Combined for $21 trillion in revenue—and $2.1 trillion in profits. Introducing the 2026 Fortune 500, the definitive list of the biggest companies in America.

Fortune 500

Fortune partnered with Great Place to Work to analyze survey feedback representing nearly 100,000 U.S. employees.

GPTW_100BestCompaniesToWorkForByRegion_2026-Texas_Large-HPE_US1__69b3fda85504e0abfadc0519_3

Employees say:"I am proud to work at HPE because of the support I receive from leadership to be able to come to work as my true self. I am also supported in career growth, positive networking and opportunities to show my value to the company. I hope to have a lasting career here. The culture is what truly makes it special and safe here."

25 Best Large Workplaces in Texas

The 300 companies on this year’s list brought in over $12.5 trillion in revenue for the latest 12 months, with the median revenue figure at $24 billion.

America's Most Innovative Companies

AI is a major force shaping this year’s list—but it’s far from the only story.

World's Most Admired Companies

This year's 100 Best Companies to Work For are rebuilding the social contract at work so people feel supported, trusted, and future-ready as they undergo that transition.

100 Best Places to Work 2026_HPE

Employees say:"I've never worked someplace with such a flat organizational feel to it. The access to senior leaders and ability to have conversations on a level playing field is amazing, making you feel important in your role and part of a bigger picture within the company."

Fortune 100 Best Companies to Work For

This ranking evaluates how Fortune 500 companies are deploying AI, and how technology leaders value those investments relative to industry peers.

Fortune AIQ 50

See which workplaces made this year's list.

2025_GPTW_InformationTechnology_Large_HPE_US1__685d53e14f22a2fc232770d3_3

Employees say:"Our culture is top notch, and our people make this a great place to work. I love that on my team we can bring new ideas to the table, have a seat at the table, and know with confidence that our ideas will be considered. I am fully trusted to get my work done and my leader is available any time I need her. I also love the frequency of the recognition within our team. It keeps our team motivated and inspired."

Best Large Workplaces in Technology

Fortune partnered with Great Place to Work to analyze survey feedback representing nearly 116,000 U.S. employees.

Best Workplaces_Texas_Large_2025-Hewlett Packard Enterprise_US1__67fd62d0bb07cc513ab900d5_3

Employees say:"HPE is a company that prioritizes employee retention in a way that I've found to be very rare, especially in tech. There is a real focus on ensuring that people who work here are happy and fulfilled in their roles. There are also opportunities for people to find other roles within HPE if they are unhappy in their current role, instead of looking for a job at another company. I think this improves not only our company culture, but also the quality of our products/services. There is an amazing amount of expertise that is able to build when people stick around for a long time. As a newer employee, I really value the knowledge that the long-time members of my team have."

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

The top companies on our list have one thing in common: Staff largely trust leadership to see them as well-rounded people and reward them for a job well done.

GPTW_100BestCompaniesToWorkFor_2025-Hewlett Packard Enterprise_US1__20241210214006_1

Employees say: "My upper-level management is exceptionally good, especially my immediate manager. The entire team is extremely supportive and invested in you learning and performing well. It is one of the healthiest work environments I have ever worked in. I would work here just for that reason alone."

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

Leaders in all industries rely more than ever on Big Tech—and appreciate the giants that deliver, at scale, without drama.

2025 Best Large Workplaces for Parents_HPE_US1__68b9ad8e7757c3af0ca2bb8e_3

Best Large Workplaces for Parents

GPTW_Parents_Large_2024-Hewlett-Packard-Enterprise_US1__20240918135500_2.jpg

Employees say:"What is truly exemplary is the 6 months of parental leave for having a child, but what's even more special is the recipients include adoptive parents. In addition, the huge benefit for those struggling with fertility and/or adoption...HPE really cares about its teams families."

Hewlett Packard Enterprise

Employees say:"HPE does an excellent job with Employee Resource Groups to help build the culture. Executives support the initiatives and the ERG leaders host events that make everyone feel welcome. I share our activities on social media and my friends are amazed at all we do for our employees at HPE."

Industries included in the sector are computers, internet services, IT services, semiconductors, and software companies.

Fortune Sector Leaders: Technology

Fortune partnered with Great Place to Work to analyze survey feedback representing nearly 95,000 U.S. employees.

