Wedoany.com Report on Mar 11th, During the latest earnings call, Hewlett Packard Enterprise (HPE) CEO Antonio Neri informed investors that the current IT market is facing intensified supply chain bottlenecks for memory, with prices for DRAM and NAND memory expected to rise until 2027.
Neri noted that HPE has secured its supply chain by expanding long-term agreements with key silicon and memory partners and implemented flexible pricing strategies to cope with cost pressures. He explained, "We have amended our quotation terms, giving us the right to reprice existing orders between quotation and shipment due to increases in commodity costs." HPE CFO Marie Myers added that the company is guiding customers toward lower memory configurations to dynamically pass on cost inflation and protect margins.
Despite the continuous price increases, Neri remains confident in demand. After meeting with customers in Europe, he stated, "Not a single customer told me, 'I don't want the product because it's too expensive now.' They all said, 'Okay, I understand the price increase. What can we do to adjust demand?'" The memory shortage has had a lesser impact on HPE's networking business, as memory constitutes a lower proportion of the bill of materials. Networking revenue grew 7% year-over-year, accounting for nearly 30% of the quarter's total revenue.
Networking growth benefited from strong performance in wireless data centers, switching and routing products, and a significant increase in sales of Wi-Fi 7 equipment. HPE is integrating Juniper Networks, with sales teams already consolidated and headcount doubled. The GreenLake as-a-service platform is approaching 50,000 customers and is expected to push AI-related annual recurring revenue to $3.5 billion. Networking lead Rami Rahim stated that GreenLake allows operators to adjust capital and operational expenditures. Neri also mentioned HPE's differentiated technology in autonomous networking, such as deployments for the 2026 Winter Olympics, showcasing its efficiency advantages.
