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Hewlett Packard Enterprise (HPE) Is Up 11.3% After Raising 2026 Guidance And Doubling Down On AI

Simply Wall St · 2d ago
  • In early December 2025, Hewlett Packard Enterprise reported fourth-quarter sales of US$9,679 million and full-year sales of US$34,296 million, alongside sharply lower profitability, while simultaneously raising its fiscal 2026 earnings guidance and increasing its regular cash dividend to US$0.1425 per share.
  • At the same time, HPE used its Discover Barcelona 2025 event to showcase an expanded GreenLake cloud portfolio, AI-native networking advances, and new AI infrastructure collaborations with NVIDIA and AMD, signaling a concerted push into hybrid cloud and AI-centric data center solutions.
  • We’ll now examine how HPE’s upgraded 2026 earnings guidance and AI-focused product launches may influence its pre-existing investment narrative.

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Hewlett Packard Enterprise Investment Narrative Recap

To own HPE today, you need to believe its pivot toward hybrid cloud, AI infrastructure, and higher-margin software can offset pressure on traditional hardware and near-term profitability. The latest results highlight this tension: revenue is rising, but full-year earnings swung to a small loss, so the upgraded 2026 EPS guidance becomes the key short term catalyst, while execution risk around turning that guidance into sustainable profit and cash flow, amid heavy AI and networking investment, remains the biggest near term concern.

Among the recent announcements, the expansion of HPE GreenLake and its AI-native networking at Discover Barcelona looks most relevant, because it directly speaks to the core catalyst of shifting HPE’s mix toward recurring, higher-margin hybrid cloud and AI services. If these offerings gain traction with enterprises that want more control than hyperscale public cloud can provide, they could help bridge the gap between HPE’s ambitious 2026 earnings targets and its currently thin profitability.

Yet beneath the upbeat guidance, investors should also be aware of how higher debt and integration risk could pressure HPE if...

Read the full narrative on Hewlett Packard Enterprise (it's free!)

Hewlett Packard Enterprise's narrative projects $44.4 billion revenue and $2.7 billion earnings by 2028. This requires 10.3% yearly revenue growth and an earnings increase of about $1.6 billion from $1.1 billion today.

Uncover how Hewlett Packard Enterprise's forecasts yield a $26.28 fair value, a 6% upside to its current price.

Exploring Other Perspectives

HPE 1-Year Stock Price Chart
HPE 1-Year Stock Price Chart

Five fair value estimates from the Simply Wall St Community span roughly US$17.90 to US$36.64, underscoring how far apart individual views on HPE can be. Against that backdrop, HPE’s push into AI centric infrastructure and GreenLake based recurring revenue becomes a crucial lens for thinking about whether its current profitability slump is temporary or more structural, so it pays to weigh several perspectives before deciding how this story fits into your own portfolio.

Explore 5 other fair value estimates on Hewlett Packard Enterprise - why the stock might be worth as much as 48% more than the current price!

Build Your Own Hewlett Packard Enterprise Narrative

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.