Strong Q2 Performance: HPE reported Q2 revenue of $7.6 billion, a 7% year-over-year increase, exceeding previous guidance. This growth was driven by higher AI system revenue, robust performance in the Intelligent Edge, and the hybrid cloud segment, particularly from HPE GreenLake cloud subscription services.

Margin Expectations: Server operating margins stood at 5.9% but are expected to improve to around 10% by the end of Q4 2025, aided by corrective actions taken to enhance pricing analytics, discount scrutiny, and inventory management. Overall, HPE is aiming for a non-GAAP operating margin above 9% for the full fiscal year.

Improved Guidance: HPE tightened its revenue growth forecast for the fiscal year to 7%-9% year-over-year (previously broader) and raised the low end of its non-GAAP diluted net earnings per share outlook by $0.08, now ranging from $1.78 to $1.90.