What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-09-04 compared with 2025-06-04 · 342 added, 284 removed, 569 unchanged (52% of the section changed)

4 unchanged sentences

This discussion should be read in conjunction with our Condensed Consolidated Financial Statements and the related notes that appear elsewhere in this document.

The financial discussion and analysis in the following MD&A compares the three and six months ended April 30, 2025 to the comparable prior-year period and where appropriate, as of April 30, 2025, unless otherwise noted.

The financial discussion and analysis in the following MD&A compares the three and nine months ended July 31, 2025 to the comparable prior-year period and where appropriate, as of July 31, 2025, unless otherwise noted.

This MD&A is organized as follows:

• Trends and Uncertainties.

A discussion of material events and uncertainties known to management, such as the mixed macroeconomic environment of supply chain constraints (though easing) and heightening global trade restrictions, uneven demand across our portfolio, increased demand for and adoption of new technologies, conservative customer spending environment (though recovering), persistent inflation, foreign exchange pressures, recent tax developments, competitive pricing pressures, and proposed acquisition of Juniper Networks, Inc.

(“Juniper Networks”).

A discussion of material events and uncertainties known to management, such as the mixed macroeconomic environment and heightening global trade restrictions, uneven demand across our portfolio, increased demand for and adoption of new technologies, increased inventory levels, conservative customer spending environment (though recovering), persistent inflation, foreign exchange pressures, recent tax developments, and competitive pricing pressures.

• Executive Overview.

14 unchanged sentences

TRENDS AND UNCERTAINTIES

During the first six months of fiscal 2025, the effects of the evolving macroeconomic environment on demand persisted and certain significant developments impacted our operations, as follows:

During the first nine months of fiscal 2025, the effects of the evolving macroeconomic environment on demand persisted and certain significant developments impacted our operations, as follows:

Technological Advancements:

2 unchanged sentences

The need for a unified cloud experience everywhere has grown, as well, in order to manage the growth of data at the edge.

With the abundance of data, there are opportunities to develop AI tools with powerful computational abilities to extract insights and value from the captured data.

Increasing demand for AI is also contributing to changes in the competitive landscape.

Our major competitors and emerging competitors are expanding their product and service offerings with integrated products and solutions and exerting increased competitive pressure.

With the abundance of data, there are opportunities to develop AI tools with powerful computational abilities to extract insights and value from the captured data.

Secure networking that is purpose-built for AI workloads is the foundation that enables users to seamlessly connect and apply AI learnings to such data that lives in various ecosystems.

While we believe our recent acquisition of Juniper Networks, Inc.

positions us to capitalize on the growing market opportunities across AI-accelerated computing, data, and networking, our major competitors and emerging competitors are expanding their product and service offerings with integrated products and solutions and exerting increased competitive pressure.

We expect these market dynamics and trends to continue in the longer term.

Macroeconomic Uncertainty:

The evolving macroeconomic environment has impacted industry-wide demand, as customers take longer to work through prior orders and have been adopting a more strategic approach to discretionary IT spending.

This has resulted in uneven demand across our portfolio and geographies, particularly for certain of our hardware offerings, as customers have focused investments on modernizing infrastructure, such as migrating to cloud-based offerings, including our own.

Additionally, there is growing uncertainty surrounding the tariff environment and import/export regulations, which has resulted in trading partners enacting reciprocally restrictive trade policies and measures.

The evolving macroeconomic environment has impacted industry-wide demand, as, until recently, customers took longer to work through prior orders and, to this day, have been adopting a more strategic approach to discretionary IT spending.

While this dynamic has been easing, this has resulted in uneven demand across our portfolio and geographies, particularly for certain of our hardware offerings, as customers have focused investments on modernizing infrastructure, such as migrating to cloud-based offerings, including our own.

Additionally, there continues to be significant uncertainty surrounding the tariff environment and import/export regulations due to numerous factors, including but not limited to tariff imposition delays, changes to tariff rates and policies, and enactment of reciprocally restrictive trade policies and measures.

These have enhanced global trade uncertainty and contributed to higher prices of components and end products and services.

We expect such mixed macroeconomic environment to largely continue and possibly limit revenue and margin growth in the near term.

While we have relied on our global supply chain and pricing measures in an attempt to mitigate adverse impacts, we expect such a mixed macroeconomic environment to largely continue and possibly limit revenue and margin growth in the near term.

Supply Chain:

1 unchanged sentence

Though they have since eased, in part due to increased availability of supply and lower material and logistics costs, the future remains uncertain due to continuous shifts in U.S.

trade policy, which have thus far impacted our ability to import and export components and finished products and the costs of doing so.

trade policy, which has thus far impacted our ability to import and export components and finished products and the costs of doing so.

Additionally, logistics costs may rise with the aforementioned changes in trade policies.

We have been experiencing higher-than-normal inventory levels, primarily due to customers transitioning to the next generation of GPUs, our securing supply ahead of demand, and longer customer acceptance timelines on AI-related orders;

we expect this trend to continue in the medium term.

We have been experiencing higher-than-normal inventory levels, primarily due to frequent component part updates, customers transitioning to the next generation of GPUs, our securing supply ahead of demand, and longer customer acceptance timelines on AI-related orders.

While we have been working to reduce inventory, any or all of the aforementioned factors could contribute to sustained higher-than-normal levels and further uncertainty.

We have experienced, and expect to continue experiencing, rising input component costs due to the global trade uncertainties referenced above and a competitive pricing environment, all of which may impact our financial results.

11 unchanged sentences

Significant staffing and resource reductions at certain public sector entities create an uncertain environment and as a result, our financial results may be impacted in the near term.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Recent Tax Developments:

5 unchanged sentences

We do not expect a material impact to our fiscal 2025 results.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

The Internal Revenue Service (“IRS”) is conducting audits of our fiscal 2020 through 2022 U.S.

federal income tax returns.

In the second quarter of fiscal 2025, the IRS issued a Revenue Agent Report (“RAR”) regarding the audit of our fiscal 2017 through 2019 U.S.

In the second quarter of fiscal 2025, the IRS issued a Revenue Agent Report regarding the audit of our fiscal 2017 through 2019 U.S.

federal income tax returns with which we agreed.

1 unchanged sentence

The resolution of the audit resulted in the release of tax reserves that were predominantly related either to adjustments to foreign tax credits that carried a full valuation allowance or to the timing of intercompany royalty revenue recognition, neither of which affected our effective tax rate.

On July 4, 2025, the U.S.

government enacted the One Big Beautiful Bill Act (“OB3”) into law.

OB3 introduces several changes to tax regulations, including the permanent restoration of 100% depreciation and the permanent restoration of immediate deductibility of costs associated with research and development activities performed in the United States.

We do not anticipate a material impact to our fiscal 2025 results but continue to evaluate the full impact of these changes on our future results.

Other Trends and Uncertainties:

1 unchanged sentence

We have, in the past, entered into contracts for the sale of certain products and services that reflect heavier-than-normal discounting due to competitive pressures, which have resulted in lower margins than expected, and we expect will continue to negatively impact our margins in the near term.

We are monitoring and seeking to mitigate these risks with adjustments to our manufacturing, supply chain, and distribution networks, as well as our pricing and discounting practices.

We have been monitoring and seeking to mitigate these risks with adjustments to our manufacturing, supply chain, and distribution networks, as well as our pricing and discounting practices.

We remain focused on executing our key strategic priorities, building long-term value creation for our stakeholders, and addressing our customers’ needs while continuing to make prudent decisions in response to the environment.

Proposed Acquisition of Juniper Networks, Inc:

On January 9, 2024 , we entered into a definitive Agreement and Plan of Merger (the “Merger Agreement”) under which we will acquire Juniper Networks in an all-cash transaction for $40.00 per share (the “Merger”), representing an equity value of approximately $14 billion.

On April 2, 2024, Juniper Networks stockholders approved the transaction.

The transaction is expected to be funded based on senior unsecured delayed draw term loans from a syndicate of banks, the post-tax proceeds from our sale to Unisplendour International Technology Limited (“UNIS”) of 30% of the total issued share capital of H3C Technologies Co., Limited (“H3C”), the net proceeds (including after repayments of maturing debt) of our September 2024 issuances of senior unsecured notes and the 7.625% Series C Mandatory Convertible Preferred Stock (the “Preferred Stock”), and cash on the balance sheet.

The closing of the transaction remains subject to receipt of regulatory approvals and satisfaction of other customary closing conditions.

On January 30 2025, the Antitrust Division of the United States Department of Justice (the “DOJ”) filed a complaint in the United States District Court for the Northern District of California, seeking to enjoin the closing of the Merger, alleging that the Merger is likely to substantially lessen competition in violation of Section 7 of the Clayton Act.

On February 10, 2025, HPE and Juniper Networks filed answers to the DOJ’s complaint, disputing these claims.

Trial is scheduled to begin on July 9, 2025.

While we intend to vigorously defend the litigation, an unfavorable ruling could ultimately prevent the closing of the Merger, thereby adversely impacting our ability to achieve the intended benefits of the Merger, which could, in turn, have an adverse impact on our business, financial condition, and results of operations.

For further information about the Merger, refer to Note 8, “ Acquisitions and Dispositions” to the Consolidated Financial Statements in Item 1 of Part I of this Quarterly Report, and for further discussion about the risks related to the Merger, see the section titled “Risk Factors” in Item 1A of Part I of the Annual Report on Form 10-K for the fiscal year ended October 31, 2024, as modified by the risk statements in the section titled “Risk Factors” in Item 1A of Part II of the Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2025.

The foregoing summary of the Merger, the adoption of the Merger Agreement, and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, which is filed as Exhibit 2.1 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on January 10, 2024.

EXECUTIVE OVERVIEW

5 unchanged sentences

Our operations are organized into five reportable segments for financial reporting purposes:

Server , Hybrid Cloud, Intelligent Edge, Financial Services (“FS”), and Corporate Investments and Other.

Effective at the beginning of the first quarter

Server , Hybrid Cloud, Networking, Financial Services (“FS”), and Corporate Investments and Other.

During the third quarter of fiscal 2025, the Intelligent Edge segment was renamed to Networking.

The segment name change did not result in any change to the composition of the Company’s segments and therefore no prior information was recast;

further, the designation change did not impact the Company’s condensed consolidated financial statements.

Effective at the beginning of the first quarter of fiscal 2025, in order to align its segment financial reporting more closely with its current business structure, HPE implemented an organizational change with the transfer of certain managed services, previously reported within the Server segment, to the Hybrid Cloud segment.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

of fiscal 2025, in order to align its segment financial reporting more closely with its current business structure, HPE implemented an organizational change with the transfer of certain managed services, previously reported within the Server reportable segment, to the Hybrid Cloud reportable segment.

Acquisition of Juniper Networks

On July 2, 2025, we completed the Juniper Networks, Inc.

(“Juniper Networks”) merger (the “Merger”).

Under the terms of the Merger Agreement, HPE agreed to pay $40.00 per share of Juniper Networks common stock, issued and outstanding as of July 2, 2025, representing a cash consideration of approximately $13.4 billion.

The results of operations of Juniper Networks are included in the unaudited Condensed Consolidated Financial Statements commencing on July 2, 2025.

See Note 8, “Acquisitions and Dispositions” to the Condensed Consolidated Financial Statements for additional information.

Cost Reduction Program

3 unchanged sentences

In addition, we may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur, including in connection with the implementation of the Program.

