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Hewlett Packard Enterprise<\/a> shares skyrocketed 30% on Monday after the tech company posted blockbuster second-quarter results that blew away estimates.<\/p>\n Here’s how the company did compared to LSEG estimates:<\/p>\n It was the company’s biggest EPS beat since February 2018.<\/p>\n Revenue was up 40% over a year ago.<\/p>\n Overall Cloud & AI revenue came in at $7.71 billion, topping the StreetAccount estimate of $6.87 billion, but it was the company’s server unit that really impressed. Server revenue, which is a sub-division of the cloud and artificial intelligence unit, came in at $5.45 billion, blowing away the $4.66 billion expected by analysts.<\/p>\n The server maker bumped its full-year EPS guidance by a full dollar, projecting fiscal year 2026 EPS of $3.35 to $3.45, up from $2.30 to $2.50. The company said it is now tracking two years ahead of its own long-term financial plan.<\/p>\n CEO Antonio Neri told CNBC’s Kristina Partsinevelos that traditional server bookings are up triple digits, and it is the biggest backlog the company has ever seen.<\/p>\n “Customers continue to invest in modernizing their infrastructure and scaling AI, and our performance shows the strength of our combined networking portfolio,” Neri said in a release announcing the quarterly results.<\/p>\n Neri also told CNBC that industries focused on security are seeing especially rapid acceleration for AI on-premises, instead of in the cloud. HPE is largely focused on providing that service to national labs and enterprises.<\/p>\n Those are “higher margin opportunities” than the neoclouds that competitors like Dell<\/a> are focused on, according to chip analyst Patrick Moorhead of Moor Insights and Strategy.<\/p>\n “Their bump up has everything to do with increasing profitability for AI, and the fact that they’re hitting their targets a year and a half in advance,” Moorhead said.<\/p>\n The global memory shortage remains a risk, and Neri said he sees costs remaining elevated into 2027.<\/p>\n Net income came in at $624 million, or 44 cents per share, compared to a net loss a year ago. HPE posted a net loss of $1.05 billion, a loss of 82 cents per share, a year ago.<\/p>\n The stock surge comes following the company’s announcement of a new server rack on Monday at the Computex conference in Taiwan. The new server will be powered by Nvidia<\/a>‘s new Vera central processing units, which are now in full production.<\/p>\n “This is going to be our new major growth driver,” Nvidia CEO Jensen Huang<\/a> said during his keynote at Computex on Monday. He said millions of the new CPUs are currently being made, and will be available starting in the fall.<\/p>\n Stock Chart IconStock chart icon HPE one-day stock chart.<\/p>\n The New York Stock Exchange is one customer that plans to use the new Nvidia chips on HPE’s new server, to help it process more than a trillion messages per day.<\/p>\n Neri said it’s a task well suited to his company’s newest ProLiant server because it’s optimized for agentic AI workloads. <\/p>\n “These workloads require high-performance servers with exceptional CPU performance to enable real-time reasoning across agentic AI and financial services applications,” he said in a press release Monday. “We are delivering a new class of infrastructure to help customers accelerate insights and operate with confidence in the most demanding environments.”<\/p>\n With the new HPE server, “enterprises can put Vera to work, and NYSE shows what purpose-built AI infrastructure can do in the world’s most demanding environments,” Nvidia’s Huang said in a release.<\/p>\n The new 12th generation ProLiant server will be available in the fall.<\/p>\n WATCH: Arm launches its own CPU, with Meta as first customer<\/a><\/p>\n\n
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