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Why Hewlett-Packard Streamlined Its Enterprise Group

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Enterprise Group business streamlined for HPE

Meg Whitman, the CEO of Hewlett-Packard Enterprise (HPE), stated during the company’s fiscal 3Q16 earnings call that the company’s Enterprise Group businesses have been streamlined.

Whitman added that the streamlining will help the firm to “better address market opportunities, improve cost structure, accelerate innovation and strengthen our competitiveness.”

Hewlett-Packard (HPQ) plans to consolidate all corporate marketing and sales efforts under a single marketing function. The company announced that Hewlett-Packard Labs will integrate with the Enterprise Group business, helping the firm to better align its research activities.

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Enterprise Group revenue

The revenue from Hewlett-Packard Enterprise’s (HPE) Enterprise Group segment fell 8% YoY (year-over-year) in fiscal 3Q16 to $6.5 billion. The segment’s revenue was flat YoY on a constant currency basis, and it had a non-GAAP[1. generally accepted accounting principles] operating profit of $815 million, or 12.6% of revenue.

The Server segment’s revenue fell 4% YoY, whereas the Storage segment’s revenue fell 8% YoY in fiscal 3Q16. Networking revenues saw a significant fall of 22% YoY, and revenue for the Technology Services segment fell 7% YoY.

In fiscal 2Q16, revenue from HPE’s Enterprise Group segment rose 7% year-over-year to $7.1 billion. It rose 7% YoY on a constant currency basis. It had a non-GAAP operating profit of $817 million, or 11.7% of revenue. The company’s operating profit improved marginally quarter-over-quarter in fiscal 3Q16.

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