GPTW-2024-Texas-Large-Hewlett-Packard-Enterprise

Employees say:"The wellness Fridays, innovation days, and the team member appreciation day are taken seriously and are nice benefits. The innovation days help employees to expand their knowledge toolkits and attack new problems and find new ways of doing things."

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

Creating a more empathetic workplace looks like staying loyal to workers, emphasizing D&I initiatives, and paying well.

100 Best Companies 2024-Hewlett Packard Enterprise

In 2015, when HPE was created in the wake of Hewlett-Packard’s separation, it made ambitious DEI goals a key part of its agenda. In February, it earned the top spot in Just Capital’s annual ranking, which takes into account social factors such as paying a fair living wage, creating American jobs, providing benefits to ensure work-life balance, and minimizing pollution. HPE was also dubbed the 15th-best workplace for parents last year, owing in large part to its flexible remote-work policies as well as its paid gender-neutral parental leave, bereavement leave after a miscarriage, and reimbursement for fertility expenses. &nbsp;HPE’s remote-work model, which it rolled out during the pandemic, reimagined offices as cultural and collaboration hubs, with workspaces reflecting HPE’s hybrid vision—equipped with more meeting spaces and hybrid tech. Approximately 78% of team members say they are pleased with the model. And nearly 87% say they are happy with the connectivity tools that bring team members together. Among hybrid staff, 84% say their work environment enables them to perform their roles more effectively.

The 26th edition of the list shows how much esteem Big Tech giants command among other business leaders.

The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

Building a culture of trust and transparency is essential to help everyone thrive, especially in rocky economic times.

100 BEST COMPANIES 2023-HPE

IT firm Hewlett Packard emphasizes the importance of transparency between employees and management. 
<ul> 
 	<li>So far more than 3,500 employees have taken part in Mystery Coffee, a program where team members connect with others from around the globe for virtual one-on-one coffee breaks.</li> 
 	<li>Employee wellness is a top priority at HPE, and team members worldwide can leave work three hours early on designated Wellness Fridays to spend time focused on their personal well-being.</li> 
 	<li>Staff receive financial wellness help, too, with tools enabling them to assess their current money situation and receive insights on how to budget, manage debt, build savings, and protect their finances.</li> 
 	<li>“HPE encourages employees to speak up, innovate, collaborate, be empowered, own our development, et cetera,” noted one employee.</li> 
</ul>

GPTW Texas 2023-Hewlett Packard Enterprise

Employees say: 
 
"HPE encourages employees to speak up, innovate, collaborate, be empowered, own your development, etc. HPE is a place of unlimited opportunities to grow and contribute, and provides a sense of belonging of a family."

GPTW 2023 Best Workplaces Tech LargeHewlett Packard Enterprise Company_1

Employees say: 
 
"Top executives care for employees, encourage and provide opportunities for work-life balance, and celebrate every ethnicity and culture. That creates a great all-inclusive culture, which is the best thing this company offers."

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

Just as it dominates our economy, Big Tech now dominates Fortune’s annual ranking of corporate reputation.

When it comes to supporting employees, flexibility, diversity, and a few extra paid days off go a long way.

100 Best 2022-Hewlett Packard Enterprise

Hewlett Packard Enterprise—which split from Hewlett-Packard in 2015 and focuses on information technology—saw order growth up 20% during the first fiscal quarter of 2022 as many U.S. companies continued to bring employees back to the office. Yet internally HPE has doubled down on the mental and emotional support offered to employees and focused on rolling out benefits like the Work That Fits Your Life program. As part of the initiative, rolled out in 2019, employees get access to three hours of paid time off one Friday a month and six full Fridays off each summer.

A key trait that shines through for company after company on this year's list is all-around fairness.

GPTW Texas Large 2022-Hewlett Packard Enterprise Company

Employees say: 
 
“Through almost 25 years of working here I've been able to balance my work and life. HPE has allowed me to be there for my children, attend field trips, and volunteer in classrooms throughout the years. When my parents get sick, I am able to balance my work and tend to them. I honestly don't know what other company would allow me to do this. I am so grateful to HPE and always tell people how much I LOVE MY JOB AND COMPANY! My colleagues are not just my colleagues but my family! Now with being an Edge worker, it's only made my work life so much easier. Thank you HPE!!!” 
 
Read the Great Place to Work review .

Fortune collaborated with the Diligent Institute to rank the most innovative boards of directors among S&P 500.

