in the Intelligent Edge segment, and robust adoption of the hybrid cloud platforms, particularly the HPE Alletra MP storage transition and GreenLake cloud services. CFO Marie Myers noted that the company also made significant progress with its cost reduction program, which included workforce reductions and organizational streamlining. Looking ahead, management's guidance is anchored by anticipated improvements in server profitability, ongoing strength in AI and hybrid cloud demand, and incremental benefits from structural cost actions. Neri stated, 'We continue to capitalize on the mega trends reshaping the IT industry across networking, AI, and hybrid cloud,' and expects further margin recovery in the server segment as corrective actions take hold. The company anticipates a less pronounced impact from tariffs, continued scaling of its annual recurring revenue, and additional product launches in AI and networking. Myers emphasized a focus on balancing investments in innovation with disciplined cost management, cautioning that macroeconomic and trade policy uncertainties remain potential headwinds for the remainder of the year. Management attributed the quarter's performance to stronger AI systems revenue, momentum in hybrid cloud and Intelligent Edge, and operational changes aimed at improving server margins. Server margin remediation: Management implemented new pricing analytics, tighter discount controls, and inventory management to address previous execution issues in the server segment. These steps are expected to result in server operating margins recovering to approximately 10% by year-end. AI systems and backlog growth: The company highlighted over $1 billion in recognized AI systems revenue, an increase from the prior quarter, and a $3.2 billion AI systems backlog. Growth was attributed to enterprise and sovereign customer demand for AI infrastructure, with management noting a 'multiples of our backlog' in the pipeline. Hybrid cloud and storage momentum: The HPE Alletra MP storage platform experienced high double-digit growth, with orders for Alletra MP growing over 75% year over year for four consecutive quarters. The transition to a subscription model is currently a revenue headwind but is expected to support long-term profitability. Intelligent Edge recovery: Intelligent Edge returned to revenue growth after five quarters, benefiting from improved demand in networking and the introduction of new Wi-Fi 7 solutions. Channel inventory levels remained healthy, and data center and campus switching orders saw double-digit growth. Cost reduction and organizational changes: The company executed a cost reduction program, including a 5% workforce reduction and the launch of the 'Catalyst' initiative to streamline operations and leverage AI for internal efficiency. Myers described these efforts as 'accelerating our reporting cycles by approximately 50% and reducing processing costs by an estimated 25%.' Management expects ongoing AI and hybrid cloud momentum, server profitability improvements, and disciplined cost actions to drive results, though macroeconomic and trade policy uncertainties remain significant factors. AI and hybrid cloud demand: Management projects continued high demand for AI systems and hybrid cloud solutions, especially as enterprise and sovereign clients expand deployments. The company's integration with NVIDIA's new GPUs and AI software partnerships are expected to further expand market opportunities. Server margin recovery: The server segment's profitability is expected to improve as pricing and discounting controls, inventory management, and cost actions take full effect. Management reaffirmed the target for server operating margins to approach 10% by year-end, supported by the rollout of new server generations and improved backlog conversion. Operational efficiency and cost control: The 'Catalyst' initiative, including workforce reductions and AI-driven process improvements, is expected to deliver incremental cost savings and improved agility. Management cautioned that ongoing trade policy changes and macroeconomic volatility could affect both demand and margins. In coming quarters, the StockStory team will monitor (1) the pace of server margin recovery and execution on cost reductions, (2) sustained growth in AI systems and hybrid cloud platforms as new product launches roll out, and (3) the closing and integration of the Juniper Networks acquisition. Other important indicators include annual recurring revenue expansion and signs of stabilization in the networking and Intelligent Edge segments. Hewlett Packard Enterprise currently trades at a forward P/E ratio of 9.1×. At this valuation, is it a buy or sell post earnings? The answer lies in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Hewlett Packard Enterprise (NYSE:HPE) Beats Q1 Sales Targets, Provides Optimistic Revenue Guidance for Next Quarter
