Hewlett Packard Enterprise Co, the division handling enterprise software and hardware under Hewlett Packard Co., announced a lesser than expected profit forecast. As a result, company’s share took a massive nosedive, falling as much as 1.9% post bell, said a report from Reuters.
It has however been a mixed day for HP. While its Enterprise division did report a poor profit forecast, the company was still able to beat analyst estimates for the fourth-quarter ended Oct. 31 by 1 cent with earnings of 61 cents per share, excluding items.
HPE said it expects first-quarter adjusted profit between 42 cents and 46 cents. This is low, considering that analysts had expected profit of 46 cents per share on an average, according to Thomson Reuters I/B/E/S.
Revenues too received a massive fall for HPE, as they fell by as much as 7.2 percent to $12.48 billion in the very first year of its existence as a stand-alone company. The company was primarily hurt by weak demand for storage and networking equipment, and growing competition from various providers in the cloud services domain, as more and more businesses move to cloud.
Moving ahead under an all new CEO in Meg Whitman, HP Enterprise has had to sell off most of its software businesses, including its computing services unit, since the company spun off from Hewlett-Packard Co in 2015.
HP Enterprise — for those who are unaware — is a spin-off from the core Hewlett Packard brand, and has forged its own business model around software and infrastructure needs for cloud, network and enterprises. Thus, it will be retaining any and all assets related to the cloud and infrastructure business, but will spin-off assets including Application Delivery Management, Big Data, Enterprise Security, Information Management, Governance and IT Operations.