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Hewlett Packard Enterprise: Fiscal 2Q16 Financial Results

Lowest quarterly storage revenue since 1FQ13 - not including 2FQ15

(in $ million) 2Q15 2Q16 6 mo. 15 6 mo. 16
Storage revenue 740 752 1,577 1,562
Growth   2%   -1%

Hewlett Packard Enterprise Development LP (HPE) announced financial results for its fiscal 2016 second quarter, ended April 30, 2016.

Officially, the company stated that quarterly storage revenue was $752 million for the period, up 2% Y/Y, up 5% in constant currency, and down 7% Q/Q.

The problem here is that, once more, HPE has modified the figures of the preceding quarters for its storage revenue. For the former 1FQ16, the firm announced $863 million for the three-month period, now it’s only $810 million. It’s curious to see a public company doing this kind of manipulation to diminish the percentage of decrease in revenue.  

If we consider the $863 million figure, storage sales of HPE are down 13% Q/Q, not 7%.

Finally, the reality is that storage is a stabilized business since 2013. $752 million for the most recent quarter is the lowest quarterly revenue since 1FQ13 – not including 2FQ15 ($740 million)

Based this time on $752 million for the most recent quarter, the company stated that converged revenue was $406 million, +14% Y/Y, and traditional revenue of $346 million, -10% Y/Y.

Storage represents now 11% of the HPE Enterprise Group.

Meg Whitman, president and CEO, comments: “In storage, HPE is the only major vendor to gain share in external disk over the last two years, while EMC, NetApp, IBM and Dell lost share year over year. Revenue in our 3PAR all-flash business grew nearly triple digits, about two times faster than the market, and is once again expected to be larger and faster-growing than Pure.”

Tim Stonesifer, CFO, added: “We estimate that we gained market share in the external disk for the 10th consecutive quarter, and expect storage to gain share throughout the remainder of the year on the strength of the 3PAR portfolio and new logo wins, as we take advantage of the uncertainty surrounding the Dell/EMC merger.”

Maybe HPE is doing better than most of its biggest competitors, but into a shrinking global market .

Quarterly revenue for HP storage only
(without services, in $ million)

Fiscal quarter
Revenue
Q/Q
Growth
1Q13 833 -12%
2Q13 857 3%
3Q13 833 -3%
4Q13 952 14%
1Q14 834 -12%
2Q14 808 -3%
3Q14 796 -1%
4Q14 878 10%
1Q15 837 -5%
2Q15 740 -12%
3Q15 784 6%
4Q15 905 3%
1Q16 863 3%
2Q16 752 -13%

To read the earnings call transcript

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