Hewlett Packard Enterprise Company (HPE) Citi's 2024 Global TMT Conference summary

Business performance and market environment

• Achieved strong quarterly results with double-digit revenue growth, EPS above consensus, and $669 million in cash flow.

• IT spending environment is improving, with sequential growth across key business pillars, led by the Americas.

• Operates four main segments: servers (including AI), hybrid cloud (GreenLake and storage), intelligent edge (networking), and leasing.

AI strategy and growth

• AI server revenue reached $1.3 billion, up 40% quarter-on-quarter, now 30% of the server business.

• Healthy AI server backlog and expectation of modest sequential growth in AI server revenue into Q4 2024.

• Focused on profitable deals, especially in competitive Tier One and Tier Two segments.

• Strong presence in sovereign AI, highlighted by a strategic deal in Japan, and growing enterprise AI pipeline.

• Enterprise AI adoption is early but expanding, with 80% of enterprises in early adoption or proof of concept stages.

Competitive advantages and innovation

• Decades of expertise in direct liquid cooling, with 300 patents and in-house manufacturing capacity.

• Launched Private Cloud AI (PCAI) offering, enabling enterprises to quickly deploy AI solutions with preloaded industry models.

• Hundreds of customers have shown interest in PCAI, with live orders initiated recently.