In connection with the Program, we incurred charges of $146 million for the three and six months ended April 30, 2025.

Three months ended April 30, 2025 compared with three months ended April 30, 2024

Net revenue of $7.6 billion represented an increase of 5.9% (increased 7.1% on a constant currency basis) primarily due to higher average unit prices (“AUPs”) in the Server segment and higher unit volume and AUPs in the Hybrid Cloud segment.

The gross profit margin of 28.4% (or $2.2 billion), represents a decrease of 4.6 percentage points from the prior-year period primarily due to an increase in cost of sales in the Server, Hybrid Cloud and Intelligent Edge segments.

The operating profit margin of (14.5)% represents a decrease of 20.4 percentage points from the prior-year period primarily due to the impairment of goodwill.

Six months ended April 30, 2025 compared with six months ended April 30, 2024

Net revenue of $15.5 billion represented an increase of 10.9% (increased 12.0% on a constant currency basis) primarily due to higher AUPs in the Server segment and higher unit volume in the Hybrid Cloud segment.

The gross profit margin of 28.8% (or $4.5 billion), represents a decrease of 5.8 percentage points from the prior-year period primarily due to an increase in cost of sales in the Server, Intelligent Edge and Hybrid Cloud segments.

The operating profit margin of (4.4)% represents a decrease of 11.2 percentage points from the prior-year period primarily due to the impairment of goodwill.

In connection with the Program, we incurred charges of $2 million and $148 million for the three and nine months ended July 31, 2025, respectively.

Three months ended July 31, 2025 compared with three months ended July 31, 2024

Net revenue of $9.1 billion represented an increase of 18.5% (increased 17.7% on a constant currency basis) primarily due to higher average unit prices (“AUPs”) in the Server segment, higher revenue from the Merger in the Networking segment, and higher unit volume in the Hybrid Cloud segment.

The gross profit margin of 29.2% (or $2.7 billion), represents a decrease of 2.4 percentage points from the prior-year period primarily due to an increase in cost of sales in the Server, Networking and Hybrid Cloud segments.

The operating profit margin of 2.7% represents a decrease of 4.4 percentage points from the prior-year period primarily due to the costs associated with the Merger.

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

Net revenue of $24.6 billion represented an increase of 13.6% (increased 14.0% on a constant currency basis) primarily due to higher AUPs in the Server segment, higher revenue from the Merger in the Networking segment, and higher unit volume in the Hybrid Cloud segment.

The gross profit margin of 29.0% (or $7.1 billion), represents a decrease of 4.6 percentage points from the prior-year period, primarily due to an increase in cost of sales in the Server, Hybrid Cloud and Networking segments.

The operating profit margin of (1.7)% represents a decrease of 8.6 percentage points from the prior-year period primarily due to the impairment of goodwill and costs associated with the Merger.

Financial Results

The following table summarizes our condensed consolidated GAAP financial results:

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

Financial Results

The following table summarizes our condensed consolidated GAAP financial results:

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 Change 2025 2024 Change

3 unchanged sentences

Gross profit margin 29.2 % 31.6 % (2.4)pts 29.0 % 33.6 % (4.6)pts

(Loss) earnings from operations $ (1,109) $ 425 (360.9)% $ (676) $ 950 (171.2)%

Earnings (loss) from operations $ 247 $ 547 (54.8)% $ (429) $ 1,497 (128.7)%

Operating profit margin 2.7 % 7.1 % (4.4)pts (1.7) % 6.9 % (8.6)pts

Net (loss) earnings attributable to HPE $ (1,050) $ 314 (434.4)% $ (423) $ 701 (160.3)%

Net (loss) earnings attributable to common stockholders $ (1,079) $ 314 (443.6)% $ (481) $ 701 (168.6)%

Diluted net (loss) earnings per share attributable to common stockholders (1)

Net earnings (loss) attributable to HPE $ 305 $ 512 (40.4)% $ (118) $ 1,213 (109.7)%

Net earnings (loss) attributable to common stockholders $ 276 $ 512 (46.1)% $ (205) $ 1,213 (116.9)%

Diluted net earnings (loss) per share attributable to common stockholders (1)

$ 0.21 $ 0.38 $(0.17) $ (0.16) $ 0.92 $(1.08)

Cash flow (used in) provided by operations $ (461) $ 1,093 $(1,554) $ (851) $ 1,157 $(2,008)

Cash flow provided by operations $ 1,305 $ 1,154 $151 $ 454 $ 2,311 $(1,857)

The following table summarizes our condensed consolidated non-GAAP financial results:

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 Change 2025 2024 Change

10 unchanged sentences

Free cash flow $ 790 $ 669 $121 $ (934) $ 797 $(1,731)

(1) For purposes of calculating diluted net (loss) earnings per share (“EPS”), the preferred stock dividends are added back to the net (loss) earnings attributable to common stockholders and the diluted weighted average share calculation assumes the preferred stock was converted at issuance or as of the beginning of the reporting period.

(1) For purposes of calculating diluted net earnings (loss) per share (“EPS”), the 7.625% Series C mandatory convertible preferred stock (“Preferred Stock”) dividends are added back to the net earnings (loss) attributable to common stockholders and the diluted weighted-average share calculation assumes the Preferred Stock was converted at issuance or as of the beginning of the reporting period.

For GAAP diluted net EPS, the effect of employee stock plans and Preferred Stock is excluded when calculating diluted net loss per share as it would be anti-dilutive.

2 unchanged sentences

Annualized Revenue Run-rate (“ARR”)

ARR represents the annualized revenue of all net HPE GreenLake cloud services revenue, related financial services revenue (which includes rental income from operating leases and interest income from finance leases), and software-as-a-service, software consumption revenue, and other aaS offerings, recognized during a quarter and multiplied by four.

We believe that ARR is a metric that allows management to better understand and highlight the potential future performance of our aaS

ARR represents the annualized revenue of all net HPE GreenLake cloud services revenue, related financial services revenue (which includes rental income from operating leases and interest income from finance leases), and software-as-a-service, software consumption revenue, and other aaS offerings, by taking such revenue recognized during a quarter and multiplying by four.

To better align the calculation of ARR with Juniper Networks’ business and offerings, beginning with the quarter ended July 31, 2025, we also included revenue from software licenses support and maintenance in our ARR calculation, and will continue to do so going forward.

The impact of this change was not material to the current and prior periods presented.

We believe that ARR is a metric that allows management to better understand and highlight the potential future performance of

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

our aaS business.

We also believe ARR provides investors with greater transparency to our financial information and of the performance metric used in our financial and operational decision making and allows investors to see our results “through the eyes of management.” We use ARR as a performance metric.

2 unchanged sentences

ARR is not a forecast and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our customers.

The following presents our ARR calculated as of April 30, 2025 and 2024:

As of April 30,

The following presents our ARR calculated as of July 31, 2025 and 2024:

As of July 31,

Dollars in millions

Year-over-year growth rate 77% 35%

The 46% year-over year increase in ARR was primarily due to growth in our Hybrid Cloud, Server and Intelligent Edge segments, which was due to an expanding customer installed base, an expanded range of HPE GreenLake Flex Solutions, Server aaS and Intelligent Edge aaS activity.

(1) The amount of annualized revenue attributable to Juniper Networks is approximately $590 million as of July 31, 2025.

We calculated ARR attributable to Juniper Networks using one month of recurring revenue multiplied by 12, as we acquired Juniper Networks on July 2, 2025.

The 77% year-over year increase in ARR was primarily due to growth in the Networking segment due to the Merger and an expanding customer installed base.

The Hybrid Cloud and Server segments increased due to an expanded range of HPE GreenLake Flex Solutions and Server aaS activity.

Dividends and Share Repurchase Program

1 unchanged sentence

The holders of HPE common stock are entitled to receive dividends when and as declared by the Board of Directors.

Our ability to pay dividends will depend on many factors, such as its financial condition, earnings, capital requirements, debt service obligations, restrictive covenants in its debt, industry practice, legal requirements, regulatory constraints, and other factors that the Board of Directors deems relevant.

Our ability to pay dividends will depend on many factors, such as the Company’s financial condition, earnings, capital requirements, debt service obligations, restrictive covenants in its debt, industry practice, legal requirements, regulatory constraints, and other factors that the Board of Directors deems relevant.

Furthermore, so long as any share of our Preferred Stock remains outstanding, no dividend on shares of common stock (or any other class of stock junior to the Preferred Stock) shall be declared or paid unless all accumulated and unpaid dividends for all preceding dividend periods for the Preferred Stock have been declared and paid in full in cash, shares of the Company’s common stock or a combination thereof, or a sufficient sum of cash or number of shares of its common stock has been set apart for the payment of such dividends, on all outstanding shares of the Preferred Stock.

During the second quarter of fiscal 2025, we paid a quarterly dividend of $0.13 per share of common stock.

On June 3, 2025, we declared a regular cash dividend of $0.13 per share of our common stock, payable on or about July 17, 2025, to our holders of record as of the close of business on June 18, 2025.

We also declared a cash dividend of $0.953125 per share of our 7.625% Series C Mandatory Convertible Preferred Stock, which was paid on June 1, 2025, to holders of record as of the close of business on May 15, 2025.

As of April 30, 2025, we had a remaining authorization of approximately $0.7 billion for future share repurchases.

During the third quarter of fiscal 2025, we paid a quarterly dividend of $0.13 per share of common stock.

On September 3, 2025, we declared a regular cash dividend of $0.13 per share of our common stock, payable on or about October 17, 2025, to our holders of record as of the close of business on September 18, 2025.

We also declared a cash dividend of $0.953125 per share of our 7.625% Series C Mandatory Convertible Preferred Stock, which was paid on September 1, 2025, to holders of record as of the close of business on August 15, 2025.

As of July 31, 2025, we had a remaining authorization of approximately $0.7 billion for future share repurchases.

RESULTS OF OPERATIONS

12 unchanged sentences

Results of operations in dollars and as a percentage of net revenue were as follows:

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 2025 2024

9 unchanged sentences

Impairment of goodwill — — — — 1,361 5.5 — —

Transformation (credit) costs (13) (0.2) 33 0.5 2 — 53 0.4

Transformation costs — — 14 0.2 2 — 67 0.3

Acquisition, disposition and other charges 181 2.0 42 0.5 302 1.2 131 0.6

(Loss) earnings from operations (1,109) (14.5) 425 5.9 (676) (4.4) 950 6.8

Gain on sale of a business — — — — 244 1.6 — —

Earnings (loss) from operations 247 2.7 547 7.1 (429) (1.7) 1,497 6.9

Interest and other, net 8 0.1 (12) (0.2) 86 0.3 (122) (0.6)

Gain on sale of a business 1 — — — 245 1.0 — —

Earnings from equity interests 32 0.4 73 0.9 74 0.3 161 0.7

(Loss) earnings before provision for taxes (1,045) (13.7) 445 6.2 (312) (2.0) 928 6.6

Provision for taxes (5) (0.1) (131) (1.8) (111) (0.7) (227) (1.6)

Net (loss) earnings attributable to HPE (1,050) (13.8) 314 4.4 (423) (2.7) 701 5.0

Earnings (loss) before provision for taxes 288 3.2 608 7.9 (24) (0.1) 1,536 7.1

Benefit (provision) for taxes 17 0.2 (96) (1.2) (94) (0.4) (323) (1.5)

Net earnings (loss) attributable to HPE 305 3.3 512 6.6 (118) (0.5) 1,213 5.6

Preferred stock dividends (29) (0.3) — — (87) (0.4) — —

Net (loss) earnings attributable to common stockholders $ (1,079) (14.2) % $ 314 4.4 % $ (481) (3.1) % $ 701 5.0 %

Three and six months ended April 30, 2025 compared with the three and six months ended April 30, 2024

For the three months ended April 30, 2025, total net revenue of $7.6 billion represented an increase of $0.4 billion, or 5.9% (increased 7.1% on a constant currency basis).

net revenue increased by $155 million, or 6.0%, to $2.7 billion, and net revenue from outside of the U.S.