Modern Boards 2022  Hewlett Packard Enterprise

In 2014, the old-guard Silicon Valley giant Hewlett-Packard split into two companies, HP Inc. and Hewlett Packard Enterprise. Since then, both have found strong footing in corporate governance: Both HPE and HP made this list. (HP is No. 9.) 
 
That fact signals a remarkable turnaround. A little over a decade ago, Hewlett-Packard’s board endured multiple controversies involving proxy fights, <a href="https://www.businessinsider.com/a-brief-history-of-hps-totally-dysfunctional-board-2011-9#a-couple-weeks-later-fiorina-was-fired-4">unusual CEO transitions</a>, and a scandal over surveillance of colleagues and journalists that led to the <a href="https://money.cnn.com/2011/01/20/technology/HP_board_of_directors/index.htm#:~:text=The%20long%20and%20winding%20Hurd,marketing%20contractor%20for%20the%20company.">departure of four directors</a> in 2011. 
 
With those issues far in the past, HPE’s board earned the No. 2 spot on this list thanks to strengths in board expertise, gender equality, and board independence, among other criteria. The company specializes in enterprise information tech; it has recently seen particularly robust growth from its Intelligent Edge division, a data analytics and business intelligence platform. 
 
HPE’s board is chaired by Patricia Russo, former CEO of Alcatel-Lucent, the communications company. Russo is also a director at Merck, General Motors, and the private equity firm KKR. 
 
HPE’s directors’ careers reflect a wide range of expertise. Daniel Ammann is a former president of General Motors, as well as its former CFO, and until recently was CEO of GM Cruise LLC, a subsidiary of GM that focuses on autonomous vehicles. Pamela Carter is a former executive at Cummins, a machinery design and manufacturing company, where she was a business unit leader and general counsel; she chairs HPE’s HR and compensation committee.  
 
George R. Kurtz started his career at PwC and later founded a tech company that was acquired by McAfee. Mary Agnes Wilderotter chairs the audit committee and is the former CEO of Frontier Communications. 
 
In the non-CEO realm, Raymond Ozzie is a former chief software architect at Microsoft and a fellow of the Computer History Museum; Gary M. Reiner is the former chief information officer at General Electric; and Raymond Lane is the former COO of Oracle and partner emeritus at the famed venture capital firm Kleiner Perkins.

Fortune Modern Board 25

GPTW Information Technology Large 2022-Hewlett Packard Enterprise Company

Employees say: 
 
“The ability to make employees feel like a significant part of the overall team. In a company this size it's hard for employees to feel as if they make a difference. At HPE they go the extra mile to make sure that you know your contributions are critical for the company's success.”

This year’s Fortune 500 marks the 68th running of the list.

After a year in which humanity leaned more heavily than ever on tech giants, see which companies topped Fortune's ranking of corporate reputation.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

Hewlett Packard Enterprise was founded in 2015 after splitting from the Hewlett-Packard company. Specializing in business information technology, the company offers cloud and infrastructure services to provide data storage, security, and network connectivity to its customers.

Fortune Global 500

Caring leaders at the Best Workplaces in Technology have been preparing their companies to thrive as the business world emerges from the COVID downturn.

Best-Workplaces-in-Technology-Large-Hewlett-Packard-Enterprise-Company

Employees say: 
“I am appreciative of the open line of communication our CEO and executive committee have kept in place with the entire company, especially during the COVID-19 shelter-in-place.” 
Read the Great Place to Work review .

These companies empower employees to bring their whole selves to work, prioritize their well-being, and grow in their careers.

Best Workplaces Women 2020-Hewlett Packard Enterprise Company

Employees say: 
 
“Our company is committed to our wellness and has provided many employee resources for financial, physical, emotional wellness. For example, every month we can leave several hours early to take care of ourselves on what's called a Wellness Friday.”

25 Best Large Workplaces in the Bay Area

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-106-Hewlett Packard Enterprise

We surveyed tens of thousands of employees to create this list of millennials’ favorite workplaces.

Best Large Workplaces Millennials 2021-Hewlett-Packard-Enterprise

Employees say: 
 
“Management is very supportive about growing and expanding your knowledge. Whenever I have shown interest in working on areas outside of my expertise, management has always been supportive, which I really appreciate.”

