Executive Summary
Hewlett Packard Enterprise (HPE) reported a solid Q3 2024 (QQ3 2024) with revenue of USD 7.71 billion and a healthy gross margin of 31.6%, delivering an operating margin of 7.1% and net margin near 6.6%. Year-over-year revenue growth of 10.1% and quarter-over-quarter growth of 7.35% reflect continued demand for data center modernization, AI-enabled workloads, and hybrid IT solutions, supported by strength in HPE’s portfolio of ProLiant servers, HPC/Cray offerings, and Aruba networking. Operating cash flow of USD 1.15 billion and free cash flow of USD 0.61 billion underline robust cash generation, enabling discretionary capital allocation including modest buybacks and sustained dividend policy, while leaving room to fund ongoing strategic initiatives.
Balance sheet and liquidity remain solid: total assets USD 60.85 billion, cash and cash equivalents USD 3.64 billion, and total debt USD 11.80 billion (net debt USD 8.16 billion). The company posted a positive net cash delta in the quarter (USD 0.98 billion), supported by operating cash flow and disciplined capital expenditure (USD 0.54 billion). The reported metrics imply a business that is navigating a competitive, cyclical market with a focus on high-margin, high-value solutions and coherent capital allocation.
Going forward, management commentary (when available) would likely emphasize continued demand for data center modernization, AI-ready infrastructure, and Aruba edge networking, along with potential monetization of as-a-service offerings (e.g., GreenLake). The primary factors to monitor are demand visibility in server and HPC markets, supply chain normalization, currency effects, and the pace of diversification into software and as-a-service recurring revenue streams.
Key Performance Indicators
Key Insights
Revenue: USD 7.71B; YoY +10.11%; QoQ +7.35%.
Gross Profit: USD 2.439B; Gross Margin 31.63%; YoY -2.83%; QoQ +6.65%.
Operating Income: USD 0.547B; Operating Margin 7.09%; YoY +16.14%; QoQ +13.49%.
Net Income: USD 0.512B; Net Margin 6.64%; YoY +10.34%; QoQ +63.06%.
EPS: USD 0.39 (diluted USD 0.38); YoY +8.33%; QoQ +62.50%.
EBITDA: USD 1.227B; EBITDA Margin 15.9%.
Cash Flow: Operating cash flow USD 1.154B; Free cash flow USD 0.611B; Net change in cash USD +0.981B; Cash at end of period USD 3.905B.
...
Financial Highlights
Revenue: USD 7.71B; YoY +10.11%; QoQ +7.35%.
Gross Profit: USD 2.439B; Gross Margin 31.63%; YoY -2.83%; QoQ +6.65%.
Operating Income: USD 0.547B; Operating Margin 7.09%; YoY +16.14%; QoQ +13.49%.
Net Income: USD 0.512B; Net Margin 6.64%; YoY +10.34%; QoQ +63.06%.
EPS: USD 0.39 (diluted USD 0.38); YoY +8.33%; QoQ +62.50%.
EBITDA: USD 1.227B; EBITDA Margin 15.9%.
Cash Flow: Operating cash flow USD 1.154B; Free cash flow USD 0.611B; Net change in cash USD +0.981B; Cash at end of period USD 3.905B.
Balance Sheet: Total assets USD 60.852B; Total liabilities USD 38.718B; Total stockholders’ equity USD 22.077B.
Liquidity & Leverage: Cash & equivalents USD 3.642B; Total debt USD 11.803B; Net debt USD 8.161B; Current ratio 0.939; Quick ratio 0.617; Cash ratio 0.130.
Return & Efficiency: ROA 0.84%; ROE 2.32%; ROCE 1.48%; Gross margin 31.6%; Operating margin 7.09%; Net margin 6.64%.
Valuation Snapshots: P/E 13.03x; P/B 1.21x; P/S 3.46x; P/FCF 43.69x; EV/EBITDA 28.82x; Dividend yield 0.63%.
Cash Flow / Capex: Capital expenditure USD 0.543B; Free cash flow yield supported by operating cash flow; FCF per share USD 0.453; Cash per share USD 2.18.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
7.71B |
10.11% |
7.35% |
| Gross Profit |
2.44B |
-2.83% |
6.65% |
| Operating Income |
547.00M |
16.14% |
13.49% |
| Net Income |
512.00M |
10.34% |
63.06% |
| EPS |
0.39 |
8.33% |
62.50% |
Key Financial Ratios
operatingProfitMargin
7.09%
operatingCashFlowPerShare
$0.86
freeCashFlowPerShare
$0.45
Management Commentary
No earnings call transcript data was provided in the input. Consequently, no management quotes or verbatim insights can be quoted here. If transcript text becomes available, this section will be populated with thematically grouped quotes (e.g., strategy execution, operating efficiency, data center demand, AI adoption, and capital allocation) alongside context and significance.
Forward Guidance
Explicit forward guidance was not included in the supplied materials. Based on the quarterly momentum and the company’s product portfolio, the plausible drivers of upside include sustained data center modernization expenditure, growth in AI-ready infrastructure and HPC deployments, and ongoing Aruba networking expansion. Potential headwinds include macro demand softness, supply chain volatility, and currency translation effects. Investors should monitor management commentary on order momentum, backlog development, GreenLake/recurring revenue uptake, and the pace of cost discipline versus investment in growth initiatives. In the absence of formal guidance, a cautious baseline assumes continued mid-single-digit revenue progression with margin resilience around the 7% operating margin range and FCFF generation supported by disciplined capex and working capital management.