Forward -looking statements You'll hear some forward -looking statements in today's presentation. All statements other than statements of historical fact are statements that could be deemed forward -looking statements. Our actual results could differ materially and we assume no obligation to update. Financial information, plans, and projections reflect estimates based on information available at the time of this presentation. These are based on risks and assumptions that may not prove correct. These risks a ...

Core Insights - Dell Technologies and Hewlett-Packard Enterprise are significant players in the AI infrastructure market, with Dell focusing on AI-optimized infrastructure and edge computing, while HPE emphasizes hybrid cloud and edge computing platforms like GreenLake [1][2] Dell Technologies - Dell is experiencing strong demand for AI servers, driven by digital transformation and interest in generative AI applications [3] - In Q2 of fiscal 2026, Dell shipped $8.2 billion in AI servers, with a $5.6 billion increase in orders and an AI backlog of $11.7 billion [4][11] - The company delivered $10 billion worth of AI-optimized servers in the first half of fiscal 2026 and projects $20 billion in shipments for the entire fiscal year [5][11] - Dell introduced the PowerEdge XR8720t, the first single-server solution for Open RAN and Cloud RAN, enhancing performance and reducing costs for telecom and edge deployments [6] Hewlett-Packard Enterprise - HPE's server segment sales increased by 16% year over year to $4.94 billion in Q3 of fiscal 2025, driven by strong demand for AI servers [7][11] - The company launched advanced servers equipped with NVIDIA RTX PRO 6000 Blackwell and NVIDIA Blackwell Ultra platforms tailored for AI workloads [8] - HPE's GreenLake platform benefits from a robust demand environment as customers undergo digital transformation [9] Market Performance - Year-to-date, Dell's shares have increased by 30.7%, while HPE's shares have risen by 14.3%, with Dell outperforming due to strong AI server demand [12] - Dell's shares are trading at a forward Price/Sales ratio of 0.90X, compared to HPE's 0.81X, indicating a more favorable valuation for Dell [15] Earnings Estimates - The Zacks Consensus Estimate for Dell's fiscal 2026 earnings is $9.54 per share, reflecting a 17.20% year-over-year increase [17] - In contrast, HPE's fiscal 2025 earnings estimate is $1.90 per share, indicating a 4.52% decline year over year [17] Conclusion - Both companies benefit from the expanding AI infrastructure market, but Dell's robust portfolio and expanding partner base position it as a more attractive option for long-term investors [18]

Core Viewpoint - Hewlett Packard Enterprise (HPE) reported better-than-expected Q3 fiscal 2025 results, with significant revenue growth driven by its Server, Hybrid Cloud, and Financial Services segments, despite a year-over-year decline in non-GAAP earnings per share [3][4]. Financial Performance - HPE's non-GAAP earnings were 44 cents per share, beating estimates by 2.3% but down 12% year-over-year [3]. - Revenues increased 19% year-over-year to $9.1 billion, surpassing estimates by 4.1% [4]. Segment-Wise Performance - **Server Segment**: Sales rose 16% year-over-year to $4.94 billion, driven by strong demand for AI servers, with an operating profit margin of 6.4%, down 440 basis points from the previous year but up 50 basis points sequentially [5]. - **Networking Division**: Revenues increased 54% year-over-year to $1.73 billion, with an operating profit margin of 20.8%, contracting 160 basis points year-over-year [6]. - **Hybrid Cloud Division**: Sales grew 12% year-over-year to $1.48 billion, with an operating profit margin of 5.9%, up 70 basis points year-over-year [7]. - **Financial Services Segment**: Revenues of $886 million increased 1% year-over-year, with an operating margin of 9.9%, expanding 90 basis points year-over-year [8]. Operating Results - Non-GAAP gross profit was $2.73 billion, up 11.5% year-over-year, with a gross margin of 29.9% [9]. - Non-GAAP operating profit increased 0.8% year-over-year to $777 million, with an operating margin of 8.5% [9]. Balance Sheet and Cash Flow - HPE ended the fiscal third quarter with $457 million in cash, down from $11.67 billion in the previous quarter [10]. - Generated $1.3 billion in cash from operations and $790 million in free cash flow during the quarter [10][11]. Guidance - For Q4 fiscal 2025, HPE forecasts revenues between $9.7 billion and $10.1 billion, with GAAP and non-GAAP earnings per share estimates of 50-54 cents and 56-60 cents, respectively [12]. - For fiscal 2025, HPE anticipates revenue growth of 14-16%, up from prior guidance of 7-9%, with revised earnings per share estimates [13]. Market Sentiment - Since the earnings release, consensus estimates have seen a flat trend, with a shift of -7.01% [14]. - HPE currently holds a Zacks Rank 3 (Hold), indicating an expectation of in-line returns in the coming months [16].

