Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Oct. 31, 2018 | Nov. 30, 2018 | Apr. 30, 2018 | |
Document and Entity Information | |||
Entity Registrant Name | Hewlett Packard Enterprise Co, | ||
Entity Central Index Key | 1,645,590 | ||
Document Type | 10-K | ||
Document Period End Date | Oct. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --10-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 25,624,852,116 | ||
Entity Common Stock, Shares Outstanding | 1,398,678,425 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Net revenue: | |||
Products | $ 19,504 | $ 17,597 | $ 18,843 |
Services | 10,901 | 10,878 | 11,073 |
Financing income | 447 | 396 | 364 |
Total net revenue | 30,852 | 28,871 | 30,280 |
Costs and expenses: | |||
Cost of products | 14,079 | 12,715 | 13,040 |
Cost of services | 7,203 | 7,197 | 7,218 |
Financing interest | 278 | 265 | 249 |
Research and development | 1,663 | 1,486 | 1,714 |
Selling, general and administrative | 4,851 | 5,006 | 5,380 |
Amortization of intangible assets | 294 | 321 | 272 |
Impairment of goodwill | 88 | 0 | 0 |
Restructuring charges | 19 | 417 | 417 |
Transformation costs | 425 | 359 | 0 |
Disaster charges | 0 | 93 | 0 |
Acquisition and other related charges | 82 | 203 | 145 |
Separation costs | 12 | 248 | 362 |
Defined benefit plan settlement charges and remeasurement (benefit) | 0 | (64) | 0 |
Gain on H3C and MphasiS divestitures | 0 | 0 | (2,420) |
Total costs and expenses | 28,994 | 28,246 | 26,377 |
Earnings from continuing operations | 1,858 | 625 | 3,903 |
Interest and other, net | (274) | (327) | (284) |
Tax indemnification adjustments | (1,354) | (3) | 317 |
Earnings (loss) from equity interests | 38 | (23) | (76) |
Earnings from continuing operations before taxes | 268 | 272 | 3,860 |
Benefit (provision) for taxes | 1,744 | 164 | (623) |
Net earnings from continuing operations | 2,012 | 436 | 3,237 |
Net (loss) earnings from discontinued operations | (104) | (92) | (76) |
Net earnings | $ 1,908 | $ 344 | $ 3,161 |
Basic | |||
Continuing operations (in dollars per share) | $ 1.32 | $ 0.26 | $ 1.89 |
Discontinued operations (in dollars per share) | (0.07) | (0.05) | (0.05) |
Total basic net earnings (loss) per share (in dollars per share) | 1.25 | 0.21 | 1.84 |
Diluted | |||
Continuing operations (in dollars per share) | 1.30 | 0.26 | 1.86 |
Discontinued operations (in dollars per share) | (0.07) | (0.05) | (0.04) |
Total diluted net earnings (loss) per share (in dollars per share) | 1.23 | 0.21 | 1.82 |
Cash dividends declared per share (in dollars per share) | $ 0.4875 | $ 0.26 | $ 0.22 |
Weighted-average shares used to compute net earnings per share: | |||
Basic (in shares) | 1,529 | 1,646 | 1,715 |
Diluted (in shares) | 1,553 | 1,674 | 1,739 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net earnings | $ 1,908 | $ 344 | $ 3,161 |
Change in net unrealized losses on available-for-sale securities: | |||
Net unrealized losses arising during the period | (3) | (8) | (4) |
(Gains) losses reclassified into earnings | (9) | (4) | 3 |
Change in unrealized (losses) gains on available-for-sale securities | (12) | (12) | (1) |
Change in net unrealized gains (losses) on cash flow hedges: | |||
Net unrealized gains arising during the period | 169 | 46 | 226 |
Net losses (gains) reclassified into earnings | 8 | (145) | (270) |
Change in unrealized gains (losses) on cash flow hedges | 177 | (99) | (44) |
Change in unrealized components of defined benefit plans: | |||
(Losses) gains arising during the period | (423) | 944 | (1,777) |
Amortization of actuarial loss and prior service benefit | 191 | 285 | 284 |
Curtailments, settlements and other | 22 | 15 | (18) |
Change in unrealized components of defined benefit plans | (210) | 1,244 | (1,511) |
Cumulative translation adjustment arising during the period | (70) | (14) | (154) |
Release of cumulative translation adjustment as a result of divestitures and country exits | 20 | 0 | 75 |
Change in foreign currency translation adjustment | (50) | (14) | (79) |
Other comprehensive (loss) income before taxes | (95) | 1,119 | (1,635) |
(Provision) benefit for taxes | (42) | (145) | 51 |
Other comprehensive (loss) income, net of taxes | (137) | 974 | (1,584) |
Comprehensive income | $ 1,771 | $ 1,318 | $ 1,577 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Oct. 31, 2018 | Oct. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 4,880 | $ 9,579 |
Accounts receivable | 3,263 | 3,073 |
Financing receivables | 3,396 | 3,378 |
Inventory | 2,447 | 2,315 |
Assets held for sale | 6 | 14 |
Other current assets | 3,280 | 3,085 |
Total current assets | 17,272 | 21,444 |
Property, plant and equipment | 6,138 | 6,269 |
Long-term financing receivables and other assets | 11,359 | 12,600 |
Investments in equity interests | 2,398 | 2,535 |
Goodwill | 17,537 | 17,516 |
Intangible assets | 789 | 1,042 |
Total assets | 55,493 | 61,406 |
Current liabilities: | ||
Notes payable and short-term borrowings | 2,005 | 3,850 |
Accounts payable | 6,092 | 6,072 |
Employee compensation and benefits | 1,412 | 1,156 |
Taxes on earnings | 378 | 429 |
Deferred revenue | 3,177 | 3,128 |
Accrued restructuring | 294 | 445 |
Other accrued liabilities | 3,840 | 3,844 |
Total current liabilities | 17,198 | 18,924 |
Long-term debt | 10,136 | 10,182 |
Other non-current liabilities | 6,885 | 8,795 |
Commitments and contingencies | ||
HPE stockholders' equity: | ||
Preferred stock, $0.01 par value (300 shares authorized; none issued) | 0 | 0 |
Common stock, $0.01 par value (9,600 shares authorized; 1,423 and 1,595 shares issued and outstanding at October 31, 2018 and October 31, 2017, respectively) | 14 | 16 |
Additional paid-in capital | 30,342 | 33,583 |
Accumulated deficit | (5,899) | (7,238) |
Accumulated other comprehensive loss | (3,218) | (2,895) |
Total HPE stockholders' equity | 21,239 | 23,466 |
Non-controlling interests | 35 | 39 |
Total stockholders' equity | 21,274 | 23,505 |
Total liabilities and stockholders' equity | $ 55,493 | $ 61,406 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Oct. 31, 2018 | Oct. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value ($ per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (shares) | 300,000,000 | 300,000,000 |
Preferred stock, issued (shares) | 0 | 0 |
Preferred stock, outstanding (shares) | 0 | 0 |
Common stock, par value ($ per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (shares) | 9,600,000,000 | 9,600,000,000 |
Common stock, issued (shares) | 1,423,000,000 | 1,595,000,000 |
Common stock, outstanding (shares) | 1,423,000,000 | 1,595,000,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | ||
Cash flows from operating activities: | ||||
Net earnings | $ 1,908 | $ 344 | $ 3,161 | |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 2,576 | 3,051 | 3,775 | |
Impairment of goodwill | 88 | 0 | 0 | |
Stock-based compensation expense | 286 | 428 | 558 | |
Provision for inventory and doubtful accounts | 198 | 129 | 232 | |
Restructuring charges | 550 | 964 | 1,236 | |
Deferred taxes on earnings | 2,229 | (1,122) | (1,345) | |
Gain on H3C and MphasiS divestitures | 0 | 0 | (2,420) | |
(Earnings) loss from equity interests | (38) | 23 | 76 | |
Dividends received from equity investee | 164 | 98 | 0 | |
Other, net | (158) | 543 | 195 | |
Changes in operating assets and liabilities, net of acquisitions: | ||||
Accounts receivable | (220) | 457 | 991 | |
Financing receivables | (366) | (462) | (301) | |
Inventory | (260) | (542) | 34 | |
Accounts payable | (27) | 992 | 66 | |
Taxes on earnings | (4,516) | (265) | 1,615 | |
Restructuring | (647) | (800) | (1,044) | |
Other assets and liabilities | [1] | 1,197 | (2,503) | (1,773) |
Net cash provided by operating activities | 2,964 | 1,335 | 5,056 | |
Cash flows from investing activities: | ||||
Investment in property, plant and equipment | (2,956) | (3,137) | (3,280) | |
Proceeds from sale of property, plant and equipment | 1,094 | 679 | 450 | |
Purchases of available-for-sale securities and other investments | (33) | (45) | (656) | |
Maturities and sales of available-for-sale securities and other investments | 98 | 38 | 585 | |
Financial collateral posted | (1,547) | (686) | 0 | |
Financial collateral returned | 1,467 | 466 | 0 | |
Payments made in connection with business acquisitions, net of cash acquired | (207) | (2,202) | (22) | |
Proceeds from business divestitures, net | 13 | (20) | 3,342 | |
Net cash (used in) provided by investing activities | (2,071) | (4,907) | 419 | |
Cash flows from financing activities: | ||||
Short-term borrowings with original maturities less than 90 days, net | 5 | 18 | (71) | |
Proceeds from debt, net of issuance costs | 2,457 | 2,259 | 1,074 | |
Payment of debt | (4,138) | (3,783) | (833) | |
Settlement of cash flow hedge | 0 | 5 | 3 | |
Net proceeds related to stock-based award activities | 116 | 108 | 41 | |
Repurchase of common stock | (3,568) | (2,556) | (2,662) | |
Net transfers from former Parent | 0 | 0 | 491 | |
Restricted cash transfer | [2] | 0 | (29) | 0 |
Cash dividends paid to non-controlling interests | (9) | 0 | 0 | |
Cash dividends paid | (570) | (428) | (373) | |
Net cash (used in) provided by financing activities | (5,592) | 164 | (2,330) | |
(Decrease) increase in cash and cash equivalents | (4,699) | (3,408) | 3,145 | |
Cash and cash equivalents at beginning of period | 9,579 | 12,987 | 9,842 | |
Cash and cash equivalents at end of period | 4,880 | 9,579 | 12,987 | |
Supplemental cash flow disclosures: | ||||
Income taxes paid, net of refunds | 538 | 836 | 656 | |
Interest expense paid | 609 | 415 | 585 | |
Supplemental schedule of non-cash investing and financing activities: | ||||
Net assets transferred to Everett and Seattle | 0 | 5,946 | 0 | |
Everett SpinCo, Inc. | ||||
Cash flows from financing activities: | ||||
Net transfer of cash and cash equivalents | (41) | (711) | 0 | |
Cash dividend | [3] | 0 | 3,008 | 0 |
Seattle SpinCo, Inc. | ||||
Cash flows from financing activities: | ||||
Net transfer of cash and cash equivalents | 156 | (227) | 0 | |
Cash dividend | [4] | $ 0 | $ 2,500 | $ 0 |
[1] | For fiscal 2017, the amount includes $1.9 billion of pension funding payments associated with the separation and merger of Everett SpinCo, Inc. with Computer Sciences Corporation. | |||
[2] | epresents the difference between the net proceeds from the Seattle debt issuance in the third quarter of fiscal 2017 and the amount held in escrow through the close of the transaction. This was settled in the fourth quarter of fiscal 2017 with the net transfer of cash and cash equivalents to Seattle. | |||
[3] | epresents a $3.0 billion cash dividend payment from Everett SpinCo, Inc. to HPE, the proceeds of which were funded from the issuance of $3.5 billion of debt by Everett SpinCo, Inc. The debt was retained by Everett SpinCo, Inc. | |||
[4] | epresents a $2.5 billion cash dividend payment from Seattle SpinCo, Inc. to HPE, the proceeds of which were funded from the issuance of $2.6 billion of aggregate debt by Seattle SpinCo, Inc. The debt was retained by Seattle SpinCo, Inc. |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) | 3 Months Ended | 12 Months Ended |
Oct. 31, 2017USD ($) | Oct. 31, 2017USD ($) | |
Face amount of debt instrument | $ 0 | $ 0 |
Spinoff | ||
Pension funding payments | 1,900,000,000 | |
HPE | Everett SpinCo, Inc. | Spinoff | ||
Due to HPE | 3,000,000,000 | |
HPE | Seattle SpinCo, Inc. | Spinoff | ||
Due to HPE | 2,500,000,000 | |
Term loan facility | HPE | Everett SpinCo, Inc. | ||
Face amount of debt instrument | 3,500,000,000 | 3,500,000,000 |
Term loan facility | HPE | Seattle SpinCo, Inc. | ||
Face amount of debt instrument | $ 2,600,000,000 | $ 2,600,000,000 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity Statement - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Additional Paid-in Capital | Former Parent Company Investment | (Accumulated Deficit) Retained Earnings | (Accumulated Deficit) Retained EarningsEverett SpinCo, Inc. | (Accumulated Deficit) Retained EarningsSeattle SpinCo, Inc. | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive LossEverett SpinCo, Inc. | Accumulated Other Comprehensive LossSeattle SpinCo, Inc. | Equity Attributable to the Company | Equity Attributable to the CompanyEverett SpinCo, Inc. | Equity Attributable to the CompanySeattle SpinCo, Inc. | Non- controlling Interests | Non- controlling InterestsEverett SpinCo, Inc. | Total Equity | Total EquityEverett SpinCo, Inc. | Total EquitySeattle SpinCo, Inc. | |
Balance at Oct. 31, 2015 | $ 0 | $ 0 | $ 38,550 | $ 0 | $ (5,015) | $ 33,535 | $ 383 | $ 33,918 | |||||||||||
Balance (in shares) at Oct. 31, 2015 | 0 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Separation-related adjustments | (1,236) | (1,236) | (1,236) | ||||||||||||||||
Issuance of common stock and reclassification of former Parent company investment (in shares) | 1,803,719 | ||||||||||||||||||
Issuance of common stock and reclassification of former Parent company investment | $ 18 | 37,296 | (37,314) | 0 | 0 | ||||||||||||||
Net earnings | $ 3,161 | 3,161 | 3,161 | 33 | 3,194 | ||||||||||||||
Other comprehensive income (loss) | (1,584) | (1,584) | (1,584) | (1,584) | |||||||||||||||
Comprehensive income | 1,577 | 1,577 | 33 | 1,610 | |||||||||||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 20,374 | ||||||||||||||||||
Issuance of common stock in connection with employee stock plans and other | 15 | 15 | 15 | ||||||||||||||||
Repurchases of common stock (in shares) | (157,761) | ||||||||||||||||||
Repurchases of common stock | $ (1) | (2,661) | (2,662) | (2,662) | |||||||||||||||
Tax benefit from employee stock plans | 1 | 1 | 1 | ||||||||||||||||
Cash dividends declared | (379) | (379) | (379) | ||||||||||||||||
Stock-based compensation expense | 597 | 597 | 597 | ||||||||||||||||
Changes in non-controlling interests | (9) | (9) | |||||||||||||||||
MphasiS divestiture | (337) | (337) | |||||||||||||||||
Balance at Oct. 31, 2016 | $ 17 | 35,248 | 0 | 2,782 | (6,599) | 31,448 | 70 | 31,518 | |||||||||||
Balance (in shares) at Oct. 31, 2016 | 1,666,332 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Transaction | $ (3,671) | $ (6,182) | $ 2,579 | $ 151 | $ (1,092) | $ (6,031) | $ (30) | $ (1,122) | $ (6,031) | ||||||||||
Net earnings | 344 | 344 | 344 | (1) | 343 | ||||||||||||||
Other comprehensive income (loss) | 974 | 974 | 974 | 974 | |||||||||||||||
Comprehensive income | 1,318 | 1,318 | (1) | 1,317 | |||||||||||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 66,618 | ||||||||||||||||||
Issuance of common stock in connection with employee stock plans and other | 75 | 75 | 75 | ||||||||||||||||
Repurchases of common stock (in shares) | (137,789) | ||||||||||||||||||
Repurchases of common stock | $ (1) | (2,497) | (82) | (2,580) | (2,580) | ||||||||||||||
Tax benefit from employee stock plans | 137 | 137 | 137 | ||||||||||||||||
Cash dividends declared | (429) | (429) | (429) | ||||||||||||||||
Stock-based compensation expense | 620 | 620 | 620 | ||||||||||||||||
Balance at Oct. 31, 2017 | $ 23,505 | $ 16 | 33,583 | 0 | (7,238) | (2,895) | 23,466 | 39 | 23,505 | ||||||||||
Balance (in shares) at Oct. 31, 2017 | 1,595 | 1,595,161 | |||||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Adjustment to reduce deferred tax asset | $ 186 | ||||||||||||||||||
Transaction | 164 | (186) | (22) | (22) | |||||||||||||||
Net earnings | 1,908 | 1,908 | 1,908 | (4) | 1,904 | ||||||||||||||
Other comprehensive income (loss) | (137) | (137) | (137) | (137) | |||||||||||||||
Comprehensive income | 1,771 | 1,771 | (4) | 1,767 | |||||||||||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | [1] | 50,369 | |||||||||||||||||
Issuance of common stock in connection with employee stock plans and other | [1] | 27 | 27 | 27 | |||||||||||||||
Repurchases of common stock (in shares) | (222,227) | ||||||||||||||||||
Repurchases of common stock | $ (2) | (3,577) | 0 | (3,579) | (3,579) | ||||||||||||||
Cash dividends declared | (733) | (733) | (733) | ||||||||||||||||
Stock-based compensation expense | 309 | 309 | 309 | ||||||||||||||||
Balance at Oct. 31, 2018 | $ 21,274 | $ 14 | 30,342 | $ 0 | $ (5,899) | $ (3,218) | $ 21,239 | $ 35 | $ 21,274 | ||||||||||
Balance (in shares) at Oct. 31, 2018 | 1,423 | 1,423,303 | |||||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||||
Adjustment to reduce deferred tax asset | $ 101 | $ 55 | |||||||||||||||||
[1] | In fiscal 2018, the Company recorded an adjustment of $55 million to reduce a deferred tax asset established in connection with the Separation as a reduction to Additional paid-in capital in the Consolidated Statement of Stockholders' Equity. |
Overview and Summary of Signifi
Overview and Summary of Significant Accounting Policies | 12 Months Ended |
Oct. 31, 2018 | |
Accounting Policies [Abstract] | |
Overview and Summary of Significant Accounting Policies | Overview and Summary of Significant Accounting Policies Background Hewlett Packard Enterprise Company ("Hewlett Packard Enterprise", "HPE", or "the Company") is a global technology leader focused on developing intelligent solutions that allow customers to capture, analyze and act upon data seamlessly from edge to cloud. Hewlett Packard Enterprise enables customers to accelerate business outcomes by driving new business models, creating new customer and employee experiences, and increasing operational efficiency today and into the future. Hewlett Packard Enterprise's customers range from small- and medium-sized businesses ("SMBs") to large global enterprises. Former Parent Separation On November 1, 2015, the Company became an independent publicly-traded company through a pro rata distribution by HP Inc. ("former Parent" or "HPI"), formerly known as Hewlett-Packard Company ("HP Co."), of 100% of the outstanding shares of Hewlett Packard Enterprise Company to HP Inc.'s stockholders (the "Separation"). Each HP Inc. stockholder of record received one share of Hewlett Packard Enterprise common stock for each share of HP Inc. common stock held on the record date. Following the Separation, the Company became an independent publicly-traded company. On October 31, 2015 and November 1, 2015, the Company entered into several agreements with former Parent that govern the relationship between the Company and former Parent following the distribution. • Separation and Distribution Agreement; • Transition Services Agreement; • Tax Matters Agreement; • Employee Matters Agreement; • Real Estate Matters Agreement; • Master Commercial Agreement; and • Information Technology Service Agreement. These agreements provided for the allocation between the Company and former Parent's assets, employees, liabilities, and obligations (including its investments, property and employee benefits and tax-related assets and liabilities) attributable to periods prior to, at and after the Separation. Obligations under the service and commercial contracts generally extend through five years. Discontinued Operations On April 1, 2017, HPE completed the separation and merger of its Enterprise Services business with Computer Sciences Corporation (“CSC”) (collectively, the “Everett Transaction”). HPE transferred its Enterprise Services business to Everett SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Everett") and distributed all of the shares of Everett to HPE stockholders. Following the distribution, New Everett Merger Sub Inc., a wholly-owned subsidiary of Everett, merged with and into CSC and Everett changed its name to DXC Technology Company ("DXC"). On September 1, 2017, HPE completed the separation and merger of its Software business segment with Micro Focus International plc (“Micro Focus”) (collectively, the “Seattle Transaction”). HPE transferred its Software business segment to Seattle SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Seattle"), and distributed all of the shares of Seattle to HPE stockholders. Following the share distribution, Seattle MergerSub, Inc., an indirect, wholly-owned subsidiary of Micro Focus, merged with and into Seattle. HPE had entered into several agreements with each of DXC and Micro Focus that govern the relationship between the parties, including the following: • Separation and Distribution Agreement; • Transition Services Agreement; • Tax Matters Agreement; • Employee Matters Agreement; • Real Estate Matters Agreement; • Intellectual Property Matters Agreement • Information Technology Service Agreement; and • Preferred Vendor Agreements. These agreements provided for the allocation of assets, employees, liabilities and obligations (including its investments, property, employee benefits, litigation, and tax-related assets and liabilities) between HPE and DXC and HPE and Micro Focus, respectively, attributable to periods prior to, at and after the transactions. Obligations under the service and commercial contracts generally extend through five years. HPE Next During the third quarter of fiscal 2017, the Company launched an initiative called HPE Next, through which it will simplify the organizational structure and redesign business processes. The HPE Next initiative is expected to be implemented through fiscal 2020. During this time, the Company expects to incur expenses for workforce reductions, to upgrade and simplify its IT infrastructure, and for other non-labor actions. These costs were partially offset by gains from real estate sales, all of which was recorded within Transformation costs in the Consolidated Statements of Earnings. For more details on the HPE Next initiative and Transformation costs, see Note 5, "HPE Next". Basis of Presentation The historical results of operations and financial position of both Everett and Seattle are reported as discontinued operations in the Consolidated Statements of Earnings and the Consolidated Balance Sheets. The historical information in the accompanying Notes to the Consolidated Financial Statements has been restated to reflect the effects of the Everett Transaction and the Seattle Transaction. For further information on discontinued operations, see Note 2, "Discontinued Operations". Principles of Consolidation and Combination The accompanying Consolidated Financial Statements include the accounts of the Company and other subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary. All intercompany transactions and accounts within the consolidated businesses of the Company have been eliminated. Intercompany transactions between the Company and former Parent, prior to the Separation, are considered to be effectively settled in the Consolidated and Combined Financial Statements at the time the transaction was recorded. The total net effect of the settlement of these intercompany transactions is reflected in the Consolidated Statements of Cash Flows within financing activities. The Company accounts for investments in companies over which it has the ability to exercise significant influence but does not hold a controlling interest under the equity method of accounting, and the Company records its proportionate share of income or losses in Earnings (loss) from equity interests in the Consolidated Statements of Earnings. Non-controlling interests are presented as a separate component within Total stockholders' equity in the Consolidated Balance Sheets. Net earnings attributable to non-controlling interests are recorded within Interest and other, net in the Consolidated Statements of Earnings and are not presented separately, as they were not material for any period presented. Segment Realignment During the first quarter of fiscal 2018, the Company completed an organizational change in certain segment and business unit realignments in order to align its segment financial reporting more closely with its current business structure. Reclassifications of certain prior year segment and business unit financial information have been made to conform to the current-year presentation. None of the changes impact the Company's previously reported consolidated net revenue, earnings from operations, net earnings or net earnings per share ("EPS"). See Note 3, "Segment Information", for a further discussion of the Company's segment realignment. Use of Estimates The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the Company's Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates. Foreign Currency Translation The Company predominately uses the U.S. dollar as its functional currency. Assets and liabilities denominated in non-U.S. currencies are remeasured into U.S. dollars at current exchange rates for monetary assets and liabilities and at historical exchange rates for non-monetary assets and liabilities. Net revenue, costs and expenses denominated in non-U.S. currencies are recorded in U.S. dollars at the average rates of exchange prevailing during the period. The Company includes gains or losses from foreign currency remeasurement in Interest and other, net in the Consolidated Statements of Earnings and gains and losses from cash flow hedges in Net revenue as the hedged revenue is recognized. Certain non-U.S. subsidiaries designate the local currency as their functional currency, and the Company records the translation of their assets and liabilities into U.S. dollars at the balance sheet date as translation adjustments and includes them as a component of Accumulated other comprehensive loss in the Consolidated Balance Sheets. The effect of foreign currency exchange rates on cash and cash equivalents was not material for any of the fiscal years presented. Former Parent Company Investment Former Parent company investment in Consolidated Statements of Stockholders' Equity represents former Parent's historical investment in the Company, the net effect of transactions with and allocations from former Parent and the Company's accumulated earnings. In December 2015, in connection with the Separation and Distribution Agreement, the Company received a net cash allocation of $526 million from former Parent. The cash allocation was based on the projected cash requirements of the Company, in light of the intended investment grade credit rating, business plan and anticipated operations and activities. Former Parent historically used a centralized approach to manage cash and finance its operations. Prior to the Separation, transactions between the Company and former Parent were considered to be effectively settled for cash at the time the transaction was recorded. The net effect of these transactions is included in Net transfer from former Parent in the Consolidated Statements of Cash Flows. Revenue Recognition General The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services are rendered, the sales price or fee is fixed or determinable, and collectability is reasonably assured. Additionally, the Company recognizes hardware revenue on sales to channel partners, including resellers, distributors or value-added solution providers at the time of delivery when the channel partners have economic substance apart from the Company, and the Company has completed its obligations related to the sale. The Company generally recognizes revenue for its standalone software sales to channel partners on receipt of evidence that the software has been sold to a specific end user. The Company limits the amount of revenue recognized for delivered elements to the amount that is not contingent on the future delivery of products or services, future performance obligations or subject to customer-specified refund or return rights. The Company reduces revenue for customer and distributor programs and incentive offerings, including price protection, rebates, promotions, other volume-based incentives, and expected returns, at the later of the date of revenue recognition or the date the sales incentive is offered. Future market conditions and product transitions may require the Company to take actions to increase customer incentive offerings, possibly resulting in an incremental reduction of revenue at the time the incentive is offered. For certain incentive programs, the Company estimates the number of customers expected to redeem the incentive based on historical experience and the specific terms and conditions of the incentive. In instances when revenue is derived from sales of third-party vendor products or services, the Company records revenue on a gross basis when the Company is a principal to the transaction and on a net basis when the Company is acting as an agent between the customer and the vendor. The Company considers several factors to determine whether it is acting as a principal or an agent, most notably whether the Company is the primary obligor to the customer, has established its own pricing and has inventory and credit risks. The Company reports revenue net of any taxes collected from customers and remitted to government authorities, with the collected taxes recorded as current liabilities until remitted to the relevant government authority. Multiple element arrangements When a sales arrangement contains multiple elements or deliverables, such as hardware and software products, and/or services, the Company allocates revenue to each element based on a selling price hierarchy. The selling price for a deliverable is based on its vendor specific objective evidence ("VSOE") of selling price, if available, third-party evidence ("TPE") if VSOE of selling price is not available, or estimated selling price ("ESP") if neither VSOE of selling price nor TPE is available. The Company establishes VSOE of selling price using the price charged for a deliverable when sold separately and, in rare instances, using the price established by management having the relevant authority. The Company establishes TPE of selling price by evaluating largely similar and interchangeable competitor products or services in standalone sales to similarly situated customers. The Company establishes ESP based on management judgment considering internal factors such as margin objectives, pricing practices and controls, customer segment pricing strategies and the product life-cycle. Consideration is also given to market conditions such as competitor pricing strategies and technology industry life-cycles. In most arrangements with multiple elements, the Company allocates the transaction price to the individual units of accounting at inception of the arrangement based on their relative selling price. In multiple element arrangements that include software that is more-than-incidental, the Company allocates the transaction price to the individual units of accounting for the non-software deliverables and to the software deliverables as a group using the relative selling price of each of the deliverables in the arrangement based on the selling price hierarchy. If the arrangement contains more than one software deliverable, the transaction price allocated to the group of software deliverables is then allocated to each component software deliverable. The Company evaluates each deliverable in an arrangement to determine whether it represents a separate unit of accounting. A deliverable constitutes a separate unit of accounting when it has standalone value to the customer. For elements with no standalone value, the Company recognizes revenue consistent with the pattern of the undelivered elements. If the arrangement includes a customer-negotiated refund or return right or other contingency relative to the delivered items, and the delivery and performance of the undelivered items is considered probable and substantially within the Company's control, the delivered element constitutes a separate unit of accounting. In arrangements with combined units of accounting, changes in the allocation of the transaction price among elements may impact the timing of revenue recognition for the contract but will not change the total revenue recognized for the contract. Product revenue Hardware Under the Company's standard terms and conditions of sale, the Company transfers title and risk of loss to the customer at the time product is delivered to the customer and recognizes revenue accordingly, unless customer acceptance is uncertain or significant obligations to the customer remain. The Company reduces revenue for estimated customer returns, price protection, rebates and other programs offered under sales agreements established by the Company with its distributors and resellers. The Company records revenue from the sale of equipment under sales-type leases as product revenue at the inception of the lease. The Company accrues the estimated cost of post-sale obligations, including standard product warranties, based on historical experience at the time the Company recognizes revenue. Software The Company recognizes revenue from perpetual software licenses at the inception of the license term, assuming all revenue recognition criteria have been satisfied. Term-based software license revenue is generally recognized ratably over the term of the license. The Company uses the residual method to allocate revenue to software licenses at the inception of the arrangement when VSOE of fair value for all undelivered elements, such as post-contract customer support, exists and all other revenue recognition criteria have been satisfied. The Company recognizes revenue from maintenance and unspecified upgrades or updates provided on a when-and-if-available basis ratably over the period during which such items are delivered. The Company recognizes revenue for software-as-a-service ("SaaS") arrangements as the service is delivered, generally on a straight-line basis, over the contractual period of performance. Services revenue The Company recognizes revenue from fixed-price support or maintenance contracts, including extended warranty contracts and software post-contract customer support agreements, ratably over the contract period and recognizes the costs associated with these contracts as incurred. For time and material contracts, the Company recognizes revenue as services are rendered and recognizes costs as they are incurred. The Company recognizes revenue from certain fixed-price contracts, such as consulting arrangements, as work progresses over the contract period on a proportional performance basis, as determined by the percentage of labor costs incurred to date compared to the total estimated labor costs of a contract. Estimates of total project costs for fixed-price contracts are regularly reassessed during the life of a contract. Provisions for estimated losses on fixed-priced contracts are recognized in the period when such losses become known. If reasonable and reliable cost estimates for a project cannot be made, the Company uses the completed contract method and recognizes revenue and costs upon service completion. The Company recognizes revenue from operating leases on a straight-line basis as service revenue over the rental period. Financing income Sales-type and direct-financing leases produce financing income, which the Company recognizes at consistent rates of return over the lease term. Deferred revenue The Company records amounts invoiced to customers in excess of revenue recognized as deferred revenue until the revenue recognition criteria are satisfied. The Company records revenue that is earned and recognized in excess of amounts invoiced on services contracts as trade receivables. Deferred revenue represents amounts invoiced in advance for product support contracts, software customer support contracts, consulting and integration projects, product sales or leasing income. Shipping and Handling The Company includes costs related to shipping and handling in Cost of products. Stock-Based Compensation Stock-based compensation expense is based on the measurement date fair value of the award and is recognized only for those awards expected to meet the service and performance vesting conditions on a straight-line basis over the requisite service period of the award. Stock-based compensation expense is determined at the aggregate grant level for service-based awards and at the individual vesting tranche level for awards with performance and/or market conditions. The forfeiture rate is estimated based on historical experience. Retirement and Post-Retirement Plans The Company has various defined benefit, other contributory and noncontributory, retirement and post-retirement plans. The Company generally amortizes unrecognized actuarial gains and losses on a straight-line basis over the average remaining estimated service life or, in the case of closed plans, life expectancy of participants. In limited cases, actuarial gains and losses are amortized using the corridor approach. See Note 6, “Retirement and Post-Retirement Benefit Plans” for a full description of these plans and the accounting and funding policies. Advertising Costs to produce advertising are expensed as incurred during production. Costs to communicate advertising are expensed when the advertising is first run. Advertising expense totaled approximately $193 million in fiscal 2018, $255 million in fiscal 2017, and $215 million in fiscal 2016. Restructuring The Company records charges associated with approved restructuring plans to reorganize one or more of the Company's business segments, to remove duplicative headcount and infrastructure associated with business acquisitions or to simplify business processes and accelerate innovation. Restructuring charges can include severance costs to eliminate a specified number of employees, infrastructure charges to vacate facilities and consolidate operations, and contract cancellation costs. The Company records restructuring charges based on estimated employee terminations and site closure and consolidation plans. The Company accrues for severance and other employee separation costs under these actions when it is probable that benefits will be paid and the amount is reasonably estimable. The rates used in determining severance accruals are based on existing plans, historical experiences and negotiated settlements. Taxes on Earnings The Company recognizes deferred tax assets and liabilities for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts using enacted tax rates in effect for the year the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is more likely than not to realize. In determining the need for a valuation allowance, the Company considers future market growth, forecasted earnings, future sources of taxable income, the mix of earnings in the jurisdictions in which the Company operates, and prudent and feasible tax planning strategies. In the event the Company were to determine that it is more likely than not that the Company will be unable to realize all or part of its deferred tax assets in the future, the Company would increase the valuation allowance and recognize a corresponding charge to earnings or other comprehensive income in the period in which such a determination were made. Likewise, if the Company later determines that the deferred tax assets are more likely than not to be realized, the Company would reverse the applicable portion of the previously recognized valuation allowance. In order for the Company to realize deferred tax assets, the Company must be able to generate sufficient taxable income in the jurisdictions in which the deferred tax assets are located. The Company records accruals for uncertain tax positions when the Company believes that it is not more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The Company makes adjustments to these accruals when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. The provision for income taxes includes the effects of adjustments for uncertain tax positions, effects of settlement of certain pre-Separation Hewlett-Packard Company income tax liabilities, as well as any related interest and penalties. Accounts Receivable The Company establishes an allowance for doubtful accounts for accounts receivable. The Company records a specific reserve for individual accounts when the Company becomes aware of specific customer circumstances, such as in the case of a bankruptcy filing or deterioration in the customer's operating results or financial position. If there are additional changes in circumstances related to the specific customer, the Company further adjusts estimates of the recoverability of receivables. The Company maintains bad debt reserves for all other customers based on a variety of factors, including the use of third-party credit risk models that generate quantitative measures of default probabilities based on market factors, the financial condition of customers, the length of time receivables are past due, trends in the weighted-average risk rating for the portfolio, macroeconomic conditions, information derived from competitive benchmarking, significant one-time events, and historical experience. The past due or delinquency status of a receivable is based on the contractual payment terms of the receivable. The Company has third-party revolving short-term financing arrangements intended to facilitate the working capital requirements of certain customers. These financing arrangements, which in certain cases provide for partial recourse, result in the transfer of the Company's trade receivables to a third party. The Company reflects amounts transferred to, but not yet collected from, the third party in Accounts receivable in the Consolidated Balance Sheets. For arrangements involving an element of recourse, the fair value of the recourse obligation is measured using market data from similar transactions and reported as a current liability in Other accrued liabilities in the Consolidated Balance Sheets. Concentrations of Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents, investments, receivables from trade customers and contract manufacturers, financing receivables and derivatives. The Company maintains cash and cash equivalents, investments, derivatives, and certain other financial instruments with various financial institutions. These financial institutions are located in many different geographic regions, and the Company's policy is designed to limit exposure from any particular institution. As part of its risk management processes, the Company performs periodic evaluations of the relative credit standing of these financial institutions. The Company has not sustained material credit losses from instruments held at these financial institutions. The Company utilizes derivative contracts to protect against the effects of foreign currency and interest rate exposures. Such contracts involve the risk of non-performance by the counterparty, which could result in a material loss. Credit risk with respect to accounts receivable and financing receivables is generally diversified due to the large number of entities comprising the Company's customer base and their dispersion across many different industries and geographic regions. The Company performs ongoing credit evaluations of the financial condition of its customers and may require collateral, such as letters of credit and bank guarantees, in certain circumstances. As of October 31, 2018 and 2017 no single customer accounted for more than 10% of the Company's gross accounts receivable balance. The Company utilizes outsourced manufacturers around the world to manufacture company-designed products. The Company may purchase product components from suppliers and sell those components to its outsourced manufacturers thereby creating receivable balances from the outsourced manufacturers. The three largest outsourced manufacturer receivable balances collectively represented 92% and 87% of the Company's manufacturer receivables of $684 million and $594 million at October 31, 2018 and 2017, respectively. The Company includes the manufacturer receivables in Other current assets in the Consolidated Balance Sheets on a gross basis. The Company's credit risk associated with these receivables is mitigated wholly or in part by the amount the Company owes to these outsourced manufacturers, as the Company generally has the legal right to offset its payables to the outsourced manufacturers against these receivables. The Company does not reflect the sale of these components in revenue and does not recognize any profit on these component sales until the related products are sold by the Company, at which time any profit is recognized as a reduction to cost of sales. The Company obtains a significant number of components from single source suppliers due to technology, availability, price, quality or other considerations. The loss of a single source supplier, the deterioration of the Company's relationship with a single source supplier, or any unilateral modification to the contractual terms under which the Company is supplied components by a single source supplier could adversely affect the Company's revenue and gross margins. Inventory The Company values inventory at the lower of cost or net realizable value. Cost is computed using standard cost which approximates actual cost on a first-in, first-out basis. Adjustments to reduce the cost of inventory to its net realizable value are made, if required, for estimated excess or obsolescence determined primarily by future demand forecasts. Property, Plant and Equipment The Company states property, plant and equipment at cost less accumulated depreciation. The Company capitalizes additions and improvements and expenses maintenance and repairs as incurred. Depreciation expense is recognized on a straight-line basis over the estimated useful lives of the assets. Estimated useful lives are five to 40 years for buildings and improvements and three to 15 years for machinery and equipment. The Company depreciates leasehold improvements over the life of the lease or the asset, whichever is shorter. The Company depreciates equipment held for lease over the initial term of the lease to the equipment's estimated residual value. The estimated useful lives of assets used solely to support a customer services contract generally do not exceed the term of the customer contract. On retirement or disposition, the asset cost and related accumulated depreciation are removed from the Consolidated Balance Sheets with any gain or loss recognized in the Consolidated Statements of Earnings. The Company capitalizes certain internal and external costs incurred to acquire or create internal use software, principally related to software coding, designing system interfaces and installation and testing of the software. The Company amortizes capitalized internal use software costs using the straight-line method over the estimated useful lives of the software, generally from three to five years. Business Combinations The Company includes the results of operations of acquired businesses in the Company's consolidated results prospectively from the date of acquisition. The Company allocates the fair value of purchase consideration to the assets acquired including in-process research and development ("IPR&D"), liabilities assumed, and non-controlling interests in the acquired entity generally based on their fair values at the acquisition date. IPR&D is initially capitalized at fair value as an intangible asset with an indefinite life and assessed for impairment thereafter. When the IPR&D project is complete, it is reclassified as an amortizable purchased intangible asset and is amortized over its estimated useful life. If an IPR&D project is abandoned, the Company will record a charge for the value of the related intangible asset to the Company's Consolidated Statement of Earnings in the period it is abandoned. The excess of the fair value of purchase consideration over the fair value of the assets acquired, liabilities assumed and non-controlling interests in the acquired entity is recorded as goodwill. The primary items that generate goodwill include the value of the synergies between the acquired company and the Company and the value of the acquired assembled workforce, neither of which qualifies for recognition as an intangible asset. Acquisition-related expenses and post-acquisition restructuring costs are recognized separately from the business combination and are expensed as incurred. Goodwill The Company reviews goodwill for impairment annually and whenever events or changes in circumstances indicate the carrying amount of goodwill may not be recoverable. The Company performs a quantitative test for all of its reporting units as part of its annual goodwill impairment test in the fourth quarter of each fiscal year. The Company estimates the fair value of its reporting units using a weighting of fair values derived most significantly from the income approach, and to a lesser extent, the market approach. Under the income approach, the Company estimates the fair value of a reporting unit based on the present value of estimated future cash flows. The Company |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Oct. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations On April 1, 2017 and September 1, 2017, the Company completed the Everett and Seattle Transactions, respectively. As a result, the financial results of Everett and Seattle are presented as Net loss from discontinued operations in the Consolidated Statements of Earnings. The following table presents the financial results for HPE's discontinued operations. Fiscal years ended October 31, 2018 2017 2016 In millions Net revenue $ — $ 8,511 $ 19,843 Cost of revenue (1) — 5,890 15,000 Expenses (2) 51 3,063 4,596 Interest and other, net 58 39 28 (Loss) earnings from discontinued operations before taxes (109 ) (481 ) 219 Benefit (provision) for taxes 5 389 (295 ) Net loss from discontinued operations $ (104 ) $ (92 ) $ (76 ) (1) Cost of revenue includes cost of products and services. (2) For the periods following the Everett and Seattle Transactions in fiscal 2017, expenses primarily consist of separation costs, which relate to third-party consulting, contractor fees and other incremental costs arising from the transactions. Prior to the Everett and Seattle Transactions, expenses in fiscal 2017 and 2016 primarily consist of selling, general and administrative (“SG&A”) expenses, research and development (“R&D”) expenses, restructuring charges, separation costs, amortization of intangible assets, acquisition and other related charges, and defined benefit plan settlement charges and remeasurement (benefit). For the fiscal years ended October 31, 2017 and 2016 , significant non-cash items of discontinued operations consisted of depreciation and amortization of $526 million and $1,524 million , respectively. For the fiscal years ended October 31, 2017 and 2016 , purchases of property, plant and equipment of discontinued operations consisted of $158 million and $331 million , respectively. |