Net earnings (loss) attributable to common stockholders $ 276 3.0 % $ 512 6.6 % $ (205) (0.8) % $ 1,213 5.6 %

Three and nine months ended July 31, 2025 compared with the three and nine months ended July 31, 2024

For the three months ended July 31, 2025, total net revenue of $9.1 billion represented an increase of $1.4 billion, or 18.5% (increased 17.7% on a constant currency basis).

net revenue increased by $1.4 billion, or 48.4%, to $4.3 billion, and net revenue from outside of the U.S.

increased by $30 million, or 0.6%, to $4.8 billion.

For the six months ended April 30, 2025 , total net revenue of $15.5 billion represented an increase of $1.5 billion, or 10.9% (increased 12.0% on a constant currency basis).

net revenue increased by $379 million, or 7.8%, to $5.3 billion, and net revenue from outside of the U.S.

For the nine months ended July 31, 2025, total net revenue of $24.6 billion represented an increase of $2.9 billion, or 13.6% (increased 14.0% on a constant currency basis).

net revenue increased by $1.8 billion, or 22.9%, to $9.5 billion, and net revenue from outside of the U.S.

increased by $1.1 billion, or 8.4%, to $15.1 billion.

4 unchanged sentences

The components of the weighted net revenue change by segment were as follows:

For the three months ended April 30, 2025 For the six months ended April 30, 2025

For the three months ended July 31, 2025 For the nine months ended July 31, 2025

Percentage Points

1 unchanged sentence

Hybrid Cloud 2.1 2.2

Intelligent Edge 1.1 0.2

Networking 7.9 2.9

Financial Services 0.1 —

3 unchanged sentences

Total HPE 18.5 13.6

Three months ended April 30, 2025 compared with three months ended April 30, 2024

Three months ended July 31, 2025 compared with three months ended July 31, 2024

From a segment perspective, the primary factors contributing to the change in total net revenue are summarized as follows:

• Server net revenue increased $685 million, or 16.1%, primarily due to higher AUPs

• Hybrid Cloud net revenue increased $171 million, or 13.3%, primarily due to increase in unit volume and AUPs

• Intelligent Edge net revenue increased $76 million, or 7.0%, primarily due to higher volume and product mix

• Financial Services net revenue decreased $11 million, or 1.3%, primarily due to lower rental revenue on lower average operating leases and unfavorable currency fluctuations

• Hybrid Cloud net revenue increased $159 million, or 12.0%, primarily due to increase in unit volume

• Networking net revenue increased $609 million, or 54.3%, primarily due to the Merger

• Financial Services net revenue increased $7 million, or 0.8%, primarily due to favorable currency fluctuations

• Corporate Investments and Other net revenue decreased $68 million, or 26.0%, primarily due to the divestiture of the Communications Technology Group (“CTG”) business

Six months ended April 30, 2025 compared with six months ended April 30, 2024

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

From a segment perspective, the primary factors contributing to the change in total net revenue are summarized as follows:

1 unchanged sentence

• Hybrid Cloud net revenue increased $462 million, or 11.9%, primarily due to an increase in unit volume

• Intelligent Edge net revenue increased $21 million, or 0.9%, primarily due to an increase in our aaS offerings

• Financial Services net revenue decreased $11 million, or 0.6%, primarily due to lower rental revenue on lower average operating leases and unfavorable currency fluctuations

• Networking net revenue increased $630 million, or 18.5%, primarily due to the Merger

• Financial Services net revenue decreased $4 million, or 0.2%, primarily due to unfavorable currency fluctuations

• Corporate Investments and Other net revenue decreased $167 million, or 22.2%, primarily due to the divestiture of CTG

Please refer to the section “Segment Information” further below for a discussion of our results of operations for each reportable segment.

For the three and six months ended April 30, 2025, the total gross profit margin of 28.4% and 28.8%, respectively, represents a decrease of 4.6 and 5.8 percentage points, respectively, as compared to the respective prior year periods.

The decrease for the three and six months ended April 30, 2025, was primarily due to an increase in cost of sales in the Server, Hybrid Cloud and Intelligent Edge segments.

For the three and nine months ended July 31, 2025, the total gross profit margin of 29.2% and 29.0%, respectively, represents a decrease of 2.4 and 4.6 percentage points, respectively, as compared to the respective prior year periods.

The decrease for the three and nine months ended July 31, 2025, was primarily due to an increase in cost of sales in the Server, Networking, and Hybrid Cloud segments.

Table of Content

4 unchanged sentences

Research and development (“R&D”)

For the three months ended April 30, 2025, R&D expense decreased by $50 million, or 8.5%, primarily due to higher mix of capital versus expense investment, which contributed 12.9 percentage points to the change.

The decrease was partially offset by the cost reduction program, which contributed 4.1 percentage points to the change.

For the six months ended April 30, 2025, R&D expense decreased by $157 million, or 13.4%, primarily due to higher mix of capital versus expense investment, which contributed 11.9 percentage points to the change.

For the three months ended July 31, 2025, R&D expense increased by $75 million, or 13.7%, primarily due to operating expenses associated with Juniper Networks, which contributed 17.3 percentage points to the change, and higher employee costs, which contributed 6.2 percentage points.

The increase was partially offset by lower operating expenses due to higher mix of capital versus expense investment, which contributed 8.9 percentage points to the change.

For the nine months ended July 31, 2025, R&D expense decreased by $82 million, or 4.8%, primarily due to higher mix of capital versus expense investment, which contributed 11.0 percentage points to the change.

The decrease was partially offset by higher operating expenses associated with Juniper Networks, which contributed 5.5 percentage points to the change.

Selling, general and administrative (“SG&A”)

For the three and six months ended April 30, 2025, SG&A expense increased by $83 million, or 6.8%, and $135 million, or 5.6%, respectively, primarily due to the cost reduction program, which contributed 7.0 and 6.1 percentage points, respectively.

For the three months ended July 31, 2025, SG&A expense increased by $267 million, or 21.7%, primarily due to higher employee costs and increased operating expenses associated with Juniper Networks, which contributed 21.9 percentage points to the change.

For the nine months ended July 31, 2025, SG&A expense increased by $402 million, or 11.0%, primarily due to higher employee costs and increased operating expenses associated with Juniper Networks, which contributed 7.8 percentage points to the change, and the expenses incurred related to the cost reduction program, which contributed 3.2 percentage points to the change.

Impairment of goodwill

Impairment of goodwill f or the three and six months ended April 30, 2025 represents a partial goodwill impairment charge of $1.4 billion, as it was determined that the fair value of the Hybrid Cloud reporting unit was below the carrying value of its net assets.

Impairment of goodwill f or the nine months ended July 31, 2025 represents a partial goodwill impairment charge of $1.4 billion, as it was determined that the fair value of the Hybrid Cloud reporting unit was below the carrying value of its net assets.

The decline in the fair value was primarily driven by an increase in the discount rate used in the discounted cash flows analysis, driven by heightened macroeconomic uncertainty.

1 unchanged sentence

Acquisition, disposition and other charges

For the three months ended April 30, 2025, acquisition, disposition and other charges increased by $9 million or 19.6%, primarily due to costs incurred in connection with the proposed acquisition of Juniper Networks.

For the six months ended April 30, 2025, acquisition, disposition and other charges increased by $32 million, or 36.0%, primarily due to costs incurred in connection with the divestiture of CTG and the proposed acquisition of Juniper Networks.

For the three and nine months ended July 31, 2025, acquisition, disposition and other charges increased by $139 million or 331.0%, and $171 million, or 130.5%, respectively, primarily due to costs incurred in connection with the Merger.

Interest and other, net

For the three months ended July 31, 2025, interest and other, net income increased by $20 million, or 166.7%, primarily due to a gain relating to a settlement to resolve claims solely against Sushovan Hussain, the former CFO of Autonomy, in the ongoing Autonomy litigation, partially offset by higher net interest expense.

For the nine months ended July 31, 2025, interest and other, net income increased by $208 million, or 170.5%, primarily due to an increase in the non-service net periodic benefit credit, the gain from the settlement to resolve claims solely against Sushovan Hussain in the ongoing Autonomy litigation, a gain on equity investments recognized in the current period compared to a loss on equity investments in the prior-year period, and increase in net interest income.

Gain on sale of a business

1 unchanged sentence

We received net proceeds of $210 million and recognized a gain of $245 million.

Interest and other, net

For the three months ended April 30, 2025, interest and other, net income increased by $61 million, or 277.3%, primarily due to an increase in net interest income and an increase in the non-service net periodic benefit credit.

For the six months ended April 30, 2025, interest and other, net income increased by $188 million, or 170.9%, primarily due to an increase in net interest income, a gain on equity investments recognized in the current period compared to a loss on equity investments in the prior-year period, and an increase in the non-service net periodic benefit credit.

Earnings from equity interests

For the three and six months ended April 30, 2025, earnings from equity interests decreased $17 million, or 40.5%, and $46 million, or 52.3%, respectively, primarily due to lower earnings from our equity interest in H3C as a result of the disposition of 30% of the total issued share capital of H3C.

For the three and nine months ended July 31, 2025, earnings from equity interests decreased $41 million, or 56.2%, and $87 million, or 54.0%, respectively, primarily due to lower earnings from our equity interest in H3C Technologies Co., Limited (“H3C”) as a result of the disposition of 30% of the total issued share capital of H3C.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

Provision for taxes

For the three months ended April 30, 2025 and 2024, we recorded income tax expense of $5 million and $131 million, respectively, which reflects an effective tax rate of (0.5)% and 29.4%, respectively.

For the six months ended April 30, 2025 and 2024, we recorded income tax expense of $111 million and $227 million, respectively, which reflects an effective tax rate of (35.6)% and 24.5%, respectively.

For the three and six months ended April 30, 2025, our effective tax rate generally differs from the U.S.

federal statutory rate of 21% due to favorable tax rates associated with certain earnings from our operations in lower tax jurisdictions throughout the world and the effects of the non-deductible goodwill impairment.

For the three and six months ended April 30, 2024, our effective tax rate differs from the U.S.

federal statutory rate of 21% due to the geographic mix of forecasted earnings and net unfavorable permanent differences from U.S.

income tax on non-U.S.

Benefit (provision) for taxes

For the three months ended July 31, 2025 and 2024, we recorded income tax benefit of $17 million and income tax expense of $96 million, respectively, which reflects an effective tax rate of (6.5)% and 15.8%, respectively.

For the nine months ended July 31, 2025 and 2024, we recorded income tax expense of $94 million and $323 million, respectively, which reflects an effective tax rate of (359.9)% and 21.0%, respectively.

