Analysis of Reportable Segments
Hewlett Packard Enterprise Co. operates in 6 segments: Compute; High Performance Computing & Artificial Intelligence (HPC & AI); Storage; Intelligent Edge; Financial Services (FS); and Corporate Investments and Other.
Segment Profit Margin
Hewlett Packard Enterprise Co., profit margin by reportable segment
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Compute | 13.72% | 13.97% | 10.79% | 8.20% | 12.52% | — |
| High Performance Computing & Artificial Intelligence (HPC & AI) | 1.20% | 0.34% | 7.34% | 9.18% | 12.24% | — |
| Storage | 9.72% | 14.48% | 16.33% | 17.35% | 19.20% | — |
| Intelligent Edge | 27.27% | 14.94% | 15.21% | 11.80% | 7.42% | — |
| Financial Services (FS) | 9.11% | 11.95% | 11.47% | 8.47% | 8.66% | — |
| Corporate Investments and Other | -13.76% | -7.33% | -7.01% | -15.87% | -24.38% | — |
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).
The analysis of the annual segment profit margin data reveals distinct trends across the business units over the years presented.
- Compute
- This segment experienced a decline from 12.52% in 2019 to 8.2% in 2020, followed by a recovery with gradual improvements reaching 13.97% in 2022. The margin slightly dipped to 13.72% in 2023, indicating relatively stable profitability after the recovery phase.
- High Performance Computing & Artificial Intelligence (HPC & AI)
- The profit margin decreased significantly from 12.24% in 2019 to 7.34% in 2021, and then sharply dropped to 0.34% in 2022. There is a minor recovery to 1.2% in 2023, but the segment remains underperforming compared to previous years, suggesting challenges in achieving profitability in recent periods.
- Storage
- This segment exhibits a consistent downward trend in profit margin, starting at 19.2% in 2019 and steadily declining each year to 9.72% in 2023. The continuous erosion indicates mounting pressures or increased costs negatively impacting profitability.
- Intelligent Edge
- Contrasting with other segments, Intelligent Edge shows a remarkable upward trend. Beginning at 7.42% in 2019, the margin improved steadily to 15.21% in 2021, with a slight decrease to 14.94% in 2022, followed by a substantial increase to 27.27% in 2023. This suggests strong growth and improved profitability, making it the best performing segment in the latest year.
- Financial Services (FS)
- The Financial Services segment demonstrates moderate fluctuations: the margin remains relatively stable around 8.5% in 2019 and 2020, rises to 11.47% in 2021 and peaks at 11.95% in 2022, before declining to 9.11% in 2023. The segment maintains profitability but with varying margins across the years.
- Corporate Investments and Other
- This segment consistently shows negative profit margins, though improving from -24.38% in 2019 to -7.01% in 2021. The margin slightly worsens again to -7.33% in 2022 and falls further to -13.76% in 2023. The persistently negative figures indicate ongoing costs or losses associated with this segment, with volatility in performance.
Overall, the data indicate divergent performance across segments. Intelligent Edge is the most notable area of profitability growth, while Storage and HPC & AI segments face declining margins. Compute stabilizes after initial decreases, and Financial Services sustain moderate profitability. Corporate Investments and Other remain a drag on overall profitability due to persistent losses.
Segment Profit Margin: Compute
Hewlett Packard Enterprise Co.; Compute; segment profit margin calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 1,569) | 1,780) | 1,326) | 1,007) | 1,719) | —) |
| Net revenue | 11,436) | 12,742) | 12,292) | 12,285) | 13,730) | —) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 13.72% | 13.97% | 10.79% | 8.20% | 12.52% | — |
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).
1 2023 Calculation
Segment profit margin = 100 × Earnings (loss) from operations ÷ Net revenue
= 100 × 1,569 ÷ 11,436 = 13.72%
- Earnings (loss) from operations
- The earnings from operations increased significantly from 1,719 million USD in 2019 to 1,780 million USD in 2022, reflecting growth in operational profitability. However, there was a decline to 1,569 million USD in 2023, indicating some pressure on operating income during the most recent year. Despite the drop, the earnings in 2023 remain above the levels reported in 2020 and 2021.
- Net revenue
- Net revenue demonstrated a fluctuating pattern across the periods. After peaking at 13,730 million USD in 2019, revenue dropped to 12,285 million USD in 2020 and remained relatively stable around 12,292 million USD in 2021. There was a modest recovery to 12,742 million USD in 2022, but revenue declined again to 11,436 million USD in 2023. The overall trend suggests volatility with a downward shift in recent years.
- Segment profit margin
- The segment profit margin experienced considerable variation from 2019 to 2023. After registering 12.52% in 2019, the margin declined sharply to 8.2% in 2020. Subsequently, it improved to 10.79% in 2021 before increasing further to a peak of 13.97% in 2022. In 2023, the margin slightly decreased to 13.72%. The trend shows recovery in profitability margins post-2020, maintaining a relatively strong margin above 13% in the two most recent years.
Segment Profit Margin: High Performance Computing & Artificial Intelligence (HPC & AI)
Hewlett Packard Enterprise Co.; High Performance Computing & Artificial Intelligence (HPC & AI); segment profit margin calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 47) | 11) | 234) | 285) | 365) | —) |
| Net revenue | 3,913) | 3,192) | 3,188) | 3,105) | 2,983) | —) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 1.20% | 0.34% | 7.34% | 9.18% | 12.24% | — |
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).
1 2023 Calculation
Segment profit margin = 100 × Earnings (loss) from operations ÷ Net revenue
= 100 × 47 ÷ 3,913 = 1.20%
The data reveals several key trends in the financial performance of the High Performance Computing & Artificial Intelligence segment from October 2018 through October 2023.
- Net Revenue
-
There has been a consistent upward trend in net revenue over the period under review. Revenue increased from 2,983 million USD in 2019 to 3,913 million USD in 2023. This represents a steady growth trajectory with the most significant increment observed between 2022 and 2023, where revenue rose by approximately 22.6%. This positive revenue growth suggests expanding market demand or successful sales strategies in the segment.
- Earnings (Loss) from Operations
-
Operating earnings exhibited a declining trend from 365 million USD in 2019 down to 11 million USD in 2022, indicating a substantial reduction in operational profitability during these years. Although there was a slight recovery to 47 million USD in 2023, the levels remained markedly lower than the 2019 peak. This downward trend in operating earnings, despite rising revenues, may point to increasing costs, lower pricing power, or other operational challenges reducing profitability.
- Segment Profit Margin
-
The segment profit margin followed a similar declining pattern, dropping from 12.24% in 2019 to a low of 0.34% in 2022. This aligns with the drop in operating earnings, indicating that profitability as a proportion of revenue has compressed significantly. The 2023 margin showed a slight improvement to 1.2%, yet it remained significantly below previous years' levels. The margin contraction suggests challenges in controlling expenses relative to revenue growth or pressure on pricing.
