Goodwill and Intangible Asset Disclosure
Adjustments to Financial Statements: Removal of Goodwill
Adjusted Financial Ratios: Removal of Goodwill (Summary)
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Hewlett Packard Enterprise Co., balance sheet: goodwill and intangible assets

US$ in millions

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
Goodwill	17,988)	17,403)	18,306)	18,017)	18,306)	17,537)
Customer contracts, customer lists and distribution agreements	357)	475)	472)	429)	312)	272)
Developed and core technology and patents	1,162)	1,163)	1,187)	1,267)	1,371)	1,121)
Trade name and trademarks	146)	144)	144)	141)	163)	87)
In-process research and development	—)	—)	4)	106)	141)	18)
Intangible assets, gross	1,665)	1,782)	1,807)	1,943)	1,987)	1,498)
Accumulated amortization	(1,011)	(1,049)	(785)	(840)	(859)	(709)
Intangible assets, net	654)	733)	1,022)	1,103)	1,128)	789)
Goodwill and intangible assets	18,642)	18,136)	19,328)	19,120)	19,434)	18,326)

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

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Item	Description	The company
Goodwill	Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.	Hewlett Packard Enterprise Co. goodwill decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.
Intangible assets, net	Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Hewlett Packard Enterprise Co. intangible assets, net decreased from 2021 to 2022 and from 2022 to 2023.
Goodwill and intangible assets	Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Hewlett Packard Enterprise Co. goodwill and intangible assets decreased from 2021 to 2022 but then slightly increased from 2022 to 2023.

Hewlett Packard Enterprise Co., adjustments to financial statements

US$ in millions

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
Adjustment to Total Assets
Total assets (as reported)	57,153)	57,123)	57,699)	54,015)	51,803)	55,493)
Less: Goodwill	17,988)	17,403)	18,306)	18,017)	18,306)	17,537)
Total assets (adjusted)	39,165)	39,720)	39,393)	35,998)	33,497)	37,956)
Adjustment to Total HPE Stockholders’ Equity
Total HPE stockholders’ equity (as reported)	21,182)	19,864)	19,971)	16,049)	17,098)	21,239)
Less: Goodwill	17,988)	17,403)	18,306)	18,017)	18,306)	17,537)
Total HPE stockholders’ equity (adjusted)	3,194)	2,461)	1,665)	(1,968)	(1,208)	3,702)
Adjustment to Net Earnings (loss) Attributable To HPE
Net earnings (loss) attributable to HPE (as reported)	2,025)	868)	3,427)	(322)	1,049)	1,908)
Add: Impairment of goodwill	—)	905)	—)	865)	—)	88)
Net earnings (loss) attributable to HPE (adjusted)	2,025)	1,773)	3,427)	543)	1,049)	1,996)

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

Hewlett Packard Enterprise Co., Financial Data: Reported vs. Adjusted

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Hewlett Packard Enterprise Co., adjusted financial ratios

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
Net Profit Margin
Reported net profit margin	6.95%	3.05%	12.33%	-1.19%	3.60%	6.18%
Adjusted net profit margin	6.95%	6.22%	12.33%	2.01%	3.60%	6.47%
Total Asset Turnover
Reported total asset turnover	0.51	0.50	0.48	0.50	0.56	0.56
Adjusted total asset turnover	0.74	0.72	0.71	0.75	0.87	0.81
Financial Leverage
Reported financial leverage	2.70	2.88	2.89	3.37	3.03	2.61
Adjusted financial leverage	12.26	16.14	23.66	—	—	10.25
Return on Equity (ROE)
Reported ROE	9.56%	4.37%	17.16%	-2.01%	6.14%	8.98%
Adjusted ROE	63.40%	72.04%	205.83%	—	—	53.92%
Return on Assets (ROA)
Reported ROA	3.54%	1.52%	5.94%	-0.60%	2.02%	3.44%
Adjusted ROA	5.17%	4.46%	8.70%	1.51%	3.13%	5.26%

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Hewlett Packard Enterprise Co. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Hewlett Packard Enterprise Co. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Hewlett Packard Enterprise Co. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Hewlett Packard Enterprise Co. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Hewlett Packard Enterprise Co. adjusted ROA deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Hewlett Packard Enterprise Co., Financial Ratios: Reported vs. Adjusted

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	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net earnings (loss) attributable to HPE	2,025)	868)	3,427)	(322)	1,049)	1,908)
Net revenue	29,135)	28,496)	27,784)	26,982)	29,135)	30,852)
Profitability Ratio
Net profit margin¹	6.95%	3.05%	12.33%	-1.19%	3.60%	6.18%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted net earnings (loss) attributable to HPE	2,025)	1,773)	3,427)	543)	1,049)	1,996)
Net revenue	29,135)	28,496)	27,784)	26,982)	29,135)	30,852)
Profitability Ratio
Adjusted net profit margin²	6.95%	6.22%	12.33%	2.01%	3.60%	6.47%