For the three and nine months ended July 31, 2025 and the three months ended July 31, 2024, the effective tax rate generally differs from the U.S.

federal statutory rate of 21% due to favorable tax rates associated with certain earnings from our operations in lower tax jurisdictions throughout the world but is also impacted by discrete tax adjustments during each fiscal period.

The effective tax rate for the nine months ended July 31, 2025 also included the effects of the non-deductible goodwill impairment.

For further discussion, refer to Note 5, “Taxes on Earnings” to the Condensed Consolidated Financial Statements in Item 1 of Part I.

4 unchanged sentences

Segment Results

The following table and ensuing discussion provide an overview of our key financial metrics by segment for the three months ended April 30, 2025, as compared to the prior-year period:

The following table and ensuing discussion provide an overview of our key financial metrics by segment for the three months ended July 31, 2025, as compared to the prior-year period:

HPE Consolidated Server

Intelligent Edge Financial Services Corporate Investments and Other

Networking Financial Services Corporate Investments and Other

Dollars in millions

2 unchanged sentences

Year-over-year change % 18.5 % 16.1 % 12.0 % 54.3 % 0.8 % (26.0) %

(Loss) earnings from operations (2)

Earnings (loss) from operations (2)

$ 247 $ 317 $ 87 $ 360 $ 88 $ (14)

(Loss) earnings from operations as a % of net revenue (14.5) % 5.9 % 5.4 % 23.6 % 10.4 % (5.2) %

Earnings (loss) from operations as a % of net revenue 2.7 % 6.4 % 5.9 % 20.8 % 9.9 % (7.2) %

Year-over-year change percentage points (4.4) pts (4.4) pts 0.7 pts (1.6) pts 0.9 pts (5.7) pts

The following table and ensuing discussion provide an overview of our key financial metrics by segment for the six months ended April 30, 2025, as compared to the prior-year period:

HPE Consolidated Server Hybrid Cloud Intelligent Edge Financial Services Corporate Investments and Other

The following table and ensuing discussion provide an overview of our key financial metrics by segment for the nine months ended July 31, 2025, as compared to the prior-year period:

HPE Consolidated Server Hybrid Cloud Networking Financial Services Corporate Investments and Other

Dollars in millions

6 unchanged sentences

Year-over-year change percentage points (8.6) pts (4.3) pts 2.7 pts (1.2) pts 1.0 pts (1.3) pts

(1) HPE consolidated net revenue excludes intersegment net revenue.

Segment net revenues include intersegment net revenue.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

(1) HPE consolidated net revenue excludes intersegment net revenue.

Segment net revenues include intersegment net revenue.

(2) Segment earnings (loss) from operations exclude certain unallocated corporate costs and eliminations, stock-based compensation expense, amortization of intangible assets, transformation (credit) costs, H3C divestiture related severance costs, severance costs related to the cost reduction program, acquisition, disposition and other charges and impairment of goodwill.

For the three months ended April 30, For the six months ended April 30,

(2) Segment earnings (loss) from operations exclude certain unallocated corporate costs and eliminations, stock-based compensation expense, amortization of intangible assets, transformation costs, H3C divestiture related severance costs, severance costs related to the cost reduction program, acquisition, disposition and other charges, and impairment of goodwill.

For the three months ended July 31, For the nine months ended July 31,

2025 2024 % Change 2025 2024 % Change

3 unchanged sentences

Earnings from operations as a % of net revenue 6.4 % 10.8 % 6.8 % 11.1 %

Three months ended April 30, 2025 compared with three months ended April 30, 2024

Server net revenue increased by $217 million, or 5.6% (increased 6.8% on a constant currency basis), primarily due to a $235 million, or 7.9%, increase in product revenue.

Three months ended July 31, 2025 compared with three months ended July 31, 2024

Server segment net revenue increased by $685 million, or 16.1% (increased 15.7% on a constant currency basis), primarily due to a $698 million, or 20.5%, increase in product revenue.

The increase in product revenue was primarily due to higher net AUPs of $750 million, or 22.0%, partially offset by a decrease in net unit volume of $50 million, or 1.5%.

Server earnings from operations as a percentage of net revenue decreased 5.1 percentage points due to an increase in cost of products as a percentage of net revenue resulting from input cost increases and competitive pricing pressure.

Server segment earnings from operations as a percentage of net revenue decreased 4.4 percentage points due to an increase in cost of products as a percentage of net revenue resulting from higher mix of lower margin products and input cost increases.

Operating expenses as a percentage of net revenue remained relatively flat as compared to the prior-year period.

Six months ended April 30, 2025 compared with six months ended April 30, 2024

Server net revenue increased by $1,180 million, or 16.5% (increased 17.5% on a constant currency basis), primarily due to a $1,180 million, or 21.5%, increase in product revenue.

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

Server segment net revenue increased by $1,865 million, or 16.3% (increased 16.8% on a constant currency basis), primarily due to a $1,878 million, or 21.1%, increase in product revenue.

The increase in product revenue was primarily due to higher net AUPs of $2,357 million, or 26.5%, partially offset by a decrease in net unit volume of $427 million, or 4.8%, and unfavorable currency fluctuations of $52 million, or 0.6%.

Server earnings from operations as a percentage of net revenue decreased 4.1 percentage points due to an increase in costs of products as a percentage of net revenue, moderated by a decrease in operating expenses as a percentage of net revenue.

The increase in cost of products as a percentage of net revenue was primarily due to competitive pricing pressure, input cost increases, and higher mix of lower margin products.

The decrease in operating expenses as a percentage of net revenue was primarily due to the scale of the net revenue increase while total operating expenses remained relatively flat.

For the three months ended April 30, For the six months ended April 30,

Server segment earnings from operations as a percentage of net revenue decreased 4.3 percentage points due to an increase in costs of products as a percentage of net revenue, moderated by a decrease in operating expenses as a percentage of net revenue.

The increase in cost of products as a percentage of net revenue was primarily due to input cost increases, competitive pricing pressure, and higher mix of lower margin products.

The decrease in operating expenses as a percentage of net revenue was primarily due to the scale of the net revenue increase, partially offset by higher SG&A expenses.

For the three months ended July 31, For the nine months ended July 31,

2025 2024 % Change 2025 2024 % Change

3 unchanged sentences

Earnings from operations as a % of net revenue 5.9 % 5.2 % 6.1 % 3.4 %

Three months ended April 30, 2025 compared with three months ended April 30, 2024

Hybrid Cloud net revenue increased by $171 million, or 13.3% (increased 14.6% on a constant currency basis), primarily due to increases in unit volume and AUPs.

Hybrid Cloud product revenue increased by $106 million, or 15.9%, primarily due to a unit volume increase of $96 million, or 14.4%, led by private cloud products.

Hybrid Cloud services revenue increased by $65 million, or 10.6%, primarily driven by higher services contribution from private cloud products and storage subscription services.

Hybrid Cloud earnings from operations as a percentage of net revenue increased 4.4 percentage points, due to a decrease in operating expenses as a percentage of net revenue.

Operating expenses decreased due to capitalization of software costs and cost containment measures.

Cost of products and services as a percentage of net revenue increased due to a higher contribution

Three months ended July 31, 2025 compared with three months ended July 31, 2024

Hybrid Cloud segment net revenue increased by $159 million, or 12.0% (increased 10.9% on a constant currency basis), primarily due to an increase in unit volume, partially offset by a decrease in AUPs.

Hybrid Cloud product revenue increased by $62 million, or 8.5%, primarily due to a unit volume increase of $260 million, or 35.5%, led by private cloud and storage products.

This increase was partially offset by decrease in AUPs of $200 million, or 27.3%, led by private cloud and storage products.

Hybrid Cloud services revenue increased by $97 million, or 16.3%, primarily driven by higher services contribution from private cloud solutions.

Hybrid Cloud segment earnings from operations as a percentage of net revenue increased 0.7 percentage points, due to a decrease in operating expenses as a percentage of net revenue, partially offset by an increase in cost of products and services as a percentage of net revenue.

Operating expenses as a percentage of net revenue decreased due to the scale of net revenue growth.

Cost of products and services as a percentage of net revenue increased due to a higher contribution from our products

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

from our products portfolio, as we transition to a more software-defined platform with HPE Alletra.

Six months ended April 30, 2025 compared with six months ended April 30, 2024

Hybrid Cloud net revenue increased by $303 million, or 11.9%, (increased 12.8% on a constant currency basis) primarily due to an increase in unit volume.

Hybrid Cloud product revenue increased by $159 million, or 11.7%, primarily due to a unit volume increase of $132 million, or 9.7%, led by private cloud products.

Hybrid Cloud services revenue increased by $144 million, or 12.0%, primarily driven by higher services contribution from private cloud products and storage subscription services.

Hybrid Cloud earnings from operations as a percentage of net revenue increased 3.7 percentage points, due to a decrease in operating expenses as a percentage of net revenue, primarily driven by capitalization of software costs and cost containment measures.

portfolio, as we transition to a more software-defined platform with HPE Alletra.

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

Hybrid Cloud segment net revenue increased by $462 million, or 11.9%, (increased 12.2% on a constant currency basis) primarily due to an increase in unit volume, partially offset by a decrease in AUPs.

Hybrid Cloud product revenue increased by $221 million, or 10.6%, primarily due to a unit volume increase of $392 million, or 18.8%, led by private cloud and storage products.

This increase was partially offset by a decrease in AUPs of $157 million, or 7.5%, led by private cloud products.

Hybrid Cloud services revenue increased by $241 million, or 13.5%, primarily driven by higher services contribution from private cloud solutions.

Hybrid Cloud segment earnings from operations as a percentage of net revenue increased 2.7 percentage points, due to a decrease in operating expenses as a percentage of net revenue, primarily driven by capitalization of software costs and cost containment measures.

Cost of products and services as a percentage of net revenue increased due to a higher contribution from our products portfolio, as we transition to a more software-defined platform with HPE Alletra.

Intelligent Edge

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 % Change 2025 2024 % Change

3 unchanged sentences

Earnings from operations as a % of net revenue 20.8 % 22.4 % 23.5 % 24.7 %

Three months ended April 30, 2025 compared with three months ended April 30, 2024

Intelligent Edge net revenue increased by $76 million, or 7.0% (increased 8.0% on a constant currency basis).

Product revenue increased by $43 million, or 5.4%, primarily led by higher volume and product mix effect of $52 million, or 6.5%.

The product revenue increase was primarily led by switching products due to increased demand.

Services net revenue increased $33 million, or 11.3%, primarily led by our aaS offerings.

Intelligent Edge earnings from operations as a percentage of net revenue increased 1.8 percentage points primarily due to a decrease in operating expenses as a percentage of net revenue, partially offset by an increase in cost of products and services as a percentage of net revenue.

Three months ended July 31, 2025 compared with three months ended July 31, 2024

Networking segment net revenue increased by $609 million, or 54.3% (increased 53.9% on a constant currency basis).

Product revenue increased by $396 million, or 48.2%, primarily led by revenue attributable to Juniper Networks of $303 million, or 36.9%, higher volume and product mix effect of $58 million, or 7.0%, and higher AUPs of $34 million, or 4.1%.

Services net revenue increased $213 million, or 71.2%, primarily led by revenue attributable to Juniper Networks of $177 million, or 59.2%, and increased services net revenue primarily from our aaS offerings of $36 million, or 12.0%.

