HP Enterprise Stock Climbs 14% in 2025 on Soaring AI Server Demand and Earnings Beat

Watch the measured move price target for HP Enterprise shares.

Highlights

• HP Enterprise (HPE) stock jumped more than 14% in pre-market trading after reporting quarterly earnings that surpassed Wall Street forecasts and raising its full-year revenue outlook.
• In the quarter ending April 30, HPE’s server revenue grew 18% year-over-year to $3.9 billion, with AI systems revenue doubling sequentially to over $900 million, fueled by escalating demand for AI servers.
• CEO Antonio Neri revealed the backlog of AI server orders remained steady compared to Q1, while the pipeline of new orders surged several times above the backlog, signaling robust future growth.
• Technical analysis suggests a potential price target of $25, based on a breakout from an ascending triangle pattern on the weekly chart.

Hewlett Packard Enterprise experienced a significant pre-market rally exceeding 14% as investors reacted to stronger-than-expected quarterly results and optimistic guidance amidst growing AI server demand in 2024. Adjusted earnings per share reached $0.42, outpacing analyst estimates, while total revenue climbed 3% year-over-year to $7.2 billion, beating consensus forecasts of $6.8 billion.

Server segment revenues surged 18% to $3.9 billion, and AI system sales more than doubled sequentially, surpassing $900 million. This growth was supported by improved supply of Nvidia’s H100 chips, integral to HPE’s AI server infrastructure.

Robust AI Server Order Pipeline Strengthens Outlook

Since the start of fiscal 2023, HPE has amassed $4.6 billion in cumulative AI system orders. CEO Antonio Neri highlighted that while the current AI server backlog remains steady compared to Q1, the new order pipeline is multiple times larger, reflecting accelerating demand.

For the upcoming quarter, HPE projects net sales between $7.4 billion and $7.8 billion, with adjusted earnings expected to range from $0.43 to $0.48 per share, closely aligning with analyst projections. The company also revised its full-year 2024 revenue growth forecast upward to 1%-3%, from a previous 0%-2%, and increased adjusted earnings guidance to $1.85-$1.95 per share.

Technical Breakout Signals New All-Time High Potential

Analyzing the weekly chart, HPE shares have traded within an ascending triangle since January 2022, consistently staying above the 200-week moving average. The anticipated earnings-driven breakout from this pattern marks a pivotal technical advancement, potentially pushing the stock to a new all-time high.

Investors can estimate the breakout price target by measuring the triangle’s widest range and adding it to the breakout point near $18, projecting a target of approximately $25.

Disclaimer: The insights and opinions shared on ZAMONA are for informational purposes only. Please review our warranty and liability disclaimer for details.

As of this article’s publication, the author holds no positions in the securities mentioned.

Have a news tip for ZAMONA? Email us at tips@ZAMONA

Discover the latest news and current events in Markets News as of 07-04-2024. The article titled " HP Enterprise Stock Climbs 14% in 2025 on Soaring AI Server Demand and Earnings Beat " provides you with the most relevant and reliable information in the Markets News field. Each news piece is thoroughly analyzed to deliver valuable insights to our readers.

The information in " HP Enterprise Stock Climbs 14% in 2025 on Soaring AI Server Demand and Earnings Beat " helps you make better-informed decisions within the Markets News category. Our news articles are continuously updated and adhere to journalistic standards.