Enterprise technology company Hewlett Packard Enterprise (NYSE:HPE) beat Wall Street's revenue expectations in Q1 CY2025, with sales up 5.9% year on year to $7.63 billion. Guidance for next quarter's revenue was optimistic at $8.35 billion at the midpoint, 2.1% above analysts' estimates. Its non-GAAP profit of $0.38 per share was 16.3% above analysts' consensus estimates. Is now the time to buy Hewlett Packard Enterprise? Find out in our full research report. Revenue: $7.63 billion vs analyst estimates of $7.46 billion (5.9% year-on-year growth, 2.3% beat) Adjusted EPS: $0.38 vs analyst estimates of $0.33 (16.3% beat) Adjusted EBITDA: -$419 million vs analyst estimates of $1.14 billion (-5.5% margin, significant miss) Revenue Guidance for Q2 CY2025 is $8.35 billion at the midpoint, above analyst estimates of $8.18 billion Management raised its full-year Adjusted EPS guidance to $1.84 at the midpoint, a 2.2% increase Operating Margin: -14.5%, down from 5.9% in the same quarter last year Free Cash Flow was -$1.01 billion, down from $655 million in the same quarter last year Market Capitalization: $22.78 billion 'We delivered a solid performance, achieving yet another quarter of year-over-year revenue growth with strength in each of our product segments,' said Antonio Neri, president and CEO of Hewlett Packard Enterprise. Born from the 2015 split of the iconic Silicon Valley pioneer Hewlett-Packard, Hewlett Packard Enterprise (NYSE:HPE) provides edge-to-cloud technology solutions that help businesses capture, analyze, and act upon their data across hybrid IT environments. A company's long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. With $31.65 billion in revenue over the past 12 months, Hewlett Packard Enterprise is a behemoth in the business services sector and benefits from economies of scale, giving it an edge in distribution. This also enables it to gain more leverage on its fixed costs than smaller competitors and the flexibility to offer lower prices. However, its scale is a double-edged sword because finding new avenues for growth becomes difficult when you already have a substantial market presence. To accelerate sales, Hewlett Packard Enterprise likely needs to optimize its pricing or lean into new offerings and international expansion. As you can see below, Hewlett Packard Enterprise's sales grew at a sluggish 2.9% compounded annual growth rate over the last five years. This shows it failed to generate demand in any major way and is a rough starting point for our analysis. We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Hewlett Packard Enterprise's annualized revenue growth of 3.4% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak. This quarter, Hewlett Packard Enterprise reported year-on-year revenue growth of 5.9%, and its $7.63 billion of revenue exceeded Wall Street's estimates by 2.3%. Company management is currently guiding for a 8.3% year-on-year increase in sales next quarter. Looking further ahead, sell-side analysts expect revenue to grow 6.4% over the next 12 months, an improvement versus the last two years. This projection is above the sector average and indicates its newer products and services will catalyze better top-line performance. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It's also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes. Hewlett Packard Enterprise was profitable over the last five years but held back by its large cost base. Its average operating margin of 3.9% was weak for a business services business. Analyzing the trend in its profitability, Hewlett Packard Enterprise's operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company's expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. This quarter, Hewlett Packard Enterprise generated an operating margin profit margin of negative 14.5%, down 20.4 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue. We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company's growth is profitable. Hewlett Packard Enterprise's EPS grew at an unimpressive 4% compounded annual growth rate over the last five years. This performance was better than its flat revenue, but we take it with a grain of salt because its operating margin didn't expand and it didn't repurchase its shares, meaning the delta came from reduced interest expenses or taxes. In Q1, Hewlett Packard Enterprise reported EPS at $0.38, down from $0.42 in the same quarter last year. Despite falling year on year, this print easily cleared analysts' estimates. Over the next 12 months, Wall Street expects Hewlett Packard Enterprise's full-year EPS of $1.95 to stay about the same. We were impressed by how significantly Hewlett Packard Enterprise blew past analysts' EPS expectations this quarter. We were also glad its quarterly revenue guidance and full-year EPS forecast quarter exceeded Wall Street's estimates. Zooming out, we think this was a solid print. The stock traded up 3.3% to $18.25 immediately after reporting. Indeed, Hewlett Packard Enterprise had a rock-solid quarterly earnings result, but is this stock a good investment here? We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free. Errore nel recupero dei dati Effettua l'accesso per consultare il tuo portafoglio Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati
Business Standard
29-05-2025
- Business
- Business Standard
Natco Pharma gains after Q4 PAT rises 5% YoY to Rs 407 cr
Natco Pharma added 3.73% to Rs 894.65 after the company's consolidated net profit increased 5.3% to Rs 406.60 crore on 14.3% jump in revenue from operations to Rs 1,221 crore in Q4 FY25 over Q4 FY24. Profit before tax (PBT) increased 5.9% YoY to Rs 505.90 crore in the quarter ended 31st March 2025. EBITDA stood at Rs 614.4 crore, registering the growth of 13.93% compared with Rs 539.3 crore posted in corresponding quarter last year. EBITDA margin reduced to 47.7% in Q4 FY25 as against 48.6% in Q4 FY24. During the quarter, the company recorded an impairment charge of Rs 50 crore in the crop health science business related to property, plant and machinery and a chargeback adjustment of approximately Rs 25 crore in its US subsidiary. On full year basis, the companys consolidated net profit jumped 35.8% to Rs 1,885.40 crore on 10.8% increase in revenue from operations to Rs 4,429.50 crore in FY25 over FY24. NATCO Pharma, headquartered at Hyderabad, India, develops, manufactures and distributes generic and branded pharmaceuticals, specialty pharmaceuticals, active pharmaceutical ingredients and crop protection products.