Networking segment earnings from operations as a percentage of net revenue decreased 1.6 percentage points primarily due to an increase in cost of products and services as a percentage of net revenue, partially offset by a decrease in operating expenses as a percentage of net revenue.

The increase in cost of product and services as a percentage of net revenue was primarily due to competitive pricing pressure.

The decrease in operating expenses as a percentage of net revenue primarily due to our cost containment measures.

Six months ended April 30, 2025 compared with six months ended April 30, 2024

Intelligent Edge net revenue increased by $21 million, or 0.9% (increased 1.5% on a constant currency basis).

Services net revenue increased $73 million, or 12.8%, primarily led by our aaS offerings.

Product revenue decreased by $52 million, or 3.0%, led by lower AUPs of $172 million, or 10.0%, partially offset by higher volume and product mix effect of $128 million, or 7.5%.

The product revenue decrease was primarily led by switching products due to higher backlog reduction in prior-year period, partially offset by an increase in wireless local area network products.

Intelligent Edge earnings from operations as a percentage of net revenue remained relatively flat.

The decrease in operating expenses as a percentage of net revenue was primarily due to the scale of the net revenue increase, partially offset by higher operating expenses associated with Juniper Networks.

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

Networking segment net revenue increased by $630 million, or 18.5% (increased 18.8% on a constant currency basis).

Product revenue increased by $344 million, or 13.6%, primarily led by revenue attributable to Juniper Networks of $303 million, or 11.9%, higher volume and product mix effect of $185 million, or 7.3%, partially offset by lower AUPs of $138 million, or 5.4%.

Services net revenue increased $286 million, or 32.8%, primarily led by revenue attributable to Juniper Networks of $177 million, or 20.3%, and increased services net revenue primarily from our aaS offerings of $109 million, or 12.5%.

Networking segment earnings from operations as a percentage of net revenue decreased 1.2 percentage points primarily due to an increase in cost of products and services as a percentage of net revenue, partially offset by a decrease in operating expenses as a percentage of net revenue.

The increase in cost of product and services as a percentage of net revenue was primarily due to competitive pricing pressure.

The decrease in operating expenses as a percentage of net revenue primarily due to the scale of the net revenue increase, partially offset by higher operating expenses associated with Juniper Networks.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Financial Services

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 % Change 2025 2024 % Change

3 unchanged sentences

Earnings from operations as a % of net revenue 9.9 % 9.0 % 9.9 % 8.9 %

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Three months ended April 30, 2025 compared with three months ended April 30, 2024

FS net revenue decreased by $11 million, or 1.3% (increased 0.8% on a constant currency basis) primarily due to lower rental revenue on lower average operating leases and unfavorable currency fluctuations, partially offset by higher finance income from higher average finance leases, along with higher asset management remarketing revenue and asset recovery services revenue.

FS earnings from operations as a percentage of net revenue increased 1.1 percentage points due to a decrease in cost of services as a percentage of net revenue, while operating expenses as a percentage of net revenue were relatively flat.

Three months ended July 31, 2025 compared with three months ended July 31, 2024

FS segment net revenue increased by $7 million, or 0.8% (decreased 0.9% on a constant currency basis) primarily due to favorable currency fluctuations, higher finance income from higher average finance leases, and higher asset management remarketing revenue, partially offset by lower rental revenue on lower average operating leases.

FS segment earnings from operations as a percentage of net revenue increased 0.9 percentage points due to a decrease in cost of services as a percentage of net revenue, while operating expenses as a percentage of net revenue were relatively flat.

The decrease in cost of services as a percentage of net revenue resulted primarily from lower depreciation expense, partially offset by higher bad debt expense.

Six months ended April 30, 2025 compared with six months ended April 30, 2024

FS net revenue decreased by $11 million, or 0.6% (increased 1.2% on a constant currency basis) primarily due to lower rental revenue on lower average operating leases and unfavorable currency fluctuations, partially offset by higher finance income from higher average finance leases, along with higher asset management remarketing revenue and asset recovery services revenue.

FS earnings from operations as a percentage of net revenue increased 1.0 percentage points due to a decrease in cost of services as a percentage of net revenue, while operating expenses as a percentage of net revenue were flat.

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

FS segment net revenue decreased by $4 million, or 0.2% (increased 0.5% on a constant currency basis) primarily due to unfavorable currency fluctuations and lower rental revenue on lower average operating leases, partially offset by higher finance income from higher average finance leases, along with higher asset management remarketing revenue and asset recovery services revenue.

FS segment earnings from operations as a percentage of net revenue increased 1.0 percentage points due to a decrease in cost of services as a percentage of net revenue, while operating expenses as a percentage of net revenue were flat.

The decrease in cost of services as a percentage of net revenue resulted primarily from lower depreciation expense, partially offset by higher bad debt expense and higher borrowing costs.

Financing Volume

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 2025 2024

Financing volume $ 1,513 $ 1,483 $ 3,974 $ 4,518

Financing volume, which represents the amount of financing provided to customers for equipment and related software and services, including intercompany activity, decreased 21.9% and 18.9% for the three and six months ended April 30, 2025, as compared to the prior-year period.

The decrease for the three and six months ended April 30, 2025, was primarily driven by lower financing of both HPE and third-party product sales and services.

Financing volume, which represents the amount of financing provided to customers for equipment and related software and services, including intercompany activity, increased 2.0% and decreased 12.0% for the three and nine months ended July 31, 2025, respectively, as compared to the prior-year period.

The increase for the three months ended July 31, 2025 was primarily driven by higher financing of third-party product sales and services, partially offset by lower financing of HPE product sales and services.

The decrease for the nine months ended July 31, 2025 was primarily driven by lower financing of both HPE and third-party product sales and services.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Portfolio Assets and Ratios

The portfolio assets and ratios derived from the segment balance sheets for FS were as follows:

April 30, 2025 October 31, 2024

July 31, 2025 October 31, 2024

Dollars in millions

11 unchanged sentences

(1) Intercompany activity is eliminated in consolidation.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

(2) Allowance for credit losses for financing receivables includes both the short- and long-term portions.

(3) Debt benefiting FS consists of intercompany equity that is treated as debt for segment reporting purposes, intercompany debt, and borrowing- and funding-related activity associated with FS and its subsidiaries.

Debt benefiting FS totaled $11.6 billion and $11.8 billion as of April 30, 2025 and October 31, 2024, respectively, and was determined by applying an assumed debt-to-equity ratio, which management believes to be comparable to that of other similar financing companies.

FS equity at both April 30, 2025 and October 31, 2024 was $1.7 billion.

As of April 30, 2025 and October 31, 2024, FS net cash and cash equivalents balances were approximately $670 million and $533 million, respectively.

Net portfolio assets as of April 30, 2025 decreased 2.2% from October 31, 2024.

(3) Debt benefiting the FS segment consists of intercompany equity that is treated as debt for segment reporting purposes, intercompany debt, and borrowing- and funding-related activity associated with the FS segment and its subsidiaries.

Debt benefiting the FS segment totaled $11.4 billion and $11.8 billion as of July 31, 2025 and October 31, 2024, respectively, and was determined by applying an assumed debt-to-equity ratio, which management believes to be comparable to that of other similar financing companies.

The FS segment equity was $1.6 billion and $1.7 billion as of July 31, 2025 and October 31, 2024, respectively.

As of July 31, 2025 and October 31, 2024, the FS segment net cash and cash equivalents balances were approximately $666 million and $533 million, respectively.

Net portfolio assets as of July 31, 2025 decreased 2.6% from October 31, 2024.

The decrease generally resulted from portfolio runoff exceeding new financing volume during the period, partially offset by favorable currency fluctuations.

FS bad debt expense includes charges to general reserves, specific reserves, and write-offs for sales-type, direct-financing, and operating leases.

For the three and six months ended April 30, 2025, FS recorded net bad debt expense of $25 million and $50 million, respectively.

For the three and six months ended April 30, 2024, FS recorded net bad debt expense of $10 million and $22 million, respectively.

The FS segment bad debt expense includes charges to general reserves, specific reserves, and write-offs for sales-type, direct-financing, and operating leases.

For the three and nine months ended July 31, 2025, the FS segment recorded net bad debt expense of $27 million and $77 million, respectively.

For the three and nine months ended July 31, 2024, the FS segment recorded net bad debt expense of $14 million and $36 million, respectively.

Corporate Investments and Other

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 % Change 2025 2024 % Change

3 unchanged sentences

Loss from operations as a % of net revenue (7.2) % (1.5) % (4.4) % (3.1) %

Three months ended April 30, 2025 compared with three months ended April 30, 2024

Corporate Investments and Other net revenue decreased by $58 million, or 23.0% (decreased 21.4% on a constant currency basis), primarily due to the divestiture of the CTG business effective December 1, 2024.

Corporate Investments and Other loss from operations remained relatively flat.

Six months ended April 30, 2025 compared with six months ended April 30, 2024

Corporate Investments and Other net revenue decreased by $99 million, or 20.2% (decreased 18.6% on a constant currency basis), primarily due to the divestiture of the CTG business effective December 1, 2024.

Corporate Investments and Other loss from operations as a percentage of net revenue decreased by 0.8 percentage points primarily due decreases in cost of services and operating expenses as a percentage of net revenue due to the divestiture of the CTG business effective December 1, 2024.

Three months ended July 31, 2025 compared with three months ended July 31, 2024

Corporate Investments and Other segment net revenue decreased by $68 million, or 26.0% (decreased 29.4% on a constant currency basis), primarily due to the divestiture of the CTG business effective December 1, 2024.

Corporate Investments and Other segment loss from operations as a percentage of net revenue increased by 5.7% percentage points primarily due to increases in cost of services and operating expenses as a percentage of net revenue due to the scale of the net revenue decline.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Nine months ended July 31, 2025 compared with nine months ended July 31, 2024

Corporate Investments and Other segment net revenue decreased by $167 million, or 22.2% (decreased 22.3% on a constant currency basis), primarily due to the divestiture of the CTG business effective December 1, 2024.

Corporate Investments and Other segment loss from operations remained relatively flat.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

6 unchanged sentences

Accounting policies that are critical in the portrayal of our financial condition and results of operations and require management’s most difficult, subjective, or complex judgments include revenue recognition, taxes on earnings, impairment assessment of goodwill and intangible assets, and contingencies.

As of July 31, 2025, there have been no significant changes to our critical accounting estimates since our Annual Report on Form 10-K for the fiscal year ended October 31, 2024, except as set forth below.

Business Combinations

We account for acquired businesses using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed are recorded at their respective fair values at the date of acquisition.

The determination of fair values of identifiable assets and liabilities requires estimates and the use of valuation techniques when fair value is not readily available and requires a significant amount of management judgment.

For the valuation of intangible assets acquired in a business combination, we use an income approach.

The income approach estimates fair value by discounting associated lifetime expected future cash flows to their present value and relies on significant assumptions regarding future expected cash flows, forecasted revenue, customer attrition rates, obsolescence rate and the discount rate.

Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates.

Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on the determination of the fair value of the intangible assets acquired.

Third-party valuation specialists are utilized for certain estimates.

We estimate the fair value of acquired inventory, including raw materials, finished goods and work in process, by determining the estimated selling price when completed, less an estimate of costs to be incurred to complete and sell the inventory, and an estimate of a reasonable profit allowance for those manufacturing and selling efforts.

The fair value of inventory is recognized in our results of operations as the inventory is sold.

