Summary
Hewlett Packard Enterprise Company (HPE) filed its 2016 10-K report on December 15, 2016, detailing its operations and financial performance for the fiscal year ended October 31, 2016. The company underwent a significant separation from its former parent, HP Inc., on November 1, 2015, operating as an independent entity thereafter. A key strategic focus for HPE during this period was the planned separation and merger of its Enterprise Services (ES) business with Computer Sciences Corporation (CSC) and its Software segment with Micro Focus International plc. These transactions were expected to deliver substantial value to shareholders and reshape HPE's operational focus. The report also highlights HPE's diverse business segments: Enterprise Group (EG), Enterprise Services (ES), Software, Financial Services (FS), and Corporate Investments, detailing their respective revenue contributions and operational performance. Investors should note the company's ongoing efforts to navigate market shifts towards cloud computing and evolving IT consumption models, alongside intense competition. The report provides insights into the company's financial health, liquidity, and risk factors, including those related to its strategic divestitures and the broader macroeconomic environment.
Financial Highlights
53 data points| Revenue | $30.28B |
| Cost of Revenue | $13.04B |
| Gross Profit | $17.24B |
| R&D Expenses | $1.71B |
| SG&A Expenses | $5.38B |
| Operating Expenses | $26.38B |
| Operating Income | $3.90B |
| Interest Expense | $547.00M |
| Net Income | $3.16B |
| EPS (Basic) | $1.84 |
| EPS (Diluted) | $1.82 |
| Shares Outstanding (Basic) | 1.72B |
| Shares Outstanding (Diluted) | 1.74B |
Key Highlights
- 1HPE completed its separation from HP Inc. on November 1, 2015, becoming an independent, publicly traded company.
- 2Plans were announced for the spin-off and merger of the Enterprise Services (ES) business with Computer Sciences Corporation (CSC), expected to deliver approximately $8.5 billion to shareholders.
- 3Plans were also announced for the spin-off and merger of the Software segment with Micro Focus International plc, expected to deliver approximately $8.8 billion to shareholders.
- 4Net revenue for fiscal year 2016 was $50.1 billion, a decrease of 3.8% compared to fiscal year 2015, primarily due to unfavorable currency fluctuations and divestitures.
- 5Gross margin improved slightly to 29.2% in fiscal year 2016 from 28.7% in fiscal year 2015, driven by service delivery efficiencies.
- 6Operating margin saw a significant increase of 5.4 percentage points in fiscal year 2016, largely due to gains from divestitures.
- 7The company held approximately $13.0 billion in cash and cash equivalents and investments as of October 31, 2016, an increase from the previous year.