Metro
22-05-2025
- Metro
What you should do if there's an earthquake when you're abroad
Holidays are supposed to be an opportunity for rest and relaxation, but there is always a risk of experiencing natural disasters while abroad. Risk levels vary depending on where you travel, as some countries face a higher risk of earthquakes, tsunamis, tornados and flooding than others. Greece is one of the most seismically active regions in Europe, due to its location on the fault line between the Eurasian and African tectonic plates. This means that there is an increased risk of experiencing an earthquake when visiting Greece and its islands compared to other holiday destinations. Right now, the country is under a tsunami warning after a 6.1 magnitude quake hit off the coast of Crete early this morning. The Greek government has issued a national directive, ordering locals and tourists to 'move away from the coast and reach a higher place'. Last week a 5.9 magnitude earthquake was recorded off the coast, sparking another temporary tsunami warning and fears that the islands of Crete and Rhodes may not be safe to visit. But what should you do if you experience an earthquake while you're abroad? Metro has the answers. The UK Foreign Office has issued advice for Brits planning to travel to the Greek islands. They say: 'The area around the Cycladic islands of Santorina (Thira), Anafi, Ios and Amorgos, experienced increased earthquake activity in early 2025. 'This increased has since subsided and the tourist season is expected to continue as usual. 'There is a risk of earthquakes and earth tremors in Greece. 'You should familiarise yourself with safety procedures in the event of an earthquake, follow advice given by the local authorities, and call the Greek emergency services on 112 if you are in immediate danger.' In general, if you become aware of an earthquake while you're abroad, the Foreign Office suggests following the following steps: Sign up to receive email alerts when FCDO travel advice is updated Keep in touch with your travel or tour operator and your hotel (where applicable) Monitor local radio, TV and press Follow the advice of local authorities, including any evacuation orders Be familiar with advice that is specific for hazards (such as 'drop, cover, hold' in an earthquake) Check in with family and friends in the UK Be prepared in case you need to move to a safe place at short notice – keep any essential items and supplies such as travel documents and essential medication together Most countries offer an emergency alert service, to notify people if there is a risk of a major incident or natural phenomena like an earthquake. The Greek government has an Emergency Communication Service, which can send out alerts written in English. In order to sign up for these alerts, the Foreign Office has shared the following instructions: For iPhones go to Settings > Notifications and enable the 'Emergency Alerts' option at the bottom For Android 11 and higher go to Settings > Notifications > Advanced Settings > Wireless Emergency Alerts For Samsung devices go to Settings > Apps > Messages > Notifications > Emergency Notifications and enable the 'Emergency Alerts' option Experts at Avanti travel insurance told Metro said there are steps you can take if your trip could be affected by a natural disaster, including to try and change your plans or get a refund. They said: 'The first thing you should do is contact your holiday provider to see what support they can give you as they may be able to provide an alternative, refund or reschedule your trip. 'If your holiday provider can't help you reschedule or refund your costs, you should contact your bank. You may be able to recoup your costs through a 'chargeback claim' if you paid using a credit card. 'If you've tried both options without any luck, then you may be able to claim through your holiday insurance. It's important to check your policy documents before cancelling a trip or if you decide not to travel so check out the 'Travel Delay' section in your policy wording to find out if a natural disaster is covered. 'If you're already on holiday and your return journey to the UK is delayed or cancelled speak with your holiday provider for alternative options. 'In this instanced your travel insurance policy should automatically extend to cover the extra time you need to get home. However, always check with your insurance provider to on the safe side. 'You will also need to speak with your holiday provider if you're accommodation is affected as they may be able to find you an alternative place to stay or if necessary, bring you home early. 