XML 31 R11.htm IDEA: XBRL DOCUMENT v3.23.4
Segment Information
 12 Months Ended
Oct. 31, 2023
Segment Reporting [Abstract]  
Segment Information Segment Information
Hewlett Packard Enterprise's operations are organized into six segments for financial reporting purposes: Compute, High Performance Computing & Artificial Intelligence (“HPC & AI”), Storage, Intelligent Edge, Financial Services (“FS”), and Corporate Investments and Other. Hewlett Packard Enterprise's organizational structure is based on a number of factors that the Chief Operating Decision Maker (“CODM”), who is the Chief Executive Officer (“CEO”), uses to evaluate, view and run the Company's business operations, which include, but are not limited to, customer base and homogeneity of products and technology. The six segments are based on this organizational structure and information reviewed by Hewlett Packard Enterprise's management to evaluate segment results. A summary of the types of products and services within each segment is as follows:
Compute includes both general purpose servers for multi-workload computing and workload optimized servers to deliver the best performance and value for demanding applications. This portfolio of products includes the HPE ProLiant Compute rack and tower servers and HPE Synergy servers. Compute offerings also include operational and support services and HPE GreenLake for Compute that provides flexible compute as-a-service (“aaS”) IT infrastructure on a consumption basis through the HPE GreenLake edge-to-cloud platform.
HPC & AI offers integrated systems comprised of software and hardware designed to address High-Performance Computing (“HPC”), Artificial Intelligence (“AI”), Data Analytics, and Transaction Processing workloads for government and commercial customers globally. The solutions are segmented into HPC and Data Solutions. The HPC portfolio of products includes HPE Cray EX, HPE Cray XD (formerly known as HPE Apollo) and Converged Edge Systems (formerly known as Edge Compute) hardware, software, and data management appliances that are often sold as supercomputing systems, including exascale supercomputers. The Data Solutions portfolio includes the mission critical compute portfolio and HPE NonStop. The mission critical compute portfolio includes the HPE Superdome Flex and HPE Integrity product lines for critical applications including large enterprise software applications and data analytics platforms. The HPE NonStop portfolio includes high-
availability, fault-tolerant software and appliances that power applications such as credit-card transaction processing that require large scale and high availability. HPC & AI offerings also include operational and support services sold with its systems and as standalone services, and also offers most of its solutions as aaS through the HPE GreenLake edge-to-cloud platform.
Storage provides data storage and data management offerings, which include cloud-native primary storage with the HPE Alletra Storage portfolio; self-service private cloud on-demand with HPE GreenLake for Private Cloud Business Edition; data storage and data management services with HPE GreenLake for Block Storage and HPE GreenLake for File Storage; disaster recovery and ransomware recovery with Zerto; data protection services with HPE GreenLake for Backup and Recovery; and big data solutions running on the family of HPE Alletra 4000 Data Storage Servers. Storage also provides solutions for unstructured data and analytics workloads along with traditional tape, disk products and storage networking. Storage also provides data-driven intelligence with HPE InfoSight and HPE CloudPhysics along with operational and support services and data management solutions delivered through the HPE GreenLake edge-to-cloud platform.
Intelligent Edge offers wired and wireless local area network, campus, branch, and data center switching, software-defined wide-area-network, network security, and associated services to enable secure connectivity for businesses of any size. The HPE Aruba Networking product portfolio includes hardware products such as Wi-Fi access points, switches and gateways. The HPE Aruba Networking software and services portfolio includes cloud-based management, network management, network access control, software-defined wide-area networking, network security, analytics and assurance, location services software, and professional and support services, as well as aaS and consumption models through the HPE GreenLake edge-to-cloud platform for the Intelligent Edge portfolio of products. Intelligent Edge offerings are consolidated in the edge service platform which takes a cloud-native approach that provides customers with a unified framework to meet their connectivity, security, and financial needs across campus, branch, data center, and remote worker environments.
Financial Services provides flexible investment solutions, such as leasing, financing, IT consumption, utility programs, and asset management services, for customers that facilitate unique technology deployment models and the acquisition of complete IT solutions, including hardware, software, and services from Hewlett Packard Enterprise and others. FS also supports financial solutions for on-premise flexible consumption models, such as the HPE GreenLake edge-to-cloud platform.
Corporate Investments and Other includes the Advisory and Professional Services (“A & PS”) business, which primarily offers consultative-led services, HPE and partner technology expertise and advice, implementation services as well as complex solution engagement capabilities; the Communications and Media Solutions business (“CMS”), which primarily offers software and related services to the telecommunications industry and includes Athonet, which provides private mobile core networks to enterprises and communication services providers; the HPE Software business, which offers the HPE Ezmeral Software Container Platform and HPE Ezmeral Software Data Fabric; OpsRamp which provides a SaaS platform for managed service providers and enterprise IT teams to monitor and manage their cloud and on-premises (“hybrid”) infrastructure; and Hewlett Packard Labs, which is responsible for research and development.
Segment Policy
Hewlett Packard Enterprise derives the results of its business segments directly from its internal management reporting system. The accounting policies that Hewlett Packard Enterprise uses to derive segment results are substantially the same as those the consolidated company uses. The CODM measures the performance of each segment based on several metrics, including earnings from operations. The CODM uses these results, in part, to evaluate the performance of, and to allocate resources to each of the segments.
Segment revenue includes revenues from sales to external customers and intersegment revenues that reflect transactions between the segments on an arm's-length basis. Intersegment revenues primarily consist of sales of hardware and software that are sourced internally and, in the majority of the cases, are financed as operating leases by FS to the Company's customers. Hewlett Packard Enterprise's consolidated net revenue is derived and reported after the elimination of intersegment revenues from such arrangements.
