Hewlett Packard Enterprise Co. (NYSE:HPE)

Gross Profit Margin

The gross profit margin exhibited a generally upward trend over the analyzed period. Starting at 30.12% in 2018, it increased to 32.58% in 2019, followed by a slight dip to 31.39% in 2020. Subsequently, the margin rose again, reaching 33.75% in 2021 and maintaining relative stability around 33.36% in 2022 before further improving to 35.14% in 2023. This indicates improved efficiency in production or sales processes over time.

Operating Profit Margin

The operating profit margin showed volatility throughout the years. It declined from 6.02% in 2018 to 4.37% in 2019, followed by a notable downturn into negative territory at -1.22% in 2020. A recovery was observed in 2021 with a margin of 4.07%, although it dropped again to 2.74% in 2022. The figure rebounded significantly in 2023, reaching 7.17%, the highest level in the period. This pattern highlights challenges in controlling operating costs and varying operational efficiency, with a marked recovery in the latest year.

Net Profit Margin

The net profit margin followed a similar fluctuating path as the operating margin. It decreased from 6.18% in 2018 to 3.6% in 2019, then fell into negative territory at -1.19% in 2020. There was a strong recovery to 12.33% in 2021, the highest value in the dataset, followed by a substantial decline to 3.05% in 2022. The margin increased again to 6.95% in 2023. These movements suggest variability in the company's bottom-line profitability, influenced by non-operating items or tax effects, as well as operational performance.

Return on Equity (ROE)

ROE demonstrated notable fluctuations across the years. It started at 8.98% in 2018, declined steadily to 6.14% in 2019, and then dropped to a negative -2.01% in 2020, reflecting a loss in equity returns. A strong rebound occurred in 2021, peaking at 17.16%, followed by a sharp decrease to 4.37% in 2022. The ROE rose again to 9.56% in 2023. This reflects considerable variability in profitability relative to shareholders' equity and potential impacts of the net income swings.

Return on Assets (ROA)

ROA mirrored the downward and recovery trend seen in other profitability metrics. Beginning at 3.44% in 2018, it declined to 2.02% in 2019 and then to -0.6% in 2020, indicating a loss-generating phase. A recovery was registered in 2021 at 5.94%, followed by a decrease to 1.52% in 2022. The figure rose again to 3.54% in 2023. This pattern shows variability in the company’s efficiency in generating profits from its asset base over time.

Net Revenue

Net revenue experienced a declining trend from 2018 through 2020, decreasing from approximately $30.9 billion in 2018 to about $27.0 billion in 2020. Following this decline, revenue exhibited a gradual recovery, rising to around $29.1 billion by 2023, although it had not fully surpassed the initial 2018 figure.

Gross Profit

Gross profit showed variability but generally remained stable around the $9.3 to $9.5 billion range between 2018 and 2022. An initial slight increase occurred from 2018 to 2019, followed by a decline in 2020. From 2021 onwards, gross profit rose steadily, reaching its highest point of over $10.2 billion in 2023.

Gross Profit Margin

The gross profit margin displayed an overall upward trend during the period. Starting at approximately 30.12% in 2018, it increased to 32.58% in 2019, despite the revenue decline in that year. After a moderate dip in 2020 to 31.39%, the margin improved consistently each subsequent year, culminating at 35.14% in 2023. This indicates an improvement in cost efficiency or pricing power.

Overall Analysis

The financial data indicates a period of initial revenue contraction from 2018 to 2020, with net revenue reducing by approximately 12.5%. Despite this, gross profit margins improved, reflecting enhanced operational efficiency or favorable product mix effects. From 2021 onwards, the company managed to stabilize and then grow both net revenue and gross profit, with gross profit increasing more rapidly than revenue, as shown by the rising margins. The margin progression to over 35% in 2023 suggests strengthened profitability and potentially better cost management. The data points to resilience in financial performance and a positive trend toward improved profitability metrics in recent years.

Earnings (loss) from operations

The earnings from operations demonstrate a fluctuating trend over the analyzed period. Starting at $1,858 million in 2018, earnings declined significantly to $1,274 million in 2019, followed by a sharp negative value of -$329 million in 2020, indicating an operational loss during that year. Recovery is observed from 2021 onwards, with earnings rising to $1,132 million in 2021 and showing a slight decline to $782 million in 2022. A notable increase occurs in 2023, reaching a peak of $2,089 million, surpassing prior years' earnings.

Net revenue

Net revenue exhibits a general downward trend from 2018 to 2020, starting at $30,852 million and decreasing to $26,982 million. A gradual recovery phase follows, with revenues increasing to $27,784 million in 2021 and continuing to rise modestly to $28,496 million in 2022 and $29,135 million in 2023. Despite the decrease in earlier years, 2023 revenue approaches the 2019 level, suggesting a positive return toward previous revenue figures.

Operating profit margin

The operating profit margin aligns with the trends in earnings from operations and reflects fluctuations in operational efficiency. The margin decreased from 6.02% in 2018 to 4.37% in 2019, turning negative at -1.22% in 2020, which coincides with the loss reported in that year. Positive margins resume in 2021 at 4.07%, but with a reduced margin to 2.74% in 2022. In 2023, the margin increases sharply to 7.17%, marking the highest profitability percentage in the period under review.

