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Hewlett Packard Enterprise (HPE) disappointed investors at its Securities Analyst Meeting, as FY26 guidance came in softer than consensus and shares sold off sharply. Management framed the near-term weakness as an investment-and-integration phase -- notably the Juniper+Aruba integration -- with the promise of stronger margins and revenue synergies after 2026.

• HPE expects FY26 EPS of $2.20-$2.40 and revenue growth of 5–10%, both below analyst expectations.
• The company said the Juniper+Aruba integration will create near-term revenue pressure due to channel and customer transitions and adjustments to the go-to-market strategy.
• HPE expects operating margins to improve to 25-28% after 2026, driven by cost synergies, scale, and a favorable mix from AI-focused datacenter switching.
• The networking business is projected to grow 5-7% from FY26-FY28, reflecting near-term challenges.
• For FY25-FY28, HPE targets a 5-7% revenue CAGR, 11-17% non-GAAP operating profit growth, and EPS of at least $3.00 by FY28.
• The Catalyst initiative aims to enhance growth and drive cost savings through portfolio simplification, SG&A efficiency, supply-chain improvements, and R&D prioritization, delivering at least $350 mln in gross savings by FY28.
• HPE still expects at least $600 mln in Juniper-related cost synergies.
• The company also announced a 10% increase to its FY26 dividend and authorized $3 bln in additional share repurchase capacity.

Briefing.com Analyst Insight:

HPE’s strategy is credible: short-term revenue softness is deliberate to prioritize integration, with longer-term margin and revenue upside from combined Aruba+Juniper assets and AI-focused data-center offerings. Catalyst cost actions and Juniper synergies support margin expansion, but execution risk remains. The market is right to react to softer guidance, as integration execution, channel transitions, and weak networking growth could pressure results over multiple quarters. Investors will likely monitor product roadmap consolidation, cross-sell progress, and early synergy realization before gaining more confidence in the turnaround.