Financing cost in the Consolidated Statements of Earnings reflects interest expense on borrowing and funding-related activity associated with FS and its subsidiaries, and debt issued by Hewlett Packard Enterprise for which a portion of the proceeds benefited FS.
Hewlett Packard Enterprise does not allocate to its segments certain operating expenses, which it manages at the corporate level. These unallocated operating costs include certain corporate costs and eliminations, stock-based compensation expense, amortization of initial direct costs, amortization of intangible assets, impairment of goodwill, transformation costs, disaster charges and acquisition, disposition and other related charges.
Effective November 1, 2023, in order to align the Company’s segment financial reporting more closely with its current business structure, the Company established a new reportable segment, Hybrid Cloud which includes its historical Storage segment, HPE GreenLake Flex Solutions (which provides flexible as-a-service IT infrastructure through the HPE GreenLake edge-to-cloud platform and was previously reported under Compute and HPC & AI segments), Private Cloud, and Software (previously reported under Corporate Investments and Other segment). Additionally, certain products and services reported in the financial results for the HPC & AI segment through the end of fiscal 2023 will be reported in the Compute and Hybrid Cloud segments, and the recently acquired Athonet business and certain components of the CMS business reported in the financial results for Corporate Investments and Other through the end of fiscal 2023 will be reported in the Intelligent Edge segment. Beginning in the first quarter of fiscal 2024, the Company will report its results under the realigned six reportable segments.
Segment Operating Results
 ComputeHPC & AIStorageIntelligent EdgeFinancial ServicesCorporate Investments and OtherTotal
 In millions
Fiscal 2023    
Net revenue$11,129 $3,775 $4,329 $5,186 $3,466 $1,250 $29,135 
Intersegment net revenue307 138 86 18 14 — 563 
Total segment net revenue$11,436 $3,913 $4,415 $5,204 $3,480 $1,250 $29,698 
Segment earnings (loss) from operations$1,569 $47 $429 $1,419 $317 $(172)$3,609 
Fiscal 2022    
Net revenue$12,627 $3,078 $4,546 $3,665 $3,326 $1,254 $28,496 
Intersegment net revenue223 114 57 9 13 1 417 
Total segment net revenue$12,850 $3,192 $4,603 $3,674 $3,339 $1,255 $28,913 
Segment earnings (loss) from operations$1,821 $11 $641 $549 $399 $(92)$3,329 
Fiscal 2021    
Net revenue$12,158 $3,037 $4,553 $3,292 $3,388 $1,356 $27,784 
Intersegment net revenue251 147 82 10 13 — 503 
Total segment net revenue$12,409 $3,184 $4,635 $3,302 $3,401 $1,356 $28,287 
Segment earnings (loss) from operations$1,382 $231 $716 $509 $390 $(95)$3,133 

The reconciliation of segment operating results to Consolidated Statement of Earnings results was as follows:
 For the fiscal years ended October 31,
 202320222021
 In millions
Net Revenue:   
Total segments$29,698 $28,913 $28,287 
Elimination of intersegment net revenue(563)(417)(503)
Total consolidated net revenue$29,135 $28,496 $27,784 
Earnings before taxes:   
Total segment earnings from operations$3,609 $3,329 $3,133 
Unallocated corporate costs and eliminations(464)(303)(285)
Stock-based compensation expense(428)(391)(372)
Amortization of initial direct costs— (4)(8)
Amortization of intangible assets(288)(293)(354)
Impairment of goodwill— (905)— 
Transformation costs(283)(473)(930)
Disaster recovery (charges)12 (159)(16)
Acquisition, disposition and other related charges(69)(19)(36)
Interest and other, net(156)(188)(211)
Tax indemnification and other adjustments55 (67)65 
Non-service net periodic (cost) benefit credit(3)134 70 
Litigation judgment— — 2,351 
Earnings from equity interests245 215 180 
Total earnings before provision for taxes$2,230 $876 $3,587 
Segment Assets
Hewlett Packard Enterprise allocates assets to its business segments based on the segments primarily benefiting from the assets. Total assets by segment and the reconciliation of segment assets to total assets as per Consolidated Balance Sheets were as follows:
 As of October 31
 20232022
 In millions
Compute$16,120 $16,881 
HPC & AI5,787 5,997 
Storage7,195 7,484 
Intelligent Edge5,352 4,594 
Financial Services14,539 14,837 
Corporate Investments and Other1,401 1,110 
Corporate and unallocated assets6,759 6,220 
Total assets$57,153 $57,123 
Major Customers
The Company has one customer which represented 11% of the Company's total net revenue in fiscal 2023, primarily within the Intelligent Edge and Compute segments. No single customer represented 10% or more of the Company's total net revenue in fiscal years 2022 and 2021.
Geographic Information
Net revenue by country is based upon the sales location that predominately represents the customer location. For each of the fiscal years of 2023, 2022 and 2021, other than the U.S., no country represented more than 10% of the Company's net revenue.
Net revenue by geographic region was as follows:
 For the fiscal years ended October 31,
 202320222021
 In millions
Americas
U.S.$10,369 $9,425 $8,850 
Americas excluding U.S.2,208 1,964 1,825 
Total Americas12,577 11,389 10,675 
Europe, Middle East and Africa10,151 10,292 10,329 
Asia Pacific and Japan6,407 6,815 6,780 
Total consolidated net revenue$29,135 $28,496 $27,784 
Property, plant and equipment, net by country in which the Company's operates was as follows:
 As of October 31
 20232022
 In millions
U.S. $2,803 $3,035 
Other countries3,186 2,749 
Total property, plant and equipment, net$5,989 $5,784