HPE Posts Strong Results As Networking Drives Growth

Hewlett Packard Enterprise kicked off fiscal 2026 with a quarter that looked solid on the surface and even better once the cash generation showed up. Hewlett Packard Enterprise reported fiscal first-quarter 2026 revenue of $9.3 billion, up 18% from a year earlier, while non-GAAP diluted EPS came in at $0.65, above the company’s prior outlook range of $0.57 to $0.61. The company also generated $1.2 billion in operating cash flow and $0.7 billion in free cash flow. Taken together, the quarter suggested the business had more momentum than the market may have been pricing in.

HPE’s overall results were strong, but networking was the segment that really stood out. Networking revenue jumped to $2.7 billion, up 151.5% year over year, including 42.0% growth in Campus & Branch, 382.6% growth in Data Center Networking, and 114.3% growth in Security. HPE said orders increased double digits across all segments, while management pointed to strong demand, cost discipline, and faster-than-planned Juniper and Catalyst synergies. Cloud & AI revenue was $6.3 billion, down 2.7% from a year earlier, but its operating profit margin improved to 10.2% from 8.4%. That gave the quarter a more convincing shape, with networking providing the clearest evidence that demand is translating into traction.

With the quarter in the bag, HPE moved quickly on to what comes next. For fiscal Q2, the company guided revenue to $9.6 billion to $10.0 billion and non-GAAP diluted EPS to $0.51 to $0.55. For the full year, HPE reaffirmed its expected 17% to 22% revenue growth range, raised its networking growth outlook to 68% to 73%, lifted its non-GAAP EPS outlook to $2.30 to $2.50, and now expects at least $2.0 billion of free cash flow. It also declared a regular quarterly dividend of $0.1425 per share, a 9.6% increase from previous distributions. HPE did not just report a solid quarter — it handed investors a better measuring stick and stronger proof points across the business.

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