Hewlett Packard Enterprise delivered its first financial report since CEO Meg Whitman stepped down February 1, leaving veteran executive Antonio Neri at the helm. Fortunately for Neri, HPE just crushed expectations and the company's share price is up nearly 16 percent.
Looking at the balance sheet, the company reported first quarter net income of $547 million, or 92 cents a share, on revenue of 7.7 billion, up 11 percent from a year ago. Excluding charges, HPE delivered earnings of 34 cents a share.
Wall Street was looking for first quarter non-GAAP earnings of 22 cents a share with $7.07 billion in revenue.
HPE said quarterly revenue for its hybrid IT group was $6.3 billion, up 10 percent year over year, with compute revenue up 11 percent, storage revenue up 24 percent and DC networking revenue up 27 percent. Revenue from HPE's Pointnext services was flat.
Meanwhile, HPE said intelligent edge revenue was $620 million, up 9 percent from a year ago, and financial services revenue was $888 million, up 8 percent from last year. HPE's Aruba product revenue was up 9 percent and Aruba services revenue was up 6 percent.
In terms of outlook, analysts are expecting HPE to deliver Q2 earnings of at least 26 cents a share with revenue of $7.05 billion. HPE responded strongly with second quarter non-GAAP earnings between 29 cents and 33 cents a share.
Neri also announced that HPE will offer tax reform-based incentives to employees, including an increase to the matching contribution to employee 401(K) programs.
"Given the recent tax reform in the U.S., which will provide easier access to off-shore cash, we are increasing our shareholder return commitment and our investment in employees," Neri said in a statement.
HPE also plans plans to offer $7 billion in share repurchases and dividends to shareholders by the end of fiscal 2019.