In summary, the segment demonstrated strong revenue growth over the five-year period, yet experienced a notable decline in operating earnings and profit margins, indicating deteriorating profitability conditions. The modest recovery in earnings and margin in the latest year hints at possible stabilization efforts, but profitability remains well below earlier levels. These trends warrant close attention to cost management and margin improvement strategies to ensure sustainable financial performance in the segment going forward.
Segment Profit Margin: Storage
Hewlett Packard Enterprise Co.; Storage; segment profit margin calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 429) | 682) | 778) | 813) | 1,009) | —) |
| Net revenue | 4,415) | 4,711) | 4,763) | 4,685) | 5,255) | —) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 9.72% | 14.48% | 16.33% | 17.35% | 19.20% | — |
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).
1 2023 Calculation
Segment profit margin = 100 × Earnings (loss) from operations ÷ Net revenue
= 100 × 429 ÷ 4,415 = 9.72%
The financial data for the Storage segment reveals several notable trends over the period from 2019 to 2023. There is a clear downward trajectory in key performance indicators that merits attention.
- Earnings (loss) from operations
- This metric peaked in 2019 at 1,009 million US dollars but then showed a consistent decline in each subsequent year. By 2023, earnings dropped sharply to 429 million US dollars, less than half the 2019 figure, indicating diminishing operational profitability in this segment.
- Net revenue
- Revenue similarly decreased from a high of 5,255 million US dollars in 2019 to 4,415 million US dollars in 2023. While the decline is less steep compared to earnings, the trend still shows a gradual shrinkage in sales or service income within the segment over the years.
- Segment profit margin
- The profit margin percentage demonstrates consistent contraction year over year, moving from 19.2% in 2019 down to 9.72% in 2023. This decline suggests increasing cost pressures or pricing challenges, eroding the profitability per unit of revenue.
Overall, the Storage segment experienced reduced revenue and profitability levels over the five-year period. The decreasing profit margin highlights growing challenges in managing costs or sustaining pricing power. The marked reduction in earnings from operations underscores the impact of these trends on the segment's financial health.
Segment Profit Margin: Intelligent Edge
Hewlett Packard Enterprise Co.; Intelligent Edge; segment profit margin calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 1,419) | 549) | 500) | 337) | 216) | —) |
| Net revenue | 5,204) | 3,674) | 3,287) | 2,855) | 2,913) | —) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 27.27% | 14.94% | 15.21% | 11.80% | 7.42% | — |
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).
1 2023 Calculation
Segment profit margin = 100 × Earnings (loss) from operations ÷ Net revenue
= 100 × 1,419 ÷ 5,204 = 27.27%
- Net Revenue
- Net revenue demonstrates a generally increasing trend over the period analyzed, starting at 2,913 million US dollars in 2019 and rising consistently each year to reach 5,204 million US dollars in 2023. This rise represents a significant growth in sales and suggests expanding market demand or increased operational scale within the segment.
- Earnings (Loss) from Operations
- Operating earnings have grown substantially from 216 million US dollars in 2019 to 1,419 million US dollars in 2023. The increase is steady year-over-year, with notable acceleration between 2022 and 2023, indicating enhanced operational efficiency and/or improved cost management contributing to stronger profitability.
- Segment Profit Margin
- The segment profit margin shows consistent improvement each year, starting at 7.42% in 2019 and increasing sharply to 27.27% in 2023. This trend reflects incremental gains in profitability relative to revenue, implying that the segment is successfully converting a larger proportion of its revenue into profits. The sharp increase in the latest period highlights substantial improvements in cost control or a favorable product mix.
- Overall Observations
- Collectively, the data indicate a robust growth trajectory for the segment, characterized by rising revenues and significantly higher operating profits. The improvement in profit margins over time suggests enhanced operational leverage and profitability. The sharp margin increase in 2023 signals a positive shift in either cost structure or revenue quality, underlining a strong performance in the most recent year.
Segment Profit Margin: Financial Services (FS)
Hewlett Packard Enterprise Co.; Financial Services (FS); segment profit margin calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 317) | 399) | 390) | 284) | 310) | —) |
| Net revenue | 3,480) | 3,339) | 3,401) | 3,352) | 3,581) | —) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 9.11% | 11.95% | 11.47% | 8.47% | 8.66% | — |
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).
1 2023 Calculation
Segment profit margin = 100 × Earnings (loss) from operations ÷ Net revenue
= 100 × 317 ÷ 3,480 = 9.11%
- Net Revenue
- The net revenue for the segment experienced fluctuations between 2019 and 2023. It decreased from 3,581 million USD in 2019 to 3,352 million USD in 2020, then showed a slight recovery in 2021 with 3,401 million USD. Revenue slightly declined again in 2022 to 3,339 million USD, followed by a moderate increase to 3,480 million USD in 2023. Overall, the net revenue remained relatively stable with minor variations during the period examined.
- Earnings (Loss) from Operations
- Operating earnings showed variability from 2019 to 2023. After an initial value of 310 million USD in 2019, earnings decreased to 284 million USD in 2020. The segment then achieved its highest earnings over the period in 2021 with 390 million USD, maintaining an elevated level of 399 million USD in 2022. However, a significant decrease occurred in 2023, with earnings dropping to 317 million USD. This suggests a peak period of operational profitability around 2021-2022 followed by a downturn in the latest year reported.
- Segment Profit Margin
- The segment profit margin exhibited an upward trend from 2019 to 2022, starting at 8.66% in 2019, slightly decreasing to 8.47% in 2020, then rising noticeably to 11.47% in 2021 and further to 11.95% in 2022. In 2023, the margin declined appreciably to 9.11%. The trend indicates improved profitability efficiency during 2021 and 2022 which was not sustained in 2023.
- Overall Analysis
- Between 2019 and 2023, the segment's financial performance displayed periods of both growth and contraction. While net revenue fluctuated moderately without a clear long-term trend, operating earnings and profit margins showed more pronounced volatility. The peak in operational profitability and margin expansion in 2021 and 2022 suggests effective cost management or improved operational efficiency during those years. However, the declines in 2023 across earnings and profit margin indicate challenges in maintaining those gains, which could warrant further investigation into underlying factors such as cost pressures, market conditions, or operational changes affecting profitability despite a modest rise in revenue.
Segment Profit Margin: Corporate Investments and Other
Hewlett Packard Enterprise Co.; Corporate Investments and Other; segment profit margin calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | (172) | (92) | (95) | (206) | (314) | —) |
| Net revenue | 1,250) | 1,255) | 1,356) | 1,298) | 1,288) | —) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | -13.76% | -7.33% | -7.01% | -15.87% | -24.38% | — |
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).