100 Best Large Workplaces for Millennials

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-431-Hewlett-Packard-Enterprise

Hewlett Packard Enterprise is a provider of various technologies including servers, storage, and networking equipment. Like many hardware companies, HPE has experienced pandemic-related supply chain problems in 2020, causing the company in March to walk back predictions that revenues would increase this year.

The companies on this year's list make a conscious effort to be supportive, inclusive workplaces.

Employees say: 
 
“While my husband was deployed, I was raising three kids with no close family. HPE has supported me for doctor appointments, sick kids, and school events. It was empowering to know that I could be a career-driven mom. ”

100 Best Large Workplaces for Women

This year's Fortune 500 marks the 66th running of the list.

F500-2020-109-HP

Hewlett Packard Enterprise is a provider of various technologies including servers, storage, and networking.

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

This year's Fortune 500 marks the 63rd running of the list.

Key Financials (last Fiscal Year)

Revenues ($M)

Profits ($M)

Assets ($M)

Total Stockholder Equity ($M)

Profit Ratios

Profit as % of Revenues

Profits as % of Assets

Profits as % of Stockholder Equity

Company Info

Industry

Industry Vertical

Founded

City

Sites

Worldwide Employees

Total Worldwide [including U.S.] Revenue in the Latest Fiscal Year

Web Address

Date info provided (companies may opt to keep some data confidential)

Best Workplaces For Parents

Best Companies

Rank last year

Years on list

U.S. employees

U.S. job openings

Year founded

Benefits

Subsidized childcare

Compressed work weeks

Option to work remotely

Minimum requirement in-office attendance (days per week)

Mental health coverage

Free mental health sessions (per year)

Free backup childcare time off (days)

Maximum $ amount covered for fertility services

Fully paid maternal leave (days)

Fully paid paternal leave (days)

Fully paid adoptive leave (days)

Maternal leave in addition to regular time off (days)

Paid days off for volunteering

Best Workplaces In Technology

Sector

Current All-Star Rank

Previous All-Star Rank

Industry Rank

Previous Industry Rank

Overall Score

Innovation

People Management

Use of Corporate Assets

Social Responsibility

Quality of Management

Financial Soundness

Long-Term Investment Value

Quality of Products/Services

Global Competitiveness

Strongest Dimension

Previous rank

State

Best Workplaces In Texas

Earnings Per Share (last Fiscal Year)

Earnings Per Share ($)

EPS % Change (from prior fiscal year)

EPS % Change (5 year annual rate)

EPS % Change (10 year annual rate)

Total Return

Total Return to Investors (last year)

Total Return to Investors (5 year, annualized)

Total Return to Investors (10 year, annualized)

Hewlett Packard Enterprise focuses on enterprise IT solutions for customers across the Americas, Europe, the Middle East, and the Asia-Pacific region. The company delivers products and services related to cloud computing, servers, storage, networking, artificial intelligence, and more. HPE has developed several of the fastest supercomputers in the world. With origins tracing back to 1939, the company was spun off from PC manufacturer HP in 2015 and has since expanded through several acquisitions.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Hewlett Packard Enterprise (HPE): Company Profile, Stock Price, News, Rankings

legacy

hewlett packard enterprise

Good day, and welcome to the fiscal 2026 second quarter Hewlett Packard Enterprise Company earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star and then two. Please note this event is being recorded. I would now like to turn the conference over to Paul Glaser, Head of Investor Relations. Please go ahead, sir.

Good afternoon. I'm Paul Glaser, Head of Investor Relations for Hewlett Packard Enterprise. I would like to welcome you to our fiscal 2026 second quarter earnings conference call with Antonio Neri, HPE's President and Chief Executive Officer, and Marie Myers, HPE's Chief Financial Officer. Before handing the call to Antonio, let me remind you that this call is being webcast. A replay of the webcast will be available shortly after the call concludes. We have posted the press release and the slide presentation accompanying the release on our HPE Investor Relations webpage. Elements of the financial information referenced on this call are forward-looking and are based on our best view of our business and the external factors affecting us as we see them today. HPE assumes no obligation and does not intend to update any such forward-looking statements.