Segment Information
Segment Information | 12 Months Ended |
Oct. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Hewlett Packard Enterprise's operations are organized into four segments for financial reporting purposes: Hybrid IT, Intelligent Edge, Financial Services ("FS") and Corporate Investments. Hewlett Packard Enterprise's organizational structure is based on a number of factors that the Chief Operating Decision Maker ("CODM"), the Chief Executive Officer ("CEO"), uses to evaluate, view and run business operations, which include, but are not limited to, customer base and homogeneity of products and technology. The segments are based on this organizational structure and information reviewed by Hewlett Packard Enterprise's management to evaluate segment results. A summary description of each segment follows. Hybrid IT provides a broad portfolio of services-led and software-enabled infrastructure and solutions including secure, software-defined servers, storage, data center networking and HPE Pointnext services, thereby combining HPE's hardware, software and services capabilities to make Hybrid IT simple for its customers. Described below are the business unit capabilities within Hybrid IT. • Hybrid IT Product includes Compute, Storage, and Data Center Networking ("DC Networking"). ◦ Compute offers both Industry Standard Servers ("ISS"), which are general purpose servers for multi-workload computing, as well as Mission Critical Servers ("MCS"), which are servers optimized for particular workloads, to address the full array of the customers' computing needs. HPE's general purpose servers include the HPE ProLiant, secure and versatile rack and tower servers; HPE BladeSystem, a modular infrastructure that converges server, storage and networking; and HPE Synergy, a composable infrastructure for traditional and cloud-native applications. The Company's workload optimized server portfolio includes the HPE Apollo for high performance computing and artificial intelligence, HPE Cloudline for cloud data centers, HPE Edgeline for computing at the network edge, HPE Integrity for mission-critical applications, and HPE SimpliVity, a hyperconverged platform for virtualization. ◦ Storage. With storage offerings that are AI-driven and built for cloud environments with as-a-service consumption and flexible investment options, HPE provides the right workload optimized destinations for data. Powered by HPE InfoSight advanced analytics and machine learning and HPE Cloud Volumes data mobility, HPE delivers intelligent storage for hybrid cloud environments so that customers can unlock data’s full potential and derive business insights. Key solutions include HPE 3PAR Storage and HPE Nimble Storage all-flash arrays for mission critical workloads and general purpose workloads, respectively, and big data solutions running on HPE Apollo Servers. Storage also provides comprehensive data protection with HPE StoreOnce and HPE Recovery Manager Central, solutions for secondary workloads and traditional tape, storage networking and disk products, such as HPE MSA and HPE XP. ◦ DC Networking offerings include top-of-rack switches, core switches, and open networking switches. The Company offers a full stack of networking solutions that deliver open, scalable, secure and agile solutions, by enabling programmable fabric, network virtualization, and network management products. • HPE Pointnext creates preferred IT experiences that power the digital business. The HPE Pointnext team and the Company's extensive partner network provide value across the IT life cycle delivering advice, transformation projects, professional services, support services and operational services for Hybrid IT and the Intelligent Edge. HPE Pointnext is also a provider of on-premises flexible consumption models, such as HPE GreenLake, that enable IT agility, simplify operations and align cost to business value. HPE Pointnext offerings includes Operational services, Advisory and Professional Services, and Communication and Media Solutions ("CMS"). The Intelligent Edge business is comprised of enterprise networking and security solutions for businesses of any size, offering secure connectivity for campus and branch environments, operating under the Aruba brand. The primary business drivers for Intelligent Edge solutions are mobility and the Internet of Things ("IoT"). ◦ HPE Aruba Product includes wired and wireless local area network hardware products such as Wi-Fi access points, switches, routers, sensors, and software products that include network management, network access control, analytics and assurance, and location services software . ◦ HPE Aruba Services offers professional and support services for the Intelligent Edge portfolio of products. Financial Services provides flexible investment solutions, such as leasing, financing, IT consumption, and 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. In order to provide flexible services and capabilities that support the entire IT life cycle, FS partners with customers globally to help build investment strategies that enhance their business agility and support their business transformation. FS offers a wide selection of investment solution capabilities for large enterprise customers and channel partners, along with an array of financial options to SMBs and educational and governmental entities. Corporate Investments includes Hewlett Packard Labs and certain business incubation projects. 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 our customers. Hewlett Packard Enterprise's consolidated net revenue is derived and reported after the elimination of intersegment revenues from such arrangements. Hewlett Packard Enterprise periodically engages in intercompany advanced royalty payment and licensing arrangements that may result in advance payments between subsidiaries. Revenues from these intercompany arrangements are deferred and recognized as earned over the term of the arrangement by the Hewlett Packard Enterprise legal entities involved in such transactions; however, these advanced payments are eliminated from revenues as reported by Hewlett Packard Enterprise and its business segments. As disclosed in Note 8, "Taxes on Earnings", Hewlett Packard Enterprise executed intercompany advanced royalty payment arrangements resulting in advanced payments of $63 million and $439 million during fiscal 2018 and 2017, respectively. In these transactions, the payments were received in the U.S. from a foreign consolidated affiliate, with a deferral of intercompany revenues over the term of the arrangements. The impact of these intercompany arrangements is eliminated from both Hewlett Packard Enterprise's consolidated and segment net revenues. Financing interest 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 costs include certain corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, transformation costs, amortization of intangible assets, impairment of goodwill, acquisition and other related charges, restructuring charges, separation costs, disaster charges, defined benefit plan settlement charges and remeasurement (benefit) and the gain on H3C and MphasiS divestitures. Segment Organizational Changes Effective at the beginning of the first quarter of fiscal 2018, the Company implemented organizational changes to align its segment financial reporting more closely with its current business structure. These organizational changes primarily include: (i) the transfer of the former Servers and Storage business units, the HPE Pointnext and CMS businesses within the former Technology Services business unit, and the Data Center Networking business within the former Networking businesses unit, all of which were previously reported within the former Enterprise Group ("EG") segment, to the newly formed Hybrid IT segment; (ii) the transfer of the remaining Networking business unit, and Aruba services within the former Technology Services business unit, all of which were previously reported within the former EG segment, to the newly formed Intelligent Edge segment; and (iii) the transfer of cloud-related activities previously reported within Corporate Investments to the Hybrid IT Segment. The Company reflected these changes to its segment information retrospectively to the earliest period presented, which primarily resulted in the transfer of net revenue, related eliminations of intersegment revenues and operating profit or loss from the former business units and segments to the newly formed business units and segments described above. The Company also implemented certain changes to its allocation methodology for stock-based compensation expense and certain corporate costs, which aligned to its segment financial reporting and are consistent with the manner in which the operating segments will be evaluated for performance on a prospective basis. The Company reflected these changes retrospectively to the earliest period presented, which resulted in: (i) the transfer of a portion of stock-based compensation expense, which under the prior allocation methodology was not allocated to the segments, to the Hybrid IT, Intelligent Edge, and Financial Services segments; and (ii) the transfer of certain corporate function costs previously allocated to the segments to unallocated corporate costs. These changes had no impact on Hewlett Packard Enterprise's previously reported net revenue, earnings from operations, net earnings, or net earnings per share. Segment Operating Results Hybrid IT Intelligent Edge Financial Services Corporate Investments Total In millions 2018 Net revenue $ 24,285 $ 2,912 $ 3,656 $ (1 ) $ 30,852 Intersegment net revenue and other 748 17 15 — 780 Total segment net revenue $ 25,033 $ 2,929 $ 3,671 $ (1 ) $ 31,632 Segment earnings (loss) from operations $ 2,654 $ 237 $ 290 $ (90 ) $ 3,091 2017 Net revenue $ 22,740 $ 2,554 $ 3,574 $ 3 $ 28,871 Intersegment net revenue and other (1) 887 30 28 — 945 Total segment net revenue $ 23,627 $ 2,584 $ 3,602 $ 3 $ 29,816 Segment earnings (loss) from operations $ 2,274 $ 253 $ 299 $ (106 ) $ 2,720 2016 Net revenue $ 23,954 $ 2,635 $ 3,097 $ 594 $ 30,280 Intersegment net revenue and other (1) 1,148 39 93 — 1,280 Total segment net revenue $ 25,102 $ 2,674 $ 3,190 $ 594 $ 31,560 Segment earnings (loss) from operations $ 3,182 $ 74 $ 338 $ (61 ) $ 3,533 (1) For the periods prior to the Everett and Seattle Transactions presented above, the amounts include the elimination of pre-separation intercompany sales to the former ES and Software segments, which are included within Net loss from discontinued operations in the Consolidated Statements of Earnings. The reconciliation of segment operating results to Hewlett Packard Enterprise consolidated results was as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions Net Revenue: Total segments $ 31,632 $ 29,816 $ 31,560 Elimination of intersegment net revenue and other (780 ) (945 ) (1,280 ) Total Hewlett Packard Enterprise consolidated net revenue $ 30,852 $ 28,871 $ 30,280 Earnings before taxes: Total segment earnings from operations $ 3,091 $ 2,720 $ 3,533 Unallocated corporate costs and eliminations (240 ) (408 ) (720 ) Unallocated stock-based compensation expense (73 ) (110 ) (134 ) Amortization of intangible assets (294 ) (321 ) (272 ) Impairment of goodwill (88 ) — — Restructuring charges (19 ) (417 ) (417 ) Transformation costs (425 ) (359 ) — Disaster charges — (93 ) — Acquisition and other related charges (82 ) (203 ) (145 ) Separation costs (12 ) (248 ) (362 ) Defined benefit plan settlement charges and remeasurement (benefit) — 64 — Gain on H3C and MphasiS divestitures — — 2,420 Interest and other, net (274 ) (327 ) (284 ) Tax indemnification adjustments (1,354 ) (3 ) 317 Earnings (loss) from equity interests 38 (23 ) (76 ) Total Hewlett Packard Enterprise consolidated earnings from continuing operations before taxes $ 268 $ 272 $ 3,860 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 Hewlett Packard Enterprise consolidated assets were as follows: As of October 31, 2018 2017 In millions Hybrid IT $ 25,839 $ 25,923 Intelligent Edge 2,990 3,002 Financial Services 13,746 13,470 Corporate Investments 170 161 Corporate and unallocated assets 12,748 18,850 Total Hewlett Packard Enterprise consolidated assets $ 55,493 $ 61,406 Corporate and unallocated assets in fiscal 2018 decreased as compared to fiscal 2017 due primarily to a decrease in cash and cash equivalents and tax assets. Major Customers No single customer represented 10% or more of Hewlett Packard Enterprise's total net revenue in any fiscal year presented. Geographic Information Fiscal 2017 revenue was reclassified between the regions to conform with the current period presentation. Net revenue by country is based upon the sales location that predominately represents the customer location. For each of the fiscal years of 2018 , 2017 and 2016 , other than the U.S., no country represented more than 10% of Hewlett Packard Enterprise's net revenue. Net revenue by country in which Hewlett Packard Enterprise operates was as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions U.S. $ 10,192 $ 10,022 $ 10,333 Other countries 20,660 18,849 19,947 Total net revenue $ 30,852 $ 28,871 $ 30,280 Net property, plant and equipment by country in which Hewlett Packard Enterprise operates was as follows: As of October 31, 2018 2017 In millions U.S. $ 2,813 $ 2,673 Other countries 3,325 3,596 Total net property, plant and equipment $ 6,138 $ 6,269 Net revenue by segment and business unit was as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions Hybrid IT Hybrid IT Product Compute $ 13,823 $ 12,837 $ 13,994 Storage 3,706 3,280 3,389 DC Networking 225 214 407 Total Hybrid IT Product 17,754 16,331 17,790 HPE Pointnext 7,279 7,296 7,312 Total Hybrid IT 25,033 23,627 25,102 Intelligent Edge HPE Aruba Product 2,619 2,307 2,423 HPE Aruba Services 310 277 251 Total Intelligent Edge 2,929 2,584 2,674 Financial Services 3,671 3,602 3,190 Corporate Investments (1 ) 3 594 Total segment net revenue 31,632 29,816 31,560 Eliminations of intersegment net revenue and other (780 ) (945 ) (1,280 ) Total net revenue $ 30,852 $ 28,871 $ 30,280 |
Restructuring
Restructuring | 12 Months Ended |
Oct. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring Summary of Restructuring Plans Restructuring charges of $19 million , $417 million and $417 million were recorded by the Company during fiscal 2018 , 2017 and 2016 , respectively, based on restructuring activities impacting the Company's employees and infrastructure. The restructuring charges for fiscal 2016 include reversals of $2 million related to earlier plans not included in the table below. Additionally, restructuring charges of $251 million and $819 million for fiscal 2017 and 2016 , respectively, are included in Net loss from discontinued operations in the Consolidated Statements of Earnings. For details on restructuring charges related to HPE Next, see Note 5, "HPE Next". Restructuring activities related to the Company's employees and infrastructure, summarized by plan, are presented in the table below: Fiscal 2015 Plan Fiscal 2012 Plan Employee Infrastructure Employee Severance and EER Infrastructure Total In millions Liability as of October 31, 2015 $ 67 $ — $ 47 $ 37 $ 151 Charges 301 42 75 1 419 Cash payments (172 ) (19 ) (82 ) (15 ) (288 ) Non-cash items 38 (10 ) (3 ) (9 ) 16 Liability as of October 31, 2016 $ 234 $ 13 $ 37 $ 14 $ 298 Charges 374 37 6 — 417 Cash payments (355 ) (19 ) (32 ) (6 ) (412 ) Non-cash items (34 ) (14 ) 5 (6 ) (49 ) Liability as of October 31, 2017 $ 219 $ 17 $ 16 $ 2 $ 254 Charges 9 (2 ) 13 (1 ) 19 Cash payments (158 ) (8 ) (15 ) — (181 ) Non-cash items (8 ) 3 (3 ) — (8 ) Liability as of October 31, 2018 $ 62 $ 10 $ 11 $ 1 $ 84 Total costs incurred to date as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 Total expected costs to be incurred as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 The current restructuring liability related to the plans in the table above, reported in Accrued restructuring in the Consolidated Balance Sheets as of October 31, 2018 and 2017 , was $53 million and $158 million , respectively. The non-current restructuring liability related to the plans in the table above, reported in Other liabilities in the Consolidated Balance Sheets as of October 31, 2018 and 2017 , was $31 million and $96 million , respectively. Fiscal 2015 Restructuring Plan On September 14, 2015, former Parent's Board of Directors approved a restructuring plan (the "2015 Plan") in connection with the Separation. As a result of the Everett and Seattle Transactions, cost amounts and total headcount exits were revised. As such, as of October 31, 2018 , the Company had eliminated 8,300 positions as part of the 2015 Plan. As of October 31, 2018 , the plan is complete, with no further positions being eliminated. The Company recognized $0.8 billion in total aggregate charges in connection with the 2015 Plan through fiscal 2018 , of which approximately $751 million related to workforce reductions and approximately $78 million primarily related to real estate consolidation and asset impairments. The severance- and infrastructure-related cash payments associated with the 2015 Plan are expected to be paid out through fiscal 2022. Fiscal 2012 Restructuring Plan On May 23, 2012, former Parent adopted a multi-year restructuring plan (the "2012 Plan") designed to simplify business processes, accelerate innovation and deliver better results for customers, employees and stockholders. As a result of the Everett and Seattle Transactions, cost amounts and total headcount exits were revised. As such, as of October 31, 2018 , the Company had eliminated 10,300 positions, with a portion of those employees exiting the Company as part of voluntary enhanced early retirement ("EER") programs in the U.S. and in certain other countries. As of October 31, 2018 , the plan is complete, with no further positions being eliminated. The Company recognized $1.4 billion in total aggregate charges in connection with the 2012 Plan, of which approximately $1.3 billion related to workforce reductions, including the EER programs, and approximately $0.1 billion related to infrastructure, including data center and real estate consolidation and other items. The severance- and infrastructure-related cash payments associated with the 2012 Plan are expected to be paid out through fiscal 2022. HPE Next Transformation Costs The HPE Next initiative is expected to be implemented through fiscal 2020, during which time the Company expects to incur expenses for workforce reductions, to upgrade and simplify its IT infrastructure, and for other non-labor actions. These costs will be partially offset by proceeds received from real estate sales. During fiscal 2018 and 2017 , the Company incurred $425 million and $359 million , respectively in net charges associated with the HPE Next initiative, which were recorded within Transformation costs in the Consolidated Statements of Earnings. Additionally, the Company incurred $20 million of transformation costs in fiscal 2018 related to cumulative translation adjustments which were recorded within Interest and other, net in the Consolidated Statements of Earnings. Fiscal years ended October 31, 2018 2017 In millions Program management (1) $ 95 $ 57 IT costs 148 34 Restructuring charges 531 296 Other (2) 56 — Gains on real estate sales (3) (405 ) (28 ) Total Transformation Costs $ 425 $ 359 (1) Primarily consists of consulting fees and other direct costs attributable to the design and implementation of the HPE Next initiative. (2) Primarily consists of costs related to real estate improvements in connection with the HPE Next initiative. (3) In fiscal 2018, primarily includes the gain on the sale of the Company's Palo Alto, California corporate headquarters. Restructuring Plan On October 16, 2017, the Company's Board of Directors approved a restructuring plan in connection with the HPE Next initiative (the "HPE Next Plan") and on September 20, 2018, the Company's Board of Directors approved a revision to that restructuring plan. As a result of the revision to the plan, cost amounts and total headcount exits were revised and the completion of the workforce reductions was extended to fiscal 2020. The changes to the workforce will vary by country, based on business needs, local legal requirements and consultations with employee work councils and other employee representatives, as appropriate. As of October 31, 2018 , the Company estimates that it will incur aggregate pre-tax charges of approximately $1.4 billion through fiscal 2020 in connection with the HPE Next Plan, of which approximately $1.2 billion relates to workforce reductions and approximately $0.2 billion relates to infrastructure, primarily real estate site exits. Employee Infrastructure In millions Liability as of October 31, 2016 $ — $ — Charges 296 — Liability as of October 31, 2017 $ 296 $ — Charges 470 61 Cash payments (452 ) (14 ) Non-cash items (23 ) (14 ) Liability as of October 31, 2018 $ 291 $ 33 Total costs incurred to date as of October 31, 2018 $ 766 $ 61 Total expected costs to be incurred as of October 31, 2018 $ 1,200 $ 180 The current restructuring liability related to the HPE Next Plan, reported in Accrued restructuring in the Consolidated Balance Sheets at October 31, 2018 and 2017 , was $241 million and $287 million , respectively. The non-current restructuring liability related to the HPE Next Plan, reported in Other liabilities in the Consolidated Balance Sheets as of October 31, 2018 and 2017 was $83 million and $9 million , respectively. |
HPE Next
HPE Next | 12 Months Ended |
Oct. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
HPE Next | Restructuring Summary of Restructuring Plans Restructuring charges of $19 million , $417 million and $417 million were recorded by the Company during fiscal 2018 , 2017 and 2016 , respectively, based on restructuring activities impacting the Company's employees and infrastructure. The restructuring charges for fiscal 2016 include reversals of $2 million related to earlier plans not included in the table below. Additionally, restructuring charges of $251 million and $819 million for fiscal 2017 and 2016 , respectively, are included in Net loss from discontinued operations in the Consolidated Statements of Earnings. For details on restructuring charges related to HPE Next, see Note 5, "HPE Next". Restructuring activities related to the Company's employees and infrastructure, summarized by plan, are presented in the table below: Fiscal 2015 Plan Fiscal 2012 Plan Employee Infrastructure Employee Severance and EER Infrastructure Total In millions Liability as of October 31, 2015 $ 67 $ — $ 47 $ 37 $ 151 Charges 301 42 75 1 419 Cash payments (172 ) (19 ) (82 ) (15 ) (288 ) Non-cash items 38 (10 ) (3 ) (9 ) 16 Liability as of October 31, 2016 $ 234 $ 13 $ 37 $ 14 $ 298 Charges 374 37 6 — 417 Cash payments (355 ) (19 ) (32 ) (6 ) (412 ) Non-cash items (34 ) (14 ) 5 (6 ) (49 ) Liability as of October 31, 2017 $ 219 $ 17 $ 16 $ 2 $ 254 Charges 9 (2 ) 13 (1 ) 19 Cash payments (158 ) (8 ) (15 ) — (181 ) Non-cash items (8 ) 3 (3 ) — (8 ) Liability as of October 31, 2018 $ 62 $ 10 $ 11 $ 1 $ 84 Total costs incurred to date as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 Total expected costs to be incurred as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 The current restructuring liability related to the plans in the table above, reported in Accrued restructuring in the Consolidated Balance Sheets as of October 31, 2018 and 2017 , was $53 million and $158 million , respectively. The non-current restructuring liability related to the plans in the table above, reported in Other liabilities in the Consolidated Balance Sheets as of October 31, 2018 and 2017 , was $31 million and $96 million , respectively. Fiscal 2015 Restructuring Plan On September 14, 2015, former Parent's Board of Directors approved a restructuring plan (the "2015 Plan") in connection with the Separation. As a result of the Everett and Seattle Transactions, cost amounts and total headcount exits were revised. As such, as of October 31, 2018 , the Company had eliminated 8,300 positions as part of the 2015 Plan. As of October 31, 2018 , the plan is complete, with no further positions being eliminated. The Company recognized $0.8 billion in total aggregate charges in connection with the 2015 Plan through fiscal 2018 , of which approximately $751 million related to workforce reductions and approximately $78 million primarily related to real estate consolidation and asset impairments. The severance- and infrastructure-related cash payments associated with the 2015 Plan are expected to be paid out through fiscal 2022. Fiscal 2012 Restructuring Plan On May 23, 2012, former Parent adopted a multi-year restructuring plan (the "2012 Plan") designed to simplify business processes, accelerate innovation and deliver better results for customers, employees and stockholders. As a result of the Everett and Seattle Transactions, cost amounts and total headcount exits were revised. As such, as of October 31, 2018 , the Company had eliminated 10,300 positions, with a portion of those employees exiting the Company as part of voluntary enhanced early retirement ("EER") programs in the U.S. and in certain other countries. As of October 31, 2018 , the plan is complete, with no further positions being eliminated. The Company recognized $1.4 billion in total aggregate charges in connection with the 2012 Plan, of which approximately $1.3 billion related to workforce reductions, including the EER programs, and approximately $0.1 billion related to infrastructure, including data center and real estate consolidation and other items. The severance- and infrastructure-related cash payments associated with the 2012 Plan are expected to be paid out through fiscal 2022. HPE Next Transformation Costs The HPE Next initiative is expected to be implemented through fiscal 2020, during which time the Company expects to incur expenses for workforce reductions, to upgrade and simplify its IT infrastructure, and for other non-labor actions. These costs will be partially offset by proceeds received from real estate sales. During fiscal 2018 and 2017 , the Company incurred $425 million and $359 million , respectively in net charges associated with the HPE Next initiative, which were recorded within Transformation costs in the Consolidated Statements of Earnings. Additionally, the Company incurred $20 million of transformation costs in fiscal 2018 related to cumulative translation adjustments which were recorded within Interest and other, net in the Consolidated Statements of Earnings. Fiscal years ended October 31, 2018 2017 In millions Program management (1) $ 95 $ 57 IT costs 148 34 Restructuring charges 531 296 Other (2) 56 — Gains on real estate sales (3) (405 ) (28 ) Total Transformation Costs $ 425 $ 359 (1) Primarily consists of consulting fees and other direct costs attributable to the design and implementation of the HPE Next initiative. (2) Primarily consists of costs related to real estate improvements in connection with the HPE Next initiative. (3) In fiscal 2018, primarily includes the gain on the sale of the Company's Palo Alto, California corporate headquarters. Restructuring Plan On October 16, 2017, the Company's Board of Directors approved a restructuring plan in connection with the HPE Next initiative (the "HPE Next Plan") and on September 20, 2018, the Company's Board of Directors approved a revision to that restructuring plan. As a result of the revision to the plan, cost amounts and total headcount exits were revised and the completion of the workforce reductions was extended to fiscal 2020. The changes to the workforce will vary by country, based on business needs, local legal requirements and consultations with employee work councils and other employee representatives, as appropriate. As of October 31, 2018 , the Company estimates that it will incur aggregate pre-tax charges of approximately $1.4 billion through fiscal 2020 in connection with the HPE Next Plan, of which approximately $1.2 billion relates to workforce reductions and approximately $0.2 billion relates to infrastructure, primarily real estate site exits. Employee Infrastructure In millions Liability as of October 31, 2016 $ — $ — Charges 296 — Liability as of October 31, 2017 $ 296 $ — Charges 470 61 Cash payments (452 ) (14 ) Non-cash items (23 ) (14 ) Liability as of October 31, 2018 $ 291 $ 33 Total costs incurred to date as of October 31, 2018 $ 766 $ 61 Total expected costs to be incurred as of October 31, 2018 $ 1,200 $ 180 The current restructuring liability related to the HPE Next Plan, reported in Accrued restructuring in the Consolidated Balance Sheets at October 31, 2018 and 2017 , was $241 million and $287 million , respectively. The non-current restructuring liability related to the HPE Next Plan, reported in Other liabilities in the Consolidated Balance Sheets as of October 31, 2018 and 2017 was $83 million and $9 million , respectively. |
Retirement and Post-Retirement
Retirement and Post-Retirement Benefit Plans | 12 Months Ended |
Oct. 31, 2018 | |
Retirement Benefits [Abstract] | |
Retirement and Post-Retirement Benefit Plans | Retirement and Post-Retirement Benefit Plans Defined Benefit Plans The Company sponsors defined benefit pension plans worldwide, the most significant of which are the United Kingdom ("UK") and Germany. The pension plan in the UK is closed to new entrants, however, members continue to earn benefit accruals. This plan provides benefits based on final pay and years of service and generally requires contributions from members. The German pension program that is open to new hires consists of cash balance plans that provide employer credits as a percentage of pay, certain employee pay deferrals and for a matching contribution. There also are previously closed German pension programs that include cash balance and final average pay plans. These previously closed pension programs comprise the majority of the pension obligations in Germany. Prior to the Everett and Seattle Transactions, the Company went through an analysis to determine which defined benefit plans would be assigned to either the Company or to Everett or Seattle. The Company's plans either transferred in their entirety to Everett or Seattle, remained in their entirety with the Company, or were split, thus resulting in the transfer of plan assets and liabilities between existing and newly created plans. The Everett plans were legally established in the first and second quarter of fiscal 2017 and transferred and reported as discontinued operations in the second quarter of fiscal 2017. The Seattle plans were legally established in the third quarter of fiscal 2017 and transferred and reported as discontinued operations in the fourth quarter of fiscal 2017. As a result of the Everett and Seattle Transactions, the Company transferred out plan assets of $8.3 billion , a benefit obligation of $8.1 billion and an accumulated other comprehensive loss of $1.9 billion . Post-Retirement Benefit Plans The Company sponsors retiree health and welfare benefit plans, the most significant of which is in the U.S. Generally, employees hired before August 2008 are eligible for employer credits under the Hewlett Packard Enterprise Retirement Medical Savings Account Plan (“RMSA”) upon attaining age 45. Employer credits to the RMSA available after September 2008 are provided in the form of matching credits on employee contributions made to a voluntary employee beneficiary association. Upon retirement, employees may use these employer credits for the reimbursement of certain eligible medical expenses. As a result of the Everett and Seattle Transactions, any employees who were involuntarily terminated during fiscal 2017 were fully vested in their RMSA balances and are able to take a distribution out of their plan balances. Defined Contribution Plans The Company offers various defined contribution plans for U.S. and non-U.S. employees. The Company's defined contribution expense was approximately $158 million in fiscal 2018 , $157 million in fiscal 2017 and $213 million in fiscal 2016 . U.S. employees are automatically enrolled in the Hewlett Packard Enterprise Company 401(k) Plan ("HPE 401(k) Plan"), when they meet eligibility requirements, unless they decline participation. Effective January 1, 2018, and during calendar year 2016, the HPE 401(k) Plan's quarterly employer matching contributions were 100% of an employee's contributions, up to a maximum of 4% of eligible compensation. In calendar year 2017, the annual employer matching contributions in the HPE 401(k) Plan were 50% of an employee's contributions, up to a maximum of 6% of eligible compensation. As a result of the Everett and Seattle Transactions, any plan participants who were involuntarily terminated during fiscal 2017 were fully vested in their Company matching contributions and earnings thereon, and are able to take a distribution out of their plan balances. Pension Benefit Expense The Company's net pension and post-retirement benefit costs that were directly attributable to the eligible employees, retirees and other former employees of Hewlett Packard Enterprise and recognized in the Consolidated Statements of Earnings for fiscal 2018 , 2017 and 2016 are presented in the table below. As of October 31, 2018 2017 2016 2018 2017 2016 Defined Post-Retirement In millions Service cost $ 105 $ 139 $ 199 $ 1 $ 3 $ 3 Interest cost 225 213 317 7 6 6 Expected return on plan assets (567 ) (548 ) (667 ) (1 ) (2 ) (2 ) Amortization and deferrals: Actuarial loss (gain) 211 264 220 (3 ) (2 ) (3 ) Prior service benefit (17 ) (17 ) (19 ) — — — Net periodic benefit cost (43 ) 51 50 4 5 4 Curtailment gain (1 ) (1 ) — — — — Settlement loss 20 15 4 — — — Special termination benefits 6 5 5 — — — Plan credit allocation (1) — (14 ) (15 ) — (1 ) (1 ) Net benefit (credit) cost from continuing operations (2) (18 ) 56 44 4 4 3 Summary of net benefit (credit) cost: Continuing operations (18 ) 56 44 4 4 3 Discontinued operations — 81 92 — 1 1 Total net benefit (credit) cost $ (18 ) $ 137 $ 136 $ 4 $ 5 $ 4 (1) Plan credit allocation represents the net cost impact of employees of HPE covered under Everett or Seattle plans and employees of Everett or Seattle covered under HPE plans. (2) Net benefit cost from continuing operations for the Company's U.S. defined benefit plans, included in the above table, was not material for fiscal 2018, 2017 and 2016. The weighted-average assumptions used to calculate the net benefit (credit) cost from continuing operations in the table above for fiscal 2018 , 2017 and 2016 were as follows: As of October 31, 2018 2017 2016 2018 2017 2016 Defined Benefit Plans Post-Retirement Benefit Plans Discount rate used to determine benefit obligation 2.0 % 2.0 % 2.7 % 4.5 % 4.2 % 4.6 % Discount rate used to determine service cost 2.4 % 2.0 % 2.7 % 3.7 % 3.7 % 4.6 % Discount rate used to determine interest cost 1.7 % 1.8 % 2.7 % 4.2 % 3.8 % 4.6 % Expected increase in compensation levels 2.3 % 2.4 % 2.3 % — — — Expected long-term return on plan assets 4.4 % 4.4 % 5.8 % 2.6 % 3.1 % 4.0 % Prior to October 31, 2016, the Company estimated the service and interest cost components using a single weighted-average discount rate derived from the yield curves used to measure the benefit obligation. Beginning in fiscal 2017, the Company changed its method used to estimate the service and interest cost components of net periodic benefit cost for defined benefit plans that use the yield curve approach, which represent substantially all of the Company's defined benefit plans. The Company has elected to use a full yield curve approach in the estimation of these components of benefit cost by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. The Company made this change to improve the correlation between projected benefit cash flows and the corresponding yield curve spot rates and to provide a more precise measurement of service and interest costs. The Company has accounted for this change as a change in estimate that is inseparable from a change in accounting principle and has accounted for it prospectively beginning in fiscal 2017. Funded Status The funded status of the plans was as follows: As of October 31, 2018 2017 2018 2017 Defined Post-Retirement In millions Change in fair value of plan assets: Fair value—beginning of year $ 12,610 $ 11,989 $ 50 $ 47 Transfers (1) 6 (799 ) — — Addition/deletion of plans (2) 181 5 — — Actual return on plan assets 93 941 1 1 Employer contributions 158 266 6 4 Participant contributions 25 17 4 4 Benefits paid (450 ) (408 ) (9 ) (6 ) Settlement (104 ) (60 ) — — Currency impact (352 ) 659 — — Fair value—end of year (3) $ 12,167 $ 12,610 $ 52 $ 50 Change in benefit obligation: Projected benefit obligation—beginning of year $ 13,069 $ 13,555 $ 170 $ 158 Transfers (1) 5 (668 ) — — Addition/deletion of plans (2) 181 19 — — Service cost 105 139 1 3 Interest cost 225 213 7 6 Participant contributions 25 17 4 4 Actuarial (gain) loss (40 ) (445 ) (9 ) 4 Benefits paid (450 ) (408 ) (9 ) (6 ) Plan amendments 22 (1 ) — — Curtailment (4 ) (1 ) — — Settlement (104 ) (60 ) — — Special termination benefits 6 5 — — Currency impact (372 ) 704 (4 ) 1 Projected benefit obligation—end of year (3) $ 12,668 $ 13,069 $ 160 $ 170 Funded status at end of year $ (501 ) $ (459 ) $ (108 ) $ (120 ) Accumulated benefit obligation $ 12,446 $ 12,832 $ — $ — (1) In fiscal 2017, in connection with the Everett and Seattle Transactions, the Company transferred plan assets and liabilities from the Company's plans to newly established Everett and Seattle plans. The Company transferred net plan assets of $702 million and $97 million to Everett and Seattle, respectively, and liabilities of $503 million and $165 million to Everett and Seattle, respectively. (2) Includes the addition/deletion of plans resulting from acquisitions or divestitures. Fiscal 2018 amounts relate primarily to the addition of a Belgium plan. (3) As of October 31, 2018 and 2017, the Company's U.S. defined benefit plans had zero plan assets and a projected benefit obligation of $5 million for both fiscal years. The weighted-average assumptions used to calculate the projected benefit obligations