1 2023 Calculation
Segment profit margin = 100 × Earnings (loss) from operations ÷ Net revenue
= 100 × -172 ÷ 1,250 = -13.76%
The financial data for the "Corporate Investments and Other" segment exhibits notable fluctuations over the examined period. Key observations and trends are as follows:
- Earnings (loss) from operations
- The segment consistently reported negative earnings throughout the observed years, indicating ongoing operational challenges. The loss decreased from -314 million US dollars in 2019 to -92 million in 2021, reflecting a substantial improvement over these years. However, in 2022 and 2023, the loss grew again to -172 million US dollars, signaling a deterioration in operational profitability following the previous improvements.
- Net revenue
- Net revenue in this segment showed a relatively stable trend with minor fluctuations. It increased marginally from 1,288 million US dollars in 2019 to a peak of 1,356 million in 2021. Subsequently, revenue slightly declined to 1,255 million in 2022 and further to 1,250 million in 2023. Overall, revenues remained within a narrow range, suggesting limited growth or contraction in the segment's sales volume or pricing.
- Segment profit margin
- The profit margin, consistently negative, improved significantly from -24.38% in 2019 to -7.01% in 2020, indicating better cost control or improved revenue quality relative to expenses. This margin held relatively steady around -7% in 2021 but worsened to -13.76% by 2023. This decline points to increased relative expenses or other operational headwinds impacting profitability despite stable revenue figures.
In summary, although the segment succeeded in reducing operational losses and improving profit margins in the earlier years, recent results point toward increased losses and reduced margins. Stable revenues paired with declining profitability suggest rising costs or investments that have yet to translate into improved earnings. Continuous monitoring and cost management appear essential for reversing the recent negative trends.
Segment Return on Assets (Segment ROA)
Hewlett Packard Enterprise Co., ROA by reportable segment
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Compute | 9.73% | 10.55% | 8.18% | 6.73% | — | — |
| High Performance Computing & Artificial Intelligence (HPC & AI) | 0.81% | 0.18% | 3.48% | 4.56% | — | — |
| Storage | 5.96% | 9.09% | 10.96% | 12.63% | — | — |
| Intelligent Edge | 26.51% | 11.94% | 11.27% | 7.74% | — | — |
| Financial Services (FS) | 2.18% | 2.69% | 2.61% | 1.92% | — | — |
| Corporate Investments and Other | -12.28% | -8.30% | -7.86% | -18.33% | — | — |
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).
The annual reportable segment Return on Assets (ROA) data displays varied trends across the different business segments over the analyzed periods.
- Compute
- The Compute segment shows a generally positive trajectory from 2019 to 2022, with ROA increasing from 6.73% in 2019 to a peak of 10.55% in 2022. However, in 2023, there is a slight decline to 9.73%, indicating a minor reduction in asset profitability for this segment after reaching its highest point in the observation period.
- High Performance Computing & Artificial Intelligence (HPC & AI)
- This segment exhibits a downward trend from 4.56% in 2019 to 0.18% in 2022, suggesting diminishing returns relative to assets. A marginal recovery occurs in 2023 with an increase to 0.81%, yet the overall ROA remains substantially lower than earlier years, indicating ongoing challenges or investments not yet yielding high returns.
- Storage
- The Storage segment's ROA declines steadily from 12.63% in 2019 to 5.96% in 2023. This significant reduction over the years points to a decrease in the efficiency or profitability of assets within this segment, suggesting possible market pressures or operational challenges.
- Intelligent Edge
- The Intelligent Edge segment demonstrates robust growth throughout the period, increasing from 7.74% in 2019 to a notable 26.51% in 2023. The sharp rise, especially between 2022 and 2023, indicates strong asset utilization and potentially successful strategic initiatives or market expansion within this area.
- Financial Services (FS)
- The Financial Services segment maintains relatively low but stable ROA values, fluctuating between 1.92% in 2019 and a peak of 2.69% in 2021, before a small decline to 2.18% in 2023. This stability suggests moderate and consistent asset performance without significant volatility.
- Corporate Investments and Other
- This segment consistently records negative ROA values, with -18.33% in 2020, improving somewhat to -7.86% in 2021, but then worsening again to -12.28% in 2023. The persistent negative returns indicate ongoing asset inefficiencies or losses in this category, potentially reflecting non-core investments or restructuring costs.
Segment ROA: Compute
Hewlett Packard Enterprise Co.; Compute; segment ROA calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 1,569) | 1,780) | 1,326) | 1,007) | 1,719) | —) |
| Assets | 16,120) | 16,872) | 16,208) | 14,962) | —) | —) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 9.73% | 10.55% | 8.18% | 6.73% | — | — |
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).
1 2023 Calculation
Segment ROA = 100 × Earnings (loss) from operations ÷ Assets
= 100 × 1,569 ÷ 16,120 = 9.73%
The analysis of the annual data for the "Compute" reportable segment reveals several notable trends over the periods presented.
- Earnings (loss) from operations
- Beginning from no reported value in the earliest period, earnings from operations showed a significant rise in 2019, reaching 1,719 million US dollars. This was followed by a decline in 2020, where earnings decreased to 1,007 million US dollars. In the subsequent years, the earnings rebounded, increasing to 1,326 million US dollars in 2021 and further surging to 1,780 million US dollars in 2022. However, in the most recent period, earnings slightly declined to 1,569 million US dollars, indicating some volatility but overall growth across the years.
- Assets
- Asset values in the Compute segment became consistently reported starting in 2020, with an initial value of 14,962 million US dollars. There was a steady increase in assets over the next two years, growing to 16,208 million US dollars in 2021 and 16,872 million US dollars in 2022. In 2023, assets slightly decreased to 16,120 million US dollars, suggesting a potential realignment or reduction in asset base after a period of growth.
- Segment Return on Assets (ROA)
- The return on assets metric demonstrates an improvement trend from 2020 through 2023. Starting at 6.73% in 2020, it rose to 8.18% in 2021 and then markedly increased to 10.55% in 2022. In 2023, ROA slightly decreased to 9.73%, but remains significantly higher compared to the initial reported value, indicating enhanced efficiency in generating earnings from the asset base during these periods.
Overall, the data portrays a segment that has undergone growth in operational earnings and assets with a corresponding improvement in profitability measures such as ROA. Despite some fluctuations in earnings and assets in the latter periods, the trend points toward better asset utilization and operational profitability over the analyzed timeframe.
