We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
HPE's Hybrid Cloud Revenues Climb: What's Driving its Growth?
Read MoreHide Full Article
Key Takeaways
HPE's hybrid cloud revenues jumped 14.2% year over year in Q3 of fiscal 2025.
Alletra MP shipments topped 5,000 units in 2025, driving triple-digit revenue growth.
GreenLake added 2,000 users in Q3, lifting its customer base to 44,000.
Hewlett Packard Enterprise’s (HPE - Free Report) hybrid cloud segment is experiencing massive growth on the back of Alletra MP adoption, GreenLake cloud platform expansion, and enterprise AI use cases based on private cloud AI. The hybrid cloud segment grew 14.2% year over year in the third quarter of fiscal 2025.
Per its earnings call report, HPE was able to ship more than 5,000 Alletra MP arrays in 2025 and achieved triple-digit revenue growth. The company’s GreenLake cloud product is also experiencing rapid adoption. In the third quarter of fiscal 2025, HPE was able to add 2,000 new users, amassing a total number of 44,000 customers for its GreenLake cloud.
HPE is focusing on bringing more innovation to its cloud offerings. Recently, it launched HPE Hybrid Cloud Ops Suite, which integrates Morpheus, VM Essentials, OpsRamp, and Zerto. After the acquisition of Juniper Networks, HPE is focusing on combining hybrid cloud, AI and networking to enable its Hybrid Cloud segment to cross-sell and bundle its networking, server and storage offerings.
HPE is also experiencing strong momentum in AI Factory private cloud solutions as the number of private cloud AI customers grew two-fold sequentially in the third quarter of fiscal 2025. These factors are helping HPE grow its top line rapidly. The Zacks Consensus Estimate for HPE’s fiscal 2025 revenues is pegged at $34.54 billion, suggesting growth of 14.6%.
How Competitors Fare Against HPE
The global cloud space is led by other massive players like Amazon (AMZN - Free Report) and Microsoft (MSFT - Free Report) . Amazon, through its Amazon Web Services, dominates services, including compute, storage, AI/ML, and hybrid offerings like Outposts and EKS Anywhere.
Microsoft, on the other hand, has a strong presence among enterprises because of its Azure Stack. Microsoft’s collaboration with AI has equipped it with AI Factory-like deployments. However, HPE has an edge in this space as it differentiates itself with the integration of private cloud, AI factory and networking.
HPE’s Price Performance, Valuation and Estimates
Shares of Hewlett Packard Enterprise have gained 10.1% year to date compared with the Zacks Computer - Integrated Systems industry’s growth of 27.6%.
Image Source: Zacks Investment Research
From a valuation standpoint, HPE trades at a forward price-to-sales ratio of 0.79, below the industry’s 3.52.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for HPE’s fiscal 2025 earnings is pegged at $1.91 per share, which implies a decrease of 4% year over year. The consensus mark for fiscal 2026 is pegged at $2.34 per share, indicating a year-over-year increase of 22.7%. HPE's fiscal 2025 and fiscal 2026 earnings were revised upward in the past seven days.
Image: Bigstock
HPE's Hybrid Cloud Revenues Climb: What's Driving its Growth?
Key Takeaways
Hewlett Packard Enterprise’s (HPE - Free Report) hybrid cloud segment is experiencing massive growth on the back of Alletra MP adoption, GreenLake cloud platform expansion, and enterprise AI use cases based on private cloud AI. The hybrid cloud segment grew 14.2% year over year in the third quarter of fiscal 2025.
Per its earnings call report, HPE was able to ship more than 5,000 Alletra MP arrays in 2025 and achieved triple-digit revenue growth. The company’s GreenLake cloud product is also experiencing rapid adoption. In the third quarter of fiscal 2025, HPE was able to add 2,000 new users, amassing a total number of 44,000 customers for its GreenLake cloud.
HPE is focusing on bringing more innovation to its cloud offerings. Recently, it launched HPE Hybrid Cloud Ops Suite, which integrates Morpheus, VM Essentials, OpsRamp, and Zerto. After the acquisition of Juniper Networks, HPE is focusing on combining hybrid cloud, AI and networking to enable its Hybrid Cloud segment to cross-sell and bundle its networking, server and storage offerings.
HPE is also experiencing strong momentum in AI Factory private cloud solutions as the number of private cloud AI customers grew two-fold sequentially in the third quarter of fiscal 2025. These factors are helping HPE grow its top line rapidly. The Zacks Consensus Estimate for HPE’s fiscal 2025 revenues is pegged at $34.54 billion, suggesting growth of 14.6%.
How Competitors Fare Against HPE
The global cloud space is led by other massive players like Amazon (AMZN - Free Report) and Microsoft (MSFT - Free Report) . Amazon, through its Amazon Web Services, dominates services, including compute, storage, AI/ML, and hybrid offerings like Outposts and EKS Anywhere.
Microsoft, on the other hand, has a strong presence among enterprises because of its Azure Stack. Microsoft’s collaboration with AI has equipped it with AI Factory-like deployments. However, HPE has an edge in this space as it differentiates itself with the integration of private cloud, AI factory and networking.
HPE’s Price Performance, Valuation and Estimates
Shares of Hewlett Packard Enterprise have gained 10.1% year to date compared with the Zacks Computer - Integrated Systems industry’s growth of 27.6%.
Image Source: Zacks Investment Research
From a valuation standpoint, HPE trades at a forward price-to-sales ratio of 0.79, below the industry’s 3.52.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for HPE’s fiscal 2025 earnings is pegged at $1.91 per share, which implies a decrease of 4% year over year. The consensus mark for fiscal 2026 is pegged at $2.34 per share, indicating a year-over-year increase of 22.7%. HPE's fiscal 2025 and fiscal 2026 earnings were revised upward in the past seven days.
Image Source: Zacks Investment Research
HPE stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here