were as follows: As of October 31, 2018 2017 2018 2017 Defined Benefit Plans Post-Retirement Benefit Plans Discount rate 2.1 % 2.0 % 4.9 % 4.5 % Expected increase in compensation levels 2.5 % 2.3 % — — The net amounts recognized for defined benefit and post-retirement benefit plans in the Company's Consolidated Balance Sheets were as follows: As of October 31, 2018 2017 2018 2017 Defined Post-Retirement In millions Non-current assets $ 829 $ 830 $ — $ — Current liabilities (40 ) (39 ) (6 ) (4 ) Non-current liabilities (1,290 ) (1,250 ) (102 ) (116 ) Funded status at end of year $ (501 ) $ (459 ) $ (108 ) $ (120 ) The following table summarizes the pre-tax net actuarial loss and prior service benefit recognized in Accumulated other comprehensive loss for the defined benefit plans: As of October 31, 2018 Defined Post-Retirement In millions Net actuarial loss (gain) $ 2,938 $ (11 ) Prior service benefit (65 ) — Total recognized in accumulated other comprehensive loss $ 2,873 $ (11 ) The following table summarizes the net actuarial loss and prior service benefit for plans that are expected to be amortized from Accumulated other comprehensive loss and recognized as components of net periodic benefit cost (credit) during the next fiscal year. As of October 31, 2018 Defined Post-Retirement In millions Net actuarial loss (gain) $ 228 $ (4 ) Prior service benefit (15 ) — Total expected to be recognized in net periodic benefit cost (credit) $ 213 $ (4 ) Defined benefit plans with projected benefit obligations exceeding the fair value of plan assets were as follows: As of October 31, 2018 2017 In millions Aggregate fair value of plan assets $ 2,314 $ 2,596 Aggregate projected benefit obligation $ 3,644 $ 3,884 Defined benefit plans with accumulated benefit obligations exceeding the fair value of plan assets were as follows: As of October 31, 2018 2017 In millions Aggregate fair value of plan assets $ 2,291 $ 1,272 Aggregate accumulated benefit obligation $ 3,495 $ 2,476 Fair Value of Plan Assets The Company pays the U.S. defined benefit plan obligations when they come due since these plans are unfunded. The table below sets forth the fair value of non-U.S defined benefit plan assets by asset category within the fair value hierarchy as of October 31, 2018 and 2017 . As of As of Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total In millions Asset Category: Equity securities U.S. $ 187 $ 7 $ — $ 194 $ 270 $ 13 $ — $ 283 Non-U.S. 344 225 — 569 365 140 — 505 Non-U.S. at NAV (1) 473 480 Debt securities Corporate — 1,221 — 1,221 — 1,966 — 1,966 Government (7) — 4,621 — 4,621 — 702 — 702 Government at NAV (2) 692 687 Alternative investments Private Equity — 2 40 42 — 7 33 40 Hybrids (3) — 1,214 132 1,346 — 492 — 492 Hybrids at NAV (4) 506 2,339 Hedge Funds — 45 — 45 — 63 — 63 Hedge Funds at NAV — 21 Common Contractual Funds at NAV (5) Equities at NAV 1,929 2,547 Fixed Income at NAV 639 701 Emerging Markets at NAV 275 368 Alternative investments at NAV 378 363 Real Estate Funds 6 186 37 229 38 158 57 253 Insurance Group Annuity Contracts — 59 38 97 — 35 52 87 Cash and Cash Equivalents 167 256 — 423 184 363 — 547 Other (6) 39 250 1 290 43 122 1 166 Obligation to return cash received from repurchase agreements (7) — (1,802 ) — (1,802 ) — — — — Total $ 743 $ 6,284 $ 248 $ 12,167 $ 900 $ 4,061 $ 143 $ 12,610 (1) Includes various worldwide equity index funds with the objective to provide returns that are consistent with the FTSE All World indexes. While the funds are not publicly traded, the custodians strike a net asset value at least monthly. There are no redemption restrictions or future commitments on these investments. (2) Includes various government bonds issued by worldwide governments, interest rate swaps, and cash, to match or slightly outperform the benchmark of the future liabilities of the funds. While the funds are not publicly traded, the custodians strike a net asset value daily. There are no redemption restrictions or future commitments on these investments. (3) Includes a fund that invests in both private and public equities primarily in the UK, as well as emerging markets across all sectors. The fund also holds fixed income and derivative instruments to hedge interest rate and inflation risk. In addition, the fund includes units in transferable securities, collective investment schemes, money market funds, asset-backed income, private debt, cash, and deposits. (4) Includes pooled funds that invest in asset-backed securities awaiting investment into non-liquid secured income opportunities. Units are available for subscription on the first day of each calendar month at net asset value. In fiscal 2017, also included pooled funds that invest in government bonds and derivative instruments, such as interest rate swaps, future contracts and repurchase agreements with the objective to provide nominal and/or inflation-linked returns. While the funds in fiscal 2017 were not publicly traded, the custodians struck a net asset value at least monthly. There are no redemption restrictions or future commitments on these investments. (5) HP Invest Common Contractual Funds (CCFs) are investment arrangements in which institutional investors pool their assets. Units may be acquired in four different sub-funds focused on equities, fixed income, alternative investments, and emerging markets. Each sub-fund is invested in accordance with the fund’s investment objective and units are issued in relation to each sub-fund. While the sub-funds are not publicly traded, the custodian strikes a net asset value either once or twice a month, depending on the sub-fund. There are no redemption restrictions or future commitments on these investments. (6) Includes international insured contracts, derivative instruments, mortgage backed securities, and unsettled transactions. (7) Repurchase agreements, primarily in the UK, represent the plans' short-term borrowing to hedge against interest rate and inflation risks. Investments in government bonds collateralize this short-term borrowing. The plans have an obligation to return the cash after the term of the agreements. Due to the short-term nature of the agreements, the outstanding balance of the obligation approximates fair value. Post-retirement benefit plan assets of $52 million and $50 million as of October 31, 2018 and 2017 , respectively, were invested in publicly traded registered investment entities and were classified within Level 1 of the fair value hierarchy. Changes in fair value measurements of Level 3 investments for the non-U.S. defined benefit plans were as follows: Fiscal year ended October 31, 2018 Alternative Private Hybrids Real Insurance Other Total In millions Balance at beginning of year $ 33 $ — $ 57 $ 52 $ 1 $ 143 Actual return on plan assets: Relating to assets held at the reporting date 6 2 — (7 ) — 1 Relating to assets sold during the period 5 — — — — 5 Purchases, sales, and settlements (4 ) 130 (20 ) (7 ) — 99 Transfers in and/or out of Level 3 — — — — — — Balance at end of year $ 40 $ 132 $ 37 $ 38 $ 1 $ 248 Fiscal year ended October 31, 2017 Alternative Private Real Insurance Other Total In millions Balance at beginning of year $ 32 $ 26 $ 63 $ 8 $ 129 Actual return on plan assets: Relating to assets held at the reporting date — 3 (39 ) 12 (24 ) Relating to assets sold during the period 1 — — — 1 Purchases, sales, and settlements — — — 28 28 Transfers in and/or out of Level 3 — 28 28 (47 ) 9 Balance at end of year $ 33 $ 57 $ 52 $ 1 $ 143 The following is a description of the valuation methodologies used to measure plan assets at fair value. Investments in publicly traded equity securities are valued using the closing price on the measurement date as reported on the stock exchange on which the individual securities are traded. For corporate, government backed debt securities, and some other investments, fair value is based on observable inputs of comparable market transactions. The valuation of certain real estate funds, insurance group annuity contracts and alternative investments, such as limited partnerships and joint ventures, may require significant management judgment. The valuation is generally based on fair value as reported by the asset manager and adjusted for cash flows, if necessary. In making such an assessment, a variety of factors are reviewed by management, including, but are not limited to, the timeliness of fair value as reported by the asset manager and changes in general economic and market conditions subsequent to the last fair value reported by the asset manager. Cash and cash equivalents includes money market funds, which are valued based on cost, which approximates fair value. Other than those assets that have quoted prices from an active market, investments are generally classified in Level 2 or Level 3 of the fair value hierarchy based on the lowest level input that is significant to the fair value measure in its entirety. Investments measured using net asset value as a practical expedient are not categorized within the fair value hierarchy. Plan Asset Allocations The weighted-average target and actual asset allocations across the benefit plans at the respective measurement dates for the non-U.S. defined benefit plans were as follows: Defined Plan Assets Asset Category 2018 2018 2017 Public equity securities 28.7 % 33.8 % Private/hybrid equity securities 18.7 % 25.7 % Real estate and other 4.2 % 3.3 % Equity-related investments 56.3 % 51.6 % 62.8 % Debt securities 41.9 % 44.9 % 32.9 % Cash and cash equivalents 1.8 % 3.5 % 4.3 % Total 100.0 % 100.0 % 100.0 % For the Company's post-retirement benefit plans, 100% of the plan assets are invested in cash and cash equivalents. Investment Policy The Company's investment strategy is to seek a competitive rate of return relative to an appropriate level of risk depending on the funded status of each plan and the timing of expected benefit payments. The majority of the plans' investment managers employ active investment management strategies with the goal of outperforming the broad markets in which they invest. Risk management practices include diversification across asset classes and investment styles and periodic rebalancing toward asset allocation targets. A number of the plans' investment managers are authorized to utilize derivatives for investment or liability exposures, and the Company may utilize derivatives to effect asset allocation changes or to hedge certain investment or liability exposures. Asset allocation decisions are typically made by an independent board of trustees for the specific plan. Investment objectives are designed to generate returns that will enable the plan to meet its future obligations. In some countries, local regulations may restrict asset allocations, typically leading to a higher percentage of investment in fixed income securities than would otherwise be deployed. The Company reviews the investment strategy and provides a recommended list of investment managers for each country plan, with final decisions on asset allocation and investment managers made by the board of trustees or investment committees for the specific plan. Basis for Expected Long-Term Rate of Return on Plan Assets The expected long-term rate of return on plan assets reflects the expected returns for each major asset class in which the plan invests and the weight of each asset class in the target mix. Expected asset returns reflect the current yield on government bonds, risk premiums for each asset class and expected real returns, which considers each country's specific inflation outlook. Because the Company's investment policy is to employ primarily active investment managers who seek to outperform the broader market, the expected returns are adjusted to reflect the expected additional returns, net of fees. Employer Contributions and Funding Policy During fiscal 2018 , the Company contributed approximately $158 million to its non-U.S. pension plans and paid $6 million to cover benefit claims under the Company's post-retirement benefit plans. During fiscal 2019, the Company expects to contribute approximately $190 million to its non-U.S. pension plans. In addition, the Company expects to contribute approximately $1 million to cover benefit payments to U.S. non-qualified plan participants. The Company expects to pay approximately $6 million to cover benefit claims for its post-retirement benefit plans. The Company's policy is to fund its pension plans so that it makes at least the minimum contribution required by local government, funding and taxing authorities. Estimated Future Benefits Payments As of October 31, 2018 , estimated future benefits payments for the Company's retirement plans were as follows: Fiscal year Defined Benefit Plans Post-Retirement Benefit Plans In millions 2019 $ 453 $ 9 2020 427 10 2021 449 10 2022 469 10 2023 492 11 Next five fiscal years to October 31, 2028 2,704 59 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Oct. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Prior to the Separation, certain of the Company's employees participated in stock-based compensation plans sponsored by former Parent ("former Parent's Plans"). In conjunction with the Separation, the Company adopted the Hewlett Packard Enterprise Company 2015 Stock Incentive Plan (the "Plan"). The Plan became effective on November 1, 2015. The total number of shares of the Company’s common stock authorized under the Plan was 260 million . On January 25, 2017, the Company amended the Plan and reduced the authorized shares of common stock to 210 million shares. In connection with the Everett and Seattle Transactions, the number of shares of the Company's common stock authorized for issuance under the Plan increased by 67 million . The Plan provides for the grant of various types of awards including restricted stock awards, stock options, and performance-based awards. These awards generally vest over three years from the grant date. The Company's stock-based incentive compensation program also includes various equity plans assumed through acquisitions under which stock-based awards are outstanding. In connection with the Separation, the Company granted one-time retention stock awards, with a total grant date fair value of approximately $137 million , to certain executives in the first quarter of fiscal 2016. These awards generally vest over three years from the grant date. Stock-Based Compensation Expense Stock-based compensation expense and the resulting tax benefits were as follows: Fiscal years ended October 31, 2018 2017 2016 In millions Stock-based compensation expense from continuing operations $ 309 $ 454 $ 408 Income tax benefit (56 ) (159 ) (131 ) Stock-based compensation expense from continuing operations, net of tax $ 253 $ 295 $ 277 Stock-based compensation expense from discontinued operations $ — $ 166 $ 189 In May 2016, in connection with the announcement of the Everett Transaction, the Company modified its stock-based compensation program such that certain unvested equity awards outstanding on May 24, 2016 would vest upon the earlier of: (i) the termination of an employee’s employment with HPE as a direct result of an announced sale, divestiture or spin-off of a subsidiary, division or other business; (ii) the termination of an employee’s employment with HPE without cause; or (iii) June 1, 2018. This modification also included changes to the performance and market conditions of certain performance-based awards. The incremental expense arising from this modification was not material. Additionally, as a result of the accelerated vesting related to this modification, the Company incurred stock-based compensation expense of $126 million during fiscal 2017, of which $92 million was recorded in Net loss from discontinued operations in the Consolidated Statement of Earnings for the fiscal year ended October 31, 2017. The remaining $34 million arising from the acceleration for fiscal 2017 was recorded within Separation costs in the Consolidated Statement of Earnings. The stock-based compensation expense arising from the acceleration for fiscal 2018 was not material. Additionally, as permitted by the Plan, in connection with the Everett and Seattle Transactions and in accordance with the respective Employee Matters Agreements, HPE made certain post-spin adjustments to the exercise price and number of stock-based compensation awards with the intention of preserving the intrinsic value of the outstanding awards prior to the close of the transactions. The incremental expense incurred by the Company related to the Everett and Seattle Transactions was not material. For the fiscal year ended October 31, 2018 , stock-based compensation expense from continuing operations in the table above includes pre-tax expense of $10 million , which was recorded within Separation costs, $3 million related to workforce reductions, which was recorded within Restructuring charges and $10 million related to the acquisition of Nimble Storage, Inc. ("Nimble Storage"), which was recorded within Acquisition and other related charges in the Consolidated Statement of Earnings. For the fiscal year ended October 31, 2017 , stock-based compensation expense from continuing operations in the table above includes pre-tax expense of $41 million , which was recorded within Separation costs, $33 million , related to workforce reductions, which was recorded within Restructuring charges, and $23 million related to the acquisitions of Silicon Graphics International Corp. ("SGI") and Nimble Storage, which was recorded within Acquisition and other related charges, in the Consolidated Statement of Earnings. For the fiscal year ended October 31, 2016 , stock-based compensation expense from continuing operations in the table above includes pre-tax expense of $33 million , which was recorded within Separation costs, and $8 million related to workforce reductions, which was recorded within Restructuring charges, in the Consolidated Statement of Earnings. Employee Stock Purchase Plan Effective November 1, 2015, the Company adopted the Hewlett Packard Enterprise Company 2015 Employee Stock Purchase Plan ("ESPP"). The total number of shares of Company's common stock authorized under the ESPP was 80 million . The ESPP allows eligible employees to contribute up to 10% of their eligible compensation to purchase Hewlett Packard Enterprise's common stock. The ESPP provides for a discount not to exceed 15% and an offering period up to 24 months. The Company currently offers 6 -month offering periods during which employees have the ability to purchase shares at 95% of the closing market price on the purchase date. No stock-based compensation expense was recorded in connection with those purchases, as the criteria of a non-compensatory plan were met. Restricted Stock Units Restricted stock units have forfeitable dividend equivalent rights equal to the dividend paid on common stock. Restricted stock units do not have the voting rights of common stock, and the shares underlying restricted stock units are not considered issued and outstanding upon grant. The fair value of the restricted stock units is the closing price of the Company's common stock on the grant date of the award. The Company expenses the fair value of restricted stock units ratably over the period during which the restrictions lapse. The Company also issues performance-adjusted restricted stock units ("PARSU") that vest only on the satisfaction of service, performance and market conditions. The Company estimates the fair value of PARSUs subject to performance-contingent vesting conditions using the Monte Carlo simulation model. The following table summarizes restricted stock unit activity: Fiscal years ended October 31, 2018 2017 2016 Shares Weighted- Shares Weighted- Shares Weighted- In thousands In thousands In thousands Outstanding at beginning of year 48,517 $ 14 57,321 $ 15 — $ — Converted from former Parent's Plans — $ — — $ — 42,012 $ 15 Granted and assumed through acquisition (1) 22,131 $ 15 23,980 $ 21 32,752 $ 15 Additional shares granted due to post-spin adjustments (2) — $ — 25,543 $ 9 — $ — Vested (3) (32,659 ) $ 14 (51,976 ) $ 16 (12,747 ) $ 15 Forfeited/canceled (4) (5,572 ) $ 14 (6,351 ) $ 16 (4,696 ) $ 15 Outstanding at end of year 32,417 $ 14 48,517 $ 14 57,321 $ 15 (1) Fiscal 2017 includes approximately 11 million restricted stock units assumed by the Company through acquisition with a weighted-average grant date fair value of $18 per share. Fiscal 2016 includes a one-time restricted stock unit retention grant of approximately 5 million shares. (2) Additional shares granted as a result of the post-spin exercise price adjustments made related to the Everett and Seattle Transactions, as permitted by the Plan, in order to preserve the intrinsic value of outstanding awards prior to the close of the transactions. (3) Fiscal 2018 includes approximately 6 million restricted stock units, with a weighted-average grant date fair value of $14 per share, which were accelerated to vest on June 1, 2018 as part of the Everett Transaction. Fiscal 2017 includes approximately 14 million restricted stock units, with a weighted-average grant date fair value of $17 per share, which were accelerated as part of the Everett and Seattle Transactions. (4) Fiscal 2017 includes approximately 0.3 million restricted stock units, with a weighted-average grant date fair value of $18 per share, related to the former ES and Software segments, which were canceled by HPE and assumed by DXC and Micro Focus in connection with the Everett and Seattle Transactions, and in accordance with the respective Employee Matters Agreements. The total grant date fair value of restricted stock awards vested for Company employees in fiscal 2018 , 2017 and 2016 was $270 million , $472 million and $130 million , respectively, net of taxes. As of October 31, 2018 , there was $259 million of unrecognized pre-tax stock-based compensation expense related to unvested restricted stock units, which the Company expects to recognize over the remaining weighted-average vesting period of 1.4 years . Stock Options Stock options granted under the Plan are generally non-qualified stock options, but the Plan permits some options granted to qualify as incentive stock options under the U.S. Internal Revenue Code. The exercise price of a stock option is equal to the closing price of the Company's common stock on the option grant date. The majority of the stock options issued by the Company contain only service vesting conditions. The Company has also issued performance-contingent stock options that vest only on the satisfaction of both service and market conditions. In fiscal 2018, the Company did not issue stock options. The Company utilizes the Black-Scholes-Merton option pricing formula to estimate the fair value of stock options subject to service-based vesting conditions. The Company estimates the fair value of stock options subject to performance-contingent vesting conditions using a combination of a Monte Carlo simulation model and a lattice model, as these awards contain market conditions. The weighted-average fair value and the assumptions used to measure fair value were as follows: Fiscal years ended October 31, 2017 2016 Weighted-average fair value (1) $ 6 $ 4 Expected volatility (2) 25.7 % 31.1 % Risk-free interest rate (3) 2.0 % 1.7 % Expected dividend yield (4) 1.0 % 1.5 % Expected term in years (5) 6.1 5.4 (1) The weighted-average fair value was based on the fair value of stock options granted under the Plan during the respective periods. (2) Expected volatility was estimated using the average historical volatility of selected peer companies. (3) The risk-free interest rate was estimated based on the yield on U.S. Treasury zero-coupon issues. (4) The expected dividend yield represents a constant dividend yield applied for the duration of the expected term of the option. (5) For options granted subject to service-based vesting, the expected term was estimated using the simplified method detailed in SEC Staff Accounting Bulletin No. 110. The following table summarizes stock option activity: Fiscal years ended October 31, 2018 2017 2016 Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate In thousands In years In millions In thousands In years In millions In thousands In years In millions Outstanding at beginning of year 49,274 $ 10 57,498 $ 15 — $ — Converted from former Parent's Plans — $ — — $ — 42,579 $ 15 Granted and assumed through acquisition (1) 316 $ 10 6,074 $ 23 25,390 $ 15 Additional shares granted due to post-spin adjustments (2) — $ — 24,523 $ 11 — $ — Exercised (26,476 ) $ 9 (29,492 ) $ 12 (7,845 ) $ 11 Forfeited/canceled/expired (3) (4,851 ) $ 13 (9,329 ) $ 16 (2,626 ) $ 20 Outstanding at end of year (4) 18,263 $ 10 4.2 $ 92 49,274 $ 10 4.6 $ 207 57,498 $ 15 5.4 $ 437 Vested and expected to vest at end of year (4) 18,038 $ 10 4.2 $ 91 48,566 $ 10 4.6 $ 205 55,716 $ 15 5.3 $ 425 Exercisable at end of year (4) 14,896 $ 10 3.7 $ 85 24,736 $ 9 3.0 $ 123 26,204 $ 13 3.8 $ 241 (1) Fiscal 2016 includes one-time stock option retention grant of approximately 16 million shares. (2) Additional shares granted as a result of the post-spin exercise price adjustments made related to the Everett and Seattle Transactions, as permitted by the Plan, in order to preserve the intrinsic value of the awards prior to the close of the transaction. (3) Fiscal 2017 includes approximately 8 million stock options, with a weighted-average exercise price of $16 per share, related to the former ES and Software segments, which were canceled by HPE in connection with the Everett and Seattle Transactions, and in accordance with the respective Employee Matters Agreements. (4) The weighted average exercise price reflects the impact of the post-spin adjustments to the exercise price related to the Everett and Seattle Transactions. The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value that option holders would have realized had all option holders exercised their options on the last trading day of fiscal 2018 , 2017 and 2016 , respectively. The aggregate intrinsic value is the difference between the Company's closing common stock price on the last trading day of the respective fiscal year and the exercise price, multiplied by the number of in-the-money options. The total intrinsic value of options exercised in fiscal 2018 , 2017 and 2016 was $200 million , $218 million and $62 million , respectively. The following table summarizes significant ranges of outstanding and exercisable stock options: As of October 31, 2018 Options Outstanding Options Exercisable Range of Exercise Prices Shares Weighted- Weighted- Shares Weighted- In thousands In years In thousands $0-$9.99 10,862 3.8 $ 8 10,368 $ 8 $10-$19.99 7,358 4.8 $ 14 4,485 $ 13 $20-$29.99 43 2.8 $ 25 43 $ 25 18,263 4.2 $ 10 14,896 $ 10 As of October 31, 2018 , there was $7 million of unrecognized pre-tax stock-based compensation expense related to stock options, which the Company expects to recognize over the remaining weighted-average vesting period of 1.3 years . Cash received from option exercises and purchases under the Company's ESPP was $279 million , $411 million and $119 million in fiscal 2018 , 2017 and 2016 , respectively. The benefit realized for the tax deduction from option exercises in fiscal 2018 , 2017 and 2016 was $61 million , $69 million and $21 million , respectively. |
Taxes on Earnings
Taxes on Earnings | 12 Months Ended |
Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Taxes on Earnings | Taxes on Earnings Provision for Taxes The domestic and foreign components of earnings from continuing operations before taxes were as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions U.S. (1) $ (2,805 ) $ (1,929 ) $ (1,758 ) Non-U.S. (1) 3,073 2,201 5,618 $ 268 $ 272 $ 3,860 (1) F iscal 2017 and 2016 amounts have been reclassified to conform with the current period presentation. The Benefit (provision) for taxes on earnings from continuing operations were as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions U.S. federal taxes: Current $ (2,177 ) $ 560 $ 940 Deferred 150 (1,366 ) (959 ) Non-U.S. taxes: Current 419 64 874 Deferred (188 ) 25 (58 ) State taxes: Current 52 (107 ) 36 Deferred — 660 (210 ) $ (1,744 ) $ (164 ) $ 623 The differences between the U.S. federal statutory income tax rate and the Company's effective tax rate were as follows: For the fiscal years ended October 31, 2018 2017 2016 U.S. federal statutory income tax rate 23.3 % 35.0 % 35.0 % State income taxes, net of federal tax benefit 4.3 % 3.0 % 1.0 % Lower rates in other jurisdictions, net (121.4 )% (426.3 )% (24.5 )% Valuation allowance (59.8 )% 310.0 % (14.7 )% U.S. permanent differences 39.3 % 27.8 % (2.3 )% Uncertain tax positions (694.8 )% (8.4 )% 23.1 % Impacts of the Tax Act (1) 158.0 % — % — % Other, net 0.4 % (1.4 )% (1.5 )% (650.7 )% (60.3 )% 16.1 % (1) Impacts of the Tax Act is inclusive of valuation allowances recorded as a result of the U.S. law change. The jurisdictions with favorable tax rates that had the most significant impact on the Company's effective tax rate in the periods presented include Puerto Rico and Singapore. In fiscal 2018, the Company recorded $2.0 billion of net income tax benefits related to items unique to the year. These amounts primarily included $2.0 billion of income tax benefits related to the settlement of certain pre-Separation tax liabilities for which the Company shares joint and several liability with HP Inc. and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement, $208 million of income tax benefits related to Everett pre-divestiture tax matters and valuation allowances, $125 million of income tax benefits on restructuring charges, separation costs, transformation costs and acquisition and other related charges and $65 million of net excess tax benefits related to stock-based compensation, the effects of which were partially offset by $422 million of income tax charges related to impacts of the Tax Act. In addition, the Company recorded $5.0 billion of certain foreign loss carryforwards and U.S. domestic capital losses carryforwards against which a full valuation allowance was recorded; the effective tax rate above reflects this activity on a net basis. In fiscal 2017, the Company recorded $554 million of net income tax benefits related to items unique to the year. These amounts primarily included $699 million of income tax benefits in connection with the Everett and Seattle Transactions and $326 million of income tax benefits on restructuring charges, separation costs, transformation costs and acquisition and other related charges, the effects of which were partially offset by $473 million of income tax charges to record valuation allowances on U.S. state deferred tax assets, and $88 million of income tax charges related to pre-Separation tax matters. In fiscal 2016, the Company recorded $250 million of net income tax charges related to items unique to the year. These amounts primarily included $714 million of income tax charges related to pre-Separation tax matters, of which $647 million was related to the effect of the potential settlement of certain pre-Separation Hewlett-Packard Company income tax liabilities, and $169 million of income tax charges resulting from a gain on the H3C divestiture, the effects of which were partially offset by $509 million of income tax benefits on restructuring charges, separation costs and acquisition and other related charges, and $124 million of income tax benefits resulting from a gain on the MphasiS divestiture. As a result of certain employment actions and capital investments the Company has undertaken, income from manufacturing and services in certain countries is subject to reduced tax rates, and in some cases is wholly exempt from taxes, through 2024. The gross income tax benefits attributable to these actions and investments were $792 million ( $0.51 diluted net EPS) in fiscal 2018, $378 million ( $0.23 diluted net EPS) in fiscal 2017 and $401 million ( $0.23 diluted net EPS) in fiscal 2016. Refer to Note 17, "Net Earnings Per Share" for details on shares used to compute diluted net EPS. Recent Tax Legislation The Tax Act requires the Company to incur a one-time Transition Tax on deferred foreign income not previously subject to U.S. income tax at a rate of 15.5% for foreign cash and certain other net current assets and 8.0% on the remaining income. The GILTI, BEAT and certain other provisions of the Tax Act will be effective for the Company beginning November 1, 2018. The Company has an October 31 fiscal year end; therefore, the lower corporate tax rate enacted by the Tax Act will be phased in, resulting in a U.S. statutory federal rate of 23.3% for the fiscal year ending October 31, 2018 and 21.0% for subsequent fiscal years. The Company has not completed its accounting for the tax effects of the Tax Act. Reasonable estimates of the impacts of the Tax Act are provided in accordance with guidance from the SEC that allows for a measurement period of up to one year after the enactment date of the Tax Act to finalize the recording of the related tax impacts. Adjustments may materially impact the Company’s provision for income taxes and effective tax rate in the period in which the adjustments are made. The Company expects to complete the accounting under the Tax Act in the first quarter of fiscal 2019. For fiscal 2018 , the Company recorded a provisional estimate of $1.7 billion of tax expense related to the Transition Tax, which was included in Benefit (provision) for taxes in the Consolidated Statements of Earnings. The final calculations of the Transition Tax may differ from estimates, potentially materially, due to, among other things, changes in interpretations of the Tax Act, analysis of proposed regulations and current and additional guidance from the Internal Revenue Service ("IRS"), the Company’s analysis of the Tax Act, or any updates or changes to estimates that the Company utilized to calculate the transition impacts, including impacts from changes to current year earnings estimates and assertions. No cash payment is anticipated due to the availability of sufficient tax credits to offset the Transition Tax. In addition, for fiscal 2018 the Company recorded $1.7 billion of net tax expense related to the remeasurement of U.S. deferred tax assets and liabilities as a result of the reduction of the U.S. corporate tax rate and a $3.7 billion tax benefit related to the reversal of previous deferred tax recognized on foreign earnings and profits, which was included in Benefit (provision) for taxes in the Consolidated Statement of Earnings. In addition, as part of evaluating the future effects of the Tax Act, the Company has reassessed the realizability of its U.S deferred tax assets, including tax credits and other non-credit deferred tax assets, based on the new method of taxation of non-U.S. earnings applicable beginning in fiscal 2019. The Company recorded a provisional estimate for valuation allowance of $687 million against its U.S. federal deferred tax assets. Regarding the new GILTI tax rules, the Company is required to make an accounting policy election to either treat taxes due on future GILTI inclusions in U.S. taxable income as a current period expense when incurred or reflect such portion of the future GILTI inclusions in U.S. taxable income that relate to existing basis differences in the Company's current measurement of deferred taxes. The Company's analysis of the new GILTI tax rules and how they may impact the Company is in process. Accordingly, the Company has not made a policy election regarding the treatment of the GILTI tax. Uncertain Tax Positions A reconciliation of unrecognized tax benefits is as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 11,262 $ 11,411 $ 4,901 Increases: For current year's tax positions 163 28 1,456 For prior years' tax positions 66 311 820 Net transfers from former Parent through equity — — 4,455 Decreases: For prior years' tax positions (82 ) (202 ) (114 ) Statute of limitations expiration (86 ) (70 ) (47 ) Settlements with taxing authorities (2 ) (216 ) (60 ) Settlements related to joint and several positions of former Parent (2,495 ) — — Balance at end of year $ 8,826 $ 11,262 $ 11,411 Up to $1.1 billion , $3.0 billion and $2.7 billion of Hewlett Packard Enterprise's unrecognized tax benefits at October 31, 2018 , 2017 and 2016 , respectively, would affect the Company's effective tax rate if realized. The $2.4 billion decrease in the amount of unrecognized tax benefits for the year ended October 31, 2018, is primarily related to the settlement of certain pre-Separation tax liabilities for which the Company shares joint and several liability with HP Inc. and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement. The $2.0 billion of income tax benefits recognized in the Company's effective tax rate includes interest, penalties, and offsetting benefits not included in the table above. The $149 million decrease in the amount of unrecognized tax benefits for the year ended October 31, 2017, is primarily related to the settlement of a foreign tax audit concerning an intercompany transaction, partially offset by unrecognized tax benefits related to the timing of intercompany royalty revenue recognition, which does not affect the Company's effective tax rate. Hewlett Packard Enterprise recognizes interest income from favorable settlements and interest expense and penalties accrued on unrecognized tax benefits in Benefit (provision) for taxes in the Consolidated Statements of Earnings. The Company had accrued $142 million and $304 million for interest and penalties as of October 31, 2018 and 2017 , respectively. Hewlett Packard Enterprise engages in continuous discussion and negotiation with taxing authorities regarding tax matters in various jurisdictions. Hewlett Packard Enterprise does not expect complete resolution of any U.S. IRS audit cycle within the next 12 months . However, it is reasonably possible that certain federal, foreign and state tax issues may be concluded in the next 12 months , including resolution of certain intercompany transactions, joint and several tax liabilities and other matters. Accordingly, Hewlett Packard Enterprise believes it is reasonably possible that its existing unrecognized tax benefits may be reduced by an amount up to $6.4 billion within the next 12 months. Hewlett Packard Enterprise is subject to income tax in the U.S. and approximately 110 other countries and is subject to routine corporate income tax audits in many of these jurisdictions. With respect to major foreign tax jurisdictions, HPE is no longer subject to tax authority examinations for years prior to 2005. With respect to major state tax jurisdictions, HPE is no longer subject to tax authority examinations for years prior to 2003. Hewlett Packard Enterprise believes it has provided adequate reserves for all tax deficiencies or reductions in tax benefits that could result from federal, state and foreign tax audits. The Company regularly assesses the likely outcomes of these audits in order to determine the appropriateness of the Company's tax provision. The Company adjusts its uncertain tax positions to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular audit. However, income tax audits are inherently unpredictable and there can be no assurance that the Company will accurately predict the outcome of these audits. The amounts ultimately paid on resolution of an audit could be materially different from the amounts previously included in the provision for taxes and therefore the resolution of one or more of these uncertainties in any particular period could have a material impact on net earnings or cash flows. Hewlett Packard Enterprise is joint and severally liable for certain pre-Separation tax liabilities of HP Inc. HP Inc. is subject to numerous ongoing audits by federal, state and foreign tax authorities. The IRS is conducting an audit of HP Inc.’s 2013, 2014 and 2015 income tax returns. Hewlett Packard Enterprise has not provided for U.S. federal income and foreign withholding taxes on $7.9 billion of undistributed earnings and basis differences from non-U.S. operations as of October 31, 2018 because the Company intends to reinvest such earnings indefinitely outside of the U.S. Such amounts have materially decreased from October 31, 2017 , due to the impacts of the Tax Act that required U.S. taxation on largely all undistributed foreign earnings. Determination of the amount of unrecognized deferred tax liability related to these earnings and basis differences is not practicable. The Company will remit non-indefinitely reinvested earnings of its non-U.S. subsidiaries for which deferred U.S. federal and withholding taxes have been provided where excess cash has accumulated and the Company determines that it is advantageous for business operations, tax or cash management reasons. Deferred Income Taxes Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The significant components of deferred tax assets and deferred tax liabilities were as follows: As of October 31, 2018 2017 In millions Deferred tax assets: Loss and credit carry-forwards (1) $ 9,149 $ 4,775 Inventory valuation 77 79 Intercompany transactions—royalty prepayments (2) 48 4,267 Intercompany transactions—excluding royalty prepayments 63 129 Warranty 81 156 Employee and retiree benefits 498 661 Restructuring 101 186 Deferred revenue 518 757 Intangible assets 48 — Other 432 593 Total deferred tax assets 11,015 11,603 Valuation allowance (3) (8,209 ) (2,789 ) Total deferred tax assets net of valuation allowance 2,806 8,814 Deferred tax liabilities: Unremitted earnings of foreign subsidiaries (4) (161 ) (3,824 ) Fixed assets (470 ) (385 ) Intangible assets — (46 ) Total deferred tax liabilities (631 ) (4,255 ) Net deferred tax assets and liabilities $ 2,175 $ 4,559 (1) The increase is primarily due to certain foreign loss carryforwards recognized in the current year and increases in U.S. domestic capital loss carryforwards recognized in the current year. (2) During fiscal 2018, the Company executed an intercompany sale transaction that resulted in the reversal of $2.1 billion of deferred tax assets attributable to deferred revenue. The tax impacts of the transaction are considered prepaid under FASB guidance applicable to fiscal 2018. The additional decrease is primarily a result of deferred tax remeasurement related to the Tax Act. (3) The increase is primarily due to certain foreign loss carryforwards recognized in the current year and increases in U.S. domestic capital loss carryforwards recognized in the current year against which valuation allowances were required as well as a partial valuation allowance recorded against U.S. foreign tax credits carryforwards as a result of the Tax Act. (4) The decrease is primarily due to $3.7 billion benefit from the reversal of previous deferred tax recognized on foreign earnings and profits as a result of the Tax Act. Deferred tax assets and liabilities included in the Consolidated Balance Sheets are as follows: As of October 31, 2018 2017 In millions Deferred tax assets $ 2,403 $ 4,663 Deferred tax liabilities (228 ) (104 ) Deferred tax assets net of deferred tax liabilities $ 2,175 $ 4,559 The Company periodically engages in intercompany advanced royalty payment and licensing arrangements that may result in advance payments between subsidiaries in different tax jurisdictions. When the local tax treatment of the intercompany licensing arrangements differs from U.S. GAAP treatment, deferred taxes are recognized. Hewlett Packard Enterprise executed intercompany advanced royalty payment arrangements resulting in advanced payments of $63 million and $439 million during fiscal 2018 and 2017 , respectively. In these transactions, the payments were received in the U.S. from a foreign consolidated affiliate, with a deferral of intercompany revenues over the term of the arrangements. Intercompany royalty revenue and the amortization expense related to the licensing rights are eliminated in consolidation. In fiscal 2018 , the Company recorded an adjustment of $55 million to reduce a deferred tax asset established in connection with the Separation as a reduction of additional paid-in capital in the Consolidated Statement of Stockholders' Equity. As of October 31, 2018 , the Company had $769 million , $2.8 billion and $19.9 billion of federal, state and foreign net operating loss carryforwards, respectively. Amounts included in federal, state and foreign net operating loss carryforwards will begin to expire in fiscal 2030, 2019, and 2020, respectively. Hewlett Packard Enterprise has provided a valuation allowance of $160 million and $5.0 billion for deferred tax assets related to state and foreign net operating losses carryforwards, respectively. As of October 31, 2018, the Company also had $6.1 billion , $6.4 billion , and $58 million of federal, state, and foreign capital loss carryforwards, respectively. Amounts included in federal and state capital loss carryforwards will begin to expire in fiscal 2024; foreign capital losses can carry forward indefinitely. Hewlett Packard Enterprise has provided a valuation allowance of $1.2 billion , $238 million , and $13 million for deferred tax assets related to federal, state, and foreign capital loss carryforwards, respectively. As of October 31, 2018 , Hewlett Packard Enterprise had recorded deferred tax assets for various tax credit carryforwards as follows: Carryforward Valuation Initial In millions U.S. foreign tax credits $ 1,832 $ (687 ) 2021 U.S. research and development and other credits 122 — 2019 Tax credits in state and foreign jurisdictions 158 (124 ) 2020 Balance at end of year $ 2,112 $ (811 ) Deferred Tax Asset Valuation Allowance The deferred tax asset valuation allowance and changes were as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 2,789 $ 2,095 $ 1,572 Income tax expense (166 ) 848 (203 ) Income tax expense related to the Tax Act 687 — — Valuation allowance offsetting current year losses recorded 5,028 — — Other comprehensive income, currency translation and charges to other accounts (129 ) (154 ) 726 Balance at end of year $ 8,209 $ 2,789 $ 2,095 Total valuation allowances increased by $5.4 billion in fiscal 2018 , due primarily to the increases in certain foreign loss carryforwards recognized in the current year and increases in U.S. domestic capital loss carryforwards recognized in the current year against which valuation allowances were required, and a partial valuation allowance recorded against U.S. foreign tax credit carryforwards as a result of the Tax Act. These were offset by partial valuation allowance releases against loss carryforwards in certain foreign jurisdictions due to law changes. Total valuation allowances increased by $694 million in fiscal 2017 due primarily to the valuation allowance recorded against foreign deferred tax assets related to pension assets and liabilities, partially offset by decreases in foreign deferred tax assets for net operating losses. Tax Matters Agreement and Other Income Tax Matters In connection with the Separation, the Company entered into a Tax Matters Agreement with HP Inc., formerly Hewlett-Packard Company. In connection with the Everett and Seattle Transactions, the Company entered into a DXC Tax Matters Agreement with DXC and a Micro Focus Tax Matters Agreement with Micro Focus, respectively. See Note 19, "Guarantees, Indemnifications and Warranties", for a description of the Tax Matters Agreement, DXC Tax Matters Agreement and Micro Focus Tax Matters Agreement. |