Some of the more significant estimates and assumptions inherent in the estimate of the fair value of inventory include stage of completion, costs to complete, costs to dispose and selling price.

We estimate the fair value of acquired property, plant and equipment using a combination of the cost and market approaches.

The market approach estimates fair value by analyzing recent actual market transactions for similar assets or liabilities.

The cost approach estimates fair value based on the expected cost to replace or reproduce the asset or liability and relies on assumptions regarding the occurrence and extent of any physical, functional and/or economic obsolescence.

Some of the more significant estimates and assumptions inherent in these approaches are the values of asset replacement costs, comparable assets and estimated remaining economic lives of the assets.

The excess of the purchase price over fair values of identifiable assets acquired and liabilities assumed is recorded as goodwill.

During the measurement period, which is up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill due to the use of preliminary information in our initial estimates.

Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

As of April 30, 2025, there have been no significant changes to our critical accounting estimates since our Annual Report on Form 10-K for the fiscal year ended October 31, 2024, except for estimates used in our goodwill impairment analysis.

We review goodwill for impairment at the reporting unit level annually on the first day of the fourth quarter, or whenever events or circumstances indicate the carrying amount of goodwill may not be recoverable.

1 unchanged sentence

We performed interim goodwill impairment tests as of November 1, 2024 and April 30, 2025.

As of April 30, 2025, our reporting units with goodwill are consistent with the reportable segments identified in Note 2, “Segment Information” to the Condensed Consolidated Financial Statements in Item 1 of Part I of this Quarterly Report, with the exception of Corporate Investments and Other which contains one reporting unit:

Advisory and Professional Services.

As of July 31, 2025, our reporting units with goodwill are consistent with the reportable segments identified in Note 2, “Segment Information” to the Condensed Consolidated Financial Statements in Item 1 of Part I of this Quarterly Report, with the exception of Networking and Corporate Investments and Other segments.

The Networking segment contains two reporting units:

Intelligent Edge and Juniper Networks.

The Corporate Investments and Other segment contains the A & PS reporting unit.

When performing the goodwill impairment test, we compare the fair value of each reporting unit to its carrying amount.

23 unchanged sentences

As a result, we recorded a goodwill impairment charge of $1.4 billion in the second quarter of fiscal 2025.

Subsequent to the impairment of Hybrid Cloud reporting unit, the indicated fair values of the reporting units exceeded their respective carrying amounts by a range of 0% to 112%.

In order to evaluate the sensitivity of the estimated fair value of

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

Subsequent to the impairment of Hybrid Cloud reporting unit, the indicated fair values of the reporting units exceeded their respective carrying amounts by a range of 0% to 112%.

In order to evaluate the sensitivity of the estimated fair value of our reporting units in the goodwill impairment test, we applied a hypothetical 10% decrease to the fair value of each reporting unit.

our reporting units in the goodwill impairment test, we applied a hypothetical 10% decrease to the fair value of each reporting unit.

Based on the results of this hypothetical 10% decrease all of the reporting units had an excess of fair value over carrying amount, except Server and Hybrid Cloud.

The Hybrid Cloud reporting unit has remaining goodwill of $3.5 billion as of April 30, 2025 and an excess of fair value over carrying value of net assets of 0% as of the interim test date.

The Hybrid Cloud reporting unit has remaining goodwill of $3.5 billion as of July 31, 2025 and an excess of fair value over carrying value of net assets of 0% as of the interim test date.

Hybrid Cloud business is transitioning to a more cloud-native, software-defined platform with HPE Alletra.

2 unchanged sentences

The fair value of the Server reporting unit was also impacted by an increase in the discount rate used in the discounted cash flow analysis, driven by heightened macroeconomic uncertainty.

The Server reporting unit has a goodwill balance of $10.2 billion as of April 30, 2025.

The Server reporting unit has a goodwill balance of $10.2 billion as of July 31, 2025.

In the current macroeconomic and inflationary environment, customers have invested selectively, resulting in moderate unit growth and competitive pricing in the traditional servers business.

5 unchanged sentences

We use cash generated by operations as our primary source of liquidity.

We believe that internally generated cash flows will be generally sufficient to support our operating businesses, capital expenditures, product development initiatives, acquisitions and disposal activities including legal settlements, restructuring activities, transformation (credit) costs, indemnifications, maturing debt, interest payments, and income tax payments, in addition to any future investments, share repurchases, and stockholder dividend payments.

We believe that internally generated cash flows will be generally sufficient to support our operating businesses, capital expenditures, product development initiatives, acquisitions and disposal activities including legal settlements, restructuring activities, transformation costs, indemnifications, maturing debt, interest payments, and income tax payments, in addition to any future investments, share repurchases, and stockholder dividend payments.

We expect to supplement this short-term liquidity, if necessary, by accessing the capital markets, issuing commercial paper, and borrowing under credit facilities made available by various domestic and foreign financial institutions.

However, our access to capital markets may be constrained and our cost of borrowing may increase under certain business, market and economic conditions.

We anticipate that the funds made available, including the debt funding related to the proposed acquisition of Juniper Networks, proceeds from issuance of the Preferred Stock and proceeds from the sale of 30% of the total issued share capital of H3C, and cash generated from our operations, along with our access to capital markets, will be sufficient to meet our liquidity requirements for at least the next twelve months (including for the payment of consideration to consummate the Juniper Networks transaction) and for the foreseeable future thereafter.

Our liquidity is subject to various risks including the risks identified in the section entitled “Risk Factors” in Item 1A of Part I of the Annual Report on Form 10-K for the fiscal year ended October 31, 2024, as modified by the risk statements in the section titled “Risk Factors” in Item 1A of Part II of this Quarterly Report, and market risks identified in the section entitled “Quantitative and Qualitative Disclosures about Market Risk” in Item 3 of Part I of this Quarterly Report.

Our cash balances are held in numerous locations throughout the world, with a substantial amount held in the U.S.

as of April 30, 2025.

We anticipate that the funds made available, cash generated from our operations, along with our access to capital markets, will be sufficient to meet our liquidity requirements for at least the next twelve months and for the foreseeable future thereafter.

Our liquidity is subject to various risks including the risks identified in the section entitled “Risk Factors” in Item 1A of Part I of the Annual Report on Form 10-K for the fiscal year ended October 31, 2024, as modified by the risk statements in the section titled “Risk Factors” in Item 1A of Part II subsequent Quarterly Reports, and market risks identified in the section entitled “Quantitative and Qualitative Disclosures about Market Risk” in Item 3 of Part I of this Quarterly Report.

Our cash balances are held in numerous locations throughout the world, with a substantial amount held outside the U.S.

as of July 31, 2025.

We utilize a variety of planning and financing strategies in an effort to ensure that our worldwide cash is available when and where it is needed.

9 unchanged sentences

to have a material effect on our overall liquidity, financial condition, or results of operations.

In connection with the share repurchase program previously authorized by our Board of Directors, we repurchased and settled an aggregate amount of $102 million, during the first nine months of fiscal 2025.

As of July 31, 2025, we had a remaining authorization of approximately $0.7 billion for future share repurchases.

For more information on our share

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

As of April 30, 2025, we had a remaining authorization of approximately $0.7 billion for future share repurchases.

For more information on our share repurchase program, refer to the section entitled “Unregistered Sales of Equity Securities and Use of Proceeds” in Item 2 of Part II.

repurchase program, refer to the section entitled “Unregistered Sales of Equity Securities and Use of Proceeds” in Item 2 of Part II.

On May 23, 2024, we announced plans to divest our CTG business to HCLTech.

3 unchanged sentences

We received net proceeds of $210 million and recognized a gain of $245 million included in Gain on sale of a business in the Condensed Consolidated Statements of Earnings.

In September 2024, we issued $9.0 billion of senior unsecured notes and $1.5 billion of Preferred Stock, the net proceeds of which we intend to use to fund a portion of the consideration for the acquisition of Juniper Networks and for other general corporate purposes.

If the transaction is terminated, the senior unsecured notes and Preferred Stock will be treated as follows:

• If (i) the proposed acquisition of Juniper Networks does not close on or before the later of (a) the date that is five business days after October 9, 2025 and (b) the date that is five business days after any later date to which Juniper Networks and HPE may agree to extend the “End Date” (as defined in the Merger Agreement) or (ii) HPE notifies the trustee of such notes that HPE will not pursue the consummation of the proposed acquisition of Juniper Networks, we shall be required to redeem $6.5 billion of these senior unsecured notes.

• If (i) the proposed acquisition of Juniper Networks does not close on or before the later of (a) the date that is five business days after October 9, 2025 and (b) the date that is five business days after any later date to which Juniper Networks and HPE may agree to extend the “End Date” (as defined in the Merger Agreement) or (ii) HPE notifies the holders of the Preferred Stock in writing that HPE will not pursue the consummation of the proposed acquisition of Juniper Networks, we may, at our option, redeem the Preferred Stock, in whole but not in part.

HPE funded the aggregate consideration for the Merger through a combination of cash from its balance sheet, commercial paper issuances, and borrowings pursuant to the three-year delayed-draw term loan credit facility of $3.0 billion and the 364-day delayed-draw term loan credit facility of $1.0 billion entered into in September 2024.

For more information on the drawdown term loan facility, see Note 12 “Borrowings” in Item 1 of Part I.

Our cash, cash equivalents, restricted cash, total debt, and available borrowing resources were as follows:

April 30, 2025 October 31, 2024

July 31, 2025 October 31, 2024

Cash, cash equivalents and restricted cash $ 4,697 $ 15,105

3 unchanged sentences

Uncommitted lines of credit (3)

(1) Excludes the financing commitment for the Juniper Networks acquisition.

The maximum aggregate commitment under this facility is $4.0 billion, however, no balances were outstanding under this facility as of April 30, 2025.

(2) The maximum aggregate borrowing amount of the commercial paper programs and revolving credit facility is $5.75 billion.

$ 1,014 $ 908

(1) The prior period excludes the financing commitment for the Merger.

The maximum aggregate commitment under those facilities is $4.0 billion, however, no balances were outstanding under these facilities as of the prior period.

(2) The maximum aggregate borrowing amount of the commercial paper programs and revolving credit facility is $5.75 billion as of July 31, 2025 and October 31, 2024, with an incremental $500 million accessible exclusively through the revolving credit facility as of July 31, 2025.

(3) The maximum aggregate capacity under the uncommitted lines of credit is $1.4 billion, of which $0.4 billion was primarily utilized towards issuances of bank guarantees.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

The following tables represent the way in which management reviews cash flows:

For the six months ended April 30,

Net cash (used in) provided by operating activities $ (851) $ 1,157

For the nine months ended July 31,

Net cash provided by operating activities $ 454 $ 2,311

Net cash used in investing activities (13,614) (1,580)

Net cash used in financing activities (1,492) (1,676)

Net cash provided by (used in) financing activities 2,743 (1,372)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash 9 (35)

2 unchanged sentences

Operating Activities

For the six months ended April 30, 2025, net cash used in operating activities increased by $2.0 billion, as compared to the corresponding period in fiscal 2024.

The increase was primarily due to unfavorable working capital changes driven by the timing of payments, moderated by an increase in collection from financing receivables, as compared to the prior-year period.

For the nine months ended July 31, 2025, net cash provided by operating activities decreased by $1.9 billion, as compared to the corresponding period in fiscal 2024.

