By Angela Palumbo

Hewlett Packard Enterprise stock was rising Monday after the information technology company reported better-than-expected earnings.

HPE reported fiscal first-quarter earnings of 65 cents a share, beating analyst estimates of 59 cents a share. Revenue in the quarter of $9.3 billion just missed Wall Street expectations of $9.35 billion.

Shares were up 2.1% in after-hours trading following the results.

"It was a very strong quarter for HPE," CEO Antonio Neri told Barron's on Monday. "We grew revenues with addition of Juniper, but we have strong momentum across both segments."

Total revenue was up 18% from the prior year, mostly driven by the company's networking segment, which has grown thanks to the recent acquisition of Juniper Networks. Networking revenue for the quarter of $2.7 billion jumped 152% from the previous year.

Within the company's cloud and artificial intelligence segment, though, server revenue dropped 2.7% from the prior year to $4.2 billion. Neri told Barron's that it ended the quarter with an AI backlog of $5 billion, but most of the backlog is with government and enterprise customers. These orders can take time to complete.

Neri said on the last earnings call in December that "the back end of the year will have the biggest part of the AI revenue conversion." Neri confirmed to Barron's on Monday that is still expected.

On top of wanting to see strong first-quarter results, shareholders were looking for updates on how HPE has been managing a rising memory cost environment. The company has previously said it was raising prices and working with suppliers to offset these headwinds.

"Prices will continue to go up," Neri said. He added he expects memory problems to remain well into 2027, but says these cost headwinds are already factored into the company's guidance.

HPE raised its adjusted earnings guidance for the fiscal year on Monday. It now expects fiscal 2026 earnings to be between $2.30 a share to $2.50 a share, compared to prior estimates of $2.25 a share to $2.45 a share. This new guidance is higher than the consensus call among analysts for earnings of $2.34 a share.

Write to Angela Palumbo at angela.palumbo@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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March 09, 2026 17:14 ET (21:14 GMT)

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