Balance Sheet Details
Balance Sheet Details | 12 Months Ended |
Oct. 31, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Details | Balance Sheet Details Balance sheet details were as follows: Accounts Receivable, Net As of October 31, 2018 2017 In millions Unbilled receivable $ 185 $ 223 Accounts receivable 3,117 2,892 Allowance for doubtful accounts (39 ) (42 ) Total $ 3,263 $ 3,073 The allowance for doubtful accounts related to accounts receivable and changes therein were as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 42 $ 49 $ 72 Provision for doubtful accounts 20 16 22 Deductions, net of recoveries (23 ) (23 ) (45 ) Balance at end of year $ 39 $ 42 $ 49 The Company has third-party revolving short-term financing arrangements intended to facilitate the working capital requirements of certain customers. The recourse obligations associated with these short-term financing arrangements as of October 31, 2018 and 2017 were not material. The activity related to Hewlett Packard Enterprise's revolving short-term financing arrangements was as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of period (1) $ 121 $ 145 $ 68 Trade receivables sold 4,844 3,910 3,015 Cash receipts (4,794 ) (3,937 ) (2,931 ) Foreign currency and other (5 ) 3 (7 ) Balance at end of period (1) $ 166 $ 121 $ 145 (1) Beginning and ending balances represent amounts for trade receivables sold but not yet collected. Inventory As of October 31, 2018 2017 In millions Finished goods $ 1,274 $ 1,236 Purchased parts and fabricated assemblies 1,173 1,079 Total $ 2,447 $ 2,315 Other Current Assets As of October 31, 2018 2017 In millions Value-added taxes receivable $ 811 $ 819 Manufacturer and other receivables 1,141 1,185 Prepaid and other current assets 1,328 1,081 Total $ 3,280 $ 3,085 Property, Plant and Equipment As of October 31, 2018 2017 In millions Land $ 294 $ 312 Buildings and leasehold improvements 2,103 2,371 Machinery and equipment, including equipment held for lease 9,419 9,194 11,816 11,877 Accumulated depreciation (5,678 ) (5,608 ) Total $ 6,138 $ 6,269 Depreciation expense was $2.3 billion , $2.2 billion and $2.0 billion in fiscal 2018 , 2017 and 2016 , respectively. Long-Term Financing Receivables and Other Assets As of October 31, 2018 2017 In millions Financing receivables, net $ 4,740 $ 4,380 Deferred tax assets 2,403 4,663 Indemnification receivables - long-term 16 1,430 Prepaid taxes - long-term 2,340 293 Prepaid pension assets 829 830 Other 1,031 1,004 Total $ 11,359 $ 12,600 For the fiscal year ended October 31, 2018 , the change in Long-term financing receivables and other assets was due primarily to a decrease in Deferred tax assets as a result of the impact of the Tax Act and a decrease in Indemnification receivable - long-term as a result of the settlement of certain pre-Separation tax liabilities for which the Company shares joint and several liability with HP Inc. and for which the Company is partially indemnified by HP Inc., partially offset by an increase in Prepaid taxes - long-term as a result of an intercompany sale transaction. Other Accrued Liabilities As of October 31, 2018 2017 In millions Accrued taxes - other $ 1,010 $ 929 Warranty - short-term 241 269 Sales and marketing programs 910 780 Other 1,679 1,866 Total $ 3,840 $ 3,844 Other Non-Current Liabilities As of October 31, 2018 2017 In millions Pension, post-retirement, and post-employment liabilities $ 1,434 $ 1,413 Deferred revenue - long-term 2,646 2,487 Tax liability - long-term 1,485 3,859 Other long-term liabilities 1,320 1,036 Total $ 6,885 $ 8,795 For the fiscal year ended October 31, 2018 , the change in Other non-current liabilities was due primarily to a decrease in Tax liability - long term. The decrease was due primarily to the settlement of certain pre-Separation tax liabilities for which the Company shares joint and several liability with HP Inc. and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement. |
Financing Receivables and Opera
Financing Receivables and Operating Leases | 12 Months Ended |
Oct. 31, 2018 | |
Leases [Abstract] | |
Financing Receivables and Operating Leases | 90 days 74 58 Unbilled sales-type and direct-financing lease receivables 7,852 7,462 Total gross financing receivables $ 8,256 $ 7,844 Gross financing receivables on non-accrual status (2) $ 226 $ 188 Gross financing receivables 90 days past due and still accruing interest (2) $ 113 $ 133 (1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables. (2) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables. Operating Leases Operating lease assets included in Property, plant and equipment in the Consolidated Balance Sheets were as follows: As of October 31, 2018 2017 In millions Equipment leased to customers $ 7,290 $ 7,356 Accumulated depreciation (3,078 ) (2,943 ) Total $ 4,212 $ 4,413 As of October 31, 2018 , minimum future rentals on non-cancelable operating leases related to leased equipment were as follows: 2019 2020 2021 2022 2023 Thereafter Total In millions Minimum future rentals on non-cancelable operating leases $ 1,901 $ 1,156 $ 477 $ 69 $ 9 $ 1 $ 3,613" id="sjs-B4">Financing Receivables and Operating Leases Financing receivables represent sales-type and direct-financing leases of the Company and third-party products. These receivables typically have terms ranging from two to five years and are usually collateralized by a security interest in the underlying assets. Financing receivables also include billed receivables from operating leases. The components of financing receivables were as follows: As of October 31, 2018 2017 In millions Minimum lease payments receivable $ 8,691 $ 8,226 Unguaranteed residual value 297 272 Unearned income (732 ) (654 ) Financing receivables, gross 8,256 7,844 Allowance for doubtful accounts (120 ) (86 ) Financing receivables, net 8,136 7,758 Less: current portion (1) (3,396 ) (3,378 ) Amounts due after one year, net (1) $ 4,740 $ 4,380 (1) The Company includes the current portion in Financing receivables, and amounts due after one year, net, in Long-term financing receivables and other assets in the accompanying Consolidated Balance Sheets. As of October 31, 2018 , scheduled maturities of the Company's minimum lease payments receivable were as follows: 2019 2020 2021 2022 2023 Thereafter Total In millions Scheduled maturities of minimum lease payments receivable $ 3,746 $ 2,331 $ 1,468 $ 763 $ 303 $ 80 $ 8,691 Sale of Financing Receivables During the fiscal years ended October 31, 2018 and 2017 , the Company entered into arrangements to transfer the contractual payments due under certain financing receivables to third party financial institutions, which are accounted for as sales in accordance with Accounting Standards Codification ("ASC") 860 - Transfers and Servicing. The Company derecognizes the carrying value of the receivable transferred and recognizes a net gain or loss on the sale. During the fiscal years ended October 31, 2018 and 2017 , the Company sold $174 million and $130 million , respectively, of financing receivables. The gains recognized on the sales of financing receivables were not material for the periods presented. Credit Quality Indicators Due to the homogeneous nature of its leasing transactions, the Company manages its financing receivables on an aggregate basis when assessing and monitoring credit risk. Credit risk is generally diversified due to the large number of entities comprising the Company's customer base and their dispersion across many different industries and geographic regions. The Company evaluates the credit quality of an obligor at lease inception and monitors that credit quality over the term of a transaction. The Company assigns risk ratings to each lease based on the creditworthiness of the obligor and other variables that augment or mitigate the inherent credit risk of a particular transaction. Such variables include the underlying value and liquidity of the collateral, the essential use of the equipment, the term of the lease, and the inclusion of credit enhancements, such as guarantees, letters of credit or security deposits. The credit risk profile of gross financing receivables, based on internal risk ratings, was as follows: As of October 31, 2018 2017 In millions Risk Rating: Low $ 4,238 $ 4,156 Moderate 3,805 3,556 High 213 132 Total $ 8,256 $ 7,844 Accounts rated low risk typically have the equivalent of a Standard & Poor's rating of BBB– or higher, while accounts rated moderate risk generally have the equivalent of BB+ or lower. The Company classifies accounts as high risk when it considers the financing receivable to be impaired or when management believes there is a significant near-term risk of impairment. Allowance for Doubtful Accounts The allowance for doubtful accounts for financing receivables is comprised of a general reserve and a specific reserve. The Company maintains general reserve percentages on a regional basis and bases such percentages on several factors, including consideration of historical credit losses and portfolio delinquencies, trends in the overall weighted-average risk rating of the portfolio, current economic conditions and information derived from competitive benchmarking. The Company excludes accounts evaluated as part of the specific reserve from the general reserve analysis. The Company establishes a specific reserve for financing receivables with identified exposures, such as customer defaults, bankruptcy or other events, that make it unlikely the Company will recover its investment. For individually evaluated receivables, the Company determines the expected cash flow for the receivable, which includes consideration of estimated proceeds from disposition of the collateral, and calculates an estimate of the potential loss and the probability of loss. For those accounts where a loss is considered probable, the Company records a specific reserve. The Company generally writes off a receivable or records a specific reserve when a receivable becomes 180 days past due, or sooner if the Company determines that the receivable is not collectible. The allowance for doubtful accounts related to financing receivables and changes therein were as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 86 $ 89 $ 95 Provision for doubtful accounts 49 23 11 Write-offs (15 ) (26 ) (17 ) Balance at end of year $ 120 $ 86 $ 89 The gross financing receivables and related allowance evaluated for loss were as follows: As of October 31, 2018 2017 In millions Gross financing receivables collectively evaluated for loss $ 7,917 $ 7,523 Gross financing receivables individually evaluated for loss 339 321 Total $ 8,256 $ 7,844 Allowance for financing receivables collectively evaluated for loss $ 78 $ 67 Allowance for financing receivables individually evaluated for loss 42 19 Total $ 120 $ 86 Non-Accrual and Past-Due Financing Receivables The Company considers a financing receivable to be past due when the minimum payment is not received by the contractually specified due date. The Company generally places financing receivables on non-accrual status, which is the suspension of interest accrual, and considers such receivables to be non-performing at the earlier of the time at which full payment of principal and interest becomes doubtful or the receivable becomes 90 days past due. Subsequently, the Company may recognize revenue on non-accrual financing receivables as payments are received, which is on a cash basis, if the Company deems the recorded financing receivable to be fully collectible; however, if there is doubt regarding the ultimate collectability of the recorded financing receivable, all cash receipts are applied to the carrying amount of the financing receivable, which is the cost recovery method. In certain circumstances, such as when the Company deems a delinquency to be of an administrative nature, financing receivables may accrue interest after becoming 90 days past due. The non-accrual status of a financing receivable may not impact a customer's risk rating. After all of a customer's delinquent principal and interest balances are settled, the Company may return the related financing receivable to accrual status. The following table summarizes the aging and non-accrual status of gross financing receivables: As of October 31, 2018 2017 In millions Billed: (1) Current 1-30 days $ 275 $ 257 Past due 31-60 days 42 52 Past due 61-90 days 13 15 Past due >90 days 74 58 Unbilled sales-type and direct-financing lease receivables 7,852 7,462 Total gross financing receivables $ 8,256 $ 7,844 Gross financing receivables on non-accrual status (2) $ 226 $ 188 Gross financing receivables 90 days past due and still accruing interest (2) $ 113 $ 133 (1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables. (2) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables. Operating Leases Operating lease assets included in Property, plant and equipment in the Consolidated Balance Sheets were as follows: As of October 31, 2018 2017 In millions Equipment leased to customers $ 7,290 $ 7,356 Accumulated depreciation (3,078 ) (2,943 ) Total $ 4,212 $ 4,413 As of October 31, 2018 , minimum future rentals on non-cancelable operating leases related to leased equipment were as follows: 2019 2020 2021 2022 2023 Thereafter Total In millions Minimum future rentals on non-cancelable operating leases $ 1,901 $ 1,156 $ 477 $ 69 $ 9 $ 1 $ 3,613 |
Acquisitions and Divestitures
Acquisitions and Divestitures | 12 Months Ended |
Oct. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures The purchase price allocations for the acquisitions described below reflect various preliminary fair value estimates and analysis, including preliminary work performed by third-party valuation specialists, certain tangible assets and liabilities acquired, the valuation of intangible assets acquired, certain legal matters, income and income based taxes, and residual goodwill, which are subject to change within the measurement period as valuations are finalized. Measurement period adjustments are recorded in the reporting period in which the estimates are finalized and adjustment amounts are determined. Pro forma results of operations for these acquisitions have not been presented because they are not material to the Company's consolidated results of operations, either individually or in the aggregate. Goodwill, which represents the excess of the purchase price over the net tangible and intangible assets acquired, is not deductible for tax purposes. Subsequent event On November 27, 2018, the Company announced that it entered into a definitive agreement to acquire BlueData, a Santa Clara, California-based provider of Artificial Intelligence ("AI")/Machine Learning and Big Data Analytics infrastructure software, which will expand the Company's footprint in the rapidly growing AI and Big Data Analytics market. BlueData's results of operations will be included within the Hybrid IT segment. Acquisitions in Fiscal 2018 During fiscal 2018, the Company completed three acquisitions, none of which were material, both individually and in the aggregate, to the Company's Consolidated Financial Statements. Acquisitions in Fiscal 2017 During fiscal 2017, the Company completed six acquisitions. The following table presents the aggregate purchase price allocation, including those items that were preliminary allocations, for the Company's acquisitions for the fiscal year ended October 31, 2017: In millions Goodwill $ 1,427 Amortizable intangible assets 603 In-process research and development 85 Net assets assumed 340 Total fair value consideration $ 2,455 On September 15, 2017, the Company completed the acquisition of Cloud Technology Partners ("CTP"), a cloud consulting, design and advisory services company. CTP’s results of operations are included within the Hybrid IT segment. On April 17, 2017, the Company completed the acquisition of Nimble Storage, a provider of predictive all-flash and hybrid-flash storage solutions. Nimble Storage's results of operations are included within the Hybrid IT segment. The acquisition date fair value consideration of $1.2 billion primarily consisted of cash paid for outstanding common stock, vested in-the-money stock awards, and the estimated fair value of earned unvested stock awards assumed by the Company. In connection with this acquisition, the Company recorded approximately $755 million of goodwill, $291 million of intangible assets, and $31 million of in-process research and development. The Company is amortizing the intangible assets on a straight-line basis over an estimated weighted-average useful life of five years . On February 17, 2017, the Company completed the acquisition of SimpliVity, a provider of software-defined, hyperconverged infrastructure. SimpliVity's results of operations are included within the Hybrid IT segment. The acquisition date fair value consideration of $651 million primarily consisted of cash paid for outstanding common stock, debt, and the estimated fair value of earned unvested stock awards assumed by the Company. In connection with this acquisition, the Company recorded approximately $442 million of goodwill, $118 million of intangible assets, and $24 million of in-process research and development. The Company is amortizing the intangible assets on a straight-line basis over an estimated weighted-average useful life of five years . On November 1, 2016, the Company completed the acquisition of SGI, a provider of high-performance solutions for computer data analytics and data management. SGI's results of operations are included within the Hybrid IT segment. The acquisition date fair value consideration of $349 million consisted of cash paid for outstanding common stock, debt, and the estimated fair value of earned unvested stock awards assumed by the Company. In connection with this acquisition, the Company recorded approximately $75 million of goodwill, $150 million of intangible assets, and $30 million of in-process research and development. The Company is amortizing the intangible assets on a straight-line basis over an estimated weighted-average useful life of five years . Divestitures in Fiscal 2016 In fiscal 2016, the Company completed three divestitures, which resulted in $3.0 billion of net proceeds. These divestitures primarily represent the sale of the Company's controlling interest in H3C and MphasiS, which are discussed further below. The gains associated with the sale of the Company's controlling interest in H3C and MphasiS are included in Gain on H3C and MphasiS divestitures in the Consolidated Statement of Earnings for the fiscal year ended October 31, 2016. In May 2016, the Company executed its joint partnership agreement with Tsinghua Holdings to bring together the Chinese enterprise technology assets of the Company and Tsinghua University to create a Chinese business provider of technology infrastructure. Under the definitive agreement, Tsinghua Holdings' subsidiary, Unisplendour Corporation, purchased 51% of the new business named H3C for $2.6 billion , which includes purchase consideration adjustments. H3C comprises the Company's former H3C Technologies and China-based server, storage and technology services businesses ("H3C disposal group"), which were previously reported within the EG segment, until the time of the sale. The Company's former EG segment was subsequently realigned into two new reportable segments, Hybrid IT and Intelligent Edge. As a result of the H3C divestiture, the Company recognized a gain of $2.2 billion . The Company's remaining China subsidiary maintains 100% ownership of its existing China-based enterprise services, software and Helion Cloud businesses. The new H3C is the exclusive provider of the Company's server and storage portfolio, as well as the Company's exclusive hardware support services provider in China, customized for that market. The results of the H3C disposal group, which represented 100% of the Company's H3C Technologies and China-based server, storage and technology services businesses, were reflected in the Company's Consolidated Financial Statements through the date of closing. The pre-tax earnings for the fiscal year ended October 31, 2016 was $182 million . The Company's remaining 49% ownership is accounted for under the equity method of accounting, and its proportionate share of H3C’s earnings are included in Earnings (loss) from equity interests in the Consolidated Statements of Earnings. See Note 22, "Equity Method Investments" for additional information. In April 2016, the Company signed a definitive agreement with The Blackstone Group to sell the Company's equity stake in MphasiS Limited, an IT services provider headquartered in Bangalore, India, for Indian Rupees ("INR") 430 per share. On September 1, 2016, the Company closed the MphasiS divestiture by selling its full equity stake, which was valued at $824 million at the purchase price of INR 430 per share. As a result of the MphasiS divestiture, the Company recognized a gain of $253 million . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Oct. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill Goodwill and related changes in the carrying amount by reportable segment were as follows: Hybrid IT Intelligent Financial Total In millions Balance at October 31, 2016 $ 14,045 $ 1,901 $ 144 $ 16,090 Goodwill acquired during the period 1,410 17 — 1,427 Changes due to foreign currency 1 — — 1 Goodwill adjustments (2 ) — — (2 ) Balance at October 31, 2017 15,454 1,918 144 17,516 Goodwill acquired during the period 101 3 — 104 Impairment of goodwill (88 ) — — (88 ) Changes due to foreign currency 6 — — 6 Goodwill adjustments (1 ) — — (1 ) Balance at October 31, 2018 $ 15,472 $ 1,921 $ 144 $ 17,537 Goodwill Impairments Goodwill is tested for impairment at the reporting unit level. On November 1, 2017, the Company's former EG segment was realigned into two new reportable segments, Hybrid IT and Intelligent Edge. Further, following certain executive leadership changes in fiscal 2018, near the end of the fourth quarter, Hybrid IT segment management changed its evaluation of Hybrid IT to evaluate the previously integrated Communications and Media Services ("CMS") business separately from the remainder of Hybrid IT, resulting in a reassessment of the reporting units. As of October 31, 2018 , the Company's reporting units within Hybrid IT include CMS and Hybrid IT excluding CMS. The Company expects to move CMS to the Corporate Investments segment under new management effective November 1, 2018. The Company's reporting units other than Hybrid IT are consistent with the reportable segments identified in Note 3, "Segment Information". Based on the results of the Company's annual impairment tests in fiscal 2018, 2017 and 2016, the Company determined that no impairment of goodwill existed. Based on the results of the Company's interim impairment tests in fiscal 2018 it was concluded that the fair value of CMS was less than its carrying amount. Prior to calculating the goodwill impairment loss, the Company analyzed the recoverability of CMS long-lived assets other than goodwill and concluded that those assets were not impaired. As a result, the Company recorded a goodwill impairment charge of $88 million . There is no remaining goodwill in the CMS reporting unit as of October 31, 2018. Intangible Assets Intangible assets comprise: As of October 31, 2018 As of October 31, 2017 Gross Accumulated Net Gross Accumulated Net In millions Customer contracts, customer lists and distribution agreements $ 272 $ (142 ) $ 130 $ 268 $ (71 ) $ 197 Developed and core technology and patents 1,121 (525 ) 596 1,133 (427 ) 706 Trade name and trade marks 87 (42 ) 45 87 (23 ) 64 In-process research and development 18 — 18 75 — 75 Total intangible assets $ 1,498 $ (709 ) $ 789 $ 1,563 $ (521 ) $ 1,042 For fiscal 2018 , the decrease in gross intangible assets was due primarily to $106 million of intangible assets which became fully amortized and were eliminated from gross intangible assets and accumulated amortization, partially offset by $41 million of purchases related to acquisitions. For fiscal 2017 , the increase in gross intangible assets was due primarily to $688 million of purchases related to acquisitions, partially offset by $384 million of intangible assets which became fully amortized and were eliminated from gross intangible assets and accumulated amortization. The Company reclassified in-process research and development assets acquired of $57 million and $10 million to developed and core technology and patents as the projects were completed, and began amortization during fiscal 2018 and fiscal 2017 , respectively. As of October 31, 2018 , the weighted-average remaining useful lives of the Company's finite-lived intangible assets were as follows: Finite-Lived Intangible Assets Weighted-Average In years Customer contracts, customer lists and distribution agreements 4 Developed and core technology and patents 4 Trade name and trade marks 4 As of October 31, 2018 , estimated future amortization expense related to finite-lived intangible assets was as follows: Fiscal year In millions 2019 $ 248 2020 197 2021 126 2022 92 2023 68 Thereafter 40 Total $ 771 |
Fair Value
Fair Value | 12 Months Ended |
Oct. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. Fair Value Hierarchy The Company uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs. Level 3—Unobservable inputs for the asset or liability. The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs. The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis: As of October 31, 2018 As of October 31, 2017 Fair Value Fair Value Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total In millions Assets Cash Equivalents and Investments: Time deposits $ — $ 781 $ — $ 781 $ — $ 1,159 $ — $ 1,159 Money market funds 2,340 — — 2,340 5,592 — — 5,592 Foreign bonds 7 124 — 131 9 214 — 223 Other debt securities — — 25 25 — — 26 26 Derivative Instruments: Foreign exchange contracts — 496 — 496 — 259 — 259 Other derivatives — — — — — 1 — 1 Total assets $ 2,347 $ 1,401 $ 25 $ 3,773 $ 5,601 $ 1,633 $ 26 $ 7,260 Liabilities Derivative Instruments: Interest rate contracts $ — $ 353 $ — $ 353 $ — $ 142 $ — $ 142 Foreign exchange contracts — 117 — 117 — 335 — 335 Other derivatives — 6 — 6 — — — — Total liabilities $ — $ 476 $ — $ 476 $ — $ 477 $ — $ 477 For the fiscal years ended October 31, 2018 and 2017, there were no transfers between levels within the fair value hierarchy. Valuation Techniques Cash Equivalents and Investments: The Company holds time deposits, money market funds, debt securities primarily consisting of corporate and foreign government notes and bonds. The Company values cash equivalents using quoted market prices, alternative pricing sources, including net asset value, or models utilizing market observable inputs. The fair value of debt investments was based on quoted market prices or model-driven valuations using inputs primarily derived from or corroborated by observable market data, and, in certain instances, valuation models that utilize assumptions which cannot be corroborated with observable market data. Derivative Instruments: The Company uses forward contracts, interest rate and total return swaps to hedge certain foreign currency and interest rate exposures. The Company uses industry standard valuation models to measure fair value. Where applicable, these models project future cash flows and discount the future amounts to present value using market-based observable inputs, including interest rate curves, the Company and counterparties' credit risk, foreign currency exchange rates, and forward and spot prices for currencies and interest rates. See Note 14, "Financial Instruments", for a further discussion of the Company's use of derivative instruments. Other Fair Value Disclosures Short- and Long-Term Debt: The Company estimates the fair value of its debt primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities, and considering its own credit risk. The portion of the Company's debt that is hedged is reflected in the Consolidated Balance Sheets as an amount equal to the debt's carrying amount and a fair value adjustment representing changes in the fair value of the hedged debt obligations arising from movements in benchmark interest rates. At October 31, 2018, the estimated fair value of the Company's short-term and long-term debt was $12.2 billion and the carrying value was $12.1 billion . As of October 31, 2017, the estimated fair value of the Company's short-term and long-term debt was $14.6 billion and the carrying value was $14.0 billion . If measured at fair value in the Consolidated Balance Sheets, short-term and long-term debt would be classified in Level 2 of the fair value hierarchy. Other Financial Instruments: For the balance of the Company's financial instruments, primarily accounts receivable, accounts payable and financial liabilities included in other accrued liabilities, the carrying amounts approximate fair value due to their short maturities. If measured at fair value in the Consolidated Balance Sheets, these other financial instruments would be classified in Level 2 or Level 3 of the fair value hierarchy. Non-Marketable Equity Investments and Non-Financial Assets: The Company's non-marketable equity investments and non-financial assets, such as intangible assets, goodwill and property, plant and equipment, are recorded at fair value in the period an impairment charge is recognized. If measured at fair value in the Consolidated Balance Sheets, these would generally be classified in Level 3 of the fair value hierarchy. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Oct. 31, 2018 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | Financial Instruments Cash Equivalents and Available-for-Sale Investments Cash equivalents and available-for-sale investments were as follows: As of As of Cost Gross Gross Fair Cost Gross Gross Fair In millions Cash Equivalents: Time deposits $ 781 $ — $ — $ 781 $ 1,159 $ — $ — $ 1,159 Money market funds 2,340 — — 2,340 5,592 — — 5,592 Total cash equivalents 3,121 — — 3,121 6,751 — — 6,751 Available-for-Sale Investments: Foreign bonds 113 18 — 131 183 40 — 223 Other debt securities 26 — (1 ) 25 37 — (11 ) 26 Total available-for-sale investments 139 18 (1 ) 156 220 40 (11 ) 249 Total cash equivalents and available-for-sale investments $ 3,260 $ 18 $ (1 ) $ 3,277 $ 6,971 $ 40 $ (11 ) $ 7,000 All highly liquid investments with original maturities of three months or less at the date of acquisition are considered cash equivalents. As of October 31, 2018 and 2017 , the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. Interest income related to cash, cash equivalents and debt securities was approximately $104 million in fiscal 2018 and 2017 and $105 million in fiscal 2016 . Time deposits were primarily issued by institutions outside the U.S. as of October 31, 2018 and 2017 . The estimated fair value of the available-for-sale investments may not be representative of values that will be realized in the future. Contractual maturities of investments in available-for-sale debt securities were as follows: As of Amortized Fair Value In millions Due in more than five years $ 139 $ 156 Equity securities in privately held companies that are accounted for as cost basis investments are included in Long-term financing receivables and other assets in the Consolidated Balance Sheets. These investments amounted to $162 million and $149 million at October 31, 2018 and 2017 , respectively. Investments in equity securities that are accounted for using the equity method are included in Investments in equity interests in the Consolidated Balance Sheets. These amounted to $2.4 billion and $2.5 billion at October 31, 2018 and 2017 , respectively. For additional information, see Note 21, "Equity Method Investments". Derivative Instruments The Company is a global company exposed to foreign currency exchange rate fluctuations and interest rate changes in the normal course of its business. As part of its risk management strategy, the Company uses derivative instruments, primarily forward contracts, interest rate swaps and total return swaps to hedge certain foreign currency, interest rate and, to a lesser extent, equity exposures. The Company's objective is to offset gains and losses resulting from these exposures with losses and gains on the derivative contracts used to hedge them, thereby reducing volatility of earnings or protecting the fair value of assets and liabilities. The Company does not have any leveraged derivatives and does not use derivative contracts for speculative purposes. The Company may designate its derivative contracts as fair value hedges, cash flow hedges or hedges of the foreign currency exposure of a net investment in a foreign operation ("net investment hedges"). Additionally, for derivatives not designated as hedging instruments, the Company categorizes those economic hedges as other derivatives. Derivative instruments are recognized at fair value in the Consolidated Balance Sheets. The change in fair value of the derivative instruments is recognized in the Consolidated Statements of Earnings or Consolidated Statements of Comprehensive Income depending upon the type of hedge as further discussed below. The Company classifies cash flows from its derivative programs with the activities that correspond to the underlying hedged items in the Consolidated Statements of Cash Flows. As a result of its use of derivative instruments, the Company is exposed to the risk that its counterparties will fail to meet their contractual obligations. To mitigate counterparty credit risk, the Company has a policy of only entering into derivative contracts with carefully selected major financial institutions based on their credit ratings and other factors, and the Company maintains dollar risk limits that correspond to each financial institution's credit rating and other factors. The Company's established policies and procedures for mitigating credit risk include reviewing and establishing limits for credit exposure and periodically reassessing the creditworthiness of its counterparties. Master netting agreements also mitigate credit exposure to counterparties by permitting the Company to net amounts due from the Company to a counterparty against amounts due to the Company from the same counterparty under certain conditions. To further mitigate credit exposure to counterparties, the Company has collateral security agreements, which allows the Company to hold collateral from, or require the Company to post collateral to counterparties when aggregate derivative fair values exceed contractually established thresholds which are generally based on the credit ratings of the Company and its counterparties. If the Company's credit rating falls below a specified credit rating, the counterparty has the right to request full collateralization of the derivatives' net liability position. Conversely, if the counterparty's credit rating falls below a specified credit rating, the Company has the right to request full collateralization of the derivatives' net liability position. Collateral is generally posted within two business days. The fair value of the Company's derivatives with credit contingent features in a net liability position was $290 million and $265 million at October 31, 2018 and 2017 , respectively, all of which were fully collateralized within two business days. Under the Company's derivative contracts, the counterparty can terminate all outstanding trades following a covered change of control event affecting the Company that results in the surviving entity being rated below a specified credit rating. This credit contingent provision did not affect the Company's financial position or cash flows as of October 31, 2018 and 2017 . Fair Value Hedges The Company issues long-term debt in U.S. dollars based on market conditions at the time of financing. The Company may enter into fair value hedges, such as interest rate swaps, to reduce the exposure of its debt portfolio to changes in fair value resulting from changes in interest rates by achieving a primarily U.S. dollar LIBOR-based floating interest rate. The swap transactions generally involve principal and interest obligations for U.S. dollar-denominated amounts. Alternatively, the Company may choose not to swap fixed for floating interest payments or may terminate a previously executed swap if it believes a larger proportion of fixed-rate debt would be beneficial. When investing in fixed-rate instruments, the Company may enter into interest rate swaps that convert the fixed interest payments into variable interest payments and may designate these swaps as fair value hedges. For derivative instruments that are designated and qualify as fair value hedges, the Company recognizes the change in fair value of the derivative instrument, as well as the offsetting change in the fair value of the hedged item, in Interest and other, net in the Consolidated Statements of Earnings in the period of change. Cash Flow Hedges The Company uses forward contracts designated as cash flow hedges to protect against the foreign currency exchange rate risks inherent in its forecasted net revenue and, to a lesser extent, cost of sales, operating expenses, and intercompany loans denominated in currencies other than the U.S. dollar. The Company's foreign currency cash flow hedges mature generally within twelve months ; however, forward contracts associated with sales-type and direct-financing leases and intercompany loans extend for the duration of the lease or loan term, which can extend up to five years. For derivative instruments that are designated and qualify as cash flow hedges, the Company initially records changes in fair value for the effective portion of the derivative instrument in Accumulated other comprehensive loss as a separate component of equity in the Consolidated Balance Sheets and subsequently reclassifies these amounts into earnings in the period during which the hedged transaction is recognized in earnings. The Company reports the effective portion of its cash flow hedges in the same financial statement line item as changes in the fair value of the hedged item. Net Investment Hedges The Company uses forward contracts designated as net investment hedges to hedge net investments in certain foreign subsidiaries whose functional currency is the local currency. The Company records the effective portion of such derivative instruments together with changes in the fair value of the hedged items in cumulative translation adjustment as a separate component of Equity in the Consolidated Balance Sheets. Other Derivatives Other derivatives not designated as hedging instruments consist primarily of forward contracts used to hedge foreign currency-denominated balance sheet exposures. The Company also uses total return swaps and, to a lesser extent, interest rate swaps, based on equity or fixed income indices, to hedge its executive deferred compensation plan liability. For derivative instruments not designated as hedging instruments, the Company recognizes changes in fair value of the derivative instrument, as well as the offsetting change in the fair value of the hedged item, in Interest and other, net in the Consolidated Statements of Earnings in the period of change. Hedge Effectiveness For interest rate swaps designated as fair value hedges, the Company measures hedge effectiveness by offsetting the change in fair value of the hedged items with the change in fair value of the derivative. For forward contracts designated as cash flow or net investment hedges, the Company measures hedge effectiveness by comparing the cumulative change in fair value of the hedge contract with the cumulative change in fair value of the hedged item, both of which are based on forward rates. The Company recognizes any ineffective portion of the hedge in the Consolidated Statements of Earnings in the same period in which ineffectiveness occurs. Amounts excluded from the assessment of effectiveness are recognized in the Consolidated Statements of Earnings in the period they arise. Fair Value of Derivative Instruments in the Consolidated Balance Sheets The gross notional and fair value of derivative instruments in the Consolidated Balance Sheets was as follows: As of As of Fair Value Fair Value Outstanding Other Long-Term Other Long-Term Outstanding Other Long-Term Other Long-Term In millions Derivatives designated as hedging instruments Fair value hedges: Interest rate contracts $ 6,850 $ — $ — $ — $ 353 $ 9,500 $ — $ — $ 16 $ 126 Cash flow hedges: Foreign currency contracts 8,423 270 107 11 15 7,202 105 45 101 70 Net investment hedges: Foreign currency contracts 1,737 32 41 13 11 1,944 35 10 36 41 Total derivatives designated as hedging instruments 17,010 302 148 24 379 18,646 140 55 153 237 Derivatives not designated as hedging instruments Foreign currency contracts 6,780 41 5 55 12 9,552 61 3 79 8 Other derivatives 104 — — 6 — 96 1 — — — Total derivatives not designated as hedging instruments 6,884 41 5 61 12 9,648 62 3 79 8 Total derivatives $ 23,894 $ 343 $ 153 $ 85 $ 391 $ 28,294 $ 202 $ 58 $ 232 $ 245 Offsetting of Derivative Instruments The Company recognizes all derivative instruments on a gross basis in the Consolidated Balance Sheets. The Company's derivative instruments are subject to master netting arrangements and collateral security arrangements. The Company does not offset the fair value of its derivative instruments against the fair value of cash collateral posted under collateral security agreements. As of October 31, 2018 and 2017 , information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements was as follows: As of In the Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 496 $ — $ 496 $ 179 $ 205 (1) $ 112 Derivative liabilities $ 476 $ — $ 476 $ 179 $ 302 (2) $ (5 ) As of In the Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 260 $ — $ 260 $ 209 $ 34 (1) $ 17 Derivative liabilities $ 477 $ — $ 477 $ 209 $ 242 (2) $ 26 (1) Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. (2) Represents the collateral posted by the Company in cash or through re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of October 31, 2018, $302 million of collateral posted was entirely cash. As of October 31, 2017, of the $242 million of collateral posted, $220 million was in cash and $22 million was through the re-use of counterparty collateral. Effect of Derivative Instruments on the Consolidated Statements of Earnings The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship for the fiscal years ended October 31, 2018 , 2017 and 2016 was as follows: Gains (Losses) Recognized in Income on Derivative and Related Hedged Item Derivative Instrument Location 2018 2017 2016 Hedged Item Location 2018 2017 2016 In millions In millions Interest rate contracts Interest and other, net $ (211 ) $ (245 ) $ 158 Fixed-rate debt Interest and other, net $ 211 $ 245 $ (158 ) The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the fiscal years ended October 31, 2018 , 2017 and 2016 was as follows: Gains (Losses) Gains (Losses) Reclassified from Accumulated OCI 2018 2017 2016 Location 2018 2017 2016 In millions In millions Cash flow hedges: Foreign currency contracts $ 163 $ (113 ) $ (71 ) Net revenue $ (24 ) $ (68 ) $ (48 ) Foreign currency contracts — (1 ) 1 Cost of products — — — Foreign currency contracts — — — Gain on H3C and MphasiS divestitures — — 8 Foreign currency contracts 6 159 236 Interest and other, net 16 170 243 Subtotal 169 45 166 Net earnings from continuing operations (8 ) 102 203 Foreign currency contracts — 1 60 Net loss from discontinued operations — 43 67 Total cash flow hedges $ 169 $ 46 $ 226 Net earnings $ (8 ) $ 145 $ 270 Net investment hedges: Foreign currency contracts $ 81 $ (71 ) $ (58 ) Interest and other, net $ — $ — $ — As of October 31, 2018 , 2017 and 2016 no portion of the hedging instruments' gain or loss was excluded from the assessment of effectiveness for fair value, cash flow or net investment hedges. Hedge ineffectiveness for fair value, cash flow and net investment hedges was not material for fiscal 2018 , 2017 and 2016 . As of October 31, 2018 , the Company expects to reclassify an estimated net accumulated other comprehensive gain of approximately $119 million , net of taxes, to earnings in the next twelve months along with the earnings effects of the related forecasted transactions associated with cash flow hedges. The pre-tax effect of derivative instruments not designated as hedging instruments on the Consolidated Statements of Earnings for the fiscal years ended October 31, 2018 , 2017 and 2016 was as follows: Gains (Losses) Recognized in Income on Derivatives Location 2018 2017 2016 In millions Foreign currency contracts Interest and other, net $ 301 $ (443 ) $ (425 ) Other derivatives Interest and other, net (6 ) 3 (4 ) Total $ 295 $ (440 ) $ (429 ) |