The decrease was primarily due to unfavorable working capital changes driven by the timing of payments, and unfavorable changes from other assets and liabilities.

The decrease was moderated by an increase in collection from financing receivables, as compared to the prior-year period.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Our working capital metrics and cash conversion impacts were as follows:

April 30, 2025 October 31, 2024 Change April 30, 2024 October 31, 2023 Change Y/Y Change

July 31, 2025 October 31, 2024 Change July 31, 2024 October 31, 2023 Change Y/Y Change

Days of sales outstanding in accounts receivable ("DSO") 56 38 18 45 43 2 11

6 unchanged sentences

DSO is calculated by dividing ending accounts receivable, net of allowance for doubtful accounts, by a 90-day average of net revenue.

Compared to the corresponding three-month period in fiscal 2024, the decrease in DSO in the current period was primarily due to higher early collections.

Compared to the corresponding three-month period in fiscal 2024, the increase in DSO in the current period was primarily due to the impact of incremental receivables as a result of the Merger.

DOS measures the average number of days from procurement to sale of our products.

DOS is calculated by dividing ending inventory by a 90-day average of cost of goods sold.

Compared to the corresponding three-month period in fiscal 2024, the decrease in DOS in the current period was primarily due to higher shipments.

Compared to the corresponding three-month period in fiscal 2024, the decrease in DOS in the current period was primarily due to higher shipments for large deals and lower purchases, partially offset by the impact of incremental inventory as a result of the Merger.

DPO measures the average number of days our accounts payable balances are outstanding.

DPO is calculated by dividing ending accounts payable by a 90-day average of cost of goods sold.

Compared to the corresponding three-month period in fiscal 2024, the decrease in DPO in the current period was primarily due to higher vendor payments for planned AI systems, and lower inventory purchases.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Compared to the corresponding three-month period in fiscal 2024, the decrease in DPO in the current period was primarily due to lower purchases.

Investing Activities

For the six months ended April 30, 2025, net cash used in investing activities decreased by $0.1 billion, as compared to the corresponding period in fiscal 2024.

The decrease was primarily due to proceeds from the divestiture of our CTG business received in the current period of $0.2 billion, lower investments in property, plant and equipment and software assets, net of sales proceeds of $0.1 billion, partially offset by higher cash utilized in net financial collateral activities of $0.2 billion, as compared to the prior-year period.

For the nine months ended July 31, 2025, net cash used in investing activities increased by $12.0 billion, as compared to the corresponding period in fiscal 2024.

The increase was primarily due to a payment made for the Merger, net of cash acquired of $12.3 billion, partially offset by proceeds from the divestiture of our CTG business of $0.2 billion during the current period, as compared to the prior-year period.

Financing Activities

For the six months ended April 30, 2025, net cash used in financing activities decreased by $0.2 billion, as compared to the corresponding period in fiscal 2024.

This decrease was primarily due to lower repayments of debt of $1.2 billion, partially offset by lower proceeds from debt, net of issuance costs of $0.8 billion, and higher cash utilized for share repurchases and stock-based award activities of $0.1 billion, as compared to the prior-year period.

For the nine months ended July 31, 2025, net cash provided by financing activities increased by $4.1 billion, as compared to the corresponding period in fiscal 2024.

This increase was primarily due to higher proceeds from debt, net of issuance costs of $3.2 billion, lower repayments of debt of $1.1 billion, partially offset by higher cash utilized for stock-based award activities of $0.2 billion, as compared to the prior-year period.

Free Cash Flow

Free cash flow (“FCF”) represents cash flow from operations less net capital expenditures (investments in property, plant and equipment (“PP&E”) and software assets less proceeds from the sale of PP&E), and adjusted for the effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash.

For the six months ended April 30, 2025, FCF decreased by $1.9 billion, as compared to the corresponding period in fiscal 2024.

This was primarily due to higher cash used in operating activities, as compared to the prior-year period.

For the nine months ended July 31, 2025, FCF decreased by $1.7 billion, as compared to the corresponding period in fiscal 2024.

This was primarily due to lower cash provided by operating activities, as compared to the prior-year period.

For more information on our FCF, refer to the section entitled “GAAP to non-GAAP Reconciliations” included in this MD&A.

For more information on the impact of operating assets and liabilities to our cash flows, see Note 6, “Balance Sheet Details” to the Condensed Consolidated Financial Statements in Item 1 of Part I.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Capital Resources

1 unchanged sentence

We maintain a revolving credit facility and two commercial paper programs, “the Parent Programs,” and a wholly-owned subsidiary maintains a third program.

There have been no changes to our commercial paper programs and revolving credit facility since October 31, 2024.

As noted above, we are also party to two senior unsecured delayed draw term loan facilities, comprised of a $1.0 billion 364-day tranche and a $3.0 billion three-year tranche, subject to customary conditions.

Unless previously terminated, commitments under both the 364-day term loan and the three-year term loan will terminate upon the earliest of (i) five business days after the Juniper Outside Date (as defined in such term loan agreements), (ii) the occurrence of the closing of the acquisition of Juniper Networks without the funding of any borrowings under either of the term loan agreements, and (iii) the termination of the Merger Agreement by HPE in writing in accordance with its terms.

In September 2024, we terminated our prior senior unsecured revolving credit facility that was entered into in December 2021, and entered into a new senior unsecured revolving credit facility with an aggregate lending commitment of $5.25 billion for a period of five years.

The commitment initially comprised of (i) $4.75 billion of commitments available immediately and (ii) $500 million of commitments available from and subject to the closing of the Merger and refinancing of Juniper Networks’ credit agreement.

With the completion of the Merger and the associated refinancing, the full $5.25 billion commitment under the new facility is now available to us.

There have been no changes to our commercial paper programs since October 31, 2024.

In December 2023, we filed a shelf registration statement with the Securities and Exchange Commission that allows us to sell, at any time and from time to time, in one or more offerings, debt securities, preferred stock, common stock, warrants, depository shares, purchase contracts, guarantees or units consisting of any of these securities.

Significant funding and liquidity activities for the six months ended April 30, 2025 were as follows:

On August 18, 2025, we elected to redeem the entire $2.5 billion aggregate principal amount of its outstanding 4.900% Notes due 2025, on September 17, 2025 (“Redemption Date”).

The Notes will be redeemed at par, plus accrued and unpaid interest up to, but not including, the Redemption Date.

Subsequent to the quarter end, we sold approximately $739 million of available-for-sale investments and recognized a realized gain of approximately $2 million.

Significant funding and liquidity activities for the nine months ended July 31, 2025 were as follows:

Debt Issuances:

• In July 2025, we assumed fixed-rate Senior Notes of Juniper Networks with par value of $1.7 billion as a part of the Merger.

For further information see Note 8, “Acquisitions and Dispositions” to the Condensed Consolidated Financial Statements in Item 1 of Part I.

• In July 2025, to support the funding of the Merger, we drew $3.0 billion under the three-year delayed-draw term loan credit facility and $1.0 billion under the 364-day delayed-draw term loan credit facility.

The 364-day loan is scheduled for full repayment on July 1, 2026.

The three-year loan is subject to quarterly amortization at 1.25%, with the remaining balance due at maturity on June 30, 2028.

• In July 2025, we issued $900 million of asset-backed debt securities in six tranches at a weighted-average interest rate of 4.673% and a final maturity date of March 2033.

Debt Repayments:

• During the six months ended April 30, 2025, we repaid $0.8 billion of the outstanding asset-backed debt securities.

• During the nine months ended July 31, 2025, we repaid $1.1 billion of the outstanding asset-backed debt securities.

Cash Requirements and Commitments

Contractual Obligations

Other than the previously mentioned repayment of asset-backed debt securities, our contractual obligations have not changed materially outside of the normal course of business since October 31, 2024.

For further information see “Cash

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Requirements and Commitments” in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended October 31, 2024.

Unconditional purchase obligations

In connection with the Merger, our unconditional purchase obligations increased by $1.2 billion.

As of July 31, 2025, unconditional purchase obligations totaled $3.0 billion, of which $463 million is due within fiscal 2025.

Our unconditional purchase obligations are related principally to inventory purchases, software maintenance and support services and other items.

Unconditional purchase obligations exclude agreements that are cancellable without penalty.

Retirement Benefit Plan Funding

2 unchanged sentences

Our policy is to fund our pension plans so that we meet at least the minimum contribution requirements, as established by various authorities including local government and tax authorities.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Restructuring Plans

As of April 30, 2025, we expect to make future cash payments of approximately $140 million in connection with our approved restructuring plans, which includes $28 million expected to be paid through the remainder of fiscal 2025 and $112 million expected to be paid thereafter.

As of July 31, 2025, we expect to make future cash payments of approximately $124 million in connection with our approved restructuring plans, which includes $21 million expected to be paid through the remainder of fiscal 2025 and $103 million expected to be paid thereafter.

For more information on our restructuring activities, see Note 3, “Transformation Programs” to the Condensed Consolidated Financial Statements in Item 1 of Part I.

2 unchanged sentences

The estimates of the duration of the Program, the charges and expenditures that we expect to incur in connection therewith, and the timing thereof are subject to a number of assumptions, including local law requirements in various jurisdictions, and actual amounts may differ materially from estimates.

As of April 30, 2025, we expect to make future cash payments of approximately $350 million in connection with the Program, which includes $140 million expected to be paid through the remainder of fiscal 2025 and $210 million expected to be paid thereafter.

As of July 31, 2025, we expect to make future cash payments of approximately $327 million in connection with the Program, which includes $79 million expected to be paid through the remainder of fiscal 2025 and $248 million expected to be paid thereafter.

Uncertain Tax Positions

As of April 30, 2025, we had approximately $152 million of recorded liabilities and related interest and penalties pertaining to uncertain tax positions.

As of July 31, 2025, we had approximately $237 million of recorded liabilities and related interest and penalties pertaining to uncertain tax positions.

These liabilities and related interest and penalties include $2 million expected to be paid within one year.

2 unchanged sentences

For more information on our uncertain tax positions, see Note 5, “Taxes on Earnings” to the Condensed Consolidated Financial Statements in Item 1 of Part I.

For further information see “Cash Requirements and Commitments” in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended October 31, 2024.

Off-Balance Sheet Arrangements

2 unchanged sentences

For more information on our third-party revolving short-term financing arrangements, see Note 6, “Balance Sheet Details”, to the Condensed Consolidated Financial Statements in Item 1 of Part I.

GAAP to non-GAAP Reconciliations

The following tables provide a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure for the periods presented:

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

GAAP to non-GAAP Reconciliations

The following tables provide a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure for the periods presented:

Reconciliation of GAAP gross profit and gross profit margin to non-GAAP gross profit and gross profit margin.

For the three months ended April 30, For the six months ended April 30,

For the three months ended July 31, For the nine months ended July 31,

2025 2024 2025 2024

13 unchanged sentences

Non-GAAP gross profit $ 2,732 29.9 % $ 2,450 31.8 % $ 7,286 29.6 % $ 7,281 33.6 %

(1) Includes divestiture recovery.

Reconciliation of GAAP (loss) earnings from operations and operating profit margin to non-GAAP earnings from operations and operating profit margin.

For the three months ended April 30, For the six months ended April 30,

(1) Includes disaster recovery and divestiture related exit costs.