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

2023 Calculations

¹ Net profit margin = 100 × Net earnings (loss) attributable to HPE ÷ Net revenue
= 100 × 2,025 ÷ 29,135 = 6.95%

² Adjusted net profit margin = 100 × Adjusted net earnings (loss) attributable to HPE ÷ Net revenue
= 100 × 2,025 ÷ 29,135 = 6.95%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Hewlett Packard Enterprise Co. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net revenue	29,135)	28,496)	27,784)	26,982)	29,135)	30,852)
Total assets	57,153)	57,123)	57,699)	54,015)	51,803)	55,493)
Activity Ratio
Total asset turnover¹	0.51	0.50	0.48	0.50	0.56	0.56
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net revenue	29,135)	28,496)	27,784)	26,982)	29,135)	30,852)
Adjusted total assets	39,165)	39,720)	39,393)	35,998)	33,497)	37,956)
Activity Ratio
Adjusted total asset turnover²	0.74	0.72	0.71	0.75	0.87	0.81

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

2023 Calculations

¹ Total asset turnover = Net revenue ÷ Total assets
= 29,135 ÷ 57,153 = 0.51

² Adjusted total asset turnover = Net revenue ÷ Adjusted total assets
= 29,135 ÷ 39,165 = 0.74

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Hewlett Packard Enterprise Co. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Total assets	57,153)	57,123)	57,699)	54,015)	51,803)	55,493)
Total HPE stockholders’ equity	21,182)	19,864)	19,971)	16,049)	17,098)	21,239)
Solvency Ratio
Financial leverage¹	2.70	2.88	2.89	3.37	3.03	2.61
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets	39,165)	39,720)	39,393)	35,998)	33,497)	37,956)
Adjusted total HPE stockholders’ equity	3,194)	2,461)	1,665)	(1,968)	(1,208)	3,702)
Solvency Ratio
Adjusted financial leverage²	12.26	16.14	23.66	—	—	10.25

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

2023 Calculations

¹ Financial leverage = Total assets ÷ Total HPE stockholders’ equity
= 57,153 ÷ 21,182 = 2.70

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total HPE stockholders’ equity
= 39,165 ÷ 3,194 = 12.26

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Hewlett Packard Enterprise Co. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net earnings (loss) attributable to HPE	2,025)	868)	3,427)	(322)	1,049)	1,908)
Total HPE stockholders’ equity	21,182)	19,864)	19,971)	16,049)	17,098)	21,239)
Profitability Ratio
ROE¹	9.56%	4.37%	17.16%	-2.01%	6.14%	8.98%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted net earnings (loss) attributable to HPE	2,025)	1,773)	3,427)	543)	1,049)	1,996)
Adjusted total HPE stockholders’ equity	3,194)	2,461)	1,665)	(1,968)	(1,208)	3,702)
Profitability Ratio
Adjusted ROE²	63.40%	72.04%	205.83%	—	—	53.92%

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

2023 Calculations

¹ ROE = 100 × Net earnings (loss) attributable to HPE ÷ Total HPE stockholders’ equity
= 100 × 2,025 ÷ 21,182 = 9.56%

² Adjusted ROE = 100 × Adjusted net earnings (loss) attributable to HPE ÷ Adjusted total HPE stockholders’ equity
= 100 × 2,025 ÷ 3,194 = 63.40%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Hewlett Packard Enterprise Co. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.

	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019	Oct 31, 2018
As Reported
Selected Financial Data (US$ in millions)
Net earnings (loss) attributable to HPE	2,025)	868)	3,427)	(322)	1,049)	1,908)
Total assets	57,153)	57,123)	57,699)	54,015)	51,803)	55,493)
Profitability Ratio
ROA¹	3.54%	1.52%	5.94%	-0.60%	2.02%	3.44%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted net earnings (loss) attributable to HPE	2,025)	1,773)	3,427)	543)	1,049)	1,996)
Adjusted total assets	39,165)	39,720)	39,393)	35,998)	33,497)	37,956)
Profitability Ratio
Adjusted ROA²	5.17%	4.46%	8.70%	1.51%	3.13%	5.26%

Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 10-K (reporting date: 2018-10-31).

2023 Calculations

¹ ROA = 100 × Net earnings (loss) attributable to HPE ÷ Total assets
= 100 × 2,025 ÷ 57,153 = 3.54%

² Adjusted ROA = 100 × Adjusted net earnings (loss) attributable to HPE ÷ Adjusted total assets
= 100 × 2,025 ÷ 39,165 = 5.17%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Hewlett Packard Enterprise Co. adjusted ROA deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Hewlett Packard Enterprise Co. (NYSE:HPE)

Analysis of Goodwill and Intangible Assets

Goodwill and Intangible Asset Disclosure

Adjustments to Financial Statements: Removal of Goodwill

Hewlett Packard Enterprise Co., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Hewlett Packard Enterprise Co., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)