Borrowings
Borrowings | 12 Months Ended |
Oct. 31, 2018 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings Notes Payable and Short-Term Borrowings Notes payable and short-term borrowings, including the current portion of long-term debt, were as follows: As of October 31, 2018 2017 Amount Weighted-Average Amount Weighted-Average Dollars in millions Current portion of long-term debt $ 1,196 2.2 % $ 3,005 3.2 % FS Commercial paper 392 (0.2 )% 401 (0.1 )% Notes payable to banks, lines of credit and other (1) 417 2.5 % 444 1.8 % Total notes payable and short-term borrowings $ 2,005 $ 3,850 (1) Notes payable to banks, lines of credit and other includes $361 million and $390 million at October 31, 2018 and 2017 , respectively, of borrowing- and funding-related activity associated with FS and its subsidiaries. Long-Term Debt As of October 31, 2018 2017 In millions Hewlett Packard Enterprise Senior Notes $2,650 issued at discount to par at a price of 99.872% in October 2015 at 2.85%, due October 5, 2018, interest payable semi-annually on April 5 and October 5 of each year $ — $ 2,648 $250 issued at par in October 2015 at three-month USD LIBOR plus 1.93%, due October 5, 2018, interest payable quarterly on January 5, April 5, July 5 and October 5 of each year — 250 $1,100 issued at discount to par at a price of 99.994% in September 2017 at 2.10%, due October 4, 2019, interest payable semi-annually on April 4 and October 4 of each year 1,100 1,100 $3,000 issued at discount to par at a price of 99.972% in October 2015 at 3.6%, due October 15, 2020, interest payable semi-annually on April 15 and October 15 of each year 3,000 3,000 $500 issued at discount to par at a price of 99.861% in September 2018 at 3.5%, due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year 499 — $800 issued at par in September 2018 at three-month USD LIBOR plus 0.72% due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year 800 — $1,350 issued at discount to par at a price of 99.802% in October 2015 at 4.4%, due October 15, 2022, interest payable semi-annually on April 15 and October 15 of each year 1,348 1,348 $2,500 issued at discount to par at a price of 99.725% in October 2015 at 4.9%, due October 15, 2025, interest payable semi-annually on April 15 and October 15 of each year 2,495 2,495 $750 issued at discount to par at a price of 99.942% in October 2015 at 6.2%, due October 15, 2035, interest payable semi-annually on April 15 and October 15 of each year 750 750 $1,500 issued at discount to par at a price of 99.932% in October 2015 at 6.35%, due October 15, 2045, interest payable semi-annually on April 15 and October 15 of each year 1,499 1,499 Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030 (1) 236 286 Fair value adjustment related to hedged debt (353 ) (142 ) Unamortized debt issuance costs (42 ) (47 ) Less: current portion (1,196 ) (3,005 ) Total long-term debt $ 10,136 $ 10,182 (1) Other, including capital lease obligations includes $131 million and $160 million as of October 31, 2018 and 2017 , respectively, of borrowing- and funding-related activity associated with FS and its subsidiaries that are collateralized by receivables and underlying assets associated with the related capital and operating leases. For both the periods presented, the carrying amount of the assets approximated the carrying amount of the borrowings. Interest expense on borrowings recognized in the Consolidated Statements of Earnings was as follows: Fiscal years ended October 31, Expense Location 2018 2017 2016 In millions Financing interest Financing interest $ 278 $ 265 $ 249 Interest expense Interest and other, net 353 334 298 Total interest expense $ 631 $ 599 $ 547 Hewlett Packard Enterprise Senior Notes On September 19, 2018, the Company completed its offering of $1.3 billion of Senior Notes due October 5, 2021. The issuance consisted of $800 million floating rate Notes at three month USD LIBOR plus 0.72% , and $500 million fixed rate Notes at 3.50% . The net proceeds from this offering were used to fund the repayment of the $1.05 billion outstanding principal amount of the 2.85% Notes and the $250 million outstanding principal amount of the floating rate Notes that both were due in October 2018, and for general corporate purposes. On June 29, 2018, the Company redeemed $1.6 billion of its $2.65 billion Senior Notes with an original maturity date of October 5, 2018. These notes were fully hedged with interest rate swaps. As part of the transaction, HPE terminated and settled a proportional amount of the hedges, as well as allocated a proportional amount of unamortized discount and debt issuance costs to the retired debt. These costs, along with the redemption price of $1.6 billion resulted in an immaterial loss. On September 20, 2017, Hewlett Packard Enterprise completed its offering of $1.1 billion of new 2.100% registered Notes due October 4, 2019. The Company used the net proceeds to fund the repayment of the remaining $750 million outstanding principal amount of its 2.450% Notes due October 5, 2017 and the repayment of the $350 million outstanding principal amount of its floating rate Notes due October 5, 2017. On April 28, 2017, the Company used a portion of the $3.0 billion cash dividend received from Everett to redeem $1.5 billion face value of the 2.450% Senior Notes with an original maturity date of October 5, 2017. A proportional amount of unamortized discount and debt issuance costs were allocated to the retired debt. These costs, along with the redemption price of $1.5 billion resulted in an immaterial loss. On December 30, 2016, Hewlett Packard Enterprise exchanged new registered Notes for all of the outstanding $14.6 billion of unregistered Senior Notes. The terms of the new registered Notes in the exchange offer were substantially identical to the terms of the previously unregistered Senior Notes, except that the new Notes were registered under the Securities Act, and certain transfer restrictions, registration rights and additional interest provisions relating to the outstanding Senior Notes do not apply to the new Notes. As disclosed in Note 14, "Financial Instruments", the Company uses interest rate swaps to mitigate the exposure of its debt portfolio to changes in fair value resulting from changes in interest rates by achieving a primarily U.S. dollar LIBOR-based floating interest rate. As of October 31, 2018, the Company had entered into interest rate swaps to reduce the exposure of $6.9 billion of aggregate principal amount of fixed rate Senior Notes to changes in fair value resulting from changes in interest rates by achieving LIBOR-based floating interest rate. Interest rates on long-term debt in the table above have not been adjusted to reflect the impact of any interest rate swaps. Commercial Paper Hewlett Packard Enterprise's Board of Directors has authorized the issuance of up to $4.0 billion in aggregate principal amount of commercial paper by Hewlett Packard Enterprise. Hewlett Packard Enterprise's subsidiaries are authorized to issue up to an additional $500 million in aggregate principal amount of commercial paper. Hewlett Packard Enterprise maintains two commercial paper programs, and a wholly-owned subsidiary maintains a third program. Hewlett Packard Enterprise's U.S. program provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $4.0 billion . Hewlett Packard Enterprise's euro commercial paper program provides for the issuance of commercial paper outside of the U.S. denominated in U.S. dollars, euros or British pounds up to a maximum aggregate principal amount of $3.0 billion or the equivalent in those alternative currencies. The combined aggregate principal amount of commercial paper outstanding under those programs at any one time cannot exceed the $4.0 billion authorized by Hewlett Packard Enterprise's Board of Directors. The Hewlett Packard Enterprise subsidiary's euro Commercial Paper/Certificate of Deposit Program provides for the issuance of commercial paper in various currencies of up to a maximum aggregate principal amount of $500 million . As of October 31, 2018 and 2017, no borrowings were outstanding under Hewlett Packard Enterprise’s two commercial paper programs, and $392 million and $401 million , respectively, were outstanding under the subsidiary’s program. Revolving Credit Facility On November 1, 2015, the Company entered into a revolving credit facility (the "Credit Agreement"), together with the lenders named therein, JPMorgan Chase Bank, N.A. ("JPMorgan"), as co-administrative agent and administrative processing agent, and Citibank, N.A., as co-administrative agent, providing for a senior, unsecured revolving credit facility with aggregate lending commitments of $4.0 billion . Loans under the revolving credit facility may be used for general corporate purposes. Commitments under the Credit Agreement are available for a period of five years , which period may be extended, subject to satisfaction of certain conditions, by up to two , one -year periods. Commitment Fees, interest rates and other terms of borrowing under the credit facility vary based on Hewlett Packard Enterprise's external credit rating. As of October 31, 2018 and 2017, no borrowings were outstanding under the Credit Agreement. Future Maturities of Long-term Debt As of October 31, 2018 , aggregate future maturities of the Company's long-term debt at face value (excluding a fair value adjustment related to hedged debt of $353 million and a net discount on debt issuance of $9 million ), including capital lease obligations were as follows: Fiscal year In millions 2019 $ 1,201 2020 3,021 2021 1,344 2022 1,363 2023 16 Thereafter 4,791 Total $ 11,736 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Oct. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity Taxes related to Other Comprehensive Income (Loss) Fiscal years ended October 31, 2018 2017 2016 In millions Taxes on change in net unrealized losses on available-for-sale securities: Tax (provision) benefit on net unrealized losses arising during the period $ — $ (2 ) $ 2 Tax provision (benefit) on (gains) losses reclassified into earnings — 1 (2 ) — (1 ) — Taxes on change in net unrealized gains (losses) on cash flow hedges: Tax (provision) benefit on net unrealized gains arising during the period (22 ) 6 (14 ) Tax (benefit) provision on net losses (gains) reclassified into earnings (1 ) 10 25 (23 ) 16 11 Taxes on change in unrealized components of defined benefit plans: Tax benefit (provision) on (losses) gains arising during the period 2 (49 ) 63 Tax provision on amortization of actuarial loss and prior service benefit (14 ) (19 ) (20 ) Tax provision on curtailments, settlements and other (10 ) (91 ) (1 ) (22 ) (159 ) 42 Taxes on change in cumulative translation adjustment: Tax on cumulative translation adjustment arising during the period 3 (1 ) 20 Tax on release of cumulative translation adjustment as a result of divestitures — — (22 ) 3 (1 ) (2 ) Tax (provision) benefit on other comprehensive (loss) income $ (42 ) $ (145 ) $ 51 Changes and reclassifications related to Other Comprehensive Income (Loss), net of taxes Fiscal years ended October 31, 2018 2017 2016 In millions Other comprehensive (loss) income, net of taxes: Change in net unrealized losses on available-for-sale securities: Net unrealized losses arising during the period $ (3 ) $ (10 ) $ (2 ) (Gains) losses reclassified into earnings (9 ) (3 ) 1 (12 ) (13 ) (1 ) Change in net unrealized gains (losses) on cash flow hedges: Net unrealized gains arising during the period 147 52 212 Net losses (gains) reclassified into earnings (1) 7 (135 ) (245 ) 154 (83 ) (33 ) Change in unrealized components of defined benefit plans: (Losses) gains arising during the period (421 ) 895 (1,714 ) Amortization of actuarial loss and prior service benefit (2) 177 266 264 Curtailments, settlements and other 12 (76 ) (19 ) (232 ) 1,085 (1,469 ) Change in cumulative translation adjustment: Cumulative translation adjustment arising during the period (67 ) (15 ) (134 ) Release of cumulative translation adjustment as a result of divestitures and country exits 20 — 53 (47 ) (15 ) (81 ) Other comprehensive (loss) income, net of taxes $ (137 ) $ 974 $ (1,584 ) (1) For more details on reclassification of pre-tax losses (gains) on cash flow hedges into the Consolidated Statements of Earnings, see Note 14, "Financial Instruments". (2) These components are included in the computation of net pension and post-retirement benefit (credit) cost in Note 6, "Retirement and Post-Retirement Benefit Plans". The components of accumulated other comprehensive loss, net of taxes as of October 31, 2018 and changes during fiscal 2018 were as follows: Net unrealized Net unrealized Unrealized Cumulative Accumulated In millions Balance at beginning of period $ 29 $ (48 ) $ (2,690 ) $ (186 ) $ (2,895 ) Activity related to separation and merger transactions — — — (186 ) (186 ) Other comprehensive (loss) income before reclassifications (3 ) 147 (421 ) (67 ) (344 ) Reclassifications of (gains) losses into earnings (9 ) 7 189 20 207 Balance at end of period $ 17 $ 106 $ (2,922 ) $ (419 ) $ (3,218 ) Dividends On November 11, 2015 , the Company's Board of Directors authorized a regular quarterly cash dividend for its common stock. The stockholders of HPE common stock are entitled to receive dividends when and as declared by HPE's Board of Directors. On February 22, 2018, the Company announced an increase to the regular quarterly dividend from $0.075 per share to $0.1125 per share, which was effective in the third quarter of fiscal 2018. Dividends declared were $0.4875 per common share in fiscal 2018 and $0.26 per common share in fiscal 2017. Share Repurchase Program On October 13, 2015, the Company's Board of Directors approved a share repurchase program with a $3.0 billion authorization, which was refreshed with additional share repurchase authorizations of $3.0 billion , $5.0 billion and $2.5 billion on May 24, 2016, October 16, 2017 and February 21, 2018, respectively. The Company may choose to repurchase shares when sufficient liquidity exists and the shares are trading at a discount relative to estimated intrinsic value. This program, which does not have a specific expiration date, authorizes repurchases in the open market or in private transactions. For fiscal 2018, the Company repurchased and settled a total of 222 million shares under its share repurchase program through open market repurchases, which included 1.7 million shares that were unsettled open market purchase as of October 31, 2017. Additionally, the Company had unsettled open market repurchases of 2.4 million shares as of October 31, 2018. Shares repurchased during fiscal 2018 were recorded as a $3.6 billion reduction to stockholders' equity. As of October 31, 2018 , the Company had a remaining authorization of $4.7 billion for future share repurchases. For fiscal 2017, the Company repurchased and settled a total of 136 million shares under its share repurchase program through open market repurchases, and recorded a $2.6 billion reduction to stockholders' equity. As of October 31, 2017, the Company had unsettled open market repurchases of 1.7 million shares, which were recorded as a $24 million reduction to stockholders' equity. |
Net Earnings Per Share
Net Earnings Per Share | 12 Months Ended |
Oct. 31, 2018 | |
Earnings Per Share [Abstract] | |
Net Earnings Per Share | Net Earnings Per Share The Company calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes the weighted-average dilutive effect of restricted stock units, stock options, and performance-based awards. The reconciliations of the numerators and denominators of each of the basic and diluted net EPS calculations were as follows: Fiscal years ended October 31, 2018 2017 2016 In millions, except per share amounts Numerator: Net earnings from continuing operations $ 2,012 $ 436 $ 3,237 Net loss from discontinued operations (104 ) (92 ) (76 ) Net earnings $ 1,908 $ 344 $ 3,161 Denominator: Weighted-average shares used to compute basic net EPS 1,529 1,646 1,715 Dilutive effect of employee stock plans 24 28 24 Weighted-average shares used to compute diluted net EPS 1,553 1,674 1,739 Basic net earnings (loss) per share: Continuing operations $ 1.32 $ 0.26 $ 1.89 Discontinued operations (0.07 ) (0.05 ) (0.05 ) Basic net earnings per share $ 1.25 $ 0.21 $ 1.84 Diluted net earnings (loss) per share: Continuing operations $ 1.30 $ 0.26 $ 1.86 Discontinued operations (1) (0.07 ) (0.05 ) (0.04 ) Diluted net earnings per share $ 1.23 $ 0.21 $ 1.82 Anti-dilutive weighted-average stock awards (2) 2 8 32 (1) U.S. GAAP requires the denominator used in the diluted net EPS calculation for discontinued operations to be the same as that of continuing operations, regardless of net earnings (loss) from continuing operations. (2) The Company excludes shares potentially issuable under employee stock plans that could dilute basic net EPS in the future from the calculation of diluted net earnings (loss) per share, as their effect, if included, would have been anti-dilutive for the periods presented. |
Litigation and Contingencies
Litigation and Contingencies | 12 Months Ended |
Oct. 31, 2018 | |
Loss Contingency [Abstract] | |
Litigation and Contingencies | Litigation and Contingencies Hewlett Packard Enterprise is involved in various lawsuits, claims, investigations and proceedings including those consisting of intellectual property, commercial, securities, employment, employee benefits and environmental matters, which arise in the ordinary course of business. In addition, as part of the Separation and Distribution Agreement, Hewlett Packard Enterprise and HP Inc. (formerly known as "Hewlett-Packard Company") agreed to cooperate with each other in managing certain existing litigation related to both parties' businesses. The Separation and Distribution Agreement included provisions that allocate liability and financial responsibility for pending litigation involving the parties, as well as provide for cross-indemnification of the parties against liabilities to one party arising out of liabilities allocated to the other party. The Separation and Distribution Agreement also included provisions that assign to the parties responsibility for managing pending and future litigation related to the general corporate matters of HP Inc. arising prior to the Separation. Hewlett Packard Enterprise records a liability when it believes that it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Significant judgment is required to determine both the probability of having incurred a liability and the estimated amount of the liability. Hewlett Packard Enterprise reviews these matters at least quarterly and adjusts these liabilities to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other updated information and events pertaining to a particular matter. Litigation is inherently unpredictable. However, Hewlett Packard Enterprise believes it has valid defenses with respect to legal matters pending against us. Nevertheless, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these contingencies. Hewlett Packard Enterprise believes it has recorded adequate provisions for any such matters and, as of October 31, 2018 , it was not reasonably possible that a material loss had been incurred in connection with such matters in excess of the amounts recognized in its financial statements. Litigation, Proceedings and Investigations India Directorate of Revenue Intelligence Proceedings . On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the "DRI") issued show cause notices to Hewlett-Packard India Sales Private Ltd ("HP India"), a subsidiary of HP Inc., seven HP India employees and one former HP India employee alleging that HP India underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately $370 million , plus penalties. Prior to the issuance of the show cause notices, HP India deposited approximately $16 million with the DRI and agreed to post a provisional bond in exchange for the DRI's agreement to not seize HP India products and spare parts and to not interrupt the transaction of business by HP India. On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related show cause notice affirming certain duties and penalties against HP India and the named individuals of approximately $386 million , of which HP India had already deposited $9 million . On December 11, 2012, HP India voluntarily deposited an additional $10 million in connection with the products-related show cause notice. On April 20, 2012, the Commissioner issued an order on the parts-related show cause notice affirming certain duties and penalties against HP India and certain of the named individuals of approximately $17 million , of which HP India had already deposited $7 million . After the order, HP India deposited an additional $3 million in connection with the parts-related show cause notice so as to avoid certain penalties. HP India filed appeals of the Commissioner's orders before the Customs Tribunal along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The Customs Department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HP India to deposit an additional $24 million against the products order, which HP India deposited in March 2013. The Customs Tribunal did not order any additional deposit to be made under the parts order. In December 2013, HP India filed applications before the Customs Tribunal seeking early hearing of the appeals as well as an extension of the stay of deposit as to HP India and the individuals already granted until final disposition of the appeals. On February 7, 2014, the application for extension of the stay of deposit was granted by the Customs Tribunal until disposal of the appeals. On October 27, 2014, the Customs Tribunal commenced hearings on the cross-appeals of the Commissioner's orders. The Customs Tribunal rejected HP India's request to remand the matter to the Commissioner on procedural grounds. The hearings were scheduled to reconvene on April 6, 2015, and again on November 3, 2015 and April 11, 2016, but were canceled at the request of the Customs Tribunal. The hearing has been rescheduled for January 15, 2019. ECT Proceedings . In January 2011, the postal service of Brazil, Empresa Brasileira de Correios e Telégrafos ("ECT"), notified a former subsidiary of HP Inc. in Brazil ("HP Brazil") that it had initiated administrative proceedings to consider whether to suspend HP Brazil's right to bid and contract with ECT related to alleged improprieties in the bidding and contracting processes whereby employees of HP Brazil and employees of several other companies allegedly coordinated their bids and fixed results for three ECT contracts in 2007 and 2008. In late July 2011, ECT notified HP Brazil it had decided to apply the penalties against HP Brazil and suspend HP Brazil's right to bid and contract with ECT for five years, based upon the evidence before it. In August 2011, HP Brazil appealed ECT's decision. In April 2013, ECT rejected HP Brazil's appeal, and the administrative proceedings were closed with the penalties against HP Brazil remaining in place. In parallel, in September 2011, HP Brazil filed a civil action against ECT seeking to have ECT's decision revoked. HP Brazil also requested an injunction suspending the application of the penalties until a final ruling on the merits of the case. The court of first instance has not issued a decision on the merits of the case, but it has denied HP Brazil's request for injunctive relief. HP Brazil appealed the denial of its request for injunctive relief to the intermediate appellate court, which issued a preliminary ruling denying the request for injunctive relief but reducing the length of the sanctions from five to two years. HP Brazil appealed that decision and, in December 2011, obtained a ruling staying enforcement of ECT's sanctions until a final ruling on the merits of the case. HP Brazil expects the decision to be issued in 2018 and any subsequent appeal on the merits to last several years. Forsyth, et al. v. HP Inc. and Hewlett Packard Enterprise. This purported class and collective action was filed on August 18, 2016 and an amended complaint was filed on December 19, 2016 in the United States District Court for the Northern District of California, against HP Inc. and Hewlett Packard Enterprise alleging defendants violated the Federal Age Discrimination in Employment Act ("ADEA"), the California Fair Employment and Housing Act, California public policy and the California Business and Professions Code by terminating older workers and replacing them with younger workers. Plaintiffs seek to certify a nationwide collective action under the ADEA comprised of all individuals aged 40 and older who had their employment terminated by an HP entity pursuant to a work force reduction ("WFR") plan on or after December 9, 2014 for individuals terminated in deferral states and on or after April 8, 2015 in non-deferral states. Plaintiffs also seek to certify a Rule 23 class under California law comprised of all persons 40 years or older employed by defendants in the state of California and terminated pursuant to a WFR plan on or after August 18, 2012. On September 20, 2017, the court granted the defendants' motion to compel arbitration and administratively closed the case pending resolution of the arbitration proceedings. On November 30, 2017, three named plaintiffs filed a single arbitration demand. Thirteen additional plaintiffs later joined the arbitration. On December 22, 2017, defendants filed a motion to (1) stay the case pending arbitrations and (2) enjoin the demanded arbitration and require each plaintiff to file a separate arbitration demand. On February 6, 2018, the court granted the motion to stay and denied the motion to enjoin. The claims of the arbitration named plaintiffs have now been resolved. The Forsyth class action remains stayed. Jackson, et al. v. HP Inc. and Hewlett Packard Enterprise. This putative nationwide class action was filed on July 24, 2017 in federal district court in San Jose. Plaintiffs purport to bring the lawsuit on behalf of themselves and other similarly situated African-Americans and individuals over the age of forty. Plaintiffs allege that defendants engaged in a pattern and practice of racial and age discrimination in lay-offs and promotions. Plaintiffs filed an amended complaint on September 29, 2017. On January 12, 2018, defendants moved to transfer the matter to the federal district court in the Northern District of Georgia. Defendants also moved to dismiss the claims on various grounds and to strike certain aspects of the proposed class definition. On July 11, 2018, the court granted defendants' motion to dismiss this action for improper venue, and also partially dismissed and struck certain claims without prejudice to re-filing in the appropriate venue. On July 23, 2018, plaintiffs re-filed their lawsuit in the United States District Court for the Northern District of Georgia. On August 9, 2018, Plaintiffs filed a notice of appeal of the dismissal of the Northern District of California action with the Ninth Circuit Court of Appeals. On August 15, 2018, Plaintiffs filed a motion to stay their lawsuit in the Northern District of Georgia, which was granted by the court. Wall v. Hewlett Packard Enterprise Company and HP Inc. This certified California class action and Private Attorney General Act action was filed against Hewlett-Packard Company on January 17, 2012 and the fifth amended (and operative) complaint was filed against HP Inc. and Hewlett Packard Enterprise on June 28, 2016. The complaint alleges that the defendants paid earned incentive compensation late and failed to timely pay final wages in violation of the California Labor Code. On August 9, 2016, the court ordered the class certified without prejudice to a future motion to amend or modify the class certification order or to decertify. The scheduled January 22, 2018 trial date was vacated following the parties’ notification to the court that they had reached a preliminary agreement to resolve the dispute. The parties subsequently finalized and executed a settlement agreement and, on May 9, 2018, plaintiff filed a motion seeking preliminary approval of the settlement. On July 2, 2018, the court issued an order granting preliminary approval of the settlement. On November 9, 2018, the court declined to grant final approval of the settlement, and continued the final approval hearing to December 21, 2018. The court's primary concern related to the amount of attorneys' fees and costs requested by the plaintiffs' counsel as part of the class settlement. Ross and Rogus v. Hewlett Packard Enterprise Company. On November 8, 2018, a putative class action complaint was filed in Santa Clara County alleging that HPE pays its California-based female employees “systemically lower compensation” than HPE pays male employees performing substantially similar work. The complaint alleges various California state law claims, including California’s Equal Pay Act, Fair Employment and Housing Act, and Unfair Competition Law, and seeks certification of a California-only class of female employees employed in certain “Covered Positions.” Hewlett-Packard Company v. Oracle (Itanium). On June 15, 2011, HP Inc. filed suit against Oracle in Santa Clara Superior Court in connection with Oracle's March 2011 announcement that it was discontinuing software support for HP Inc.’s Itanium-based line of mission critical servers. HP Inc. asserted, among other things, that Oracle’s actions breached the contract that was signed by the parties as part of the settlement of the litigation relating to Oracle’s hiring of Mark Hurd. The matter eventually progressed to trial, which was bifurcated into two phases. HP Inc. prevailed in the first phase of the trial, in which the court ruled that the contract at issue required Oracle to continue to offer its software products on HP Inc.'s Itanium-based servers for as long as HP Inc. decided to sell such servers. Phase 2 of the trial was then postponed by Oracle’s appeal of the trial court’s denial of Oracle’s “anti-SLAPP” motion, in which Oracle argued that HP Inc.’s damages claim infringed on Oracle’s First Amendment rights. On August 27, 2015, the Court of Appeal rejected Oracle’s appeal. The matter was remanded to the trial court for Phase 2 of the trial, which began on May 23, 2016, and was submitted to the jury on June 29, 2016. On June 30, 2016, the jury returned a verdict in favor of HP Inc., awarding HP Inc. approximately $3 billion in damages: $1.7 billion for past lost profits and $1.3 billion for future lost profits. On October 20, 2016, the court entered judgment for this amount with interest accruing until the judgment is paid. Oracle’s motion for a new trial was denied on December 19, 2016, and Oracle filed its notice of appeal from the trial court’s judgment on January 17, 2017. On February 2, 2017, HP Inc. filed a notice of cross-appeal challenging the trial court’s denial of prejudgment interest. The schedule for appellate briefing and argument has not yet been established. HP Inc. expects that the appeals process could take several years to complete. Pursuant to the terms of the Separation and Distribution Agreement, HP Inc. and Hewlett Packard Enterprise will share equally in any recovery from Oracle once Hewlett Packard Enterprise has been reimbursed for all costs incurred in the prosecution of the action prior to the HP Inc. /Hewlett Packard Enterprise separation on November 1, 2015. Oracle America, Inc., et al. v. Hewlett Packard Enterprise Company (Terix copyright matter). On March 22, 2016, Oracle filed a complaint against HPE in the Northern District of California, alleging copyright infringement, interference with contract, intentional interference with prospective economic relations, and unfair competition. Oracle’s claims arise out of HPE’s prior use of a third-party maintenance provider named Terix Computer Company, Inc. (“Terix”). Oracle contends that in connection with HPE’s use of Terix as a subcontractor for certain customers of HPE’s multivendor support business, Oracle’s copyrights were infringed, and HPE is liable for vicarious and contributory infringement and related claims. The lawsuit against HPE follows a prior lawsuit brought by Oracle against Terix in 2013 relating to Terix’s alleged unauthorized provision of Solaris patches to customers on Oracle hardware. On June 14, 2018, the court heard oral argument on HPE's and Oracle's cross-motions for summary judgment. The court has not yet ruled on the parties' motions. Trial is scheduled to begin on March 4, 2019. Pursuant to the Separation and Distribution agreement between Hewlett-Packard Enterprise and DXC, this is a shared litigation as it relates to both parties’ businesses. Network-1 Technologies, Inc. v. Alcatel-Lucent USA Inc., et al. This patent infringement action was filed in September 2011 in the United States District Court for the Eastern District of Texas and alleges that various Hewlett Packard Enterprise switches and access points infringe Network-1’s patent relating to the 802.3af and 802.3at “Power over Ethernet” standards. The Network-1 patent at issue expires in 2020. A jury trial was conducted beginning on November 6, 2017. On November 13, 2017, the jury returned a verdict in favor of HPE, finding that HPE did not infringe Network-1’s patent and that the patent was invalid. On August 29 2018, the court denied Network-1's motion for a new trial on infringement and entered the jury's verdict finding that HPE does not infringe the relevant Network-1 patent. The court also granted Network-1's motion for Judgment as a Matter of Law on validity. Network-1 has appealed the jury verdict of non-infringement to the United States Court of Appeals for the Federal Circuit. HPE has cross-appealed the court’s decision to grant Network-1's motion for Judgment as a Matter of Law on validity. HPE expects appellate briefing to be completed by May 2019. DXC Technology Indemnification Demand. On March 27, 2018, DXC Technology (“DXC”) served an arbitration demand on HPE under the Separation and Distribution Agreement by and between HPE and DXC (f/k/a Everett SpinCo, Inc.) dated May 24, 2016, relating to the separation of HPE’s Enterprise Services business (the “ES Business”). The arbitration demand asserts that HPE is required to indemnify DXC for any transferred long-term capitalized lease obligations of the ES Business that exceed the threshold amount of $250 million . DXC contends that this $250 million threshold was exceeded by approximately $1.0 billion because the valuation of the assets underlying certain leases did not justify their classification as operating leases based on the terms of such leases, thereby rendering them long-term capitalized lease obligations. The arbitration demand follows DXC's November 8, 2017 request for indemnification on this same issue. The arbitration is scheduled to begin on February 4, 2019. HPE believes the relevant leases were properly classified as operating leases, DXC’s arbitration claim has no merit, and there is no basis for indemnification. HPE intends to vigorously defend its interests in this matter. Shared Litigation with HP Inc., DXC and Micro Focus As part of the Separation and Distribution Agreements between Hewlett Packard Enterprise and HP Inc., Hewlett Packard Enterprise and DXC, and Hewlett Packard Enterprise and Seattle SpinCo, the parties to each agreement agreed to cooperate with each other in managing certain existing litigation related to both parties' businesses. The Separation and Distribution Agreements also included provisions that assign to the parties responsibility for managing pending and future litigation related to the general corporate matters of HP Inc. (in the case of the separation of Hewlett Packard Enterprise from HP Inc.) or of Hewlett Packard Enterprise (in the case of the separation of DXC from Hewlett Packard Enterprise and the separation of Seattle SpinCo from Hewlett Packard Enterprise), in each case arising prior to the applicable separation. Environmental The Company's operations and products are or may in the future become subject to various federal, state, local and foreign laws and regulations concerning environmental protection, including laws addressing the discharge of pollutants into the air and water, the management and disposal of hazardous substances and wastes, the clean-up of contaminated sites, the substances and materials used in the Company's products, the energy consumption of products, services and operations and the operational or financial responsibility for recycling, treatment and disposal of those products. This includes legislation that makes producers of electrical goods, including servers and networking equipment, financially responsible for specified collection, recycling, treatment and disposal of past and future covered products (sometimes referred to as "product take-back legislation"). The Company could incur substantial costs, its products could be restricted from entering certain jurisdictions, and it could face other sanctions, if it were to violate or become liable under environmental laws or if its products become non-compliant with environmental laws. The Company's potential exposure includes impacts on revenue, fines and civil or criminal sanctions, third-party property damage or personal injury claims and clean-up costs. The amount and timing of costs to comply with environmental laws are difficult to predict. In particular, the Company may become a party to, or otherwise involved in, proceedings brought by U.S. or state environmental agencies under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), known as "Superfund," or other federal, state or foreign laws and regulations addressing the clean-up of contaminated sites, and may become a party to, or otherwise involved in, proceedings brought by private parties for contribution towards clean-up costs. The Company is also contractually obligated to make financial contributions to address actions related to certain environmental liabilities, both ongoing and arising in the future, pursuant to its Separation and Distribution Agreement with HP Inc. |
Guarantees, Indemnifications an
Guarantees, Indemnifications and Warranties | 12 Months Ended |
Oct. 31, 2018 | |
Guarantees [Abstract] | |
