Hewlett Packard Enterprise beats quarterly outcomes estimates on sturdy AI server demand

(Reuters) – Hewlett Packard Enterprise (NYSE:HPE) beat Wall Road expectations for fourth-quarter income and revenue on Thursday, because it advantages from sturdy demand for its servers used to energy synthetic intelligence functions.

Shares of the corporate rose round 1.5% in prolonged buying and selling.

Demand for HPE’s servers, outfitted with Nvidia (NASDAQ:NVDA) processors, has remained wholesome as enterprises make investments closely in {hardware} that may help and course of the swathes of information utilized in coaching AI fashions.

Regardless of a weaker efficiency, HPE has been seeing an enchancment in its Clever Edge enterprise, which offers networking {hardware} resembling switches and Wi-Fi entry factors.

Clever Edge income fell 20% to $1.12 billion within the fourth quarter.

HPE finalized a deal in the beginning of the 12 months to accumulate networking tools maker Juniper Networks (NYSE:JNPR), in a transfer to spice up its networking market share in a aggressive trade. 

Whole (EPA:TTEF) income for the fourth quarter got here in at $8.46 billion, beating estimates of $8.26 billion, as per information compiled by LSEG. 

Server income rose 32% to $4.71 billion within the quarter ended Oct. 31.

For the primary quarter, HPE expects income to develop within the mid-teens p.c, roughly in step with analysts’ estimates.

On an adjusted foundation, the corporate earned 58 cents per share, beating estimates of 56 cents apiece.