Overall Analysis

The data reveals a challenging operational environment around 2020, characterized by decreased revenue and a loss from operations. Following this period, incremental improvements in both revenue and earnings from operations are observed, culminating in 2023 with a recovery in net revenue to near earlier levels and a strong rebound in earnings and profitability. The operating profit margin trends suggest enhanced cost management or operational efficiency in the most recent year.

Net Earnings (Loss) Attributable to HPE

The net earnings showed considerable volatility over the examined periods. The earnings started at 1,908 million USD in 2018, followed by a significant decline to 1,049 million USD in 2019. A notable loss of 322 million USD was recorded in 2020, reflecting a challenging financial year. However, a strong recovery occurred in 2021, with net earnings surging to 3,427 million USD, the highest in the series. In 2022, earnings decreased substantially to 868 million USD but recovered again to 2,025 million USD in 2023. This pattern highlights variability in profitability, likely influenced by external market conditions or internal operational changes.

Net Revenue

Net revenue demonstrated a declining trend from 2018 through 2020, dropping from 30,852 million USD to 26,982 million USD. Some recovery was noted in the subsequent years, with revenues rising to 27,784 million USD in 2021 and continuing upward to 29,135 million USD by 2023, matching the 2019 level. Overall, revenue showed resilience with a partial rebound after the downturn observed in 2020, though it remained below the 2018 peak.

Net Profit Margin

The net profit margin mirrored the fluctuating earnings, starting at 6.18% in 2018 and decreasing to 3.6% in 2019. It turned negative at -1.19% in 2020, coinciding with the loss recorded that year. A sharp increase to 12.33% occurred in 2021, indicating a significant improvement in profitability. This was followed by a decline to 3.05% in 2022, and a recovery to 6.95% in 2023. These variations suggest that profitability was inconsistent but showed recoveries aligning with net earnings trends.

The financial data reveals notable fluctuations in the net earnings attributable to Hewlett Packard Enterprise Co. over the six-year period. Initially, net earnings decreased from $1,908 million in 2018 to $1,049 million in 2019, followed by a loss of $322 million in 2020. Subsequently, the company experienced a strong recovery in 2021 with net earnings rising sharply to $3,427 million. However, this was followed by a decline to $868 million in 2022, before increasing again to $2,025 million in 2023.

Total stockholders’ equity exhibited a declining trend from 2018 through 2020, dropping from $21,239 million to $16,049 million. In 2021, equity rebounded to $19,971 million and then stabilized around $19,864 million in 2022, with a slight increase to $21,182 million by 2023, nearing the initial value observed in 2018.

Return on equity (ROE) mirrored the volatility seen in net earnings. ROE declined from 8.98% in 2018 to 6.14% in 2019, turning negative at -2.01% in 2020, which aligns with the net loss reported that year. A substantial improvement occurred in 2021, with ROE reaching 17.16%. This ratio then decreased sharply to 4.37% in 2022 but improved again to 9.56% in 2023.

Net Earnings (Loss)

Experienced a sharp decline and a loss in 2020, followed by recovery and volatility in subsequent years.

Total Stockholders’ Equity

Showed a downward trend initially, then recovered and stabilized towards the end of the period.

Return on Equity (ROE)

Fluctuated considerably, reflecting changes in net earnings and demonstrating a strong rebound after 2020.

Overall, the data indicates that the company faced significant challenges in 2020 but demonstrated resilience and recovery afterwards. The variability in both profitability and equity levels suggests a period of financial instability followed by efforts to restore financial performance and shareholder value.

The analysis of the annual financial data reveals several notable trends and fluctuations over the period from 2018 to 2023.

Net Earnings (Loss) Attributable to Hewlett Packard Enterprise

The net earnings showed significant volatility during the six-year period. Starting at a positive US$1,908 million in 2018, earnings decreased substantially to US$1,049 million in 2019. In 2020, the company experienced a loss of US$322 million, marking the lowest point in the period. However, this was followed by a strong recovery in 2021 with net earnings rising sharply to US$3,427 million, the highest level recorded. The earnings then declined again in 2022 to US$868 million before increasing to US$2,025 million in 2023. This pattern indicates considerable earnings instability with rapid recoveries after downturns.

Total Assets

Total assets exhibited relative stability with moderate growth and slight fluctuations. Beginning at US$55,493 million in 2018, assets decreased to US$51,803 million in 2019, followed by a gradual increase to US$54,015 million in 2020 and US$57,699 million in 2021. There was a minor reduction in 2022 to US$57,123 million, with a marginal rise again in 2023 to US$57,153 million. Overall, total assets remained fairly consistent with a slight tendency to increase over the six years.

Return on Assets (ROA)

Return on assets closely mirrored the net earnings trend, illustrating varying profitability relative to asset base. ROA decreased from 3.44% in 2018 to 2.02% in 2019, turning negative at -0.6% in 2020, corresponding with the net loss year. A substantial rebound occurred in 2021 with ROA reaching 5.94%, the peak of the series, indicating efficient asset utilization. Following this, ROA decreased to 1.52% in 2022 before rising again to 3.54% in 2023. These fluctuations highlight uneven profitability and asset efficiency across the years, aligning with the oscillations in net earnings.

In summary, the company experienced significant earnings volatility from 2018 to 2023, with notable recoveries following losses, while maintaining relatively stable total assets. The return on assets demonstrated sensitivity to profit changes, reflecting the underlying earnings variability and asset management performance across the examined period.