'Lastly, if your travel arrangements change be sure to update your travel insurance policy and be aware that traveling against FCDO advice may invalidate your cover so keep up to date with the latest announcements on the FCDO website.' Meanwhile Alice Lawson, associate director of insurance at Holiday Extras, told Metro that coverage for natural disasters isn't usually covered by travel insurance as standard, but can be added as an optional extra. She explained: 'If you're travelling to a destination where natural disasters could be a possibility, it's important to make sure that you have read the policy details of the insurance product you're considering before purchasing it. 'If there is a natural disaster at your destination but holidays are still considered safe to continue, there's no insurance cover available; if your holiday is still going ahead but you decide not to travel just in case a natural disaster happens, insurance providers usually wouldn't reimburse you for deciding not to fly. 'In the unlikely event that your provider can't fulfil their duty you may be able to claim against your insurance – in most overseas emergencies in the past either the airline, holiday provider, or in extreme cases the UK government have stepped in to get people home.' The Greek Ministry for Climate Crisis and Civil Protection has shared advice on what to do if you experience an earthquake while in Greece. If you have been alerted that an earthquake is likely, they suggest you prepare by fastening shelves and heavy furniture to the walls and moving tall furniture which could fall and block exit doors. Heavy items should be placed on lower shelves and removed from above beds and sofas. You should find safe spots in each room of the house, located away from exterior walls and glass surfaces and ideally underneath sturdy tables or desks. You should know how to turn off electricity, water, and gas supply, and also know Greece's emergency phone number, which is 112. Ideally you should also have a portable radio with batteries, a torch, and a first aid kit. Another potential concern when it comes to earthquakes is the lack of access to the internet, with the possibility of tremors knocking out electricity and IT systems. This could make it impossible to pay for anything with a debit or credit card, Simon Phillips from No1 Currency warns. He told Metro: 'Most of us take card and contactless payments for granted, and the technology is great – right up until the moment it stops working. 'In April nationwide power outages in Spain and Portugal turned millions of people's smartphones into expensive paperweights and left them with only one way to pay for things – cash. 'Keeping some cash in your purse or wallet when you're overseas is common sense. It's easy to use, there are no hidden charges and you can always rely on it if digital payments go down. 'Card and contactless payments are useful, practical and safe. But they rely on tech infrastructure that is fallible, and this is why you should always keep some cash as a back-up, both in Britain and especially when you're travelling abroad.' During an earthquake, the first piece of advice is to stay calm. You should take cover under sturdy furniture and hold its leg, but if there isn't any suitable furniture, lower your height as much as possible and protect your head and nape with your hands. Move away from large glass surfaces, furniture or objects that could injure you. Don't try to leave the house or go onto a balcony. If you're in a tall building, stay away from glass and interior walls. If you're in a public building like a shopping centre, stay indoors until the earthquake stops and stay away from any panicked crowds due to the risk of trampling. If you're outdoors, move away from buildings and electric or phone cables and cover your head with a bag if available. If you're in a car, park the car in an open space away from tunnels or bridges and try not to obstruct traffic. Once the earthquake has ended, be aware that there could be further aftershocks. Check if anyone around you is injured and do not move anyone who is seriously injured. Evacuate the building you're in via the stairs, without using the lift, after switching off the electricity, gas and water, and go to an open outdoor space. Don't drive unless there's an emergency, to keep the roads clear for the emergency services, and only use your phone in an emergency to avoid network overload. Not all earthquakes can cause a tsunami, but if you're in a coastal area it's worth checking if there is a significant rise or fall of the water level, which acts as a warning for an oncoming tsunami. You should leave the seashore and head to areas of higher altitude, and stay away from seaside areas until authorities say the danger is over. The Civil Protection