Hewlett Packard Enterprise just delivered a reality check that sent its stock tumbling 7% in after-hours trading. The enterprise infrastructure giant slashed its fiscal 2026 revenue growth outlook to just 5-10%, falling dramatically short of Wall Street's 17% expectations during Wednesday's analyst meeting.
The enterprise tech sector just got a dose of sobering reality from one of its biggest players. Hewlett Packard Enterprise delivered guidance Wednesday that sent shockwaves through investor circles, with shares plunging 7% in extended trading after the company's analyst meeting revealed just how much the infrastructure giant is struggling to meet market expectations.
The numbers tell a stark story. HPE's adjusted earnings per share guidance of $2.20 to $2.40 for fiscal 2026 barely scraped the bottom of analyst expectations at $2.40, according to LSEG data. But it's the revenue outlook that really stung - HPE's projected 5-10% growth rate represents a massive miss against Wall Street's bullish 17% forecast.
For a company positioned at the heart of the AI infrastructure boom, these conservative projections raise serious questions about HPE's ability to capitalize on the current tech cycle. The disconnect between market expectations and company reality suggests either analysts got way ahead of themselves, or HPE is facing headwinds that aren't immediately visible in the broader enterprise spending surge.
"In HPE's new chapter, our strengthened portfolio will create more profitable growth, increasing capital return opportunities that deliver even greater value to our shareholders," CEO Antonio Neri said in the company statement. The carefully crafted language hints at a company trying to thread the needle between investor expectations and operational realities.
HPE's strategic pivot centers heavily on its recent Juniper Networks acquisition, which the company sees as its networking technology foundation. The deal positions HPE to compete more aggressively in the AI-driven data center market, particularly in what the company calls "sovereign and enterprise segments."
But integration challenges and market timing might be working against HPE. The company has been in restructuring mode, announcing in March a 5% workforce reduction that eliminated roughly 2,500 jobs. These cuts, revealed during , signal a company still working through operational inefficiencies even as it tries to capture AI infrastructure opportunities.
