Hewlett Packard Enterprise stock soars on earnings, guidance

Shares of Hewlett Packard Enterprise (HPE) jumped after reporting better-than-expected second quarter earnings. The tech company also issued Q3 and full-year guidance that was more optimistic than Wall Street had been expecting.

In the video above, Yahoo Finance's Madison Mills and Brad Smith explain how AI is giving HPE a boost.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Stephanie Mikulich.

Transcription de la vidéo

Hewlett Packard shares surging after the company lifting its full year guidance, getting a boost in the second quarter here in the quarter from strong demand rather from its artificial intelligence servers, which are powered by NVIDIA.

No surprise there.

All of this comes together, right strong and video demand leading to a lot of a I usage, leading to a lot of server usage.

Great news for Hewlett Packard.

The stock is up 16%.

That is the biggest gain Brad for this company since 2016.

So this is a huge boon for that.

They were anticipating a revenue Wall Street was anticipating rather a projected 2% decline in year on year revenue, and they ended up seeing a 3.3% increase.

So a huge overview there?

Yeah, absolutely.

And you look out to the revenue guidance that they're looking at for their fiscal Q three as well, 7.4 billion to 7.8 billion.

So it signals that they're continuing some anticipated or anticipating some continuing growth there.

They also in that a I systems revenue.

They saw that more than double sequential the over $900 million so that, uh a massive figure as you think about how many consumers of the HP Enterprise Solutions are really trying to figure out how they can best implement a A I strategy, whatever that may look like right now.

Um and so H PE is certainly benefiting from that.

But I mean, this still comes back to the server revenue business here.

$3.9 billion of that 7.2 billion total figure for the quarter.

And it starts to paint this picture of a of non ending ability of demand to continue to go up and up and up and when there's not necessarily going to be continued supply.

So H PE, Super Micro Dell So many of these companies that are going to benefit from the A i server rally Super Micro, really outperforming those names that I just mentioned and H PE kind of just getting in the race here.

When you look at those stocks year to date really H PE under performing the others.

But this could be a sign of more growth to come