Core Insights - Arista Networks Inc. (ANET) is experiencing significant growth in the cloud networking sector, with Q2 revenues increasing to $2.2 billion from $1.69 billion year-over-year, surpassing the consensus estimate of $2.11 billion [1][8] - The company is innovating to meet the rising demands of AI/ML-driven network architectures, enhancing customer experience and engagement [1] - Arista's comprehensive portfolio is well-positioned to benefit from the migration to higher bandwidths (400G and 800G) driven by AI workloads [3] Financial Performance - Arista's Q2 revenues rose to $2.2 billion, exceeding the consensus estimate of $2.11 billion [8] - The company has raised its 2025 revenue guidance by $550 million to $8.75 billion, reflecting strong momentum in cloud and AI [4][8] - The Zacks Consensus Estimate for Arista's earnings for 2025 has increased over the past 60 days [11] Competitive Landscape - Arista faces competition from Hewlett Packard Enterprise (HPE) and Cisco Systems Inc. (CSCO) in the cloud networking space [5][6] - HPE is benefiting from strong demand for its GreenLake platform, which enhances visibility into resource utilization [5] - Cisco is experiencing solid order growth in data center switching, supported by its partnership with NVIDIA for secure AI-native data centers [6] Market Position - Arista's shares have surged 50.9% over the past year, outperforming the industry's growth of 38.3% [7] - The company trades at a forward price-to-sales ratio of 18.35, which is above the industry average [9]

Core Insights - Hewlett Packard Enterprise (HPE) reported better-than-expected results for Q3 fiscal 2025, with shares rising 2% in extended trading [1] - Non-GAAP earnings were 44 cents per share, beating the Zacks Consensus Estimate by 2.3%, but down 12% year over year [1] - Revenues increased 19% year over year to $9.1 billion, surpassing the Zacks Consensus Estimate by 4.1% [2] Revenue Performance - HPE's revenue growth was driven by the Server, Hybrid Cloud, and Financial Services segments, particularly due to increased sales in artificial intelligence and GreenLake [2] - The Server segment saw a 16% year-over-year increase in sales, reaching $4.94 billion, with strong demand for AI servers [3] - Networking division revenues surged 54% year over year to $1.73 billion, while the Hybrid Cloud division's sales rose 12% to $1.48 billion [4][5] Segment Analysis - The Financial Services segment reported revenues of $886 million, a 1% increase year over year, with a net portfolio asset increase to $13.2 billion [6] - The Server segment's operating profit margin was 6.4%, down 440 basis points year over year but up 50 basis points sequentially [3] - The Hybrid Cloud division's operating profit margin improved to 5.9%, reflecting controlled operating expenses [5] Operating Results - Non-GAAP gross profit was $2.73 billion, up 11.5% year over year, with a gross margin of 29.9% [7] - Non-GAAP operating profit increased 0.8% year over year to $777 million, with an operating margin of 8.5% [7] Cash Flow and Balance Sheet - HPE ended the fiscal third quarter with $457 million in cash, down from $11.67 billion in the previous quarter [8] - The company generated $1.3 billion in cash from operational activities during the quarter and returned $171 million to shareholders [9] Guidance - For Q4 fiscal 2025, HPE forecasts revenues between $9.7 billion and $10.1 billion, with non-GAAP earnings per share estimated at 56-60 cents [10] - For fiscal 2025, HPE raised its revenue growth outlook to 14-16%, up from the previous guidance of 7-9% [11]