Segment ROA: High Performance Computing & Artificial Intelligence (HPC & AI)
Hewlett Packard Enterprise Co.; High Performance Computing & Artificial Intelligence (HPC & AI); segment ROA calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 47) | 11) | 234) | 285) | 365) | —) |
| Assets | 5,787) | 5,986) | 6,726) | 6,245) | —) | —) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 0.81% | 0.18% | 3.48% | 4.56% | — | — |
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).
1 2023 Calculation
Segment ROA = 100 × Earnings (loss) from operations ÷ Assets
= 100 × 47 ÷ 5,787 = 0.81%
The segment's earnings from operations have displayed a fluctuating trend over the analyzed periods. Beginning with a positive figure of 365 million US dollars in 2019, earnings declined steadily to 285 million in 2020 and further to 234 million in 2021. This decreasing trend continued, reaching a notably low 11 million in 2022. However, in 2023, there was a modest recovery in earnings, rising to 47 million.
With regard to assets, the segment shows an increasing trend from 2020 through 2021 and 2022, starting at 6,245 million US dollars in 2020, rising to 6,726 million in 2021, but then followed by a decline to 5,986 million in 2022 and further down to 5,787 million in 2023. This indicates a reduction in asset base in the most recent years after a period of growth.
The Segment Return on Assets (ROA) demonstrates a general downward trend over the period observed, starting at 4.56% in 2020 and declining to 3.48% in 2021. It then dropped sharply to 0.18% in 2022, suggesting a significant decrease in asset efficiency or profitability during that year. In 2023, there was a slight improvement to 0.81%, though still substantially lower than the earlier years.
Overall, the data reflects challenges faced by the segment, with diminishing operating earnings and declining asset profitability particularly evident in the years 2021 and 2022. Though a slight rebound in earnings and return on assets is seen in 2023, the lower asset base and reduced ROA compared to earlier years suggest ongoing difficulties in achieving previous levels of performance.
Segment ROA: Storage
Hewlett Packard Enterprise Co.; Storage; segment ROA calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 429) | 682) | 778) | 813) | 1,009) | —) |
| Assets | 7,195) | 7,506) | 7,097) | 6,438) | —) | —) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 5.96% | 9.09% | 10.96% | 12.63% | — | — |
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).
1 2023 Calculation
Segment ROA = 100 × Earnings (loss) from operations ÷ Assets
= 100 × 429 ÷ 7,195 = 5.96%
- Earnings from operations
- The earnings from operations exhibited a declining trend over the analyzed period. Starting at US$1,009 million in 2019, earnings decreased to US$813 million in 2020, followed by a further decline to US$778 million in 2021. This downward trajectory continued in 2022 with earnings dropping to US$682 million and culminated in a notable reduction to US$429 million in 2023. This substantial decrease in operational earnings suggests either increased costs, reduced revenues, or both within the segment in recent years.
- Assets
- Segment assets demonstrated a steady increase from 2020 through 2022, starting at US$6,438 million in 2020 and rising to US$7,097 million in 2021, followed by an additional increase to US$7,506 million in 2022. However, in 2023, assets declined slightly to US$7,195 million. This pattern indicates initial investment growth or asset accumulation followed by a moderate contraction or asset reallocation in the most recent period.
- Segment Return on Assets (ROA)
- The segment ROA revealed a consistent downward trend from 2020 onward. Starting at 12.63% in 2020, the return diminished to 10.96% in 2021, decreased further to 9.09% in 2022, and reached 5.96% in 2023. This decline in ROA suggests diminishing efficiency in utilizing assets to generate operating earnings, correlating with the simultaneous decrease in earnings and the relatively stable or slightly declining asset base.
Segment ROA: Intelligent Edge
Hewlett Packard Enterprise Co.; Intelligent Edge; segment ROA calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 1,419) | 549) | 500) | 337) | 216) | —) |
| Assets | 5,352) | 4,597) | 4,435) | 4,352) | —) | —) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 26.51% | 11.94% | 11.27% | 7.74% | — | — |
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).
1 2023 Calculation
Segment ROA = 100 × Earnings (loss) from operations ÷ Assets
= 100 × 1,419 ÷ 5,352 = 26.51%
- Earnings from operations
- The earnings from operations displayed a consistent upward trajectory from 2019 through 2023. Starting at $216 million in 2019, earnings increased to $337 million in 2020, then showed a larger increase to $500 million in 2021. The trend continued with $549 million in 2022, culminating in a substantial rise to $1,419 million in 2023. This progression indicates significant growth in operational profitability over the recent five-year period.
- Assets
- Reported assets increased steadily from 2020 through 2023. Beginning at $4,352 million in 2020, assets increased to $4,435 million in 2021, then to $4,597 million in 2022, followed by a more notable rise to $5,352 million in 2023. This upward trend suggests expanding investment or accumulation of resources within this segment.
- Segment Return on Assets (ROA)
- The segment ROA showed marked improvement over the years with data available, starting from 7.74% in 2020 and increasing to 11.27% in 2021. It continued to rise moderately to 11.94% in 2022, followed by a sharp increase to 26.51% in 2023. This indicates enhanced efficiency in generating earnings from the assets held by the segment, particularly notable in the last year where the ROA more than doubled compared to the previous year.
- Overall Analysis
- The segment exhibited strong financial performance improvements over the observed periods. Both operational earnings and asset base have grown, with earnings increasing at a faster rate, which is reflected in the substantially higher ROA in 2023. This points to improved management effectiveness, higher profitability, and possibly better utilization of resources within the segment. The data suggests that the segment has strengthened its operational capabilities and asset productivity significantly in recent years.
Segment ROA: Financial Services (FS)
Hewlett Packard Enterprise Co.; Financial Services (FS); segment ROA calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | 317) | 399) | 390) | 284) | 310) | —) |
| Assets | 14,539) | 14,837) | 14,951) | 14,765) | —) | —) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 2.18% | 2.69% | 2.61% | 1.92% | — | — |
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).
1 2023 Calculation
Segment ROA = 100 × Earnings (loss) from operations ÷ Assets
= 100 × 317 ÷ 14,539 = 2.18%
- Earnings (Loss) from Operations
-
The earnings from operations for the segment showed an initial increase from 310 million US dollars in 2019 to 390 million US dollars in 2021. This was followed by a slight growth to 399 million US dollars in 2022. However, in 2023, earnings decreased to 317 million US dollars, marking a significant decline from the previous two years' peak levels.
- Assets
-
The asset base for the segment was recorded starting in 2020 at 14,765 million US dollars. Assets slightly increased to 14,951 million US dollars in 2021, then steadily declined to 14,837 million US dollars in 2022 and further to 14,539 million US dollars in 2023. This trend indicates modest asset contraction over the most recent two years.
