Hewlett Packard Enterprise Stock Sinks on Firm’s Outlook, Cost-Cutting Measures

Hewlett Packard Enterprise (HPE) shares plunged 15% Friday, a day after the information technology provider gave weak guidance and began cost-cutting measures.

The company expects current-quarter adjusted earnings per share (EPS) of $0.28 to $0.34, and full year of $1.70 to $1.90, Analysts surveyed by Visible Alpha were looking for current-quarter adjusted EPS of $0.50 and full year of $2.12.

In the fiscal 2025 first quarter, HPE posted adjusted EPS of $0.49, also short of forecasts. Revenue increased 16% year-over-year to $7.85 billion, slightly above forecasts.

CEO Antonio Neri explained that while the company “has a proven track record of consistent, disciplined execution,” it “could have executed better in some areas in the quarter.”

HPE to Lay Off About 2,500 Employees

HPE also announced that it was launching a cost-reduction plan “to reduce structural operating costs and continue advancing its ongoing commitment to profitable growth.” It added that “the program is expected to be implemented through fiscal year 2026 and deliver gross savings of approximately $350 million by fiscal year 2027 through reductions in its workforce.”

To that end, Neri said on the earnings call that “we plan to reduce our employee base 5% over the next 12 to 18 months through the reduction of approximately 2,500 positions and expected attrition,” according to a transcript provided by AlphaSense.

Hewlett Packard Enterprise shares sank to their lowest level in more than a year.