{"id":19767,"date":"2022-11-30T01:22:37","date_gmt":"2022-11-30T01:22:37","guid":{"rendered":"https:\/\/mailinvest.blog\/index.php\/2022\/11\/30\/hpe-and-netapp-deliver-mixed-financial-results-as-revenue-growth-slows\/"},"modified":"2022-11-30T01:22:37","modified_gmt":"2022-11-30T01:22:37","slug":"hpe-and-netapp-deliver-mixed-financial-results-as-revenue-growth-slows","status":"publish","type":"post","link":"https:\/\/mailinvest.blog\/index.php\/2022\/11\/30\/hpe-and-netapp-deliver-mixed-financial-results-as-revenue-growth-slows\/","title":{"rendered":"HPE and NetApp deliver mixed financial results as revenue growth slows"},"content":{"rendered":"

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Enterprise computing infrastructure firms Hewlett Packard Enterprise Co.<\/a> and NetApp Inc.<\/a> both reported mixed financial results today.<\/p>\n

However, while HPE\u2019s stock made slight gains in the extended trading session on strong guidance for the next quarter, NetApp\u2019s shares plummeted on a weaker-than-expected forecast.<\/p>\n

HPE beats estimates<\/h3>\n

HPE reported<\/a> a net loss of $304 million, with fourth-quarter earnings before certain costs such as stock compensation coming to 57 cents per share, matching Wall Street\u2019s expectations. Revenue for the period rose 7% from a year earlier, to $7.9 billion, beating analysts\u2019 consensus estimate of $7.4 billion.<\/p>\n

HPE\u2019s stock rose by more than 2% in extended trading, erasing a slight decline that came during the regular session. HPE President and Chief Executive Antonio Neri (pictured) said the company had put in an \u201cimpressive quarter\u201d that resulted in an \u201coutstanding performance\u201d across all of its key performance metrics.<\/p>\n

\u201cWe are producing strong financial results as we meet new customer needs with the edge-to-cloud portfolio that only we can deliver,\u201d Neri said. \u201cThe strength of our culture and commitment of our team members this quarter and throughout the entire 2022 fiscal year enabled us to innovate and take bold actions to pivot our portfolio and bolster our financial position as we head into 2023.\u201d<\/p>\n

HPE is a provider of information technology hardware such as servers, storage and networking gear, plus associated software services. Its flagship offering these days is HPE GreenLake, a portfolio of hardware and software products that enterprises can buy on a pay-as-you-go basis, rather than purchase everything upfront.<\/p>\n

Revenue from HPE GreenLake is included in the company\u2019s Intelligent Edge business segment and that was one of its best performers, with revenue rising 18% to $965 million for the period. HPE\u2019s largest business segment, its Compute division, also did well, with revenue up 16%, to $3.7 billion. Storage revenue increased too, rising 4%, to $1.3 billion.<\/p>\n

On the other hand, HPE\u2019s High Performance Computing and Artificial Intelligence division saw revenue decline 14%, to just $862 million. Financial Services revenue, meanwhile, stayed flat at $857 million.<\/p>\n

The mixed results were followed by some very strong guidance, with HPE saying it expects first quarter sales of between $7.2 billion and $7.6 billion, well ahead of Wall Street\u2019s forecast of $6.98 billion.<\/p>\n

Weak guidance sends NetApp down<\/h3>\n

\"\"Unfortunately for NetApp, it wasn\u2019t quite able to match HPE\u2019s strong performance. The provider of enterprise storage systems did beat Wall Street\u2019s estimates on earnings, reporting<\/a> a second-quarter profit before certain costs of $1.48 per share, ahead of the $1.33 targeted by analysts. However, its revenue grew by just 6%, to $1.66 billion, below the $1.68 billion target.<\/p>\n

All told, NetApp reported income for the period of $750 million.<\/p>\n

\u201cWe delivered a solid quarter in a dynamic environment, with all-time highs for Q2 revenue, billings, gross profit dollars, operating income and EPS,\u201d said NetApp Chief Executive George Kurian (pictured, adjacent). \u201cOur modern approach to the hybrid multicloud delivers significant value to our customers and creates sizeable opportunity for us. In a challenging macro environment, we remain focused on innovation, execution, and operational discipline.\u201d<\/p>\n

That may be so, but NetApp\u2019s investors meanwhile are focused on the company\u2019s immediate financial prospects and did not like what they saw. For the third quarter, NetApp said it\u2019s expecting earnings of between $1.25 and $1.35 per share, below Wall Street\u2019s forecast of $1.44 per share. Similarly, its revenue forecast of $1.525 billion to $1.675 billion also came below the consensus estimate of $1.71 billion.<\/p>\n

As a result, NetApp\u2019s stock fell more than 10% in extended trading. No doubt investor\u2019s concerns were exacerbated by the company\u2019s revised full-year outlook. NetApp said it\u2019s revising its full-year earnings forecast to a range of $5.30 to $5.50 per share, down from its previous forecast of $5.40 to $5.60 per share.<\/p>\n

Photos: SiliconANGLE<\/h5>\n
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