- Segment Return on Assets (ROA)
-
The segment's return on assets improved from 1.92% in 2020 to a peak of 2.69% in 2022, reflecting increased efficiency in asset utilization. However, in 2023, the ROA declined to 2.18%, consistent with the decrease in earnings and assets, suggesting some reduction in profitability relative to the asset base.
- Overall Insights
-
The segment demonstrated growth in earnings and operational efficiency between 2019 and 2022, with peak performance in 2021 and 2022. Despite a relatively stable asset base initially, assets started to decline after 2021. The return on assets mirrored earnings trends, showing improvement until 2022 followed by a decline in 2023. These patterns may highlight challenges in maintaining profitability under slightly decreasing asset allocations in the most recent year.
Segment ROA: Corporate Investments and Other
Hewlett Packard Enterprise Co.; Corporate Investments and Other; segment ROA calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings (loss) from operations | (172) | (92) | (95) | (206) | (314) | —) |
| Assets | 1,401) | 1,108) | 1,209) | 1,124) | —) | —) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | -12.28% | -8.30% | -7.86% | -18.33% | — | — |
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).
1 2023 Calculation
Segment ROA = 100 × Earnings (loss) from operations ÷ Assets
= 100 × -172 ÷ 1,401 = -12.28%
- Earnings (loss) from operations
- The segment experienced consistent operating losses throughout the reported periods from 2019 to 2023. The losses decreased in magnitude from a high of -314 million USD in 2019 to -92 million USD in 2021, indicating an improvement in operational efficiency or reduced expenses. However, this positive trend reversed slightly in 2023, with losses increasing again to -172 million USD, suggesting emerging challenges or increased costs during that period.
- Assets
- Assets within the segment were first reported in 2020 with a value of 1,124 million USD. Following this, there was a gradual increase in assets through 2021 and 2023, reaching 1,401 million USD by the latest period. This indicates a steady accumulation or retention of assets over time, possibly reflecting strategic investments or an expansion of the segment’s asset base.
- Segment Return on Assets (ROA)
- The segment's ROA was consistently negative, reflecting operational losses relative to its asset base. The ROA improved from -18.33% in 2020 to -7.86% in 2021, indicating better asset utilization or improved profitability trends. However, after a slight deterioration to -8.3% in 2022, the ROA declined further to -12.28% in 2023, which correlates with the increase in operating losses during the same period. This pattern suggests fluctuating profitability challenges and inefficiencies in generating returns from assets.
- Overall trends and insights
- The segment faced ongoing profitability challenges, demonstrated by consistent operational losses and negative returns on assets. Temporary improvements in profitability and operational efficiency observed between 2019 and 2021 were not sustained, with a noticeable decline in 2023. Meanwhile, the asset base steadily increased, which may imply continued investment or expansion efforts despite the lack of positive earnings. The decline in ROA in 2023 amid increased losses points to potential difficulties in aligning asset growth with improved earnings performance.
Segment Asset Turnover
Hewlett Packard Enterprise Co., asset turnover by reportable segment
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Compute | 0.71 | 0.76 | 0.76 | 0.82 | — | — |
| High Performance Computing & Artificial Intelligence (HPC & AI) | 0.68 | 0.53 | 0.47 | 0.50 | — | — |
| Storage | 0.61 | 0.63 | 0.67 | 0.73 | — | — |
| Intelligent Edge | 0.97 | 0.80 | 0.74 | 0.66 | — | — |
| Financial Services (FS) | 0.24 | 0.23 | 0.23 | 0.23 | — | — |
| Corporate Investments and Other | 0.89 | 1.13 | 1.12 | 1.15 | — | — |
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).
The annual reportable segment asset turnover data reveals several important trends and changes across different business segments over the observed periods.
- Compute Segment
- The compute segment shows a gradual decline in asset turnover ratio, decreasing from 0.82 in 2020 to 0.71 in 2023. This indicates a diminishing efficiency in generating revenue from assets in this segment over the years.
- High Performance Computing & Artificial Intelligence (HPC & AI)
- This segment exhibits a notable upward trend, with the asset turnover ratio increasing from 0.50 in 2020 to 0.68 in 2023. This suggests improving asset utilization and potentially growing market demand or better operational performance within HPC & AI.
- Storage Segment
- The storage segment experiences a steady decline, from 0.73 in 2020 down to 0.61 in 2023. This negative trend signals a reduction in efficiency in converting assets to revenue, possibly reflecting market pressures or increased investment without proportional revenue growth.
- Intelligent Edge Segment
- The intelligent edge segment shows a consistent and marked increase, starting at 0.66 in 2020 and rising to 0.97 in 2023. This significant improvement points to strong growth and effective asset utilization in this area, indicating it may be a key growth driver.
- Financial Services (FS)
- The financial services segment remains stable with minimal change, showing a steady asset turnover around 0.23 to 0.24 from 2020 through 2023. This stability suggests a consistent but relatively low asset efficiency in this segment.
- Corporate Investments and Other
- This category exhibits a slight decline, decreasing from 1.15 in 2020 to 0.89 in 2023. Although still the highest asset turnover ratio among all segments, the downward trend may reflect divestitures, changes in investment strategy, or lower returns on assets held in this category.
Overall, segments such as HPC & AI and Intelligent Edge show promising upward trends in asset turnover, highlighting these as areas of potential strength and growth. Conversely, Compute, Storage, and Corporate Investments show declines, signaling areas where asset utilization may require attention or strategic reassessment. Financial Services maintains a low but stable turnover ratio, indicating a steady, if limited, contribution to asset efficiency.
Segment Asset Turnover: Compute
Hewlett Packard Enterprise Co.; Compute; segment asset turnover calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 11,436) | 12,742) | 12,292) | 12,285) | 13,730) | —) |
| Assets | 16,120) | 16,872) | 16,208) | 14,962) | —) | —) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 0.71 | 0.76 | 0.76 | 0.82 | — | — |
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).
1 2023 Calculation
Segment asset turnover = Net revenue ÷ Assets
= 11,436 ÷ 16,120 = 0.71
- Net Revenue
- The net revenue exhibited a fluctuating trend over the observed periods. Starting at 13,730 million USD in 2019, it declined to 12,285 million USD in 2020. It then remained relatively stable in 2021 with a slight increase to 12,292 million USD, followed by an increase to 12,742 million USD in 2022. However, the net revenue experienced a notable decline to 11,436 million USD in 2023, indicating a downturn in sales or service income in the most recent year.
- Assets
- The total assets for the segment increased steadily from 14,962 million USD in 2020 to 16,208 million USD in 2021, and further to 16,872 million USD in 2022. However, in 2023, assets decreased to 16,120 million USD. This pattern suggests growth in asset base through 2022, followed by a slight contraction in the latest year.
