Hewlett Packard Enterprise Reports Fiscal 2015 Q4 Segment Results and Reaffirms Fiscal 2016 Outlook

• Delivers second consecutive quarter of Hewlett Packard Enterprise segment revenue growth in constant currency in fiscal 2015 fourth quarter

• Reaffirms 2016 Full Year Outlook of $1.85 - $1.95 in non-GAAP diluted net earnings per share

PALO ALTO, Calif., Nov. 24, 2015 – Hewlett Packard Enterprise (NYSE: HPE) today provided an update on its fiscal 2015 fourth quarter segment results, reaffirmed its fiscal 2016 outlook and provided its outlook for the fiscal 2016 first quarter.

“Hewlett Packard Enterprise is off to a very strong start,” said Meg Whitman, president and chief executive officer, Hewlett Packard Enterprise. “The new company’s business segments delivered a second consecutive quarter of constant currency revenue growth in Q4, and we believe that momentum will accelerate into FY16.”

Fiscal 2015 Fourth Quarter Hewlett Packard Enterprise Segment Results During the fiscal 2015 fourth quarter, Hewlett Packard Enterprise operated as part of Hewlett-Packard Company, and its results were consolidated within Hewlett-Packard Company results. Full Hewlett-Packard Company fourth quarter financial results can be found at HP.com by clicking on “Investor relations”.

In the fiscal 2015 fourth quarter, total revenue from Hewlett Packard Enterprise segments was $14.1 billion, down 4% year over year, or up 3% in constant currency. This is the second consecutive quarter of year over year, constant currency revenue growth for the Hewlett Packard Enterprise segments.

Business segment results are as follows:

• Enterprise Group revenue was $7.4 billion, up 2% year over year, up 9% in constant currency, with a 14.0% operating margin. Industry Standard Servers revenue was up 5%, up 13% in constant currency, Storage revenue was down 7%, flat in constant currency, Business Critical Systems revenue was down 8%, down 2% in constant currency, Networking revenue was up 35%, up 43% in constant currency, and Technology Services revenue was down 11%, down 4% in constant currency.
• Enterprise Services revenue was $5.0 billion, down 9% year over year, down 2% in constant currency, with an 8.2% operating margin. Infrastructure Technology Outsourcing revenue was down 11%, down 4% in constant currency, and Application and Business Services revenue was down 5%, up 1% in constant currency.
• Software revenue was $958 million, down 7% year over year, down 2% in constant currency, with a 30.1% operating margin. License revenue was down 6%, down 2% in constant currency, support revenue was down 9%, down 4% in constant currency, professional services revenue was down 3%, up 4% in constant currency, and software-as-a-service (SaaS) revenue was down 2%, down 2% in constant currency.
• HP Financial Services revenue was $802 million, down 11% year over year, down 4% in constant currency with a 2% increase in net portfolio assets and a 4% decrease in financing volume. The business delivered an operating margin of 10.8%.

Fiscal 2015 Results

On a pro-forma basis, Hewlett Packard Enterprise estimates its total contribution to Hewlett-Packard Company fiscal 2015 non-GAAP diluted net EPS was approximately $1.84, within the range provided at the Hewlett-Packard Company Securities Analyst Meeting in September.

The unaudited pro forma Hewlett Packard Enterprise fiscal 2015 non-GAAP diluted net earnings per share information presented is based on its estimated contribution to Hewlett-Packard Company’s fiscal 2015 non-GAAP diluted net EPS as adjusted to give effect to the separation transaction effective on November 1, 2015. The pro forma amounts do not necessarily reflect what the fiscal 2015 non-GAAP diluted net EPS of Hewlett Packard Enterprise would have been had the separation occurred on November 1, 2014. They also may not be useful in predicting the future financial condition and results of operations of the separate companies. The actual financial position and results of operations as reported in Hewlett Packard Enterprise’s Annual Report on Form 10-K and other filings with the Securities and Exchange Commission may differ significantly from the pro forma amounts reflected herein due to a variety of factors.

In fiscal 2015, Hewlett Packard Enterprise operated as part of Hewlett-Packard Company. Hewlett Packard Enterprise provided detailed information in its Registration Statement on Form 10 and additional information will be available in the first Form 10-K filing for Hewlett Packard Enterprise in December. Beginning in the first quarter of fiscal 2016, Hewlett Packard Enterprise will begin reporting detailed quarterly financial results.

Fiscal 2016 First Quarter and Full Year Outlook

For fiscal 2016, Hewlett Packard Enterprise affirmed the non-GAAP diluted net EPS outlook announced in September. Hewlett Packard Enterprise estimates non-GAAP diluted net EPS to be in the range of $1.85 to $1.95 and GAAP diluted net EPS to be in the range of $0.75 to $0.85. Fiscal 2016 non-GAAP diluted net EPS estimates exclude after-tax costs of approximately $1.10 per share, related to restructuring charges, the amortization of intangible assets, separation costs and acquisition-related charges.

For the fiscal 2016 first quarter, Hewlett Packard Enterprise estimates non-GAAP diluted net EPS to be in the range of $0.37 to $0.41 and GAAP diluted net EPS to be in the range of $0.09 to $0.13. Fiscal 2016 first quarter non-GAAP diluted net EPS estimates exclude after-tax costs of approximately $0.28 per share, related to restructuring charges, the amortization of intangible assets, separation costs and acquisition-related charges.