Guarantees, Indemnifications and Warranties | Guarantees, Indemnifications and Warranties Guarantees In the ordinary course of business, the Company may issue performance guarantees to certain of its clients, customers and other parties pursuant to which the Company has guaranteed the performance obligations of third parties. Some of those guarantees may be backed by standby letters of credit or surety bonds. In general, the Company would be obligated to perform over the term of the guarantee in the event a specified triggering event occurs as defined by the guarantee. The Company believes the likelihood of having to perform under a material guarantee is remote. The Company has entered into service contracts with certain of its clients that are supported by financing arrangements. If a service contract is terminated as a result of the Company's non-performance under the contract or failure to comply with the terms of the financing arrangement, the Company could, under certain circumstances, be required to acquire certain assets related to the service contract. The Company believes the likelihood of having to acquire a material amount of assets under these arrangements is remote. Indemnifications In the ordinary course of business, the Company enters into contractual arrangements under which the Company may agree to indemnify a third party to such arrangement from any losses incurred relating to the services they perform on behalf of the Company or for losses arising from certain events as defined within the particular contract, which may include, for example, litigation or claims relating to past performance. The Company also provides indemnifications to certain vendors and customers against claims of IP infringement made by third parties arising from the use by such vendors and customers of the Company's software products and support services and certain other matters. Some indemnifications may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial. General Cross-indemnification In connection with the Separation, the Company entered into a Separation and Distribution Agreement with HP Inc. effective November 1, 2015 where the Company agreed to indemnify HP Inc., each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to the Company as part of the Separation. HP Inc. similarly agreed to indemnify the Company, each of its subsidiaries and each of their respective directors, officers and employees from and against all claims and liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to HP Inc. as part of the Separation. In connection with the Everett and Seattle Transactions, the Company entered into a Separation and Distribution Agreement with DXC and Micro Focus, effective March 31, 2017 and September 1, 2017, respectively, where DXC and Micro Focus agreed to indemnify HPE, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to DXC and Micro Focus as part of the Everett and Seattle Transactions. HPE similarly agreed to indemnify DXC and Micro Focus, each of its subsidiaries and each of their respective directors, officers and employees from and against all claims and liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to the Company as part of the Everett and Seattle Transactions. Tax Matters Agreement with HP Inc., and Other Income Tax Matters In connection with the Separation, the Company entered into a Tax Matters Agreement (the "Tax Matters Agreement") with HP Inc. effective November 1, 2015 that governs the rights and obligations of the Company and HP Inc. for certain pre-Separation tax liabilities. The Tax Matters Agreement provides that the Company and HP Inc. will share certain pre-Separation income tax liabilities that arise from adjustments made by tax authorities to the Company and HP Inc.'s U.S. and certain non-U.S. income tax returns. In certain jurisdictions, the Company and HP Inc. have joint and several liability for past income tax liabilities and accordingly, the Company could be legally liable under applicable tax law for such liabilities and required to make additional tax payments. In these cases, the Company records the entire liability, which is partially offset by the indemnification receivable from HP Inc., thereby reflecting the Company's net exposure in its Consolidated Balance Sheets. In addition, if the Distribution of Hewlett Packard Enterprise's common shares to the HP Inc. stockholders are determined to be taxable, the Company and HP Inc. would share the tax liability equally, unless the taxability of the Distribution is the direct result of action taken by either the Company or HP Inc. subsequent to the Distribution in which case the party causing the Distribution to be taxable would be responsible for any taxes imposed on the Distribution. Tax Matters Agreement with DXC and Other Income Tax Matters In connection with the Everett Transaction, the Company entered into a Tax Matters Agreement (the "DXC Tax Matters Agreement") with DXC effective on April 1, 2017 that governs the rights and obligations of the Company and DXC for certain pre-divestiture tax liabilities and tax receivables. The DXC Tax Matters Agreement generally provides that the Company will be responsible for pre-divestiture tax liabilities and will be entitled to pre-divestiture tax receivables that arise from adjustments made by tax authorities to the Company and DXC's U.S. and certain non-U.S. tax returns. In certain jurisdictions the Company and DXC have joint and several liability for past tax liabilities and accordingly, the Company could be legally liable under applicable tax law for such liabilities and required to make additional tax payments. In addition, if the distribution of Everett's common shares to Hewlett Packard Enterprise's stockholders is determined to be taxable, the Company would generally bear the tax liability, unless the taxability of the distribution is the direct result of actions taken by DXC, in which case DXC would be responsible for any taxes imposed on the distribution. Tax Matters Agreement with Seattle and Other Income Tax Matters In connection with the Seattle Transaction, the Company entered into a Tax Matters Agreement (the "Micro Focus Tax Matters Agreement") with Micro Focus effective on September 1, 2017 that governs the rights and obligations of the Company and Micro Focus for certain pre-divestiture tax liabilities and tax receivables. The Micro Focus Tax Matters Agreement generally provides that the Company will be responsible for pre-divestiture tax liabilities and will be entitled to pre-divestiture tax receivables that arise from adjustments made by tax authorities to the Company and Micro Focus's U.S. and certain non-U.S. tax returns. In certain jurisdictions the Company and Micro Focus have joint and several liability for past tax liabilities and accordingly, the Company could be legally liable under applicable tax law for such liabilities and required to make additional tax payments. In addition, if the distribution of Seattle's common shares to Hewlett Packard Enterprise's stockholders is determined to be taxable, the Company would generally bear the tax liability, unless the taxability of the distribution is the direct result of actions taken by Micro Focus, in which case Micro Focus would be responsible for any taxes imposed on the distribution. As of October 31, 2018 and 2017, the Company’s receivable and payable balances related to indemnified litigation matters and other contingencies, and income tax-related indemnification covered by these agreements were as follows: As of October 31, 2018 2017 In millions Litigation matters and other contingencies Receivable $ 104 $ 150 Payable $ 83 $ 91 Income tax-related indemnification (1) Indemnification receivable - long-term (2) $ 16 $ 1,430 Indemnification receivable - short-term $ 17 $ — Indemnification payable - long-term $ 9 $ — Indemnification payable - short-term $ 26 $ 36 (1) The actual amount that the Company may receive or pay could vary depending upon the outcome of certain unresolved tax matters, which may not be resolved for several years. (2) Indemnification receivable - long-term in fiscal 2017 primarily included $1.3 billion from HP Inc. for certain tax liabilities that the Company is joint and severally liable for, but for which it is indemnified by HP Inc. under the Tax Matter Agreement, and which was partially settled during fiscal 2018. Warranties The Company accrues the estimated cost of product warranties at the time it recognizes revenue. The Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers; however, contractual warranty terms, repair costs, product call rates, average cost per call, current period product shipments and ongoing product failure rates, as well as specific product class failures outside of the Company's baseline experience, affect the estimated warranty obligation. The Company's aggregate product warranty liabilities and changes therein were as follows: Fiscal years ended October 31, 2018 2017 In millions Balance at beginning of year $ 475 $ 497 Accruals for warranties issued 265 292 Adjustments related to pre-existing warranties (10 ) (8 ) Settlements made (300 ) (306 ) Balance at end of year $ 430 $ 475 |
Commitments
Commitments | 12 Months Ended |
Oct. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Commitments Lease Commitments The Company leases certain real and personal property under non-cancelable operating leases. Certain leases require the Company to pay property taxes, insurance and routine maintenance, and include renewal options and escalation clauses. Rent expense on operating leases was approximately $289 million , $290 million and $307 million for fiscal 2018 , 2017 and 2016 , respectively. Property under capital leases is comprised primarily of building, equipment and furniture. Capital lease assets included in Property, plant and equipment in the Consolidated Balance Sheets were $61 million and $75 million as of October 31, 2018 and 2017 , respectively. Accumulated depreciation on the property under capital lease was $8 million and $16 million as of October 31, 2018 and 2017 , respectively. As of October 31, 2018 , future minimum lease commitments on the Company's operating leases were as follows: Fiscal Year In millions 2019 $ 226 2020 207 2021 152 2022 131 2023 116 Thereafter 387 Less: Sublease rental income (216 ) Total $ 1,003 Unconditional Purchase Obligations At October 31, 2018 , the Company had unconditional purchase obligations of approximately $0.6 billion . These unconditional purchase obligations include agreements to purchase goods or services that are enforceable and legally binding on the Company and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum or variable price provisions and the approximate timing of the transaction, as well as settlements that the Company has reached with third parties, requiring it to pay determined amounts over a specified period of time. These unconditional purchase obligations are related principally to software maintenance and support services and other items. Unconditional purchase obligations exclude agreements that are cancelable without penalty. As of October 31, 2018 , future unconditional purchase obligations were as follows: Fiscal Year In millions 2019 $ 257 2020 196 2021 110 2022 16 2023 9 Thereafter 49 Total $ 637 |
Equity Method Investments
Equity Method Investments | 12 Months Ended |
Oct. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investments The Company includes investments which are accounted for using the equity method, under Investments in equity interests on the Company's Consolidated Balance Sheets. As of October 31, 2018 and October 31, 2017 , the Company's Investments in equity interests were $2.4 billion and $2.5 billion , respectively, primarily related to a 49% equity interest in H3C. Investment in H3C In the periods presented, the Company recorded its interest in the net earnings of H3C along with an adjustment to eliminate unrealized profits on intra-entity sales, and the amortization of basis difference, within Earnings (loss) from equity interests in the Consolidated Statements of Earnings. During fiscals 2018 and 2017, the Company received a cash dividend of $164 million and $98 million , respectively, from H3C. This amount was accounted for as a return on investment and reflected as a reduction in the carrying balance of the Company's Investments in equity interests in its Consolidated Balance Sheets. The difference between the sale date carrying value of the Company's investment in H3C and its proportionate share of the net assets of H3C, created a basis difference of $2.5 billion, which was allocated as follows: In millions Equity method goodwill $ 1,674 Intangible assets 749 In-process research and development 188 Deferred tax liabilities (152 ) Other 75 Basis difference $ 2,534 The Company amortizes the basis difference over the estimated useful lives of the assets that gave rise to this difference. The weighted-average life of the H3C intangible assets is five years and is being amortized using the straight-line method. As of October 31, 2018 and 2017 , the Company determined that no impairment of its equity method investments existed. The Company recorded earnings from equity interests of $38 million in fiscal 2018 and loss from equity interests of $23 million and $76 million in fiscals 2017 and 2016 , respectively, in the Consolidated Statements of Earnings. For fiscal 2018 , Earnings (loss) from equity interests consists of the Company's share of H3C's net income of $192 million , partially offset by basis difference amortization of $151 million and an adjustment related to elimination of profit on intra-entity sales and withholding taxes of $3 million . For fiscal 2017 , Earnings (loss) from equity interests consists of basis difference amortization of $155 million , partially offset by the Company's share of H3C's net income of $127 million and an adjustment related to elimination of profit on intra-entity sales of $5 million . For fiscal 2016 , Earnings (loss) from equity interests consists of basis difference amortization of $93 million and an adjustment related to elimination of profit on intra-entity sales of $15 million , partially offset by the Company's share of H3C's net income of $32 million . The earnings and losses from equity interests are reflected as an adjustment to the carrying amount of Investments in equity interests in the Consolidated Balance Sheets as of October 31, 2018 and 2017 . The Company also has commercial arrangements with H3C to buy and sell HPE branded servers, storage and networking products and HPE Pointnext services. During fiscals 2018 , 2017 and 2016 , HPE recorded approximately $1.3 billion , $1.2 billion and $0.5 billion of sales to H3C and $273 million , $331 million and $169 million of purchases from H3C, respectively. Net payables due to H3C as of October 31, 2018 and 2017 were approximately $43 million and $64 million , respectively. |
Quarterly Summary
Quarterly Summary | 12 Months Ended |
Oct. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Summary | Quarterly Summary (Unaudited) (In millions, except per share amounts) For the three-month periods January 31 April 30 July 31 October 31 Net revenue $ 7,674 $ 7,468 $ 7,764 $ 7,946 Cost of sales 5,491 5,196 5,384 5,489 Research and development 388 402 434 439 Selling, general and administrative 1,202 1,227 1,203 1,219 Amortization of intangible assets 78 72 72 72 Restructuring charges 3 9 2 5 Transformation costs 245 123 131 (74 ) Impairment of goodwill — — — 88 Acquisition and other related charges 30 16 24 12 Separation costs (24 ) 26 (2 ) 12 Total costs and expenses 7,413 7,071 7,248 7,262 Earnings from continuing operations 261 397 516 684 Interest and other, net (21 ) (78 ) (64 ) (111 ) Tax indemnification adjustments (919 ) (425 ) 2 (12 ) Earnings (loss) from equity interests 22 (10 ) 11 15 (Loss) earnings from continuing operations before taxes (657 ) (116 ) 465 576 Benefit (provision) for taxes 2,139 966 (13 ) (1,348 ) Net earnings (loss) from continuing operations 1,482 850 452 (772 ) Net (loss) earnings from discontinued operations (46 ) (72 ) (1 ) 15 Net earnings (loss) $ 1,436 $ 778 $ 451 $ (757 ) Net earnings (loss) per share: Basic Continuing operations $ 0.93 $ 0.55 $ 0.30 $ (0.53 ) Discontinued operations (0.03 ) (0.05 ) — 0.01 Total basic net earnings (loss) per share $ 0.90 $ 0.50 $ 0.30 $ (0.52 ) Diluted Continuing operations $ 0.92 $ 0.54 $ 0.29 $ (0.53 ) Discontinued operations (0.03 ) (0.05 ) — 0.01 Total diluted net earnings (loss) per share $ 0.89 $ 0.49 $ 0.29 $ (0.52 ) Cash dividends declared per share $ 0.1500 $ 0.1125 $ 0.1125 $ 0.1125 Weighted-average shares used to compute net earnings (loss) per share: Basic 1,591 1,552 1,513 1,459 Diluted 1,619 1,582 1,531 1,459 Quarterly Summary (Unaudited) (In millions, except per share amounts) For the three-month periods January 31 April 30 July 31 October 31 Net revenue $ 6,902 $ 6,808 $ 7,501 $ 7,660 Cost of sales 4,689 4,799 5,306 5,383 Research and development 356 376 390 364 Selling, general and administrative 1,204 1,229 1,285 1,288 Amortization of intangible assets 66 72 97 86 Restructuring charges 83 69 152 113 Transformation costs — — 31 328 Disaster charges — — — 93 Acquisition and other related charges 44 50 56 53 Separation costs 11 30 5 202 Defined benefit plan settlement charges and remeasurement (benefit) (1) (4 ) (12 ) (22 ) (26 ) Total costs and expenses 6,449 6,613 7,300 7,884 Earnings (loss) from continuing operations 453 195 201 (224 ) Interest and other, net (78 ) (86 ) (87 ) (76 ) Tax indemnification adjustments (18 ) 7 10 (2 ) (Loss) earnings from equity interests (22 ) (3 ) 1 1 Earnings (loss) from continuing operations before taxes 335 113 125 (301 ) (Provision) benefit for taxes (84 ) (591 ) 160 679 Net earnings (loss) from continuing operations 251 (478 ) 285 378 Net earnings (loss) from discontinued operations 16 (134 ) (120 ) 146 Net earnings (loss) $ 267 $ (612 ) $ 165 $ 524 Net earnings (loss) per share: Basic Continuing operations $ 0.15 $ (0.29 ) $ 0.17 $ 0.23 Discontinued operations 0.01 (0.08 ) (0.07 ) 0.09 Total basic net earnings (loss) per share $ 0.16 $ (0.37 ) $ 0.10 $ 0.32 Diluted Continuing operations $ 0.15 $ (0.29 ) $ 0.17 $ 0.23 Discontinued operations 0.01 (0.08 ) (0.07 ) 0.09 Total diluted net earnings (loss) per share $ 0.16 $ (0.37 ) $ 0.10 $ 0.32 Cash dividends declared per share $ 0.130 $ 0.065 $ 0.065 $ — Weighted-average shares used to compute net earnings (loss) per share: Basic 1,669 1,658 1,641 1,618 Diluted 1,700 1,658 1,667 1,647 (1) Represents adjustments to the net periodic pension cost resulting from remeasurements of certain Hewlett Packard Enterprise pension plans due to plan separations in connection with the Everett and Seattle Transactions. |
Overview and Summary of Signi_2
Overview and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 31, 2018 | |
Accounting Policies [Abstract] | |
Discontinued Operations | Discontinued Operations On April 1, 2017, HPE completed the separation and merger of its Enterprise Services business with Computer Sciences Corporation (“CSC”) (collectively, the “Everett Transaction”). HPE transferred its Enterprise Services business to Everett SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Everett") and distributed all of the shares of Everett to HPE stockholders. Following the distribution, New Everett Merger Sub Inc., a wholly-owned subsidiary of Everett, merged with and into CSC and Everett changed its name to DXC Technology Company ("DXC"). On September 1, 2017, HPE completed the separation and merger of its Software business segment with Micro Focus International plc (“Micro Focus”) (collectively, the “Seattle Transaction”). HPE transferred its Software business segment to Seattle SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Seattle"), and distributed all of the shares of Seattle to HPE stockholders. Following the share distribution, Seattle MergerSub, Inc., an indirect, wholly-owned subsidiary of Micro Focus, merged with and into Seattle. HPE had entered into several agreements with each of DXC and Micro Focus that govern the relationship between the parties, including the following: • Separation and Distribution Agreement; • Transition Services Agreement; • Tax Matters Agreement; • Employee Matters Agreement; • Real Estate Matters Agreement; • Intellectual Property Matters Agreement • Information Technology Service Agreement; and • Preferred Vendor Agreements. These agreements provided for the allocation of assets, employees, liabilities and obligations (including its investments, property, employee benefits, litigation, and tax-related assets and liabilities) between HPE and DXC and HPE and Micro Focus, respectively, attributable to periods prior to, at and after the transactions. Obligations under the service and commercial contracts generally extend through five years. |
Basis of Presentation | Basis of Presentation The historical results of operations and financial position of both Everett and Seattle are reported as discontinued operations in the Consolidated Statements of Earnings and the Consolidated Balance Sheets. The historical information in the accompanying Notes to the Consolidated Financial Statements has been restated to reflect the effects of the Everett Transaction and the Seattle Transaction. For further information on discontinued operations, see Note 2, "Discontinued Operations". |
Principles of Combination and Consolidation | Principles of Consolidation and Combination The accompanying Consolidated Financial Statements include the accounts of the Company and other subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary. All intercompany transactions and accounts within the consolidated businesses of the Company have been eliminated. Intercompany transactions between the Company and former Parent, prior to the Separation, are considered to be effectively settled in the Consolidated and Combined Financial Statements at the time the transaction was recorded. The total net effect of the settlement of these intercompany transactions is reflected in the Consolidated Statements of Cash Flows within financing activities. The Company accounts for investments in companies over which it has the ability to exercise significant influence but does not hold a controlling interest under the equity method of accounting, and the Company records its proportionate share of income or losses in Earnings (loss) from equity interests in the Consolidated Statements of Earnings. Non-controlling interests are presented as a separate component within Total stockholders' equity in the Consolidated Balance Sheets. Net earnings attributable to non-controlling interests are recorded within Interest and other, net in the Consolidated Statements of Earnings and are not presented separately, as they were not material for any period presented. Segment Realignment During the first quarter of fiscal 2018, the Company completed an organizational change in certain segment and business unit realignments in order to align its segment financial reporting more closely with its current business structure. Reclassifications of certain prior year segment and business unit financial information have been made to conform to the current-year presentation. None of the changes impact the Company's previously reported consolidated net revenue, earnings from operations, net earnings or net earnings per share ("EPS"). See Note 3, "Segment Information", for a further discussion of the Company's segment realignment. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the Company's Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates. |
Foreign Currency Translation | Foreign Currency Translation The Company predominately uses the U.S. dollar as its functional currency. Assets and liabilities denominated in non-U.S. currencies are remeasured into U.S. dollars at current exchange rates for monetary assets and liabilities and at historical exchange rates for non-monetary assets and liabilities. Net revenue, costs and expenses denominated in non-U.S. currencies are recorded in U.S. dollars at the average rates of exchange prevailing during the period. The Company includes gains or losses from foreign currency remeasurement in Interest and other, net in the Consolidated Statements of Earnings and gains and losses from cash flow hedges in Net revenue as the hedged revenue is recognized. Certain non-U.S. subsidiaries designate the local currency as their functional currency, and the Company records the translation of their assets and liabilities into U.S. dollars at the balance sheet date as translation adjustments and includes them as a component of Accumulated other comprehensive loss in the Consolidated Balance Sheets. The effect of foreign currency exchange rates on cash and cash equivalents was not material for any of the fiscal years presented. |
Former Parent Company Investment | Former Parent Company Investment Former Parent company investment in Consolidated Statements of Stockholders' Equity represents former Parent's historical investment in the Company, the net effect of transactions with and allocations from former Parent and the Company's accumulated earnings. In December 2015, in connection with the Separation and Distribution Agreement, the Company received a net cash allocation of $526 million from former Parent. The cash allocation was based on the projected cash requirements of the Company, in light of the intended investment grade credit rating, business plan and anticipated operations and activities. Former Parent historically used a centralized approach to manage cash and finance its operations. Prior to the Separation, transactions between the Company and former Parent were considered to be effectively settled for cash at the time the transaction was recorded. The net effect of these transactions is included in Net transfer from former Parent in the Consolidated Statements of Cash Flows. |
Revenue Recognition | Revenue Recognition General The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services are rendered, the sales price or fee is fixed or determinable, and collectability is reasonably assured. Additionally, the Company recognizes hardware revenue on sales to channel partners, including resellers, distributors or value-added solution providers at the time of delivery when the channel partners have economic substance apart from the Company, and the Company has completed its obligations related to the sale. The Company generally recognizes revenue for its standalone software sales to channel partners on receipt of evidence that the software has been sold to a specific end user. The Company limits the amount of revenue recognized for delivered elements to the amount that is not contingent on the future delivery of products or services, future performance obligations or subject to customer-specified refund or return rights. The Company reduces revenue for customer and distributor programs and incentive offerings, including price protection, rebates, promotions, other volume-based incentives, and expected returns, at the later of the date of revenue recognition or the date the sales incentive is offered. Future market conditions and product transitions may require the Company to take actions to increase customer incentive offerings, possibly resulting in an incremental reduction of revenue at the time the incentive is offered. For certain incentive programs, the Company estimates the number of customers expected to redeem the incentive based on historical experience and the specific terms and conditions of the incentive. In instances when revenue is derived from sales of third-party vendor products or services, the Company records revenue on a gross basis when the Company is a principal to the transaction and on a net basis when the Company is acting as an agent between the customer and the vendor. The Company considers several factors to determine whether it is acting as a principal or an agent, most notably whether the Company is the primary obligor to the customer, has established its own pricing and has inventory and credit risks. The Company reports revenue net of any taxes collected from customers and remitted to government authorities, with the collected taxes recorded as current liabilities until remitted to the relevant government authority. Multiple element arrangements When a sales arrangement contains multiple elements or deliverables, such as hardware and software products, and/or services, the Company allocates revenue to each element based on a selling price hierarchy. The selling price for a deliverable is based on its vendor specific objective evidence ("VSOE") of selling price, if available, third-party evidence ("TPE") if VSOE of selling price is not available, or estimated selling price ("ESP") if neither VSOE of selling price nor TPE is available. The Company establishes VSOE of selling price using the price charged for a deliverable when sold separately and, in rare instances, using the price established by management having the relevant authority. The Company establishes TPE of selling price by evaluating largely similar and interchangeable competitor products or services in standalone sales to similarly situated customers. The Company establishes ESP based on management judgment considering internal factors such as margin objectives, pricing practices and controls, customer segment pricing strategies and the product life-cycle. Consideration is also given to market conditions such as competitor pricing strategies and technology industry life-cycles. In most arrangements with multiple elements, the Company allocates the transaction price to the individual units of accounting at inception of the arrangement based on their relative selling price. In multiple element arrangements that include software that is more-than-incidental, the Company allocates the transaction price to the individual units of accounting for the non-software deliverables and to the software deliverables as a group using the relative selling price of each of the deliverables in the arrangement based on the selling price hierarchy. If the arrangement contains more than one software deliverable, the transaction price allocated to the group of software deliverables is then allocated to each component software deliverable. The Company evaluates each deliverable in an arrangement to determine whether it represents a separate unit of accounting. A deliverable constitutes a separate unit of accounting when it has standalone value to the customer. For elements with no standalone value, the Company recognizes revenue consistent with the pattern of the undelivered elements. If the arrangement includes a customer-negotiated refund or return right or other contingency relative to the delivered items, and the delivery and performance of the undelivered items is considered probable and substantially within the Company's control, the delivered element constitutes a separate unit of accounting. In arrangements with combined units of accounting, changes in the allocation of the transaction price among elements may impact the timing of revenue recognition for the contract but will not change the total revenue recognized for the contract. Product revenue Hardware Under the Company's standard terms and conditions of sale, the Company transfers title and risk of loss to the customer at the time product is delivered to the customer and recognizes revenue accordingly, unless customer acceptance is uncertain or significant obligations to the customer remain. The Company reduces revenue for estimated customer returns, price protection, rebates and other programs offered under sales agreements established by the Company with its distributors and resellers. The Company records revenue from the sale of equipment under sales-type leases as product revenue at the inception of the lease. The Company accrues the estimated cost of post-sale obligations, including standard product warranties, based on historical experience at the time the Company recognizes revenue. Software The Company recognizes revenue from perpetual software licenses at the inception of the license term, assuming all revenue recognition criteria have been satisfied. Term-based software license revenue is generally recognized ratably over the term of the license. The Company uses the residual method to allocate revenue to software licenses at the inception of the arrangement when VSOE of fair value for all undelivered elements, such as post-contract customer support, exists and all other revenue recognition criteria have been satisfied. The Company recognizes revenue from maintenance and unspecified upgrades or updates provided on a when-and-if-available basis ratably over the period during which such items are delivered. The Company recognizes revenue for software-as-a-service ("SaaS") arrangements as the service is delivered, generally on a straight-line basis, over the contractual period of performance. Services revenue The Company recognizes revenue from fixed-price support or maintenance contracts, including extended warranty contracts and software post-contract customer support agreements, ratably over the contract period and recognizes the costs associated with these contracts as incurred. For time and material contracts, the Company recognizes revenue as services are rendered and recognizes costs as they are incurred. The Company recognizes revenue from certain fixed-price contracts, such as consulting arrangements, as work progresses over the contract period on a proportional performance basis, as determined by the percentage of labor costs incurred to date compared to the total estimated labor costs of a contract. Estimates of total project costs for fixed-price contracts are regularly reassessed during the life of a contract. Provisions for estimated losses on fixed-priced contracts are recognized in the period when such losses become known. If reasonable and reliable cost estimates for a project cannot be made, the Company uses the completed contract method and recognizes revenue and costs upon service completion. The Company recognizes revenue from operating leases on a straight-line basis as service revenue over the rental period. Financing income Sales-type and direct-financing leases produce financing income, which the Company recognizes at consistent rates of return over the lease term. Deferred revenue The Company records amounts invoiced to customers in excess of revenue recognized as deferred revenue until the revenue recognition criteria are satisfied. The Company records revenue that is earned and recognized in excess of amounts invoiced on services contracts as trade receivables. Deferred revenue represents amounts invoiced in advance for product support contracts, software customer support contracts, consulting and integration projects, product sales or leasing income. |
Shipping and Handling | Shipping and Handling The Company includes costs related to shipping and handling in Cost of products. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense is based on the measurement date fair value of the award and is recognized only for those awards expected to meet the service and performance vesting conditions on a straight-line basis over the requisite service period of the award. Stock-based compensation expense is determined at the aggregate grant level for service-based awards and at the individual vesting tranche level for awards with performance and/or market conditions. The forfeiture rate is estimated based on historical experience. Stock Options Stock options granted under the Plan are generally non-qualified stock options, but the Plan permits some options granted to qualify as incentive stock options under the U.S. Internal Revenue Code. The exercise price of a stock option is equal to the closing price of the Company's common stock on the option grant date. The majority of the stock options issued by the Company contain only service vesting conditions. The Company has also issued performance-contingent stock options that vest only on the satisfaction of both service and market conditions. In fiscal 2018, the Company did not issue stock options. The Company utilizes the Black-Scholes-Merton option pricing formula to estimate the fair value of stock options subject to service-based vesting conditions. The Company estimates the fair value of stock options subject to performance-contingent vesting conditions using a combination of a Monte Carlo simulation model and a lattice model, as these awards contain market conditions. |
Retirement and Post-Retirement Plans | Retirement and Post-Retirement Plans The Company has various defined benefit, other contributory and noncontributory, retirement and post-retirement plans. The Company generally amortizes unrecognized actuarial gains and losses on a straight-line basis over the average remaining estimated service life or, in the case of closed plans, life expectancy of participants. In limited cases, actuarial gains and losses are amortized using the corridor approach. See Note 6, “Retirement and Post-Retirement Benefit Plans” for a full description of these plans and the accounting and funding policies. |
Advertising | Advertising Costs to produce advertising are expensed as incurred during production. Costs to communicate advertising are expensed when the advertising is first run. |
Restructuring | Restructuring The Company records charges associated with approved restructuring plans to reorganize one or more of the Company's business segments, to remove duplicative headcount and infrastructure associated with business acquisitions or to simplify business processes and accelerate innovation. Restructuring charges can include severance costs to eliminate a specified number of employees, infrastructure charges to vacate facilities and consolidate operations, and contract cancellation costs. The Company records restructuring charges based on estimated employee terminations and site closure and consolidation plans. The Company accrues for severance and other employee separation costs under these actions when it is probable that benefits will be paid and the amount is reasonably estimable. The rates used in determining severance accruals are based on existing plans, historical experiences and negotiated settlements. |
Taxes on Earnings | Taxes on Earnings The Company recognizes deferred tax assets and liabilities for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts using enacted tax rates in effect for the year the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is more likely than not to realize. In determining the need for a valuation allowance, the Company considers future market growth, forecasted earnings, future sources of taxable income, the mix of earnings in the jurisdictions in which the Company operates, and prudent and feasible tax planning strategies. In the event the Company were to determine that it is more likely than not that the Company will be unable to realize all or part of its deferred tax assets in the future, the Company would increase the valuation allowance and recognize a corresponding charge to earnings or other comprehensive income in the period in which such a determination were made. Likewise, if the Company later determines that the deferred tax assets are more likely than not to be realized, the Company would reverse the applicable portion of the previously recognized valuation allowance. In order for the Company to realize deferred tax assets, the Company must be able to generate sufficient taxable income in the jurisdictions in which the deferred tax assets are located. The Company records accruals for uncertain tax positions when the Company believes that it is not more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The Company makes adjustments to these accruals when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. The provision for income taxes includes the effects of adjustments for uncertain tax positions, effects of settlement of certain pre-Separation Hewlett-Packard Company income tax liabilities, as well as any related interest and penalties. Hewlett Packard Enterprise believes it has provided adequate reserves for all tax deficiencies or reductions in tax benefits that could result from federal, state and foreign tax audits. The Company regularly assesses the likely outcomes of these audits in order to determine the appropriateness of the Company's tax provision. The Company adjusts its uncertain tax positions to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular audit. However, income tax audits are inherently unpredictable and there can be no assurance that the Company will accurately predict the outcome of these audits. The amounts ultimately paid on resolution of an audit could be materially different from the amounts previously included in the provision for taxes and therefore the resolution of one or more of these uncertainties in any particular period could have a material impact on net earnings or cash flows. Hewlett Packard Enterprise is joint and severally liable for certain pre-Separation tax liabilities of HP Inc. HP Inc. is subject to numerous ongoing audits by federal, state and foreign tax authorities. The IRS is conducting an audit of HP Inc.’s 2013, 2014 and 2015 income tax returns. Hewlett Packard Enterprise has not provided for U.S. federal income and foreign withholding taxes on $7.9 billion of undistributed earnings and basis differences from non-U.S. operations as of October 31, 2018 because the Company intends to reinvest such earnings indefinitely outside of the U.S. Such amounts have materially decreased from October 31, 2017 , due to the impacts of the Tax Act that required U.S. taxation on largely all undistributed foreign earnings. Determination of the amount of unrecognized deferred tax liability related to these earnings and basis differences is not practicable. The Company will remit non-indefinitely reinvested earnings of its non-U.S. subsidiaries for which deferred U.S. federal and withholding taxes have been provided where excess cash has accumulated and the Company determines that it is advantageous for business operations, tax or cash management reasons. Deferred Income Taxes Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. |
Accounts Receivable | Accounts Receivable The Company establishes an allowance for doubtful accounts for accounts receivable. The Company records a specific reserve for individual accounts when the Company becomes aware of specific customer circumstances, such as in the case of a bankruptcy filing or deterioration in the customer's operating results or financial position. If there are additional changes in circumstances related to the specific customer, the Company further adjusts estimates of the recoverability of receivables. The Company maintains bad debt reserves for all other customers based on a variety of factors, including the use of third-party credit risk models that generate quantitative measures of default probabilities based on market factors, the financial condition of customers, the length of time receivables are past due, trends in the weighted-average risk rating for the portfolio, macroeconomic conditions, information derived from competitive benchmarking, significant one-time events, and historical experience. The past due or delinquency status of a receivable is based on the contractual payment terms of the receivable. |
Financing arrangements | The Company has third-party revolving short-term financing arrangements intended to facilitate the working capital requirements of certain customers. These financing arrangements, which in certain cases provide for partial recourse, result in the transfer of the Company's trade receivables to a third party. The Company reflects amounts transferred to, but not yet collected from, the third party in Accounts receivable in the Consolidated Balance Sheets. For arrangements involving an element of recourse, the fair value of the recourse obligation is measured using market data from similar transactions and reported as a current liability in Other accrued liabilities in the Consolidated Balance Sheets. |
Concentrations of Risk | Concentrations of Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents, investments, receivables from trade customers and contract manufacturers, financing receivables and derivatives. The Company maintains cash and cash equivalents, investments, derivatives, and certain other financial instruments with various financial institutions. These financial institutions are located in many different geographic regions, and the Company's policy is designed to limit exposure from any particular institution. As part of its risk management processes, the Company performs periodic evaluations of the relative credit standing of these financial institutions. The Company has not sustained material credit losses from instruments held at these financial institutions. The Company utilizes derivative contracts to protect against the effects of foreign currency and interest rate exposures. Such contracts involve the risk of non-performance by the counterparty, which could result in a material loss. Credit risk with respect to accounts receivable and financing receivables is generally diversified due to the large number of entities comprising the Company's customer base and their dispersion across many different industries and geographic regions. The Company performs ongoing credit evaluations of the financial condition of its customers and may require collateral, such as letters of credit and bank guarantees, in certain circumstances. As of October 31, 2018 and 2017 no single customer accounted for more than 10% of the Company's gross accounts receivable balance. The Company utilizes outsourced manufacturers around the world to manufacture company-designed products. The Company may purchase product components from suppliers and sell those components to its outsourced manufacturers thereby creating receivable balances from the outsourced manufacturers. The three largest outsourced manufacturer receivable balances collectively represented 92% and 87% of the Company's manufacturer receivables of $684 million and $594 million at October 31, 2018 and 2017, respectively. The Company includes the manufacturer receivables in Other current assets in the Consolidated Balance Sheets on a gross basis. The Company's credit risk associated with these receivables is mitigated wholly or in part by the amount the Company owes to these outsourced manufacturers, as the Company generally has the legal right to offset its payables to the outsourced manufacturers against these receivables. The Company does not reflect the sale of these components in revenue and does not recognize any profit on these component sales until the related products are sold by the Company, at which time any profit is recognized as a reduction to cost of sales. The Company obtains a significant number of components from single source suppliers due to technology, availability, price, quality or other considerations. The loss of a single source supplier, the deterioration of the Company's relationship with a single source supplier, or any unilateral modification to the contractual terms under which the Company is supplied components by a single source supplier could adversely affect the Company's revenue and gross margins. |