- Segment Asset Turnover
- The segment asset turnover ratio started at 0.82 in 2020 and declined steadily to 0.76 in 2021 and remained unchanged in 2022. A further decrease to 0.71 occurred in 2023. This reduction indicates a decreasing efficiency in generating revenue from the asset base, reflecting either lower sales relative to assets or an increase in assets not matched by proportional revenue growth.
- Overall Analysis
- The segment showed a general decline in net revenue and asset turnover ratio by 2023 despite an increasing asset base in previous years, which may imply challenges in operational efficiency or market conditions impacting revenue generation. The decrease in both net revenue and asset turnover in 2023 suggests a need to review asset utilization and revenue strategies within the segment.
Segment Asset Turnover: High Performance Computing & Artificial Intelligence (HPC & AI)
Hewlett Packard Enterprise Co.; High Performance Computing & Artificial Intelligence (HPC & AI); segment asset turnover calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 3,913) | 3,192) | 3,188) | 3,105) | 2,983) | —) |
| Assets | 5,787) | 5,986) | 6,726) | 6,245) | —) | —) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 0.68 | 0.53 | 0.47 | 0.50 | — | — |
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).
1 2023 Calculation
Segment asset turnover = Net revenue ÷ Assets
= 3,913 ÷ 5,787 = 0.68
The segment's net revenue exhibited a steady upward trajectory over the period analyzed. Starting from 2,983 million USD in the fiscal year ending October 2019, revenue increased annually, reaching 3,913 million USD by October 2023. This represents a notable growth, especially between the last two years where revenue jumped significantly from 3,192 million USD in 2022 to 3,913 million USD in 2023.
Assets within the segment showed more variability during the same period. From 6,245 million USD in 2020, assets rose to 6,726 million USD in 2021 before experiencing declines in subsequent years to 5,986 million USD in 2022 and further to 5,787 million USD in 2023. This downward trend in assets in the last two years indicates a contraction in the asset base.
The segment asset turnover ratio, which measures the efficiency of asset utilization in generating revenue, initially decreased slightly from 0.50 in 2020 to 0.47 in 2021. However, it improved to 0.53 in 2022 and saw a considerable increase to 0.68 in 2023. This rising ratio, particularly the sharp increase in the most recent year, suggests enhanced operational efficiency, with the segment generating more revenue per unit of asset employed.
Overall, the data depicts a segment experiencing steady revenue growth coupled with a reduction in asset levels in the latter years, leading to improved asset turnover. This trend indicates a strengthening ability to use assets more effectively to drive revenue growth within the High Performance Computing & Artificial Intelligence reportable segment.
Segment Asset Turnover: Storage
Hewlett Packard Enterprise Co.; Storage; segment asset turnover calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 4,415) | 4,711) | 4,763) | 4,685) | 5,255) | —) |
| Assets | 7,195) | 7,506) | 7,097) | 6,438) | —) | —) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 0.61 | 0.63 | 0.67 | 0.73 | — | — |
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).
1 2023 Calculation
Segment asset turnover = Net revenue ÷ Assets
= 4,415 ÷ 7,195 = 0.61
The analysis of the Storage segment data over the reported periods reveals several notable trends in revenue, assets, and asset utilization.
- Net Revenue
- Net revenue displayed a declining trend starting from fiscal year 2019 through 2023. The segment reached its peak revenue in 2019 at 5,255 million US dollars, after which it consistently decreased each year, ending at 4,415 million US dollars in 2023. This represents an approximate 16% decline over the five-year span, indicating potential challenges in sales growth or increased competitive pressures.
- Assets
- Total assets attributed to the segment showed a rising trend from 2019 to 2022, increasing from 6,438 million US dollars to 7,506 million US dollars. However, in 2023, there was a reversal in this trend, with assets slightly declining to 7,195 million US dollars. Overall, asset levels have grown by around 12% from 2019 to their peak in 2022, suggesting increased investment or capital allocation to the segment during that period.
- Segment Asset Turnover
- The segment asset turnover ratio, which measures the efficiency of asset utilization to generate revenue, has steadily declined from 0.73 in 2020 to 0.61 in 2023. This decrease implies diminishing efficiency in using assets to produce revenue. The drop from 0.73 to 0.61 represents a decline of approximately 16%, aligning with the downward trend observed in net revenue despite increased asset levels earlier in the period.
In summary, despite an increase in assets up to 2022, the segment faced continuous revenue declines and a reduction in asset turnover, reflecting a potential operational efficiency challenge. The decline in asset turnover suggests that the Storage segment's capacity to effectively leverage its asset base to generate sales weakened over time, which could prompt strategic reviews of asset management and revenue enhancement initiatives.
Segment Asset Turnover: Intelligent Edge
Hewlett Packard Enterprise Co.; Intelligent Edge; segment asset turnover calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 5,204) | 3,674) | 3,287) | 2,855) | 2,913) | —) |
| Assets | 5,352) | 4,597) | 4,435) | 4,352) | —) | —) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 0.97 | 0.80 | 0.74 | 0.66 | — | — |
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).
1 2023 Calculation
Segment asset turnover = Net revenue ÷ Assets
= 5,204 ÷ 5,352 = 0.97
- Net Revenue
- The net revenue demonstrates a fluctuating but overall increasing trend from 2019 through 2023. Starting at $2,913 million in 2019, it slightly declined to $2,855 million in 2020. However, from 2020 onwards, net revenue showed consistent growth, rising to $3,287 million in 2021, $3,674 million in 2022, and experiencing a significant increase to $5,204 million in 2023. This indicates a strong recovery and accelerated growth in the most recent year.
- Assets
- Asset values are available beginning in 2020 and they exhibit a steady upward trajectory over the observed period. Starting at $4,352 million in 2020, assets increased modestly to $4,435 million in 2021 and then to $4,597 million in 2022. The most substantial increase occurred in 2023 with assets reaching $5,352 million. This suggests an expanding asset base supporting the business growth.
- Segment Asset Turnover
- The segment asset turnover ratio, which measures the efficiency of asset utilization in generating revenue, also shows a progressive improvement. Recorded from 2020 onwards, the ratio rose from 0.66 in 2020 to 0.74 in 2021 and 0.80 in 2022. The most notable increase occurred in 2023, with the ratio climbing to 0.97. This trend reflects increasingly effective use of assets to generate revenue over time.
- Overall Insights
- Over the observed period, net revenue and asset base both have grown, with net revenue increasing at a faster pace relative to assets, as highlighted by the rising asset turnover ratio. The marked jump in net revenue and asset turnover in 2023 suggests a period of enhanced operational efficiency and possibly strategic investments or market expansion driving improved performance. The trend points to positive momentum within the segment, reflecting stronger revenue generation capability per unit of asset employed.