Summary of Hewlett Packard Enterprise (HPE) Conference Call on Juniper Networks Acquisition Company and Industry - **Company**: Hewlett Packard Enterprise Company (HPE) - **Acquisition Target**: Juniper Networks - **Industry**: IT and Networking, focusing on AI and hybrid cloud solutions Core Points and Arguments 1. **Acquisition Significance**: The acquisition of Juniper Networks is positioned to enhance HPE's capabilities in the growing AI and hybrid cloud market, creating a comprehensive IT portfolio that includes a modern network stack [5][20] 2. **Market Positioning**: HPE aims to capitalize on the transformation in IT by aligning its portfolio with higher growth and higher margin areas, responding to disruptive industry trends [6][20] 3. **Customer Focus**: The integration of Juniper is expected to strengthen relationships with customers and partners, enabling them to leverage AI technologies effectively [6][8] 4. **Financial Outlook**: HPE anticipates at least $600 million in annual cost synergies over the next three years, an increase from the previously communicated $450 million [21] 5. **Revenue Growth**: Juniper reported over 40% year-over-year order growth and over 20% revenue growth in Q2, driven by AI-driven enterprise solutions and data center products [28][33] 6. **Integration Strategy**: HPE has a detailed integration plan to merge Juniper's offerings with its existing products, focusing on maintaining product continuity and enhancing go-to-market strategies [14][18] 7. **AI and Networking**: The combined company will focus on AI-native networking solutions, which are essential for managing data-intensive workloads and improving operational efficiency [10][11] 8. **Global Reach**: HPE's existing global supply chain and market presence will enhance Juniper's reach, particularly in international markets [36][68] Additional Important Insights 1. **Cultural Fit**: The cultures of HPE and Juniper are complementary, both emphasizing innovation and customer commitment [7] 2. **Product Overlap**: While there is some overlap in campus and branch portfolios, each company brings unique strengths that will expand the total addressable market [19] 3. **Future Innovations**: The integration of Mist AI with HPE's existing technologies is expected to deliver significant operational improvements, including up to 85% cost savings and a 90% reduction in trouble tickets [11] 4. **Customer Segmentation**: HPE plans to target various customer segments, including Tier 1 and Tier 2 cloud providers, leveraging Juniper's strengths in AI and networking [66][68] 5. **Long-term Vision**: HPE's strategic shift towards AI and cloud solutions is expected to drive sustained profitable revenue growth, positioning the company as a market leader [20][22] This summary encapsulates the key points discussed during the conference call regarding HPE's acquisition of Juniper Networks, highlighting the strategic importance, financial expectations, and integration plans that will shape the future of the combined entity.

Financial Performance - HPE delivered above commitments for the quarter, including the server business, with results at the high end of guidance for revenue, operating profit, and operating margins [2] - HPE achieved its fifth consecutive quarter of year-over-year revenue growth across the company [3] - HPE is on track to deliver server operating margins back to 10% by the exit of Q4 [3] - HPE is raising its bottom range of non-GAAP EPS guidance by 8 cents [3] - HPE has almost $12 billion in cash on its balance sheet, about 50% of its market cap [14] - HPE aims to achieve $350 million in cost savings by the 2026 fiscal year [10] Business Strategy and Market Dynamics - HPE took swift, targeted, and aggressive actions to address challenges in the server business [2] - One-third of HPE's AI orders came from the enterprise market, which tends to have higher margins due to more software and services [4] - GreenLake grew 47% year-over-year, driven by the stickiness of that experience through storage and private cloud [7] - HPE believes the Juniper deal is the fastest way to generate shareholder value and is committed to delivering at least $450 million of synergies [15]