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Infrastructurepublished

HPE Raises 2026 Revenue Growth Forecast to 34%-37% After $12.21B Quarter

The earnings beat gives HPE a stronger base for its new forecasts, while constrained components could limit how quickly server demand becomes delivered systems.

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HPE Raises 2026 Revenue Growth Forecast to 34%-37% After $12.21B Quarter
HPE Raises 2026 Revenue Growth Forecast to 34%-37% After $12.21B Quarter
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HPE has sharply raised its growth outlook for the next two fiscal years, after AI infrastructure demand helped produce a stronger-than-expected quarter. Fiscal third-quarter revenue climbed 33.6% to 12.21 billion dollars, beating the 11.91 billion-dollar analyst estimate. Adjusted earnings came in at 1.11 dollars per share, versus expectations of 93 cents. The upgrade is substantial. HPE now expects fiscal 2026 revenue growth of 34% to 37%, up from a previous range of 29% to 33%. Its adjusted earnings forecast also rose, to 3.75 to 3.85 dollars per share. Looking further out, fiscal 2027 revenue growth is projected at 13% to 17%, while adjusted earnings-per-share growth is expected at 16% to 20%. Demand is coming from cloud-computing companies and large enterprises buying high-powered AI servers. HPE also said Oracle will deploy HPE Juniper Networking equipment in its AI data centers. But the companies disclosed no timetable, scale, or expected revenue from that deployment. And investors focused on the execution risk: HPE shares fell 8% in extended trading. Memory is the company’s biggest component bottleneck, followed by NAND, CPUs, and drives. HPE has signed longer-term supply agreements that could improve access, but it has not quantified the relief. The key question is how quickly that constrained supply can become delivered systems—and revenue.

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3 key points

HPE’s AI infrastructure business is accelerating, with fiscal third-quarter revenue up 33.6% to $12.21 billion and adjusted EPS of $1.11, both above estimates. The company now expects fiscal 2026 revenue growth of 34%-37% and fiscal 2027 growth of 13%-17%, extending the outlook beyond the current year. The key execution risk is supply: memory is the largest bottleneck, followed by NAND, CPUs, and drives. Shares fell...

  1. 01

    Fiscal 2026 adjusted EPS guidance rose to $3.75-$3.85, from $3.35-$3.45.

  2. 02

    Fiscal 2027 adjusted EPS growth is now forecast at 16%-20%, versus 12%-16%.

  3. 03

    HPE says longer-term component agreements may improve access, but has not quantified the relief.

Hewlett Packard Enterprise lifted its fiscal 2026 and 2027 growth forecasts after a quarter in which AI server and networking demand helped revenue and adjusted earnings exceed analyst expectations. The higher targets set out a longer runway for the company, but HPE says memory remains its largest component bottleneck.

HPE’s third-quarter revenue rose 33.6% to $12.21 billion, ahead of the $11.91 billion analyst estimate. Adjusted earnings were $1.11 a share, versus a 93-cent estimate. HPE said its high-powered AI servers saw strong demand from cloud-computing companies and large enterprises.

Investors nevertheless marked the shares down 8% in extended trading after the results. That reaction came despite a forecast upgrade that covers both the current fiscal year and the following one.

The near-term forecast moved sharply higher

For fiscal 2027, HPE now expects revenue growth of 13%-17%, up from 8%-12%, and adjusted EPS growth of 16%-20%, up from 12%-16%. Those are company forecasts, rather than recorded sales or profit.

Oracle gives the networking business a named AI deployment

HPE also expanded its collaboration with Oracle to deploy HPE Juniper Networking equipment across Oracle’s AI data centers. The announcement connects HPE’s networking business to a specified AI infrastructure buildout, though it did not give a deployment scale, timetable or revenue contribution.

Component availability is the delivery test

HPE identified memory as its main supply bottleneck, followed by NAND, CPUs and drives. CFO Marie Myers said demand was outstripping supply and that HPE had signed longer-term supply agreements to improve component access. The company has not quantified how much those agreements will ease the constraint.

Sources

  1. wtvbam.comHPE raises annual forecasts as AI, networking demand lifts quarterly revenue

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