Ministry warns: 'Do not approach the shore in order to watch a tsunami coming. When you see the tsunami coming, it will probably be too late to avoid it.' Greece has seen an increased amount of seismic activity in the last 24 hours. More Trending Its Institute of Geodynamics has recorded around 409 seismic incidents in the last seven days, with more than 120 of those taking place in the last 24 hours. While a cluster of them happened in around the same location as the 6.1 magnitude quake, many have also occurred in the sea around the islands of Fira and Amorgos, as well as around the Greek mainland. There have been 37 quakes recorded since the 6.1 magnitude earthquake, all varying between 1.3 and 3.5 in magnitude. Get in touch with our news team by emailing us at webnews@ For more stories like this, check our news page. MORE: Seven alternative European destinations to visit as anti-tourist protests sweep Spain MORE: Fury in Greece over Adidas advert that shows shoe 'kicking' the Acropolis MORE: 'It's very chill': Your favourite European beaches that aren't full of tourists
Scoop
21-05-2025
- Business
- Scoop
Budget Set For 2025/26, Rates Increase Less Than Proposed
Press Release – Waikato Regional Council Waikato regional councillors have set the budget for 2025/26, landing on a 5.7 per cent increase in rates revenue which is lower than proposed in the draft annual plan. Following almost five hours of deliberations on Tuesday (20 May), councillors agreed an increase in rates revenue from current ratepayers of $152.584 million or 5.7 per cent – less than the 5.9 per cent proposed for consultation, and significantly lower than the 8.6 per cent signalled 12 months ago through the 2024-2034 Long Term Plan. 'Staff and councillors have worked hard together to deliver a fiscally responsible budget,' said Waikato Regional Council Chair, Pamela Storey. Consultation was open from 1 to 30 April 2025, with feedback being sought on two key proposals: public transport rating and a river and catchment funding model for Wharekawa Coast. The council also sought views on changes to fees and charges and a new rate remission policy. Hearings were held in Paeroa and Hamilton on Monday (19 May), with 10 of the 143 individuals and groups who made a submission on the draft annual plan providing in person feedback. 'We appreciate the time taken by submitters to share their views and have balanced what we heard against the needs of our communities,' Chair Storey said. On the topic of regional rating for public transport, councillors agreed to stick with capital value for Hamilton ratepayers and introduce a flat per property rate in four categories across the rest of the Waikato. For the Wharekawa Coast, on the Firth of Thames, funding was confirmed through a mix of targeted and general rates, with a differential between rates charged to direct and indirect beneficiaries. Additional funding of $240,000 was committed for expert work on a business case and implementation plan for Te Huia – the passenger rail service between Waikato and Auckland. Councillors heard the work was critical to providing the NZ Transport Agency Waka Kotahi Board with the best information on which to decide the future of Te Huia beyond the end of the trial in 2026. Councillors were evenly split on whether to use a prior year surplus of $2.545 million to reduce rates for 2025/26, or to hold it to be available for one-off costs that arise due to rapid changes in the council's operating environment. Operating surpluses arise from differences between budgeted and actual revenue and expenditure. This may be due to operational savings or through changes in the operating environment, such as the rapid changes to the Official Cash Rate (OCR) seen over the last two financial years. Two submissions on this matter said they wanted the council to hold onto the surplus. Staff told councillors rates for 2025/26 would drop to 4 per cent if the surplus was used to reduce rates. At a property level, returning the surplus would see a reduction in the general rate of $1.09 per $100,000 capital value. For a $1 million property, that would equate to $10.90 off the annual rates bill. There would also be consequences in the following year, staff said, with the rates increase projected in the long term plan going from 4.2 per cent to 5.9 per cent. 'Giving back the surplus now would create a gap in our finances for future years and force bigger rates increases later on. It would also leave us less prepared for unexpected events, like a major cyclone or a biosecurity threat like we've seen with Caulerpa and freshwater clams,' Chair Storey said. On the casting vote of the chair, the motion to return the surplus to ratepayers was lost.
