Hewlett Packard Enterprise (HPE) reported record-breaking financial results for the third quarter of fiscal 2025, ended July 31, 2025, bolstered by the acquisition of Juniper Networks. The results reflect strong growth in revenue and strategic advancements in AI, cloud, and networking segments.
Revenue: $9.1B, up 19% YoY and 18% in constant currency.
Annualized Revenue Run-Rate (ARR): $3.1B, up 77% YoY.
Gross Margin: GAAP at 29.2%, non-GAAP at 29.9%.
Diluted EPS: GAAP at $0.21, non-GAAP at $0.44.
Free Cash Flow: $790M, up $121M YoY.
Juniper Acquisition: Closed July 2, 2025, enhancing networking capabilities.
Dividend: $0.13 per share, payable October 17, 2025.
HPE achieved a record revenue of $9.1 billion, a 19% increase from the prior-year period (18% in constant currency), driven by strong demand in Server and Networking segments. The Annualized Revenue Run-Rate (ARR) surged to $3.1 billion, up 77% YoY, reflecting robust growth in HPE GreenLake and related services. GAAP gross margin was 29.2%, down 240 basis points YoY but up 80 basis points sequentially, while non-GAAP gross margin was 29.9%. GAAP diluted net EPS was $0.21, down $0.17 YoY, and non-GAAP EPS was $0.44, within guidance. Cash flow from operations reached $1,305 million, with free cash flow at $790 million, up $121 million YoY.
HPE closed its $14 billion acquisition of Juniper Networks on July 2, 2025, doubling the size of its Networking business. Antonio Neri, President and CEO, stated, “HPE delivered record-breaking revenue and improved profitability this quarter as we marked a major milestone by closing our acquisition of Juniper Networks.” The acquisition, contributing to Q3 results from July 2 to July 31, 2025, enhances HPE’s AI-native and cloud-native portfolio, positioning it to capture growing market opportunities in data centers, firewalls, and routers.
Server: Revenue of $4.9B, up 16% YoY, with a 6.4% operating profit margin (down from 10.8% YoY due to competitive pricing in AI servers).
Networking: Revenue of $1.7B, up 54% YoY, with a 20.8% operating profit margin, reflecting Juniper’s integration and strong AI-driven demand.
Hybrid Cloud: Revenue of $1.5B, up 12% YoY, with a 5.9% operating profit margin, driven by HPE GreenLake adoption.
Financial Services: Revenue of $886M, up 1% YoY, with a 9.9% operating profit margin and $13.2B in net portfolio assets.
For Q4 2025, HPE projects revenue between $9.7B and $10.1B, GAAP diluted EPS of $0.50-$0.54, and non-GAAP EPS of $0.56-$0.60. Full-year 2025 revenue growth is expected at 14-16% in constant currency, with non-GAAP EPS of $1.88-$1.92, though GAAP operating profit is projected to decline significantly due to a $1.4B goodwill impairment from Q2. Free cash flow is estimated at $700M. The HPE Board declared a $0.13 per share dividend, payable on October 17, 2025, to shareholders of record by September 18, 2025.
Marie Myers, EVP and CFO, noted, “Acquiring Juniper Networks has already added to our results, with more profit accretion expected as we work to quickly capture planned synergies.” HPE anticipates $600M in synergies within three years, strengthening its position against competitors like Dell Technologies. The company’s focus on AI, hybrid cloud, and networking aligns with market trends, though margin pressures in legacy segments like Compute and Storage remain a challenge.
HPE’s Q3 2025 results underscore its transformation into a leader in AI and networking, with the Juniper acquisition enhancing its competitive edge. With a robust outlook and strategic investments, HPE is poised to drive shareholder value in a dynamic market.
HPE (NYSE: HPE) is a global leader in enterprise technology, delivering AI, cloud, and networking solutions to optimize operational performance and drive digital transformation across industries.
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