We also note that the financial information discussed on this call reflects estimates based on information available at this time and could differ materially from the amounts ultimately reported in HPE's quarterly report on Form 10-Q for the fiscal quarter ended April 30th, 2026. Figures used in verbal remarks are rounded for ease of discussion. For more detailed information, please see the earnings materials as well as disclaimers relating to forward-looking statements that involve risks, uncertainties, and assumptions. Please refer to HPE's filings with the SEC for more detailed discussion of these risks. For financial information that we are showing on a non-GAAP basis, we have provided reconciliations to the comparable GAAP information on our website. Please refer to the tables and slide presentation accompanying today's earnings release on our website for details. Throughout this conference call, all revenue growth rates, unless noted otherwise, are presented on a year-over-year basis.

Unless otherwise noted, all financial metrics and growth rates discussed today are non-GAAP, and EPS refers to non-GAAP diluted net earnings per share. Certain financial information featured in the presentation today has been normalized to include Juniper Networks' results as of the beginning of HPE's fiscal 2025. Antonio and Marie will reference our earnings presentation in their prepared comments. With that, let me turn it over to Antonio.

Thank you, Paul. Good afternoon, everyone. HPE delivered an exceptional quarter with record-breaking results, disciplined execution, and clear proof that our strategy is working. We made excellent progress in our Juniper integration and in our Catalyst initiative, with both running ahead of schedule. Revenue in the quarter reached $10.7 billion, up 40%. Non-GAAP earnings per share of $0.79 increased 108%, significantly above the high end of our outlook. We generated $915 million in free cash flow, an improvement of $1.8 billion, driven by strong cash from operations and improved cash conversion cycle performance. Demand was even stronger than revenue growth. Orders more than doubled, significantly outpacing revenue, resulting in a record company backlog. Customer investments in agentic AI and AI inferencing accelerated. We also saw broad-based demand strength across the portfolio, driven by ongoing investment in compute infrastructure modernization, unstructured storage data growth, and private cloud adoption for AI.

Last year at our Securities Analyst Meeting in New York, we laid out our strategy and fiscal 2028 financial commitments. Based on our strong first half 2026 results, our record backlog, and our visibility into the second half demand, we now expect to deliver $3.40 in non-GAAP earnings per share at the midpoint and at least $3.5 billion in free cash flow in fiscal 2026. That is two years ahead of our committed long-term plan. Marie will provide more detail on our third quarter and full year fiscal 2026 outlook, as well as our fiscal 2027 framework, which is grounded on durable customer demand and the profitability of both business segments. Now let me turn to our business segment highlights, starting with networking. I am particularly pleased with the progress we are making on the Juniper integration.

We are ahead of our integration milestones and synergies commitments, and the unified portfolio and sales force are already strengthening our market position and growth momentum. Our combined networking portfolio and vision for self-driving networks is resonating with customers, and that enthusiasm, together with strong go-to-market execution, is reflected in our results. Networking delivered revenue of $2.7 billion, up double digits on a normalized basis, with orders growing significantly faster than revenue. We saw increased demand in campus and branch, networks for AI, and security. I am pleased with the strong demand we saw from enterprise customers for our networking portfolio. Campus and branch orders reach a new record high, growing in the upper 20% range on a normalized basis. We won multimillion-dollar deals across multiple verticals, including retail, automotive, government, and technology. Wi-Fi 7 access points sales increased more than seven times, reflecting a clear shift toward network modernization.

HPE, for the 20th time in a row, was named a leader in the Gartner Magic Quadrant for Enterprise Wired and Wireless LAN Infrastructure. We believe this independent industry analyst validation reinforces how far ahead we are in enterprise networking beyond even incumbents. Customers trust us with their most critical networking infrastructure decisions as they expand their digital initiatives and AI investments. One customer taking advantage of the power of our combined campus and branch networking portfolio is Lowe's. With over 1,750 stores across North America, Lowe's chose HPE to deliver the network foundation for a major technology transformation to support its digital on-ramp and AI-enabled operations. The solution is built on our HPE Mist AI platform for wired and wireless networking infrastructure, alongside our HPE EdgeConnect SD-WAN solution.

Last month, we reached a milestone with the launch of new autonomous agents powered by agentic AI for optimizing networking performance. The self-driving network is no longer a concept. It is a reality. The U.K. Ministry of Justice is an early adopter example. It was able to reduce the number of incidents seen by its network operation center by approximately 75% after deploying a suite of solutions that included our new HPE self-driving network capabilities. In enterprise data center switching, orders increased nearly 20% on a normalized basis. Our data center switching pipeline remains strong. Cross-portfolio product integration and sales across server storage and networking are driving deeper customer engagement and larger deals. Security orders grew in the mid-teens on a normalized basis. We continue to make the network a first line of defense that responds to threats in real time.