For the three and nine months ended July 31, 2025, Acquisition, disposition and other charges include non-cash amortization of fair value adjustment for inventory in connection with the Merger, which was recorded in cost of sales.

Table of Content

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Reconciliation of GAAP earnings (loss) from operations and operating profit margin to non-GAAP earnings from operations and operating profit margin.

For the three months ended July 31, For the nine months ended July 31,

2025 2024 2025 2024

3 unchanged sentences

Dollars in millions

GAAP (loss) earnings from operations $ (1,109) (14.5) % $ 425 5.9 % $ (676) (4.4) % $ 950 6.8 %

GAAP earnings (loss) from operations $ 247 2.7 % $ 547 7.1 % $ (429) (1.7) % $ 1,497 6.9 %

Non-GAAP Adjustments:

1 unchanged sentence

Impairment of goodwill — — % — — % 1,361 5.5 % — — %

Transformation (credit) costs (13) (0.2) % 33 0.5 % 2 — % 53 0.4 %

Transformation costs — — % 14 0.2 % 2 — % 67 0.3 %

Stock-based compensation expense 177 1.9 % 80 1.0 % 447 1.8 % 341 1.6 %

2 unchanged sentences

Acquisition, disposition and other charges (1)

225 2.5 % 70 0.9 % 343 1.4 % 127 0.6 %

Non-GAAP earnings from operations $ 777 8.5 % $ 771 10.0 % $ 2,170 8.8 % $ 2,230 10.3 %

(1) Includes disaster recovery and divestiture related exit costs.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

Reconciliation of GAAP net (loss) earnings and diluted net EPS to non-GAAP net earnings and diluted net EPS.

For the three months ended April 30, Six months ended April 30,

Reconciliation of GAAP net earnings (loss) and diluted net EPS to non-GAAP net earnings and diluted net EPS.

For the three months ended July 31, Nine months ended July 31,

2025 2024 2025 2024

Dollars Diluted Net EPS (1)

Dollars Diluted Net EPS Dollars Diluted Net EPS (1)

Dollars Diluted Net EPS Dollars Diluted Net EPS Dollars Diluted Net EPS (1)

Dollars Diluted Net EPS

Dollars in millions except per share amounts

GAAP net (loss) earnings $ (1,050) $ (0.82) $ 314 $ 0.24 (423) (0.36) $ 701 0.53

GAAP net earnings (loss) $ 305 $ 0.21 $ 512 $ 0.38 $ (118) $ (0.16) $ 1,213 $ 0.92

Non-GAAP Adjustments:

1 unchanged sentence

Impairment of goodwill — — — — 1,361 1.03 — —

Transformation (credit) costs (13) (0.01) 33 0.03 2 — 53 0.04

Transformation costs — — 14 0.01 2 — 67 0.05

Stock-based compensation expense 177 0.12 80 0.06 447 0.34 341 0.26

3 unchanged sentences

Acquisition, disposition and other charges (2)

225 0.17 70 0.05 343 0.26 127 0.10

Adjustments for equity interests — — (44) (0.04) — — (132) (0.10)

(Gain) loss on equity investments, net (7) (0.01) — — (9) (0.01) 61 0.05

Litigation judgment (52) (0.04) — — (52) (0.04) — —

Loss (gain) on equity investments, net 1 — (14) (0.01) (8) — 47 0.03

Other adjustments (3)

6 unchanged sentences

(1) Non-GAAP diluted net EPS reflects any dilutive effect of outstanding convertible Preferred Stock and employee stock plans, but that effect is excluded when calculating GAAP diluted net EPS as that would be anti-dilutive.

See Note 14 “Net (Loss) Earnings Per Share”, to the Condensed Consolidated Financial Statements in Item 1 of Part I for further information.

(2) Other adjustments includes non-service net periodic benefit cost and tax indemnification and other adjustments.

See Note 14 “Net Earnings (Loss) Per Share”, to the Condensed Consolidated Financial Statements in Item 1 of Part I for further information.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

(2) Includes disaster recovery and divestiture related exit costs.

(3) Other adjustments includes non-service net periodic benefit cost and tax indemnification and other adjustments.

(4) For purposes of calculating Non-GAAP diluted net EPS, the Preferred Stock dividends are added back to the Non-GAAP net earnings attributable to common stockholders, and the diluted weighted-average share calculation assumes the Preferred Stock was converted at issuance or as of the beginning of the reporting period.

1 unchanged sentence

Shares used to calculate Non-GAAP diluted net EPS.

For the three months ended April 30, For the six months ended April 30, 2025

For the three months ended July 31, For the nine months ended July 31, 2025

2025 2024 2025 2024

4 unchanged sentences

Reconciliation of net cash provided by operating activities to free cash flow.

For the three months ended April 30, For the six months ended April 30, 2025

For the three months ended July 31, For the nine months ended July 31, 2025

2025 2024 2025 2024

Net cash (used in) provided by operating activities $ (461) $ 1,093 $ (851) $ 1,157

Net cash provided by operating activities $ 1,305 $ 1,154 $ 454 $ 2,311

Investment in property, plant and equipment and software assets (576) (543) (1,651) (1,759)

12 unchanged sentences

The GAAP measure most directly comparable to non-GAAP net earnings attributable to HPE and non-GAAP net earnings attributable to common stockholders is net earnings.

The GAAP measure most directly comparable to non-GAAP diluted net earnings per share

The GAAP measure most directly comparable to non-GAAP diluted net earnings per share attributable to common stockholders is diluted net earnings per share attributable to common stockholders.

The GAAP measure most directly comparable to FCF is cash flow from operations.

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

attributable to common stockholders is diluted net earnings per share attributable to common stockholders.

The GAAP measure most directly comparable to FCF is cash flow from operations.

We believe that providing the non-GAAP measures stated above, in addition to the related GAAP measures provides greater transparency to the information used in our financial and operational decision making and allows the reader of our Condensed Consolidated Financial Statements to see our financial results “through the eyes” of management.

12 unchanged sentences

• We incur costs related to our acquisition, disposition and other charges.

Charges include expenses associated with acquisitions, disposal activities, and disaster (recovery) charges.

Charges include expenses associated with acquisitions, non-cash amortization of fair value adjustment for inventory in connection with the Merger, exit costs associated with disposal activities, and disaster (recovery) charges.

We exclude these costs because we consider these charges to be discrete events and do not believe they are reflective of normal continuing business operations.

For the three and six months ended April 30, 2025, acquisition charges were driven by costs associated with the proposed acquisition of Juniper Networks and miscellaneous disposition related charges.

For the three and six months ended April 30, 2024, acquisition charges were driven by the proposed acquisition of Juniper Networks, in addition to prior acquisitions of Axis and Athonet.

For the three and nine months ended July 31, 2025, acquisition charges were driven by costs associated with the Merger and miscellaneous disposition related charges.

For the three and nine months ended July 31, 2024, acquisition charges were driven by the Merger and prior acquisitions of Axis and Athonet.

• We incurred severance and other charges pursuant to cost management initiatives.

7 unchanged sentences

We expect future annualized cost savings of approximately $120 million following the completion of these actions.

Non-GAAP earnings from operations and non-GAAP operating profit margin consist of (loss) earnings from operations or (loss) earnings from operations as a percentage of net revenue excluding the items mentioned above and charges relating to the amortization of intangible assets, impairment of goodwill, transformation (credit) costs, gain on sale of a business, and

Non-GAAP earnings from operations and non-GAAP operating profit margin consist of earnings (loss) from operations or earnings (loss) from operations as a percentage of net revenue excluding the items mentioned above and charges relating to the amortization of intangible assets, impairment of goodwill, and transformation costs.

In addition to the items previously explained above, management excludes these items for the following reasons:

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

acquisition, disposition and other charges.

In addition to the items previously explained above, management excludes these items for the following reasons:

• We incur charges relating to the amortization of intangible assets and exclude these charges for purposes of calculating these non-GAAP measures.

6 unchanged sentences

Although this does not directly affect our cash position, the loss in value of goodwill over time can have a material impact on the equivalent GAAP earnings measure.

• Transformation (credit) costs represent net costs related to the (i) HPE Next Plan and (ii) Cost Optimization and Prioritization Plan.

• Transformation costs represent net costs related to the (i) HPE Next Plan and (ii) Cost Optimization and Prioritization Plan.

We exclude these costs as they are discrete costs related to two specific transformation programs that were announced in 2017 and 2020, respectively, as multi-year programs necessary to transform the business and IT infrastructure.

1 unchanged sentence

The exclusion of the transformation program costs from our non-GAAP financial measures as stated above is to provide a supplemental measure of our operating results that does not include material HPE Next Plan and Cost Optimization and Prioritization Plan costs as we do not believe such costs to be reflective of our ongoing operating cost structure.

• Gain on sale of a business represents the gain associated with certain disposal activities.

On December 1, 2024, we completed the disposition of CTG which resulted in a gain of $244 million.

We consider this divestiture to be a discrete event and believe eliminating this adjustment for the purposes of calculating non-GAAP measures facilitates the evaluation of our current operating performance.

Non-GAAP net earnings attributable to HPE, non-GAAP net earnings attributable to common stockholders, and non-GAAP diluted net earnings per share attributable to common stockholders consist of net (loss) earnings or diluted net (loss) earnings per share excluding those same charges mentioned above, as well as other items such as adjustments for equity interests, gain or loss on equity investments, other adjustments, and adjustments for taxes.

Non-GAAP net earnings attributable to HPE, non-GAAP net earnings attributable to common stockholders, and non-GAAP diluted net earnings per share attributable to common stockholders consist of net earnings (loss) or diluted net earnings (loss) per share excluding those same charges mentioned above, as well as other items such as gain on sale of a business, adjustments for equity interests, gain or loss on equity investments, other adjustments, and adjustments for taxes.

Non-GAAP net earnings attributable to HPE and non-GAAP diluted net earnings per share attributable to common stockholders includes preferred stock dividends added back to non-GAAP net earnings attributable to HPE.

1 unchanged sentence

In addition to the items previously explained, management excludes these items for the following reasons:

• Gain on sale of a business represents the gain associated with certain disposal activities.

On December 1, 2024, we completed the disposition of CTG which resulted in a gain of $245 million.

• During the six months ended April 30, 2024, we stopped reporting H3C earnings in our non-GAAP results due to the planned divestiture of the H3C investment.

4 unchanged sentences

We believe that eliminating these amounts for purposes of calculating non-GAAP financial measures facilitates the evaluation of our current operating performance.

• In the third quarter of fiscal 2025, Hewlett Packard Enterprise received $52 million from a settlement to resolve claims solely against Sushovan Hussain, in the ongoing Autonomy litigation.

We exclude the litigation judgment for purposes of calculating non-GAAP measures to facilitate a more meaningful evaluation of our current operating performance and comparisons to our operating performance in other periods.

• We exclude gains and losses (including impairments) on our non-marketable equity investments because we do not believe they are reflective of normal continuing business operations.

1 unchanged sentence

We believe eliminating these adjustments for the purposes of calculating non-GAAP measures facilitates the evaluation of our current operating performance.

• We utilize a structural long-term projected non-GAAP income tax rate in order to provide consistency across the interim reporting periods and to eliminate the effects of items not directly related to our operating structure that can

Table of Content

2 unchanged sentences

Financial Condition and Results of Operations (Continued)

vary in size, frequency and timing.

When projecting this long-term rate, we evaluated a three-year financial projection.

14 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis