Hewlett Packard Enterprise Tumbles on Disappointing FY2026 Guidance

Hewlett Packard Enterprise (NYSE: HPE) shares slid ~9% premarket after the company’s Securities Analyst Meeting in New York revealed a weaker-than-expected outlook for fiscal 2026, disappointing Wall Street.

At the event, HPE projected revenue growth of 5%–10% for FY2026 — well below the ~18% consensus expectation from Bloomberg data.

Earnings and Cash Flow Miss Analyst Estimates

The company forecasted earnings per share of $2.20–$2.40, below Bloomberg’s analyst consensus of $2.41 per share.
It also guided free cash flow between $1.5 billion and $2 billion, sharply undercutting the $2.41 billion analysts had expected.

Despite the weak outlook, HPE announced a 10% dividend increase and said it expects free cash flow to reach $3.5 billion by FY2028, but that long-term optimism failed to offset near-term investor disappointment.

AI Hardware Pressure Weighs on Margins

As one of the leading computing and server manufacturers, HPE continues to face margin pressure tied to rising AI chip costs and data center buildouts.

The company’s lower guidance underscores the short-term profitability strain of integrating high-cost AI infrastructure, a challenge shared by peers like Dell Technologies (DELL) and Super Micro Computer (SMCI).