Inventory | Inventory The Company values inventory at the lower of cost or net realizable value. Cost is computed using standard cost which approximates actual cost on a first-in, first-out basis. Adjustments to reduce the cost of inventory to its net realizable value are made, if required, for estimated excess or obsolescence determined primarily by future demand forecasts. |
Property, Plant and Equipment | Property, Plant and Equipment The Company states property, plant and equipment at cost less accumulated depreciation. The Company capitalizes additions and improvements and expenses maintenance and repairs as incurred. Depreciation expense is recognized on a straight-line basis over the estimated useful lives of the assets. Estimated useful lives are five to 40 years for buildings and improvements and three to 15 years for machinery and equipment. The Company depreciates leasehold improvements over the life of the lease or the asset, whichever is shorter. The Company depreciates equipment held for lease over the initial term of the lease to the equipment's estimated residual value. The estimated useful lives of assets used solely to support a customer services contract generally do not exceed the term of the customer contract. On retirement or disposition, the asset cost and related accumulated depreciation are removed from the Consolidated Balance Sheets with any gain or loss recognized in the Consolidated Statements of Earnings. The Company capitalizes certain internal and external costs incurred to acquire or create internal use software, principally related to software coding, designing system interfaces and installation and testing of the software. The Company amortizes capitalized internal use software costs using the straight-line method over the estimated useful lives of the software, generally from three to five years. |
Business Combinations | Business Combinations The Company includes the results of operations of acquired businesses in the Company's consolidated results prospectively from the date of acquisition. The Company allocates the fair value of purchase consideration to the assets acquired including in-process research and development ("IPR&D"), liabilities assumed, and non-controlling interests in the acquired entity generally based on their fair values at the acquisition date. IPR&D is initially capitalized at fair value as an intangible asset with an indefinite life and assessed for impairment thereafter. When the IPR&D project is complete, it is reclassified as an amortizable purchased intangible asset and is amortized over its estimated useful life. If an IPR&D project is abandoned, the Company will record a charge for the value of the related intangible asset to the Company's Consolidated Statement of Earnings in the period it is abandoned. The excess of the fair value of purchase consideration over the fair value of the assets acquired, liabilities assumed and non-controlling interests in the acquired entity is recorded as goodwill. The primary items that generate goodwill include the value of the synergies between the acquired company and the Company and the value of the acquired assembled workforce, neither of which qualifies for recognition as an intangible asset. Acquisition-related expenses and post-acquisition restructuring costs are recognized separately from the business combination and are expensed as incurred. |
Goodwill | Goodwill The Company reviews goodwill for impairment annually and whenever events or changes in circumstances indicate the carrying amount of goodwill may not be recoverable. The Company performs a quantitative test for all of its reporting units as part of its annual goodwill impairment test in the fourth quarter of each fiscal year. The Company estimates the fair value of its reporting units using a weighting of fair values derived most significantly from the income approach, and to a lesser extent, the market approach. Under the income approach, the Company estimates the fair value of a reporting unit based on the present value of estimated future cash flows. The Company prepares cash flow projections based on management's estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. The Company bases the discount rate on the weighted-average cost of capital adjusted for the relevant risk associated with business-specific characteristics and the uncertainty related to the reporting unit's ability to execute on the projected cash flows. Under the market approach, the Company estimates fair value based on market multiples of revenue and earnings derived from comparable publicly traded companies with similar operating and investment characteristics as the reporting unit. The Company weights the fair value derived from the market approach depending on the level of comparability of these publicly traded companies to the reporting unit. When market comparables are not meaningful or not available, the Company estimates the fair value of a reporting unit using only the income approach. If the fair value of a reporting unit exceeds the carrying amount of the net assets assigned to that reporting unit, goodwill is not impaired and no further testing is required. If the fair value of the reporting unit is less than its carrying amount, goodwill is impaired. The goodwill impairment loss is measured as the excess of the reporting unit's carrying value over its fair value (not to exceed the total goodwill allocated to that reporting unit). |
Intangible Assets and Long-Lived Assets | Intangible Assets and Long-Lived Assets The Company reviews intangible assets with finite lives and long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. The Company assesses the recoverability of assets based on the estimated undiscounted future cash flows expected to result from the use and eventual disposition of the asset. If the undiscounted future cash flows are less than the carrying amount, the asset is impaired. The Company measures the amount of impairment loss, if any, as the difference between the carrying amount of the asset and its fair value using an income approach or, when available and appropriate, using a market approach. The Company amortizes intangible assets with finite lives using the straight-line method over the estimated economic lives of the assets, ranging from one to ten years. |
Assets Held for Sale | Assets Held for Sale The Company classifies its long-lived assets to be sold as held for sale in the period (i) it has approved and committed to a plan to sell the asset, (ii) the asset is available for immediate sale in its present condition, (iii) an active program to locate a buyer and other actions required to sell the asset have been initiated, (iv) the sale of the asset is probable, (v) the asset is being actively marketed for sale at a price that is reasonable in relation to its current fair value, and (vi) it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. The Company initially measures a long-lived asset that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell. Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met. Conversely, gains are not recognized on the sale of a long-lived asset until the date of sale. Upon designation as an asset held for sale, the Company stops recording depreciation expense on the asset. The Company assesses the fair value of a long-lived asset less any costs to sell at each reporting period and until the asset is no longer classified as held for sale. |
Equity Method Investments | Equity Method Investments Investments and ownership interests are accounted for under equity method accounting if the Company has the ability to exercise significant influence, but does not have a controlling financial interest. The Company records its interest in the net earnings of its equity method investees, along with adjustments for unrealized profits or losses on intra-entity transactions and amortization of basis differences, within earnings or loss from equity interests in the Consolidated Statements of Earnings. Profits or losses related to intra-entity sales with its equity method investees are eliminated until realized by the investor or investee. Basis differences represent differences between the cost of the investment and the underlying equity in net assets of the investment and are generally amortized over the lives of the related assets that gave rise to them. Equity method goodwill is not amortized or tested for impairment; instead the equity method investment is tested for impairment. The Company records its interest in the net earnings of its equity method investments based on the most recently available financial statements of the investees. The carrying amount of the investment in equity interests is adjusted to reflect the Company's interest in net earnings, dividends received and other-than-temporary impairments. The Company reviews for impairment whenever factors indicate that the carrying amount of the investment might not be recoverable. In such a case, the decrease in value is recognized in the period the impairment occurs in the Consolidated Statement of Earnings. |
Debt and Marketable Equity Securities | Debt and Marketable Equity Securities Investments Debt and marketable equity securities are generally considered available-for-sale and are reported at fair value with unrealized gains and losses, net of applicable taxes, in Accumulated other comprehensive loss in the Consolidated Balance Sheets. Realized gains and losses for available-for-sale securities are calculated based on the specific identification method and included in Interest and other, net in the Consolidated Statements of Earnings. The Company monitors its investment portfolio for potential impairment on a quarterly basis. When the carrying amount of an investment in debt securities exceeds its fair value and the decline in value is determined to be other-than-temporary, the Company records an impairment charge to Interest and other, net in the amount of the credit loss and the balance, if any, is recorded in Accumulated other comprehensive loss in the Consolidated Balance Sheets. |
Derivatives | Derivatives The Company uses derivative financial instruments, primarily forwards, swaps, and, at times, options, to hedge certain foreign currency and interest rate exposures. The Company also may use other derivative instruments, such as forwards, to hedge foreign currency balance sheet exposures. The Company does not use derivative financial instruments for speculative purposes. See Note 14, "Financial Instruments", for a full description of the Company's derivative financial instrument activities and related accounting policies. Derivative Instruments The Company is a global company exposed to foreign currency exchange rate fluctuations and interest rate changes in the normal course of its business. As part of its risk management strategy, the Company uses derivative instruments, primarily forward contracts, interest rate swaps and total return swaps to hedge certain foreign currency, interest rate and, to a lesser extent, equity exposures. The Company's objective is to offset gains and losses resulting from these exposures with losses and gains on the derivative contracts used to hedge them, thereby reducing volatility of earnings or protecting the fair value of assets and liabilities. The Company does not have any leveraged derivatives and does not use derivative contracts for speculative purposes. The Company may designate its derivative contracts as fair value hedges, cash flow hedges or hedges of the foreign currency exposure of a net investment in a foreign operation ("net investment hedges"). Additionally, for derivatives not designated as hedging instruments, the Company categorizes those economic hedges as other derivatives. Derivative instruments are recognized at fair value in the Consolidated Balance Sheets. The change in fair value of the derivative instruments is recognized in the Consolidated Statements of Earnings or Consolidated Statements of Comprehensive Income depending upon the type of hedge as further discussed below. The Company classifies cash flows from its derivative programs with the activities that correspond to the underlying hedged items in the Consolidated Statements of Cash Flows. As a result of its use of derivative instruments, the Company is exposed to the risk that its counterparties will fail to meet their contractual obligations. To mitigate counterparty credit risk, the Company has a policy of only entering into derivative contracts with carefully selected major financial institutions based on their credit ratings and other factors, and the Company maintains dollar risk limits that correspond to each financial institution's credit rating and other factors. The Company's established policies and procedures for mitigating credit risk include reviewing and establishing limits for credit exposure and periodically reassessing the creditworthiness of its counterparties. Master netting agreements also mitigate credit exposure to counterparties by permitting the Company to net amounts due from the Company to a counterparty against amounts due to the Company from the same counterparty under certain conditions. To further mitigate credit exposure to counterparties, the Company has collateral security agreements, which allows the Company to hold collateral from, or require the Company to post collateral to counterparties when aggregate derivative fair values exceed contractually established thresholds which are generally based on the credit ratings of the Company and its counterparties. If the Company's credit rating falls below a specified credit rating, the counterparty has the right to request full collateralization of the derivatives' net liability position. Conversely, if the counterparty's credit rating falls below a specified credit rating, the Company has the right to request full collateralization of the derivatives' net liability position. Collateral is generally posted within two business days. The fair value of the Company's derivatives with credit contingent features in a net liability position was $290 million and $265 million at October 31, 2018 and 2017 , respectively, all of which were fully collateralized within two business days. Under the Company's derivative contracts, the counterparty can terminate all outstanding trades following a covered change of control event affecting the Company that results in the surviving entity being rated below a specified credit rating. This credit contingent provision did not affect the Company's financial position or cash flows as of October 31, 2018 and 2017 . Fair Value Hedges The Company issues long-term debt in U.S. dollars based on market conditions at the time of financing. The Company may enter into fair value hedges, such as interest rate swaps, to reduce the exposure of its debt portfolio to changes in fair value resulting from changes in interest rates by achieving a primarily U.S. dollar LIBOR-based floating interest rate. The swap transactions generally involve principal and interest obligations for U.S. dollar-denominated amounts. Alternatively, the Company may choose not to swap fixed for floating interest payments or may terminate a previously executed swap if it believes a larger proportion of fixed-rate debt would be beneficial. When investing in fixed-rate instruments, the Company may enter into interest rate swaps that convert the fixed interest payments into variable interest payments and may designate these swaps as fair value hedges. For derivative instruments that are designated and qualify as fair value hedges, the Company recognizes the change in fair value of the derivative instrument, as well as the offsetting change in the fair value of the hedged item, in Interest and other, net in the Consolidated Statements of Earnings in the period of change. Cash Flow Hedges The Company uses forward contracts designated as cash flow hedges to protect against the foreign currency exchange rate risks inherent in its forecasted net revenue and, to a lesser extent, cost of sales, operating expenses, and intercompany loans denominated in currencies other than the U.S. dollar. The Company's foreign currency cash flow hedges mature generally within twelve months ; however, forward contracts associated with sales-type and direct-financing leases and intercompany loans extend for the duration of the lease or loan term, which can extend up to five years. For derivative instruments that are designated and qualify as cash flow hedges, the Company initially records changes in fair value for the effective portion of the derivative instrument in Accumulated other comprehensive loss as a separate component of equity in the Consolidated Balance Sheets and subsequently reclassifies these amounts into earnings in the period during which the hedged transaction is recognized in earnings. The Company reports the effective portion of its cash flow hedges in the same financial statement line item as changes in the fair value of the hedged item. Net Investment Hedges The Company uses forward contracts designated as net investment hedges to hedge net investments in certain foreign subsidiaries whose functional currency is the local currency. The Company records the effective portion of such derivative instruments together with changes in the fair value of the hedged items in cumulative translation adjustment as a separate component of Equity in the Consolidated Balance Sheets. Other Derivatives Other derivatives not designated as hedging instruments consist primarily of forward contracts used to hedge foreign currency-denominated balance sheet exposures. The Company also uses total return swaps and, to a lesser extent, interest rate swaps, based on equity or fixed income indices, to hedge its executive deferred compensation plan liability. For derivative instruments not designated as hedging instruments, the Company recognizes changes in fair value of the derivative instrument, as well as the offsetting change in the fair value of the hedged item, in Interest and other, net in the Consolidated Statements of Earnings in the period of change. Hedge Effectiveness For interest rate swaps designated as fair value hedges, the Company measures hedge effectiveness by offsetting the change in fair value of the hedged items with the change in fair value of the derivative. For forward contracts designated as cash flow or net investment hedges, the Company measures hedge effectiveness by comparing the cumulative change in fair value of the hedge contract with the cumulative change in fair value of the hedged item, both of which are based on forward rates. The Company recognizes any ineffective portion of the hedge in the Consolidated Statements of Earnings in the same period in which ineffectiveness occurs. Amounts excluded from the assessment of effectiveness are recognized in the Consolidated Statements of Earnings in the period they arise. |
Loss Contingencies | Loss Contingencies The Company is involved in various lawsuits, claims, investigations, and proceedings that arise in the ordinary course of business. The Company records a liability for contingencies when it believes it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. See Note 18, "Litigation and Contingencies", for a full description of the Company's loss contingencies and related accounting policies. |
Recently Adopted Accounting Pronouncements and Recently Enacted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In March 2018, the Financial Accounting Standards Board ("FASB") issued guidance that amends ASC 740, Income Taxes, to reflect and codify SAB 118. The guidance became effective upon issuance. The Company applied SAB 118 upon the original issuance in December 2017 prior to the codification. See Note 8, "Taxes on Earnings" for a full description of the impact of the Tax Act to the Company's operations. In January 2017, the FASB issued guidance that clarifies the definition of a business. The guidance provides a more robust framework to use in determining when a set of assets and activities acquired or sold is a business. The Company adopted the guidance in the fourth quarter of fiscal 2018 on a prospective basis. The adoption of this guidance has no material impact on the Company's Consolidated Financial Statements. In March 2016, the FASB amended the existing accounting standards for employee share-based payment arrangements. The new guidance requires excess tax benefits and tax deficiencies to be recorded in the income statement when stock awards vest or are settled. In addition, cash flows related to excess tax benefits will no longer be separately classified as an inflow from financing activities, with a corresponding outflow from operating activities, but will be classified along with other income tax cash flows as an operating activity. The standard also allows the Company to repurchase more of an employee's vesting shares for tax withholding purposes without triggering liability accounting and clarifies that all cash payments made to tax authorities on an employee's behalf for withheld shares should be presented as a financing activity on the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2018 and prospectively recorded all excess tax benefits and tax deficiencies arising from stock awards vesting as settled as income tax expense or benefit, rather than in equity. For the fiscal year ended October 31, 2018, the impact of the adoption was $65 million , of net excess tax benefits as a component of the (provision) benefit for income taxes. The Company elected to continue to estimate forfeitures of awards in determining stock-based compensation expense. The Company elected to apply the presentation requirements for cash flows retrospectively, which resulted in increases to net cash provided by operating activities of $446 million and $98 million and corresponding increases to net cash used in financing activities for the fiscal years ended October 31, 2017 and 2016, respectively. There were no other material impacts to the Company's Consolidated Financial Statements as a result of adopting this standard. Recently Enacted Accounting Pronouncements In August 2018, the FASB issued guidance on a customer's accounting for implementation costs incurred in cloud-computing arrangements that are hosted by a vendor. Certain types of implementation costs should be capitalized and amortized over the term of the hosting arrangement. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Consolidated Financial Statements. In August 2018, the FASB issued guidance which changes the disclosure requirements for fair value measurements and defined benefit plans. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. As the guidance represents a change to disclosure only, the Company does not expect the guidance to have a material impact on its Consolidated Financial Statements. In February 2018, the FASB issued guidance that allows companies to reclassify stranded tax effects resulting from the Tax Act, from accumulated other comprehensive loss to retained earnings. The guidance also requires certain new disclosures regardless of the election. The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Consolidated Financial Statements. In August 2017, the FASB amended the existing accounting standards for hedge accounting. The amendments expand an entity’s ability to hedge non-financial and financial risk components and reduce complexity in fair value hedges of interest rate risk. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also simplifies certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Consolidated Financial Statements. In March 2017, the FASB amended the existing accounting standards for retirement benefits. The amendments require the presentation of the service cost component of net periodic benefit cost in the same income statement line items as other employee compensation costs, unless eligible for capitalization. The other components of net periodic benefit costs will be presented separately from service cost as non-operating costs. The Company plans to adopt the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. The Company is currently evaluating the impact of these amendments on its Consolidated Financial Statements. In November 2016, the FASB amended the existing accounting standards for the classification and presentation of restricted cash in the statement of cash flows. The amendments require that the statement of cash flows explain the change during the period to total cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. The Company plans to adopt the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. The Company is currently evaluating the impact of these amendments on its Consolidated Financial Statements. In October 2016, the FASB amended the existing accounting standards for income taxes. The amendments require the recognition of the income tax consequences for intra-entity transfers of assets other than inventory when the transfer occurs. Under current GAAP, current and deferred income taxes for intra-entity asset transfers are not recognized until the asset has been sold to an outside party. The Company plans to adopt the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the modified retrospective method. The Company expects to recognize $2.4 billion of income taxes as an adjustment to retained earnings in the first quarter of fiscal 2019. In August 2016, the FASB amended the existing accounting standards for the statement of cash flows. The amendments provide guidance on eight classification issues related to the statement of cash flows. The Company plans to adopt the guidance in the first quarter of fiscal 2019, beginning November 1, 2018. The amendments should be applied retrospectively to all periods presented. For issues that are impracticable to apply retrospectively, the amendments may be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of these amendments on its Consolidated Financial Statements. In June 2016, the FASB amended the existing accounting standards for the measurement of credit losses. The amendments require an entity to estimate its lifetime expected credit loss for most financial instruments, including trade and lease receivables, and record an allowance for the portion of the amortized cost the entity does not expect to collect. The estimate of expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted beginning in fiscal 2020. The Company is currently evaluating the timing and the impact of these amendments on its Consolidated Financial Statements. The FASB issued guidance in February 2016, with amendments in 2018, which changes the accounting standards for leases. The amendments require lessees to record, at lease inception, a lease liability for the obligation to make lease payments and a right-of-use ("ROU") asset for the right to use the underlying asset for the lease term on their balance sheets. Lessees may elect to not recognize lease liabilities and ROU assets for most leases with terms of 12 months or less. The lease liability is measured at the present value of the lease payments over the lease term. The ROU asset will be based on the liability, adjusted for lease prepayments, lease incentives received, and the lessee's initial direct costs. For finance leases, lease expense will be the sum of interest on the lease obligation and amortization of the ROU asset, resulting in a front-loaded expense pattern. For operating leases, lease expense will generally be recognized on a straight-line basis over the lease term. The amended lessor accounting model is similar to the current model, updated to align with certain changes to the lessee model and the new revenue standard. The current sale-leaseback guidance, including guidance applicable to real estate, is also replaced with a new model for both lessees and lessors. The Company plans to adopt the guidance in the first quarter of fiscal 2020, beginning November 1, 2019, using the transition method whereby prior comparative periods will not be retrospectively presented in the Consolidated Financial Statements. The Company is currently evaluating the impact of these amendments and other available practical expedients on its Consolidated Financial Statements. In January 2016, the FASB issued guidance that requires equity investments with readily determinable fair values (other than those accounted for under the equity method or those that result in consolidation of the investee) to be measured at fair value and recognize any changes in fair value in net income. The guidance provides for electing the measurement alternative or defaulting to the fair value option. The Company plans to elect the measurement alternative for equity investments that do not have readily determinable fair values. These investments will be measured at cost, less any impairment, plus or minus adjustments resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer, which are recorded in net income. The Company plans to adopt the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using a prospective method. The Company is currently evaluating the impact of these amendments on its Consolidated Financial Statements. In May 2014, the FASB amended the existing accounting standards for revenue recognition. The Company plans to adopt the new revenue standard in the first quarter of fiscal 2019, beginning November 1, 2018, using the modified retrospective method. The Company has completed a review of the accounting systems and processes required to apply the modified retrospective method. In response, the Company is implementing a new IT solution as part of the adoption of the new standard and finalizing changes to accounting policies, processes and internal controls. The Company expects the impact from the revenue recognition standard changes for its broad portfolio of hardware, software and services offerings to be largely immaterial. However, the guidance is expected to change the timing of revenue recognition in certain areas, including accounting for certain software licenses. Since the Company currently expenses sales commissions as incurred, the requirement in the new standard to capitalize certain sales commissions will result in an accounting change for the Company. The Company is in the process of completing the assessment of these changes and quantifying the impact on its Consolidated Financial Statements as it works through the final steps for the adoption of the new revenue standard. |
Segment Policy | 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 our customers. Hewlett Packard Enterprise's consolidated net revenue is derived and reported after the elimination of intersegment revenues from such arrangements. Hewlett Packard Enterprise periodically engages in intercompany advanced royalty payment and licensing arrangements that may result in advance payments between subsidiaries. Revenues from these intercompany arrangements are deferred and recognized as earned over the term of the arrangement by the Hewlett Packard Enterprise legal entities involved in such transactions; however, these advanced payments are eliminated from revenues as reported by Hewlett Packard Enterprise and its business segments. As disclosed in Note 8, "Taxes on Earnings", Hewlett Packard Enterprise executed intercompany advanced royalty payment arrangements resulting in advanced payments of $63 million and $439 million during fiscal 2018 and 2017, respectively. In these transactions, the payments were received in the U.S. from a foreign consolidated affiliate, with a deferral of intercompany revenues over the term of the arrangements. The impact of these intercompany arrangements is eliminated from both Hewlett Packard Enterprise's consolidated and segment net revenues. Financing interest 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 costs include certain corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, transformation costs, amortization of intangible assets, impairment of goodwill, acquisition and other related charges, restructuring charges, separation costs, disaster charges, defined benefit plan settlement charges and remeasurement (benefit |
Investment Policy | Investment Policy The Company's investment strategy is to seek a competitive rate of return relative to an appropriate level of risk depending on the funded status of each plan and the timing of expected benefit payments. The majority of the plans' investment managers employ active investment management strategies with the goal of outperforming the broad markets in which they invest. Risk management practices include diversification across asset classes and investment styles and periodic rebalancing toward asset allocation targets. A number of the plans' investment managers are authorized to utilize derivatives for investment or liability exposures, and the Company may utilize derivatives to effect asset allocation changes or to hedge certain investment or liability exposures. Asset allocation decisions are typically made by an independent board of trustees for the specific plan. Investment objectives are designed to generate returns that will enable the plan to meet its future obligations. In some countries, local regulations may restrict asset allocations, typically leading to a higher percentage of investment in fixed income securities than would otherwise be deployed. The Company reviews the investment strategy and provides a recommended list of investment managers for each country plan, with final decisions on asset allocation and investment managers made by the board of trustees or investment committees for the specific plan. |
Fair Value Of Pension Plan Assets Policy | The following is a description of the valuation methodologies used to measure plan assets at fair value. Investments in publicly traded equity securities are valued using the closing price on the measurement date as reported on the stock exchange on which the individual securities are traded. For corporate, government backed debt securities, and some other investments, fair value is based on observable inputs of comparable market transactions. The valuation of certain real estate funds, insurance group annuity contracts and alternative investments, such as limited partnerships and joint ventures, may require significant management judgment. The valuation is generally based on fair value as reported by the asset manager and adjusted for cash flows, if necessary. In making such an assessment, a variety of factors are reviewed by management, including, but are not limited to, the timeliness of fair value as reported by the asset manager and changes in general economic and market conditions subsequent to the last fair value reported by the asset manager. Cash and cash equivalents includes money market funds, which are valued based on cost, which approximates fair value. Other than those assets that have quoted prices from an active market, investments are generally classified in Level 2 or Level 3 of the fair value hierarchy based on the lowest level input that is significant to the fair value measure in its entirety. Investments measured using net asset value as a practical expedient are not categorized within the fair value hierarchy. |
Basis for Expected Long-Term Rate of Return on Plan Assets Policy | Basis for Expected Long-Term Rate of Return on Plan Assets The expected long-term rate of return on plan assets reflects the expected returns for each major asset class in which the plan invests and the weight of each asset class in the target mix. Expected asset returns reflect the current yield on government bonds, risk premiums for each asset class and expected real returns, which considers each country's specific inflation outlook. Because the Company's investment policy is to employ primarily active investment managers who seek to outperform the broader market, the expected returns are adjusted to reflect the expected additional returns, net of fees. |
Financing Receivables Allowance for Credit Loss and Reserves Policy | Allowance for Doubtful Accounts The allowance for doubtful accounts for financing receivables is comprised of a general reserve and a specific reserve. The Company maintains general reserve percentages on a regional basis and bases such percentages on several factors, including consideration of historical credit losses and portfolio delinquencies, trends in the overall weighted-average risk rating of the portfolio, current economic conditions and information derived from competitive benchmarking. The Company excludes accounts evaluated as part of the specific reserve from the general reserve analysis. The Company establishes a specific reserve for financing receivables with identified exposures, such as customer defaults, bankruptcy or other events, that make it unlikely the Company will recover its investment. For individually evaluated receivables, the Company determines the expected cash flow for the receivable, which includes consideration of estimated proceeds from disposition of the collateral, and calculates an estimate of the potential loss and the probability of loss. For those accounts where a loss is considered probable, the Company records a specific reserve. The Company generally writes off a receivable or records a specific reserve when a receivable becomes 180 days past due, or sooner if the Company determines that the receivable is not collectible. Credit Quality Indicators Due to the homogeneous nature of its leasing transactions, the Company manages its financing receivables on an aggregate basis when assessing and monitoring credit risk. Credit risk is generally diversified due to the large number of entities comprising the Company's customer base and their dispersion across many different industries and geographic regions. The Company evaluates the credit quality of an obligor at lease inception and monitors that credit quality over the term of a transaction. The Company assigns risk ratings to each lease based on the creditworthiness of the obligor and other variables that augment or mitigate the inherent credit risk of a particular transaction. Such variables include the underlying value and liquidity of the collateral, the essential use of the equipment, the term of the lease, and the inclusion of credit enhancements, such as guarantees, letters of credit or security deposits. |
Financing Receivables, Non-Accrual and Past Due Status Policy | Non-Accrual and Past-Due Financing Receivables The Company considers a financing receivable to be past due when the minimum payment is not received by the contractually specified due date. The Company generally places financing receivables on non-accrual status, which is the suspension of interest accrual, and considers such receivables to be non-performing at the earlier of the time at which full payment of principal and interest becomes doubtful or the receivable becomes 90 days past due. Subsequently, the Company may recognize revenue on non-accrual financing receivables as payments are received, which is on a cash basis, if the Company deems the recorded financing receivable to be fully collectible; however, if there is doubt regarding the ultimate collectability of the recorded financing receivable, all cash receipts are applied to the carrying amount of the financing receivable, which is the cost recovery method. In certain circumstances, such as when the Company deems a delinquency to be of an administrative nature, financing receivables may accrue interest after becoming 90 days past due. The non-accrual status of a financing receivable may not impact a customer's risk rating. After all of a customer's delinquent principal and interest balances are settled, the Company may return the related financing receivable to accrual status. |
Fair Value | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. Fair Value Hierarchy The Company uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs. Level 3—Unobservable inputs for the asset or liability. The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs. Valuation Techniques Cash Equivalents and Investments: The Company holds time deposits, money market funds, debt securities primarily consisting of corporate and foreign government notes and bonds. The Company values cash equivalents using quoted market prices, alternative pricing sources, including net asset value, or models utilizing market observable inputs. The fair value of debt investments was based on quoted market prices or model-driven valuations using inputs primarily derived from or corroborated by observable market data, and, in certain instances, valuation models that utilize assumptions which cannot be corroborated with observable market data. Derivative Instruments: The Company uses forward contracts, interest rate and total return swaps to hedge certain foreign currency and interest rate exposures. The Company uses industry standard valuation models to measure fair value. Where applicable, these models project future cash flows and discount the future amounts to present value using market-based observable inputs, including interest rate curves, the Company and counterparties' credit risk, foreign currency exchange rates, and forward and spot prices for currencies and interest rates. See Note 14, "Financial Instruments", for a further discussion of the Company's use of derivative instruments. Other Fair Value Disclosures Short- and Long-Term Debt: The Company estimates the fair value of its debt primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities, and considering its own credit risk. The portion of the Company's debt that is hedged is reflected in the Consolidated Balance Sheets as an amount equal to the debt's carrying amount and a fair value adjustment representing changes in the fair value of the hedged debt obligations arising from movements in benchmark interest rates. At October 31, 2018, the estimated fair value of the Company's short-term and long-term debt was $12.2 billion and the carrying value was $12.1 billion . As of October 31, 2017, the estimated fair value of the Company's short-term and long-term debt was $14.6 billion and the carrying value was $14.0 billion . If measured at fair value in the Consolidated Balance Sheets, short-term and long-term debt would be classified in Level 2 of the fair value hierarchy. Other Financial Instruments: For the balance of the Company's financial instruments, primarily accounts receivable, accounts payable and financial liabilities included in other accrued liabilities, the carrying amounts approximate fair value due to their short maturities. If measured at fair value in the Consolidated Balance Sheets, these other financial instruments would be classified in Level 2 or Level 3 of the fair value hierarchy. Non-Marketable Equity Investments and Non-Financial Assets: The Company's non-marketable equity investments and non-financial assets, such as intangible assets, goodwill and property, plant and equipment, are recorded at fair value in the period an impairment charge is recognized. If measured at fair value in the Consolidated Balance Sheets, these would generally be classified in Level 3 of the fair value hierarchy. |
Net Earnings per share | The Company calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes the weighted-average dilutive effect of restricted stock units, stock options, and performance-based awards. |