This quarter, we launched the HPE Juniper SRX400 Series, bringing carrier-grade firewall protection to the branch for large distributed environments. We see significant runway as more customers consolidate networking and security with a single vendor, forcing convergence all the way to the silicon layer of the stack, where HPE will have further differentiation. In our service provider customer segment, revenue increased double digits on a normalized basis, with routing orders growing significantly faster than revenue. Routing orders increased nearly 30% on a normalized basis, driven by data center interconnect deployments in large cloud service providers. Customers are choosing HPE because we help them scale in every dimension. Scale up by increasing the performance and density of individual platforms for the most demanding AI workloads. Scale out by expanding the networking fabric to connect thousands of GPUs and accelerators within a single data center.

Scale across by extending high bandwidth interconnectivity between data centers, across campuses, and into the wide area network, so AI services can run wherever they are needed. HPE is developing a scale-up Ethernet switch and software designed specifically for the AMD Helios AI rack-scale architecture, which we expect will be introduced in the fall. In scale out, we lead with our AI-driven QFX Series switching fabric. HPE is the first OEM to productize a Tomahawk 6-based 100% liquid-cooled switch with industry-leading performance and power efficient for AI infrastructure. Our leading fabric management and AIOps capabilities reduce congestion, latency, as well as operational complexity. We expect our roadmap to extend this leadership through co-packaged optics, resulting in lower overall power consumption. In scale across, the Juniper PTX Series delivers 800 Gb density with exceptional power efficiency, leveraging our distinct express silicon and simplified AI native automation.

Because of our leading innovation and market momentum in Networks for AI, we are raising our cumulative fiscal 2026 Networks for AI order target to at least $2 billion. We are laser-focused on building the best networking business in the industry. Our priorities are clear. Extend AI-driven automation across the portfolio, help customers scale modern AI infrastructure with secure high-performance networking, and lead in the convergence of networking and security. We have the team, the capabilities, and the momentum to convert the opportunity in this segment into durable shareholder value. In our Cloud and AI business segment, we executed with strong discipline across all business lines. Revenue was $7.7 billion, up 23%, driven by exceptional traditional server orders and very strong demand in AI systems, Alletra MP Storage, Private Cloud, and GreenLake software and services.

Traditional server orders increased triple digits as customers continue to modernize their compute infrastructure and invest in AI inferencing. We are working very closely with our silicon and memory partners to continue to secure supply, which we factor into our new fiscal 2026 guide. We're also engaging customers and channel partners on lead times and configuration options to help them plan effectively. We saw strong demand in AI training throughout the quarter. We booked $1.8 billion in new AI systems orders, bringing cumulative AI systems bookings to $16.4 billion. We enter Q3 with $5.9 billion in backlog, primarily composed of enterprise and sovereign orders. We are seeing a broad pattern across industries. Enterprises want the flexibility of choosing multiple AI models with the governance and control of on-premises. We will continue to manage AI systems opportunities with a focus on profitable growth and prudent working capital management.

Storage had an outstanding quarter. Alletra MP storage orders increased triple digits, the sixth consecutive quarter of strong growth. Several weeks ago, we expanded the platform with new file storage and agentic AIOps capabilities. This extends Alletra MP into the growing unstructured data market. Our HPE Morpheus Enterprise and HPE VM Essentials software offerings continue to build momentum. Revenue grew sequentially for the fourth consecutive quarter. VM Essentials customer count increased 43% in the first half, with a notable rise in net new logos. Private Cloud AI orders increased again this quarter with a growing base of new customer wins. We recently launched our second-generation PCAI offering designed for enterprise AI inferencing and cloud gap sovereign environments, which position us for continued growth. More broadly, we are embedding agentic AI capabilities across our storage and data protection portfolio to help customers automate AI data pipelines and operations.