Segment Asset Turnover: Financial Services (FS)
Hewlett Packard Enterprise Co.; Financial Services (FS); segment asset turnover calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 3,480) | 3,339) | 3,401) | 3,352) | 3,581) | —) |
| Assets | 14,539) | 14,837) | 14,951) | 14,765) | —) | —) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 0.24 | 0.23 | 0.23 | 0.23 | — | — |
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).
1 2023 Calculation
Segment asset turnover = Net revenue ÷ Assets
= 3,480 ÷ 14,539 = 0.24
The financial data over the examined periods reveal several notable trends within the Financial Services segment.
- Net Revenue
- Net revenue experienced fluctuations between 2019 and 2023. Starting at 3,581 million US dollars in 2019, it decreased to 3,352 million in 2020, showing a downturn that may be attributed to external or internal factors impacting revenue generation. In the following years, revenue exhibited a modest recovery, increasing to 3,401 million in 2021, slightly declining to 3,339 million in 2022, and ultimately rising again to 3,480 million by 2023. This pattern indicates periods of volatility but an overall mild upward trend towards the end of the period.
- Assets
- Asset levels were consistently reported from 2020 onward, beginning at 14,765 million US dollars. Throughout the subsequent years, assets fluctuated marginally, increasing slightly to 14,951 million in 2021, then gradually decreasing to 14,837 million in 2022 and further to 14,539 million in 2023. The overall slight decline in assets over this timeframe may suggest adjustments in asset management or divestitures impacting the asset base.
- Segment Asset Turnover
- The segment asset turnover ratio remained stable at 0.23 from 2020 through 2022, indicating consistent efficiency in generating revenue from assets during these years. A slight increase to 0.24 in 2023 suggests a marginal improvement in how effectively assets were utilized to generate net revenue. This increase, though small, could signify enhanced operational efficiency or better asset utilization practices.
In summary, the Financial Services segment showed stable but modest net revenue growth by 2023 after a dip in 2020, accompanied by a slight decline in assets and a consistent, mildly improving asset turnover ratio. These patterns suggest relatively steady operational performance with minor efficiency enhancements over the analyzed period.
Segment Asset Turnover: Corporate Investments and Other
Hewlett Packard Enterprise Co.; Corporate Investments and Other; segment asset turnover calculation
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 1,250) | 1,255) | 1,356) | 1,298) | 1,288) | —) |
| Assets | 1,401) | 1,108) | 1,209) | 1,124) | —) | —) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 0.89 | 1.13 | 1.12 | 1.15 | — | — |
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).
1 2023 Calculation
Segment asset turnover = Net revenue ÷ Assets
= 1,250 ÷ 1,401 = 0.89
The financial data exhibits several noteworthy trends across the reported periods.
- Net Revenue
- Net revenue demonstrated relatively stable performance between fiscal years 2019 and 2023, remaining in a narrow range from approximately 1,250 million to 1,356 million US dollars. The peak was observed in 2021 with revenue of 1,356 million US dollars, followed by a decline to 1,255 million and then 1,250 million in the subsequent years. This indicates a slight downward trend after 2021, albeit with minimal volatility.
- Assets
- Assets showed a consistent upward trend from 2020 onward. Starting at 1,124 million US dollars in 2020, assets increased steadily each year, reaching 1,401 million US dollars in 2023. This progression suggests investments or capital growth within the segment over the examined timeframe.
- Segment Asset Turnover
- Segment asset turnover, a measure of efficiency in using assets to generate revenue, declined from 1.15 in 2020 to 0.89 in 2023. Despite a relatively stable net revenue, this decrease in turnover ratio implies that assets grew at a faster pace than revenue, reducing asset utilization efficiency.
Overall, the segment experienced slight stagnation in net revenue combined with progressive asset growth, leading to a decreased asset turnover ratio. This may reflect a strategic decision towards asset accumulation or other operational factors impacting revenue generation relative to asset base expansion.
Net revenue
Hewlett Packard Enterprise Co., net revenue by reportable segment
US$ in millions
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Compute | 11,436) | 12,742) | 12,292) | 12,285) | 13,730) | —) |
| High Performance Computing & Artificial Intelligence (HPC & AI) | 3,913) | 3,192) | 3,188) | 3,105) | 2,983) | —) |
| Storage | 4,415) | 4,711) | 4,763) | 4,685) | 5,255) | —) |
| Intelligent Edge | 5,204) | 3,674) | 3,287) | 2,855) | 2,913) | —) |
| Financial Services (FS) | 3,480) | 3,339) | 3,401) | 3,352) | 3,581) | —) |
| Corporate Investments and Other | 1,250) | 1,255) | 1,356) | 1,298) | 1,288) | —) |
| Total | 29,698) | 28,913) | 28,287) | 27,580) | 29,750) | —) |
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).
- Overall Revenue Trend
- Total net revenue exhibits a fluctuating pattern over the reported years. After peaking at 29,750 million USD in 2018, revenue declined steadily to 27,580 million USD in 2019, followed by a gradual recovery reaching 29,698 million USD by 2023. This indicates some volatility but a general trend towards stabilization near the initial level.
- Compute Segment
- The Compute segment reveals a declining trend over the period. Starting from 13,730 million USD in 2019, revenue fell to 11,436 million USD by 2023. This represents a cumulative decrease of approximately 17%, signaling potential challenges or market shifts impacting this category.
- High Performance Computing & Artificial Intelligence (HPC & AI) Segment
- This segment demonstrates consistent growth, climbing from 2,983 million USD in 2019 to 3,913 million USD in 2023. The increase of around 31% indicates a rising demand or successful expansion in this emerging technology area, contrasting the decline observed in the broader Compute segment.
- Storage Segment
- The Storage segment shows a gradual decline throughout the years, from 5,255 million USD in 2019 down to 4,415 million USD in 2023. This downward trajectory suggests diminishing revenue streams within this business line by about 16%, possibly due to evolving technology trends or competitive pressures.
- Intelligent Edge Segment
- This segment presents the most significant growth, starting at 2,913 million USD in 2019 and rising sharply to 5,204 million USD in 2023. This represents an increase of approximately 79%, highlighting substantial expansion and possibly reflecting strategic emphasis on edge computing technologies.
- Financial Services (FS) Segment
- The Financial Services segment experiences mild fluctuations, beginning at 3,581 million USD in 2019, dipping to 3,339 million USD in 2022, but slightly improving to 3,480 million USD in 2023. Overall, this indicates a relatively stable revenue contribution with minor variability across the years.
- Corporate Investments and Other Segment
- Revenues in this category remain relatively flat, fluctuating narrowly between 1,288 million USD and 1,356 million USD from 2019 to 2023. This stability implies limited impact on total revenue and potentially reflects non-core or ancillary business activities.
