HPE to cut 2,500 employees as stock slides 16% on Weak Earnings Outlook

Hewlett Packard Enterprise Shares Slid 16% in Extended Trading on Center Equipment Maker Issued Quarterly and Full-Yaar Guidance that came in below consensus.

Here’s how the company did in the fiscal first Quarter in Comparison with Lseg Consensus:

• Earnings per share: 49 cents adjusted vs. 49 cents Expected
• Revenue: $ 7.85 billion vs. $ 7.82 billion

HPE’s Revenue Rose 16% Year Over Year in the Quarter Ending on Jan. 31, according to a statementThe company was left with profit of $ 598 million, or 44 cents per share, up from $ 387 million, or 29 cents per share, in the same Quarter a year earlier. The Adjusted Earnings Per Share Excludes Stock-Based Compensation.

“We Cold have executed better,” Ceo antonio neri said on a conference call with analysts. The company had higher than normal inventory for artificial intelligence servers against of a shift to next-genewell graphics processing units from Nvidia,

The Backlog for AI Systems Rose 29% Quarter Over Quarter to $ 3.1 Billion.

HPE said it would implement a cost reduction program involving layoffs over the next 18 months that will lead to $ 350 million in gross saving saving by the 2027 fiscal year. Around 2,500 Employees will be affected, a spokesperson said, representing about 5% of the workforce when also factoring in expected Attrition. At the end of October, HPE Employed 61,000 People, According to Its Most Recent annual report,

DURING The Quarter, The US Justice Department Filed Sued In A Federal District Court to Stop HPE from Acquiring Juniper NetworksHPE announced The proposed $ 14 billion deal in January 2024. The court expects a trial to begin in July, according to the statement. The deal should close by October 2025, HPE SAID. In December, the company Had said The transaction would be done in early 2025.

HPE CALLED For 28 Cents to 34 cents in adjusted earnings per share for the fiscal second quarter, with Revenue Coming in Between $ 7.2 Billion and $ 7.6 Billion. Analysts surveyed by lseg had looked for 50 cents per share on $ 7.93 billion in revenue.

For the 2025 fiscal year, hpe sees $ 1.70 to $ 1.90 in adjusted earnings per share. Analaysts Pollled By Lseg Had Predicted $ 2.13 per share.

As of CHURSDAY’s Close, HPE Shares WERE Up About 2% So far in 2025, while the s & p 500 index was down 2%.

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Watch: HPE Shares Fall more than 10% After Mixed Earnings, Layoff Plans