We continue to add new cloud and AI agentic services to our GreenLake cloud platform, acquiring new customers and increasing the net retention rates for our HPE GreenLake services business, which remains near 110%. We exited Q2 with approximately 50,000 customers operating their IT in our GreenLake cloud, managing more than 6.7 million systems, up from 5.3 million a year ago. One win that brings the power of the full HPE portfolio together is the Dallas Cowboys, the most valuable sports franchise in the world. They came to HPE with a clear objective: modernize their infrastructure, simplify operations, and build the right secure foundation for AI. We delivered a comprehensive solution anchored on our HPE GreenLake for Private Cloud offering, spanning HPE ProLiant servers, Alletra Storage MP, and HPE Morpheus Enterprise. The Cowboys are also adopting HPE Morpheus VM Essentials as their preferred virtualization layer.

This is a strong example of the value customers can unlock when they choose HPE as an end-to-end technology partner. Lastly, HPE Financial Services delivered another outstanding quarter with record return on equity. Financial Services deepens customer relationships, supports our GreenLake cloud adoption, and remains a meaningful competitive advantage as customers ramp their investment in AI. Before I close, I want to highlight two important upcoming events. In two weeks, we are hosting HPE Discover in Las Vegas. We will share updates on our networking, cloud, and AI strategies, including major product announcements along with a live Q&A for investors and analysts. I hope to see you there. Later this fall, we will host a dedicated Networking Investor Day. In closing, HPE delivered an exceptional quarter. Our results demonstrate that our strategy continues to pay off.

We now expect to significantly exceed our original fiscal 2028 non-GAAP earnings per share target and generate at least $3.5 billion in free cash flow in fiscal 2026, two years ahead of plan. The market trends driving our performance remain strong and well-aligned to our strategy. We expect demand strength to continue into fiscal 2027 and beyond, which will accelerate durable shareholder value as we continue to scale profitably.

We are executing with strong discipline, creating meaningful value from the Juniper acquisition and strengthening our position at the intersection of networking, cloud, and AI. With the combined strength of HPE and Juniper, we have the portfolio, the talent, and the go-to-market scale to lead in the market. I want to thank our team members for their focus and strong execution. With that, let me turn it to Marie to take you through the financial results and our 2026 and 2027 outlook.

Thank you, Antonio, and good afternoon, everyone. I'm pleased with our outstanding second quarter results. We exceeded our commitments, delivering record revenue and EPS, driven by disciplined execution and a strong demand environment. Our large backlog, favorable industry tailwinds, and improved demand visibility support a higher growth outlook. In addition, we are achieving Catalyst cost savings and Juniper synergies ahead of schedule. As a result, we are increasing our fiscal 2026 EPS outlook by over 40%. I will address the drivers behind the strong EPS and free cash flow outlook shortly. First, let's take a look at our Q2 performance. Revenue of $10.7 billion was above the high end of our guidance range, led by traditional server, as customers accelerated investments in agentic AI and AI inferencing, and by Networking, where we saw broad-based growth across the portfolio.

Sequentially, revenue grew 15%, reflecting higher average selling prices within our server business, driven by ongoing DRAM and NAND inflationary costs and supply constraints. We continue to work with our partners to secure long-term agreements while executing the pricing actions we discussed last quarter. Gross margin improved to 36.9%, driven by mix as we shape demand to higher margin products. Catalyst savings and Juniper-related Synergies also contributed to improvement on a year-over-year basis. Operating profit was $1.4 billion, above our expectations, representing a 13.3% operating margin. As the company scales and we continue to capture accelerated Catalyst cost savings and Juniper Synergies, we expect operating profit growth to continue to outpace our top line. EPS was $0.79, well above the high end of our guidance. GAAP EPS was $0.44. We delivered Q2 free cash flow of $915 million, fueled by strong operating profit.

Now let's turn to our segment results. Networking delivered another solid quarter. Revenue of $2.7 billion was up 10% on a normalized basis as growth accelerated. Our backlog continues to grow given elevated demand and supply constraints. This is reflected in the greater than 40% sequential growth we saw in our purchase commitments. We continue to see strong demand for our networks for AI portfolio. Now expect cumulative orders to reach at least $2 billion by fiscal year-end 2026. Within our product categories, campus and branch normalized revenue growth accelerated to 10%, anchored by large deals across multiple industries. Security growth inflected positively to 18%, benefiting from improved backlog conversion and solid in-quarter demand. Data center networking and routing grew 6% and 9% respectively, reflecting robust networks for AI demand. We are optimistic about the demand momentum we are seeing based on our growing pipeline.

Hewlett Packard Enterprise (HPE) Q2 2026 Earnings Call Transcript

Company Participants