- Summary
- The data reveals a division between traditional segments such as Compute and Storage, which face declining or stagnant revenue, and emerging segments like HPC & AI and Intelligent Edge, which experience robust growth. This dichotomy suggests a strategic shift toward newer technologies driving future revenue streams, while legacy areas contract or stabilize. The overall total net revenue demonstrates resilience, managing to rebound after dips and maintain a level close to the initial reported figure.
Earnings (loss) from operations
Hewlett Packard Enterprise Co., earnings (loss) from operations by reportable segment
US$ in millions
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Compute | 1,569) | 1,780) | 1,326) | 1,007) | 1,719) | —) |
| High Performance Computing & Artificial Intelligence (HPC & AI) | 47) | 11) | 234) | 285) | 365) | —) |
| Storage | 429) | 682) | 778) | 813) | 1,009) | —) |
| Intelligent Edge | 1,419) | 549) | 500) | 337) | 216) | —) |
| Financial Services (FS) | 317) | 399) | 390) | 284) | 310) | —) |
| Corporate Investments and Other | (172) | (92) | (95) | (206) | (314) | —) |
| Total | 3,609) | 3,329) | 3,133) | 2,520) | 3,305) | —) |
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).
The data on annual reportable segment earnings (loss) from operations reveals several notable trends over the period analyzed. Overall, the total earnings exhibit a cyclical pattern with a notable increase in the last reported year.
- Compute Segment
- The Compute segment shows an initial decline from 1,719 million US dollars in 2019 to 1,007 million in 2020. Thereafter, it experiences a recovery, rising to 1,326 million in 2021 and peaking at 1,780 million in 2022, before a slight decline to 1,569 million in 2023. This indicates a general recovery after a dip, but with some variability in the most recent year.
- High Performance Computing & Artificial Intelligence (HPC & AI)
- The HPC & AI segment demonstrates a steady decline over the years, starting at 365 million in 2019 and decreasing consistently to a minimal 11 million in 2022, before a modest increase to 47 million in 2023. This trend suggests challenges or reduced profitability in this segment during the period.
- Storage
- The Storage segment shows a continuous downward trajectory from 1,009 million in 2019 to 429 million in 2023. The steady decrease each year could indicate declining demand, increased competition, or operational challenges in this area.
- Intelligent Edge
- The Intelligent Edge segment experiences significant growth over the review period. Starting at 216 million in 2019, the earnings escalate progressively to 1,419 million in 2023. This represents the most substantial increase among all segments, signaling it as a rapidly expanding and potentially strategic area for the company.
- Financial Services (FS)
- Financial Services display some fluctuation but remain relatively stable overall. Earnings start at 310 million in 2019, dip slightly to 284 million in 2020, increase to 390 million in 2021, and settle around 317 million in 2023. The consistent but moderate earning levels suggest steady performance without major volatility.
- Corporate Investments and Other
- This segment reports losses throughout the period, though the magnitude of loss decreases from -314 million in 2019 to -92 million in 2021, before slightly increasing again to -172 million in 2023. The persistent negative performance indicates ongoing investment costs or losses that impact overall profitability.
- Total Earnings
- Total earnings reflect the combined effects of the segment changes. After a decline from 3,305 million in 2019 to 2,520 million in 2020, total earnings recover to 3,133 million in 2021 and show consistent growth up to 3,609 million in 2023. This upward trend in total earnings, despite challenges in certain segments, points to overall positive financial momentum driven largely by the Intelligent Edge and recovery in Compute segments.
Assets
Hewlett Packard Enterprise Co., assets by reportable segment
US$ in millions
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | Oct 31, 2018 | |
|---|---|---|---|---|---|---|
| Compute | 16,120) | 16,872) | 16,208) | 14,962) | —) | —) |
| High Performance Computing & Artificial Intelligence (HPC & AI) | 5,787) | 5,986) | 6,726) | 6,245) | —) | —) |
| Storage | 7,195) | 7,506) | 7,097) | 6,438) | —) | —) |
| Intelligent Edge | 5,352) | 4,597) | 4,435) | 4,352) | —) | —) |
| Financial Services (FS) | 14,539) | 14,837) | 14,951) | 14,765) | —) | —) |
| Corporate Investments and Other | 1,401) | 1,108) | 1,209) | 1,124) | —) | —) |
| Corporate and unallocated assets | 6,759) | 6,217) | 7,073) | 6,129) | —) | —) |
| Total | 57,153) | 57,123) | 57,699) | 54,015) | —) | —) |
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).
- Overall Asset Trends
- The total reportable segment assets displayed an upward trajectory from 54,015 million US dollars in 2020 to a peak of 57,699 million in 2021. This was followed by a slight decline, stabilizing around 57,123 million in 2022 and 57,153 million in 2023. This suggests a period of growth leading to a plateau in recent years.
- Compute Segment
- The Compute segment assets increased steadily from 14,962 million US dollars in 2020 to a high of 16,872 million in 2022, before experiencing a decrease to 16,120 million in 2023. This pattern indicates initial expansion with a moderate contraction in the most recent year.
- High Performance Computing & Artificial Intelligence (HPC & AI)
- This segment showed growth from 6,245 million in 2020 to 6,726 million in 2021, then declined consecutively to 5,986 million in 2022 and further to 5,787 million in 2023. The downward trend following 2021 suggests a reduction in asset allocation or value in this segment.
- Storage Segment
- The Storage assets consistently increased from 6,438 million in 2020 to a peak of 7,506 million in 2022 before slightly decreasing to 7,195 million in 2023. The trend reflects a general growth pattern with some recent minor retrenchment.
- Intelligent Edge Segment
- This segment displayed continuous growth throughout the period, moving from 4,352 million in 2020 to 5,352 million in 2023. The steady increase indicates a sustained investment or expansion in assets within this area.
- Financial Services (FS)
- The Financial Services segment assets increased marginally from 14,765 million in 2020 to 14,951 million in 2021, and then exhibited a gradual decline over the next two years, reaching 14,539 million in 2023. This trend reflects relative stability followed by slight contraction.
- Corporate Investments and Other
- Assets held in Corporate Investments and Other increased moderately from 1,124 million in 2020 to 1,209 million in 2021, followed by a decline to 1,108 million in 2022, then a noticeable rise to 1,401 million in 2023. This indicates variability with a recent upswing in this category.
- Corporate and Unallocated Assets
- These assets rose from 6,129 million in 2020 to 7,073 million in 2021, then decreased to 6,217 million in 2022 before rising again to 6,759 million in 2023. The fluctuation suggests changing allocations or valuation adjustments, ending with a significant recovery.