HPE (Hewlett Packard Enterprise) is navigating market challenges due to the Trump administration's tariffs, affecting projected earnings and leading to a 20% drop in share price. Despite a 16% revenue increase to $7.9 billion in Q1 2025, uncertainties surrounding imported parts costs are forcing HPE to lower future revenue expectations. The company aims to mitigate these effects through supply chain adjustments and pricing strategies. Additionally, CEO Antonio Neri announced plans for significant layoffs as part of a strategy to strengthen HPE's financial position amid these challenges.
"Recent tariff announcements have created uncertainty for our industry, primarily affecting our server business," HPE chief financial officer Marie Myers said on a conference call with analysts.
"We are working on plans to mitigate these impacts through supply chain measures and pricing actions. Through these efforts, we expect to mitigate to a significant degree the impact on the second half of the year and to a lesser extent the impact on Q2 as it takes time to implement mitigations."
HPE estimates revenue for Q2 2025 to be lower, in the range of $7.2 billion to $7.6 billion.
CEO Antonio Neri announced plans for significant layoffs, describing the move as an opportunity to strengthen the corporation's financial position in challenging times.
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