Warranties | Warranties The Company accrues the estimated cost of product warranties at the time it recognizes revenue. The Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers; however, contractual warranty terms, repair costs, product call rates, average cost per call, current period product shipments and ongoing product failure rates, as well as specific product class failures outside of the Company's baseline experience, affect the estimated warranty obligation. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The following table presents the financial results for HPE's discontinued operations. Fiscal years ended October 31, 2018 2017 2016 In millions Net revenue $ — $ 8,511 $ 19,843 Cost of revenue (1) — 5,890 15,000 Expenses (2) 51 3,063 4,596 Interest and other, net 58 39 28 (Loss) earnings from discontinued operations before taxes (109 ) (481 ) 219 Benefit (provision) for taxes 5 389 (295 ) Net loss from discontinued operations $ (104 ) $ (92 ) $ (76 ) (1) Cost of revenue includes cost of products and services. (2) For the periods following the Everett and Seattle Transactions in fiscal 2017, expenses primarily consist of separation costs, which relate to third-party consulting, contractor fees and other incremental costs arising from the transactions. Prior to the Everett and Seattle Transactions, expenses in fiscal 2017 and 2016 primarily consist of selling, general and administrative (“SG&A”) expenses, research and development (“R&D”) expenses, restructuring charges, separation costs, amortization of intangible assets, acquisition and other related charges, and defined benefit plan settlement charges and remeasurement (benefit). |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Earnings (Loss) from Operations, by Segment | Segment Operating Results Hybrid IT Intelligent Edge Financial Services Corporate Investments Total In millions 2018 Net revenue $ 24,285 $ 2,912 $ 3,656 $ (1 ) $ 30,852 Intersegment net revenue and other 748 17 15 — 780 Total segment net revenue $ 25,033 $ 2,929 $ 3,671 $ (1 ) $ 31,632 Segment earnings (loss) from operations $ 2,654 $ 237 $ 290 $ (90 ) $ 3,091 2017 Net revenue $ 22,740 $ 2,554 $ 3,574 $ 3 $ 28,871 Intersegment net revenue and other (1) 887 30 28 — 945 Total segment net revenue $ 23,627 $ 2,584 $ 3,602 $ 3 $ 29,816 Segment earnings (loss) from operations $ 2,274 $ 253 $ 299 $ (106 ) $ 2,720 2016 Net revenue $ 23,954 $ 2,635 $ 3,097 $ 594 $ 30,280 Intersegment net revenue and other (1) 1,148 39 93 — 1,280 Total segment net revenue $ 25,102 $ 2,674 $ 3,190 $ 594 $ 31,560 Segment earnings (loss) from operations $ 3,182 $ 74 $ 338 $ (61 ) $ 3,533 (1) For the periods prior to the Everett and Seattle Transactions presented above, the amounts include the elimination of pre-separation intercompany sales to the former ES and Software segments, which are included within Net loss from discontinued operations in the Consolidated Statements of Earnings. |
Schedule of Reconciliation of Revenues and Earnings before Taxes from Segments to Combined and Consolidated | The reconciliation of segment operating results to Hewlett Packard Enterprise consolidated results was as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions Net Revenue: Total segments $ 31,632 $ 29,816 $ 31,560 Elimination of intersegment net revenue and other (780 ) (945 ) (1,280 ) Total Hewlett Packard Enterprise consolidated net revenue $ 30,852 $ 28,871 $ 30,280 Earnings before taxes: Total segment earnings from operations $ 3,091 $ 2,720 $ 3,533 Unallocated corporate costs and eliminations (240 ) (408 ) (720 ) Unallocated stock-based compensation expense (73 ) (110 ) (134 ) Amortization of intangible assets (294 ) (321 ) (272 ) Impairment of goodwill (88 ) — — Restructuring charges (19 ) (417 ) (417 ) Transformation costs (425 ) (359 ) — Disaster charges — (93 ) — Acquisition and other related charges (82 ) (203 ) (145 ) Separation costs (12 ) (248 ) (362 ) Defined benefit plan settlement charges and remeasurement (benefit) — 64 — Gain on H3C and MphasiS divestitures — — 2,420 Interest and other, net (274 ) (327 ) (284 ) Tax indemnification adjustments (1,354 ) (3 ) 317 Earnings (loss) from equity interests 38 (23 ) (76 ) Total Hewlett Packard Enterprise consolidated earnings from continuing operations before taxes $ 268 $ 272 $ 3,860 |
Schedule of Reconciliation of Assets from Segments to Combined and Consolidated | Total assets by segment and the reconciliation of segment assets to Hewlett Packard Enterprise consolidated assets were as follows: As of October 31, 2018 2017 In millions Hybrid IT $ 25,839 $ 25,923 Intelligent Edge 2,990 3,002 Financial Services 13,746 13,470 Corporate Investments 170 161 Corporate and unallocated assets 12,748 18,850 Total Hewlett Packard Enterprise consolidated assets $ 55,493 $ 61,406 |
Schedule of net revenue by geographical areas | Net revenue by country in which Hewlett Packard Enterprise operates was as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions U.S. $ 10,192 $ 10,022 $ 10,333 Other countries 20,660 18,849 19,947 Total net revenue $ 30,852 $ 28,871 $ 30,280 |
Schedule of net property, plant and equipment by geographical areas | Net property, plant and equipment by country in which Hewlett Packard Enterprise operates was as follows: As of October 31, 2018 2017 In millions U.S. $ 2,813 $ 2,673 Other countries 3,325 3,596 Total net property, plant and equipment $ 6,138 $ 6,269 |
Schedule of Revenue by Segment and Business Unit | Net revenue by segment and business unit was as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions Hybrid IT Hybrid IT Product Compute $ 13,823 $ 12,837 $ 13,994 Storage 3,706 3,280 3,389 DC Networking 225 214 407 Total Hybrid IT Product 17,754 16,331 17,790 HPE Pointnext 7,279 7,296 7,312 Total Hybrid IT 25,033 23,627 25,102 Intelligent Edge HPE Aruba Product 2,619 2,307 2,423 HPE Aruba Services 310 277 251 Total Intelligent Edge 2,929 2,584 2,674 Financial Services 3,671 3,602 3,190 Corporate Investments (1 ) 3 594 Total segment net revenue 31,632 29,816 31,560 Eliminations of intersegment net revenue and other (780 ) (945 ) (1,280 ) Total net revenue $ 30,852 $ 28,871 $ 30,280 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring Plans | Restructuring activities related to the Company's employees and infrastructure, summarized by plan, are presented in the table below: Fiscal 2015 Plan Fiscal 2012 Plan Employee Infrastructure Employee Severance and EER Infrastructure Total In millions Liability as of October 31, 2015 $ 67 $ — $ 47 $ 37 $ 151 Charges 301 42 75 1 419 Cash payments (172 ) (19 ) (82 ) (15 ) (288 ) Non-cash items 38 (10 ) (3 ) (9 ) 16 Liability as of October 31, 2016 $ 234 $ 13 $ 37 $ 14 $ 298 Charges 374 37 6 — 417 Cash payments (355 ) (19 ) (32 ) (6 ) (412 ) Non-cash items (34 ) (14 ) 5 (6 ) (49 ) Liability as of October 31, 2017 $ 219 $ 17 $ 16 $ 2 $ 254 Charges 9 (2 ) 13 (1 ) 19 Cash payments (158 ) (8 ) (15 ) — (181 ) Non-cash items (8 ) 3 (3 ) — (8 ) Liability as of October 31, 2018 $ 62 $ 10 $ 11 $ 1 $ 84 Total costs incurred to date as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 Total expected costs to be incurred as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 Employee Infrastructure In millions Liability as of October 31, 2016 $ — $ — Charges 296 — Liability as of October 31, 2017 $ 296 $ — Charges 470 61 Cash payments (452 ) (14 ) Non-cash items (23 ) (14 ) Liability as of October 31, 2018 $ 291 $ 33 Total costs incurred to date as of October 31, 2018 $ 766 $ 61 Total expected costs to be incurred as of October 31, 2018 $ 1,200 $ 180 |
HPE Next (Tables)
HPE Next (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | During fiscal 2018 and 2017 , the Company incurred $425 million and $359 million , respectively in net charges associated with the HPE Next initiative, which were recorded within Transformation costs in the Consolidated Statements of Earnings. Additionally, the Company incurred $20 million of transformation costs in fiscal 2018 related to cumulative translation adjustments which were recorded within Interest and other, net in the Consolidated Statements of Earnings. Fiscal years ended October 31, 2018 2017 In millions Program management (1) $ 95 $ 57 IT costs 148 34 Restructuring charges 531 296 Other (2) 56 — Gains on real estate sales (3) (405 ) (28 ) Total Transformation Costs $ 425 $ 359 (1) Primarily consists of consulting fees and other direct costs attributable to the design and implementation of the HPE Next initiative. (2) Primarily consists of costs related to real estate improvements in connection with the HPE Next initiative. (3) In fiscal 2018, primarily includes the gain on the sale of the Company's Palo Alto, California corporate headquarters. |
Schedule of Restructuring Reserve by Cost | Restructuring activities related to the Company's employees and infrastructure, summarized by plan, are presented in the table below: Fiscal 2015 Plan Fiscal 2012 Plan Employee Infrastructure Employee Severance and EER Infrastructure Total In millions Liability as of October 31, 2015 $ 67 $ — $ 47 $ 37 $ 151 Charges 301 42 75 1 419 Cash payments (172 ) (19 ) (82 ) (15 ) (288 ) Non-cash items 38 (10 ) (3 ) (9 ) 16 Liability as of October 31, 2016 $ 234 $ 13 $ 37 $ 14 $ 298 Charges 374 37 6 — 417 Cash payments (355 ) (19 ) (32 ) (6 ) (412 ) Non-cash items (34 ) (14 ) 5 (6 ) (49 ) Liability as of October 31, 2017 $ 219 $ 17 $ 16 $ 2 $ 254 Charges 9 (2 ) 13 (1 ) 19 Cash payments (158 ) (8 ) (15 ) — (181 ) Non-cash items (8 ) 3 (3 ) — (8 ) Liability as of October 31, 2018 $ 62 $ 10 $ 11 $ 1 $ 84 Total costs incurred to date as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 Total expected costs to be incurred as of October 31, 2018 $ 751 $ 78 $ 1,268 $ 145 $ 2,242 Employee Infrastructure In millions Liability as of October 31, 2016 $ — $ — Charges 296 — Liability as of October 31, 2017 $ 296 $ — Charges 470 61 Cash payments (452 ) (14 ) Non-cash items (23 ) (14 ) Liability as of October 31, 2018 $ 291 $ 33 Total costs incurred to date as of October 31, 2018 $ 766 $ 61 Total expected costs to be incurred as of October 31, 2018 $ 1,200 $ 180 |
Retirement and Post-Retiremen_2
Retirement and Post-Retirement Benefit Plans (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Retirement Benefits [Abstract] | |
Schedule of net pension benefit (credit) costs | The Company's net pension and post-retirement benefit costs that were directly attributable to the eligible employees, retirees and other former employees of Hewlett Packard Enterprise and recognized in the Consolidated Statements of Earnings for fiscal 2018 , 2017 and 2016 are presented in the table below. As of October 31, 2018 2017 2016 2018 2017 2016 Defined Post-Retirement In millions Service cost $ 105 $ 139 $ 199 $ 1 $ 3 $ 3 Interest cost 225 213 317 7 6 6 Expected return on plan assets (567 ) (548 ) (667 ) (1 ) (2 ) (2 ) Amortization and deferrals: Actuarial loss (gain) 211 264 220 (3 ) (2 ) (3 ) Prior service benefit (17 ) (17 ) (19 ) — — — Net periodic benefit cost (43 ) 51 50 4 5 4 Curtailment gain (1 ) (1 ) — — — — Settlement loss 20 15 4 — — — Special termination benefits 6 5 5 — — — Plan credit allocation (1) — (14 ) (15 ) — (1 ) (1 ) Net benefit (credit) cost from continuing operations (2) (18 ) 56 44 4 4 3 Summary of net benefit (credit) cost: Continuing operations (18 ) 56 44 4 4 3 Discontinued operations — 81 92 — 1 1 Total net benefit (credit) cost $ (18 ) $ 137 $ 136 $ 4 $ 5 $ 4 (1) Plan credit allocation represents the net cost impact of employees of HPE covered under Everett or Seattle plans and employees of Everett or Seattle covered under HPE plans. (2) Net benefit cost from continuing operations for the Company's U.S. defined benefit plans, included in the above table, was not material for fiscal 2018, 2017 and 2016. |
Schedule of weighted average assumptions used to calculate net benefit (credit) cost | The weighted-average assumptions used to calculate the net benefit (credit) cost from continuing operations in the table above for fiscal 2018 , 2017 and 2016 were as follows: As of October 31, 2018 2017 2016 2018 2017 2016 Defined Benefit Plans Post-Retirement Benefit Plans Discount rate used to determine benefit obligation 2.0 % 2.0 % 2.7 % 4.5 % 4.2 % 4.6 % Discount rate used to determine service cost 2.4 % 2.0 % 2.7 % 3.7 % 3.7 % 4.6 % Discount rate used to determine interest cost 1.7 % 1.8 % 2.7 % 4.2 % 3.8 % 4.6 % Expected increase in compensation levels 2.3 % 2.4 % 2.3 % — — — Expected long-term return on plan assets 4.4 % 4.4 % 5.8 % 2.6 % 3.1 % 4.0 % |
Schedule of funded status of the direct plans | The funded status of the plans was as follows: As of October 31, 2018 2017 2018 2017 Defined Post-Retirement In millions Change in fair value of plan assets: Fair value—beginning of year $ 12,610 $ 11,989 $ 50 $ 47 Transfers (1) 6 (799 ) — — Addition/deletion of plans (2) 181 5 — — Actual return on plan assets 93 941 1 1 Employer contributions 158 266 6 4 Participant contributions 25 17 4 4 Benefits paid (450 ) (408 ) (9 ) (6 ) Settlement (104 ) (60 ) — — Currency impact (352 ) 659 — — Fair value—end of year (3) $ 12,167 $ 12,610 $ 52 $ 50 Change in benefit obligation: Projected benefit obligation—beginning of year $ 13,069 $ 13,555 $ 170 $ 158 Transfers (1) 5 (668 ) — — Addition/deletion of plans (2) 181 19 — — Service cost 105 139 1 3 Interest cost 225 213 7 6 Participant contributions 25 17 4 4 Actuarial (gain) loss (40 ) (445 ) (9 ) 4 Benefits paid (450 ) (408 ) (9 ) (6 ) Plan amendments 22 (1 ) — — Curtailment (4 ) (1 ) — — Settlement (104 ) (60 ) — — Special termination benefits 6 5 — — Currency impact (372 ) 704 (4 ) 1 Projected benefit obligation—end of year (3) $ 12,668 $ 13,069 $ 160 $ 170 Funded status at end of year $ (501 ) $ (459 ) $ (108 ) $ (120 ) Accumulated benefit obligation $ 12,446 $ 12,832 $ — $ — (1) In fiscal 2017, in connection with the Everett and Seattle Transactions, the Company transferred plan assets and liabilities from the Company's plans to newly established Everett and Seattle plans. The Company transferred net plan assets of $702 million and $97 million to Everett and Seattle, respectively, and liabilities of $503 million and $165 million to Everett and Seattle, respectively. (2) Includes the addition/deletion of plans resulting from acquisitions or divestitures. Fiscal 2018 amounts relate primarily to the addition of a Belgium plan. (3) As of October 31, 2018 and 2017, the Company's U.S. defined benefit plans had zero plan assets and a projected benefit obligation of $5 million for both fiscal years. |
Schedule of weighted-average assumptions used to calculate the projected benefit obligations | The weighted-average assumptions used to calculate the projected benefit obligations were as follows: As of October 31, 2018 2017 2018 2017 Defined Benefit Plans Post-Retirement Benefit Plans Discount rate 2.1 % 2.0 % 4.9 % 4.5 % Expected increase in compensation levels 2.5 % 2.3 % — — |
Schedule of net amount recognized for the direct plans in the entity's Combined Balance Sheets | The net amounts recognized for defined benefit and post-retirement benefit plans in the Company's Consolidated Balance Sheets were as follows: As of October 31, 2018 2017 2018 2017 Defined Post-Retirement In millions Non-current assets $ 829 $ 830 $ — $ — Current liabilities (40 ) (39 ) (6 ) (4 ) Non-current liabilities (1,290 ) (1,250 ) (102 ) (116 ) Funded status at end of year $ (501 ) $ (459 ) $ (108 ) $ (120 ) |
Summary of pre-tax net actuarial loss and prior service benefit recognized in accumulated other comprehensive loss for direct defined benefit plans | The following table summarizes the pre-tax net actuarial loss and prior service benefit recognized in Accumulated other comprehensive loss for the defined benefit plans: As of October 31, 2018 Defined Post-Retirement In millions Net actuarial loss (gain) $ 2,938 $ (11 ) Prior service benefit (65 ) — Total recognized in accumulated other comprehensive loss $ 2,873 $ (11 ) |
Summary of actuarial loss and prior service benefit for direct plans that are expected to be amortized from Accumulated other comprehensive loss and recognized as components of net periodic benefit cost (credit) | The following table summarizes the net actuarial loss and prior service benefit for plans that are expected to be amortized from Accumulated other comprehensive loss and recognized as components of net periodic benefit cost (credit) during the next fiscal year. As of October 31, 2018 Defined Post-Retirement In millions Net actuarial loss (gain) $ 228 $ (4 ) Prior service benefit (15 ) — Total expected to be recognized in net periodic benefit cost (credit) $ 213 $ (4 ) |
Schedule of direct defined benefit plans with projected benefit obligations exceeding the fair value of plan assets | Defined benefit plans with projected benefit obligations exceeding the fair value of plan assets were as follows: As of October 31, 2018 2017 In millions Aggregate fair value of plan assets $ 2,314 $ 2,596 Aggregate projected benefit obligation $ 3,644 $ 3,884 |
Schedule of direct defined benefit plans with accumulated benefit obligations exceeding the fair value of plan assets | Defined benefit plans with accumulated benefit obligations exceeding the fair value of plan assets were as follows: As of October 31, 2018 2017 In millions Aggregate fair value of plan assets $ 2,291 $ 1,272 Aggregate accumulated benefit obligation $ 3,495 $ 2,476 |
Schedule of fair value of direct plan non-U.S. defined benefit plan assets by asset category within the fair value hierarchy | The table below sets forth the fair value of non-U.S defined benefit plan assets by asset category within the fair value hierarchy as of October 31, 2018 and 2017 . As of As of Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total In millions Asset Category: Equity securities U.S. $ 187 $ 7 $ — $ 194 $ 270 $ 13 $ — $ 283 Non-U.S. 344 225 — 569 365 140 — 505 Non-U.S. at NAV (1) 473 480 Debt securities Corporate — 1,221 — 1,221 — 1,966 — 1,966 Government (7) — 4,621 — 4,621 — 702 — 702 Government at NAV (2) 692 687 Alternative investments Private Equity — 2 40 42 — 7 33 40 Hybrids (3) — 1,214 132 1,346 — 492 — 492 Hybrids at NAV (4) 506 2,339 Hedge Funds — 45 — 45 — 63 — 63 Hedge Funds at NAV — 21 Common Contractual Funds at NAV (5) Equities at NAV 1,929 2,547 Fixed Income at NAV 639 701 Emerging Markets at NAV 275 368 Alternative investments at NAV 378 363 Real Estate Funds 6 186 37 229 38 158 57 253 Insurance Group Annuity Contracts — 59 38 97 — 35 52 87 Cash and Cash Equivalents 167 256 — 423 184 363 — 547 Other (6) 39 250 1 290 43 122 1 166 Obligation to return cash received from repurchase agreements (7) — (1,802 ) — (1,802 ) — — — — Total $ 743 $ 6,284 $ 248 $ 12,167 $ 900 $ 4,061 $ 143 $ 12,610 (1) Includes various worldwide equity index funds with the objective to provide returns that are consistent with the FTSE All World indexes. While the funds are not publicly traded, the custodians strike a net asset value at least monthly. There are no redemption restrictions or future commitments on these investments. (2) Includes various government bonds issued by worldwide governments, interest rate swaps, and cash, to match or slightly outperform the benchmark of the future liabilities of the funds. While the funds are not publicly traded, the custodians strike a net asset value daily. There are no redemption restrictions or future commitments on these investments. (3) Includes a fund that invests in both private and public equities primarily in the UK, as well as emerging markets across all sectors. The fund also holds fixed income and derivative instruments to hedge interest rate and inflation risk. In addition, the fund includes units in transferable securities, collective investment schemes, money market funds, asset-backed income, private debt, cash, and deposits. (4) Includes pooled funds that invest in asset-backed securities awaiting investment into non-liquid secured income opportunities. Units are available for subscription on the first day of each calendar month at net asset value. In fiscal 2017, also included pooled funds that invest in government bonds and derivative instruments, such as interest rate swaps, future contracts and repurchase agreements with the objective to provide nominal and/or inflation-linked returns. While the funds in fiscal 2017 were not publicly traded, the custodians struck a net asset value at least monthly. There are no redemption restrictions or future commitments on these investments. (5) HP Invest Common Contractual Funds (CCFs) are investment arrangements in which institutional investors pool their assets. Units may be acquired in four different sub-funds focused on equities, fixed income, alternative investments, and emerging markets. Each sub-fund is invested in accordance with the fund’s investment objective and units are issued in relation to each sub-fund. While the sub-funds are not publicly traded, the custodian strikes a net asset value either once or twice a month, depending on the sub-fund. There are no redemption restrictions or future commitments on these investments. (6) Includes international insured contracts, derivative instruments, mortgage backed securities, and unsettled transactions. (7) Repurchase agreements, primarily in the UK, represent the plans' short-term borrowing to hedge against interest rate and inflation risks. Investments in government bonds collateralize this short-term borrowing. The plans have an obligation to return the cash after the term of the agreements. Due to the short-term nature of the agreements, the outstanding balance of the obligation approximates fair value. |
Schedule of changes in fair value measurements of Level 3 investments for Direct non-U.S. defined benefit plans | Changes in fair value measurements of Level 3 investments for the non-U.S. defined benefit plans were as follows: Fiscal year ended October 31, 2018 Alternative Private Hybrids Real Insurance Other Total In millions Balance at beginning of year $ 33 $ — $ 57 $ 52 $ 1 $ 143 Actual return on plan assets: Relating to assets held at the reporting date 6 2 — (7 ) — 1 Relating to assets sold during the period 5 — — — — 5 Purchases, sales, and settlements (4 ) 130 (20 ) (7 ) — 99 Transfers in and/or out of Level 3 — — — — — — Balance at end of year $ 40 $ 132 $ 37 $ 38 $ 1 $ 248 Fiscal year ended October 31, 2017 Alternative Private Real Insurance Other Total In millions Balance at beginning of year $ 32 $ 26 $ 63 $ 8 $ 129 Actual return on plan assets: Relating to assets held at the reporting date — 3 (39 ) 12 (24 ) Relating to assets sold during the period 1 — — — 1 Purchases, sales, and settlements — — — 28 28 Transfers in and/or out of Level 3 — 28 28 (47 ) 9 Balance at end of year $ 33 $ 57 $ 52 $ 1 $ 143 |
Schedule of weighted-average target and actual asset allocations across the benefit plans | The weighted-average target and actual asset allocations across the benefit plans at the respective measurement dates for the non-U.S. defined benefit plans were as follows: Defined Plan Assets Asset Category 2018 2018 2017 Public equity securities 28.7 % 33.8 % Private/hybrid equity securities 18.7 % 25.7 % Real estate and other 4.2 % 3.3 % Equity-related investments 56.3 % 51.6 % 62.8 % Debt securities 41.9 % 44.9 % 32.9 % Cash and cash equivalents 1.8 % 3.5 % 4.3 % Total 100.0 % 100.0 % 100.0 % |
Schedule of estimated future benefits payable for the Company's direct retirement plans | As of October 31, 2018 , estimated future benefits payments for the Company's retirement plans were as follows: Fiscal year Defined Benefit Plans Post-Retirement Benefit Plans In millions 2019 $ 453 $ 9 2020 427 10 2021 449 10 2022 469 10 2023 492 11 Next five fiscal years to October 31, 2028 2,704 59 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Share-based compensation | |
Schedule of stock based compensation expense and the resulting tax benefits | Stock-based compensation expense and the resulting tax benefits were as follows: Fiscal years ended October 31, 2018 2017 2016 In millions Stock-based compensation expense from continuing operations $ 309 $ 454 $ 408 Income tax benefit (56 ) (159 ) (131 ) Stock-based compensation expense from continuing operations, net of tax $ 253 $ 295 $ 277 Stock-based compensation expense from discontinued operations $ — $ 166 $ 189 |
Schedule of restricted stock award activity | The following table summarizes restricted stock unit activity: Fiscal years ended October 31, 2018 2017 2016 Shares Weighted- Shares Weighted- Shares Weighted- In thousands In thousands In thousands Outstanding at beginning of year 48,517 $ 14 57,321 $ 15 — $ — Converted from former Parent's Plans — $ — — $ — 42,012 $ 15 Granted and assumed through acquisition (1) 22,131 $ 15 23,980 $ 21 32,752 $ 15 Additional shares granted due to post-spin adjustments (2) — $ — 25,543 $ 9 — $ — Vested (3) (32,659 ) $ 14 (51,976 ) $ 16 (12,747 ) $ 15 Forfeited/canceled (4) (5,572 ) $ 14 (6,351 ) $ 16 (4,696 ) $ 15 Outstanding at end of year 32,417 $ 14 48,517 $ 14 57,321 $ 15 (1) Fiscal 2017 includes approximately 11 million restricted stock units assumed by the Company through acquisition with a weighted-average grant date fair value of $18 per share. Fiscal 2016 includes a one-time restricted stock unit retention grant of approximately 5 million shares. (2) Additional shares granted as a result of the post-spin exercise price adjustments made related to the Everett and Seattle Transactions, as permitted by the Plan, in order to preserve the intrinsic value of outstanding awards prior to the close of the transactions. (3) Fiscal 2018 includes approximately 6 million restricted stock units, with a weighted-average grant date fair value of $14 per share, which were accelerated to vest on June 1, 2018 as part of the Everett Transaction. Fiscal 2017 includes approximately 14 million restricted stock units, with a weighted-average grant date fair value of $17 per share, which were accelerated as part of the Everett and Seattle Transactions. (4) Fiscal 2017 includes approximately 0.3 million restricted stock units, with a weighted-average grant date fair value of $18 per share, related to the former ES and Software segments, which were canceled by HPE and assumed by DXC and Micro Focus in connection with the Everett and Seattle Transactions, and in accordance with the respective Employee Matters Agreements. |
Stock Options | |
Share-based compensation | |
Schedule of weighted-average fair value and the assumptions used to measure fair value | The weighted-average fair value and the assumptions used to measure fair value were as follows: Fiscal years ended October 31, 2017 2016 Weighted-average fair value (1) $ 6 $ 4 Expected volatility (2) 25.7 % 31.1 % Risk-free interest rate (3) 2.0 % 1.7 % Expected dividend yield (4) 1.0 % 1.5 % Expected term in years (5) 6.1 5.4 (1) The weighted-average fair value was based on the fair value of stock options granted under the Plan during the respective periods. (2) Expected volatility was estimated using the average historical volatility of selected peer companies. (3) The risk-free interest rate was estimated based on the yield on U.S. Treasury zero-coupon issues. (4) The expected dividend yield represents a constant dividend yield applied for the duration of the expected term of the option. (5) For options granted subject to service-based vesting, the expected term was estimated using the simplified method detailed in SEC Staff Accounting Bulletin No. 110. |
Schedule of stock options activity | The following table summarizes stock option activity: Fiscal years ended October 31, 2018 2017 2016 Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate In thousands In years In millions In thousands In years In millions In thousands In years In millions Outstanding at beginning of year 49,274 $ 10 57,498 $ 15 — $ — Converted from former Parent's Plans — $ — — $ — 42,579 $ 15 Granted and assumed through acquisition (1) 316 $ 10 6,074 $ 23 25,390 $ 15 Additional shares granted due to post-spin adjustments (2) — $ — 24,523 $ 11 — $ — Exercised (26,476 ) $ 9 (29,492 ) $ 12 (7,845 ) $ 11 Forfeited/canceled/expired (3) (4,851 ) $ 13 (9,329 ) $ 16 (2,626 ) $ 20 Outstanding at end of year (4) 18,263 $ 10 4.2 $ 92 49,274 $ 10 4.6 $ 207 57,498 $ 15 5.4 $ 437 Vested and expected to vest at end of year (4) 18,038 $ 10 4.2 $ 91 48,566 $ 10 4.6 $ 205 55,716 $ 15 5.3 $ 425 Exercisable at end of year (4) 14,896 $ 10 3.7 $ 85 24,736 $ 9 3.0 $ 123 26,204 $ 13 3.8 $ 241 (1) Fiscal 2016 includes one-time stock option retention grant of approximately 16 million shares. (2) Additional shares granted as a result of the post-spin exercise price adjustments made related to the Everett and Seattle Transactions, as permitted by the Plan, in order to preserve the intrinsic value of the awards prior to the close of the transaction. (3) Fiscal 2017 includes approximately 8 million stock options, with a weighted-average exercise price of $16 per share, related to the former ES and Software segments, which were canceled by HPE in connection with the Everett and Seattle Transactions, and in accordance with the respective Employee Matters Agreements. (4) The weighted average exercise price reflects the impact of the post-spin adjustments to the exercise price related to the Everett and Seattle Transactions. |
Schedule of significant ranges of outstanding and exercisable stock options | The following table summarizes significant ranges of outstanding and exercisable stock options: As of October 31, 2018 Options Outstanding Options Exercisable Range of Exercise Prices Shares Weighted- Weighted- Shares Weighted- In thousands In years In thousands $0-$9.99 10,862 3.8 $ 8 10,368 $ 8 $10-$19.99 7,358 4.8 $ 14 4,485 $ 13 $20-$29.99 43 2.8 $ 25 43 $ 25 18,263 4.2 $ 10 14,896 $ 10 |
Taxes on Earnings (Tables)
Taxes on Earnings (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of domestic and foreign components of earnings before taxes | The domestic and foreign components of earnings from continuing operations before taxes were as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions U.S. (1) $ (2,805 ) $ (1,929 ) $ (1,758 ) Non-U.S. (1) 3,073 2,201 5,618 $ 268 $ 272 $ 3,860 (1) F iscal 2017 and 2016 amounts have been reclassified to conform with the current period presentation. |
Schedule of provision for (benefit from) taxes on earnings | The Benefit (provision) for taxes on earnings from continuing operations were as follows: For the fiscal years ended October 31, 2018 2017 2016 In millions U.S. federal taxes: Current $ (2,177 ) $ 560 $ 940 Deferred 150 (1,366 ) (959 ) Non-U.S. taxes: Current 419 64 874 Deferred (188 ) 25 (58 ) State taxes: Current 52 (107 ) 36 Deferred — 660 (210 ) $ (1,744 ) $ (164 ) $ 623 |
Schedule of differences between the U.S. federal statutory income tax rate and effective tax rate | The differences between the U.S. federal statutory income tax rate and the Company's effective tax rate were as follows: For the fiscal years ended October 31, 2018 2017 2016 U.S. federal statutory income tax rate 23.3 % 35.0 % 35.0 % State income taxes, net of federal tax benefit 4.3 % 3.0 % 1.0 % Lower rates in other jurisdictions, net (121.4 )% (426.3 )% (24.5 )% Valuation allowance (59.8 )% 310.0 % (14.7 )% U.S. permanent differences 39.3 % 27.8 % (2.3 )% Uncertain tax positions (694.8 )% (8.4 )% 23.1 % Impacts of the Tax Act (1) 158.0 % — % — % Other, net 0.4 % (1.4 )% (1.5 )% (650.7 )% (60.3 )% 16.1 % (1) Impacts of the Tax Act is inclusive of valuation allowances recorded as a result of the U.S. law change. |
Schedule of reconciliation of gross unrecognized tax benefits | A reconciliation of unrecognized tax benefits is as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 11,262 $ 11,411 $ 4,901 Increases: For current year's tax positions 163 28 1,456 For prior years' tax positions 66 311 820 Net transfers from former Parent through equity — — 4,455 Decreases: For prior years' tax positions (82 ) (202 ) (114 ) Statute of limitations expiration (86 ) (70 ) (47 ) Settlements with taxing authorities (2 ) (216 ) (60 ) Settlements related to joint and several positions of former Parent (2,495 ) — — Balance at end of year $ 8,826 $ 11,262 $ 11,411 |
Schedule of significant components of deferred tax assets and deferred tax liabilities | The significant components of deferred tax assets and deferred tax liabilities were as follows: As of October 31, 2018 2017 In millions Deferred tax assets: Loss and credit carry-forwards (1) $ 9,149 $ 4,775 Inventory valuation 77 79 Intercompany transactions—royalty prepayments (2) 48 4,267 Intercompany transactions—excluding royalty prepayments 63 129 Warranty 81 156 Employee and retiree benefits 498 661 Restructuring 101 186 Deferred revenue 518 757 Intangible assets 48 — Other 432 593 Total deferred tax assets 11,015 11,603 Valuation allowance (3) (8,209 ) (2,789 ) Total deferred tax assets net of valuation allowance 2,806 8,814 Deferred tax liabilities: Unremitted earnings of foreign subsidiaries (4) (161 ) (3,824 ) Fixed assets (470 ) (385 ) Intangible assets — (46 ) Total deferred tax liabilities (631 ) (4,255 ) Net deferred tax assets and liabilities $ 2,175 $ 4,559 (1) The increase is primarily due to certain foreign loss carryforwards recognized in the current year and increases in U.S. domestic capital loss carryforwards recognized in the current year. (2) During fiscal 2018, the Company executed an intercompany sale transaction that resulted in the reversal of $2.1 billion of deferred tax assets attributable to deferred revenue. The tax impacts of the transaction are considered prepaid under FASB guidance applicable to fiscal 2018. The additional decrease is primarily a result of deferred tax remeasurement related to the Tax Act. (3) The increase is primarily due to certain foreign loss carryforwards recognized in the current year and increases in U.S. domestic capital loss carryforwards recognized in the current year against which valuation allowances were required as well as a partial valuation allowance recorded against U.S. foreign tax credits carryforwards as a result of the Tax Act. (4) The decrease is primarily due to $3.7 billion benefit from the reversal of previous deferred tax recognized on foreign earnings and profits as a result of the Tax Act. |
Schedule of current and long-term deferred tax assets and liabilities | Deferred tax assets and liabilities included in the Consolidated Balance Sheets are as follows: As of October 31, 2018 2017 In millions Deferred tax assets $ 2,403 $ 4,663 Deferred tax liabilities (228 ) (104 ) Deferred tax assets net of deferred tax liabilities $ 2,175 $ 4,559 |
Schedule of tax credit carryforwards | As of October 31, 2018 , Hewlett Packard Enterprise had recorded deferred tax assets for various tax credit carryforwards as follows: Carryforward Valuation Initial In millions U.S. foreign tax credits $ 1,832 $ (687 ) 2021 U.S. research and development and other credits 122 — 2019 Tax credits in state and foreign jurisdictions 158 (124 ) 2020 Balance at end of year $ 2,112 $ (811 ) |
Schedule of valuation allowance balance | The deferred tax asset valuation allowance and changes were as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 2,789 $ 2,095 $ 1,572 Income tax expense (166 ) 848 (203 ) Income tax expense related to the Tax Act 687 — — Valuation allowance offsetting current year losses recorded 5,028 — — Other comprehensive income, currency translation and charges to other accounts (129 ) (154 ) 726 Balance at end of year $ 8,209 $ 2,789 $ 2,095 |
Balance Sheet Details (Table)
Balance Sheet Details (Table) | 12 Months Ended |
Oct. 31, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |
Accounts Receivable, Net | Accounts Receivable, Net As of October 31, 2018 2017 In millions Unbilled receivable $ 185 $ 223 Accounts receivable 3,117 2,892 Allowance for doubtful accounts (39 ) (42 ) Total $ 3,263 $ 3,073 |
Schedule of revolving short-term financing arrangements | The allowance for doubtful accounts related to accounts receivable and changes therein were as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 42 $ 49 $ 72 Provision for doubtful accounts 20 16 22 Deductions, net of recoveries (23 ) (23 ) (45 ) Balance at end of year $ 39 $ 42 $ 49 |
Schedule of transferred trade receivables not collected from the third parties | The activity related to Hewlett Packard Enterprise's revolving short-term financing arrangements was as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of period (1) $ 121 $ 145 $ 68 Trade receivables sold 4,844 3,910 3,015 Cash receipts (4,794 ) (3,937 ) (2,931 ) Foreign currency and other (5 ) 3 (7 ) Balance at end of period (1) $ 166 $ 121 $ 145 (1) Beginning and ending balances represent amounts for trade receivables sold but not yet collected. |
Inventory | Inventory As of October 31, 2018 2017 In millions Finished goods $ 1,274 $ 1,236 Purchased parts and fabricated assemblies 1,173 1,079 Total $ 2,447 $ 2,315 |
Other Current Assets | Other Current Assets As of October 31, 2018 2017 In millions Value-added taxes receivable $ 811 $ 819 Manufacturer and other receivables 1,141 1,185 Prepaid and other current assets 1,328 1,081 Total $ 3,280 $ 3,085 |
Property, Plant and Equipment | Property, Plant and Equipment As of October 31, 2018 2017 In millions Land $ 294 $ 312 Buildings and leasehold improvements 2,103 2,371 Machinery and equipment, including equipment held for lease 9,419 9,194 11,816 11,877 Accumulated depreciation (5,678 ) (5,608 ) Total $ 6,138 $ 6,269 |
Long-Term Financing Receivables and Other Assets | Long-Term Financing Receivables and Other Assets As of October 31, 2018 2017 In millions Financing receivables, net $ 4,740 $ 4,380 Deferred tax assets 2,403 4,663 Indemnification receivables - long-term 16 1,430 Prepaid taxes - long-term 2,340 293 Prepaid pension assets 829 830 Other 1,031 1,004 Total $ 11,359 $ 12,600 |
Other Accrued Liabilities | Other Accrued Liabilities As of October 31, 2018 2017 In millions Accrued taxes - other $ 1,010 $ 929 Warranty - short-term 241 269 Sales and marketing programs 910 780 Other 1,679 1,866 Total $ 3,840 $ 3,844 |
Other Liabilities | Other Non-Current Liabilities As of October 31, 2018 2017 In millions Pension, post-retirement, and post-employment liabilities $ 1,434 $ 1,413 Deferred revenue - long-term 2,646 2,487 Tax liability - long-term 1,485 3,859 Other long-term liabilities 1,320 1,036 Total $ 6,885 $ 8,795 |
Financing Receivables and Ope_2
Financing Receivables and Operating Leases (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Leases [Abstract] | |
Components of financing receivables | The components of financing receivables were as follows: As of October 31, 2018 2017 In millions Minimum lease payments receivable $ 8,691 $ 8,226 Unguaranteed residual value 297 272 Unearned income (732 ) (654 ) Financing receivables, gross 8,256 7,844 Allowance for doubtful accounts (120 ) (86 ) Financing receivables, net 8,136 7,758 Less: current portion (1) (3,396 ) (3,378 ) Amounts due after one year, net (1) $ 4,740 $ 4,380 (1) The Company includes the current portion in Financing receivables, and amounts due after one year, net, in Long-term financing receivables and other assets in the accompanying Consolidated Balance Sheets. |
Scheduled maturities of minimum lease payments receivable | As of October 31, 2018 , scheduled maturities of the Company's minimum lease payments receivable were as follows: 2019 2020 2021 2022 2023 Thereafter Total In millions Scheduled maturities of minimum lease payments receivable $ 3,746 $ 2,331 $ 1,468 $ 763 $ 303 $ 80 $ 8,691 |
Credit risk profile of gross financing receivables | The credit risk profile of gross financing receivables, based on internal risk ratings, was as follows: As of October 31, 2018 2017 In millions Risk Rating: Low $ 4,238 $ 4,156 Moderate 3,805 3,556 High 213 132 Total $ 8,256 $ 7,844 |
Schedule of allowance for doubtful accounts for financing receivables | The allowance for doubtful accounts related to financing receivables and changes therein were as follows: As of October 31, 2018 2017 2016 In millions Balance at beginning of year $ 86 $ 89 $ 95 Provision for doubtful accounts 49 23 11 Write-offs (15 ) (26 ) (17 ) Balance at end of year $ 120 $ 86 $ 89 |
Gross financing receivables and related allowance collectively and individually evaluated for loss | The gross financing receivables and related allowance evaluated for loss were as follows: As of October 31, 2018 2017 In millions Gross financing receivables collectively evaluated for loss $ 7,917 $ 7,523 Gross financing receivables individually evaluated for loss 339 321 Total $ 8,256 $ 7,844 Allowance for financing receivables collectively evaluated for loss $ 78 $ 67 Allowance for financing receivables individually evaluated for loss 42 19 Total $ 120 $ 86 |
Summary of the aging and non-accrual status of gross financing receivables | The following table summarizes the aging and non-accrual status of gross financing receivables: As of October 31, 2018 2017 In millions Billed: (1) Current 1-30 days $ 275 $ 257 Past due 31-60 days 42 52 Past due 61-90 days 13 15 Past due >90 days 74 58 Unbilled sales-type and direct-financing lease receivables 7,852 7,462 Total gross financing receivables $ 8,256 $ 7,844 Gross financing receivables on non-accrual status (2) $ 226 $ 188 Gross financing receivables 90 days past due and still accruing interest (2) $ 113 $ 133 (1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables. (2) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables. |
Schedule of operating lease assets included in machinery and equipment | Operating lease assets included in Property, plant and equipment in the Consolidated Balance Sheets were as follows: As of October 31, 2018 2017 In millions Equipment leased to customers $ 7,290 $ 7,356 Accumulated depreciation (3,078 ) (2,943 ) Total $ 4,212 $ 4,413 |
Minimum future rentals on non-cancelable operating leases | As of October 31, 2018 , minimum future rentals on non-cancelable operating leases related to leased equipment were as follows: 2019 2020 2021 2022 2023 Thereafter Total In millions Minimum future rentals on non-cancelable operating leases $ 1,901 $ 1,156 $ 477 $ 69 $ 9 $ 1 $ 3,613 |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Business Combinations [Abstract] | |
Aggregate purchase price allocation, including preliminary allocations | The following table presents the aggregate purchase price allocation, including those items that were preliminary allocations, for the Company's acquisitions for the fiscal year ended October 31, 2017: In millions Goodwill $ 1,427 Amortizable intangible assets 603 In-process research and development 85 Net assets assumed 340 Total fair value consideration $ 2,455 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of allocation and changes in the carrying amount of goodwill | Goodwill and related changes in the carrying amount by reportable segment were as follows: Hybrid IT Intelligent Financial Total In millions Balance at October 31, 2016 $ 14,045 $ 1,901 $ 144 $ 16,090 Goodwill acquired during the period 1,410 17 — 1,427 Changes due to foreign currency 1 — — 1 Goodwill adjustments (2 ) — — (2 ) Balance at October 31, 2017 15,454 1,918 144 17,516 Goodwill acquired during the period 101 3 — 104 Impairment of goodwill (88 ) — — (88 ) Changes due to foreign currency 6 — — 6 Goodwill adjustments (1 ) — — (1 ) Balance at October 31, 2018 $ 15,472 $ 1,921 $ 144 $ 17,537 |
Intangible Assets | Intangible assets comprise: As of October 31, 2018 As of October 31, 2017 Gross Accumulated Net Gross Accumulated Net In millions Customer contracts, customer lists and distribution agreements $ 272 $ (142 ) $ 130 $ 268 $ (71 ) $ 197 Developed and core technology and patents 1,121 (525 ) 596 1,133 (427 ) 706 Trade name and trade marks 87 (42 ) 45 87 (23 ) 64 In-process research and development 18 — 18 75 — 75 Total intangible assets $ 1,498 $ (709 ) $ 789 $ 1,563 $ (521 ) $ 1,042 |
Schedule of intangible assets | As of October 31, 2018 , the weighted-average remaining useful lives of the Company's finite-lived intangible assets were as follows: Finite-Lived Intangible Assets Weighted-Average In years Customer contracts, customer lists and distribution agreements 4 Developed and core technology and patents 4 Trade name and trade marks 4 |
Schedule of estimated future amortization expense related to finite-lived purchased intangible assets | As of October 31, 2018 , estimated future amortization expense related to finite-lived intangible assets was as follows: Fiscal year In millions 2019 $ 248 2020 197 2021 126 2022 92 2023 68 Thereafter 40 Total $ 771 |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis: As of October 31, 2018 As of October 31, 2017 Fair Value Fair Value Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total In millions Assets Cash Equivalents and Investments: Time deposits $ — $ 781 $ — $ 781 $ — $ 1,159 $ — $ 1,159 Money market funds 2,340 — — 2,340 5,592 — — 5,592 Foreign bonds 7 124 — 131 9 214 — 223 Other debt securities — — 25 25 — — 26 26 Derivative Instruments: Foreign exchange contracts — 496 — 496 — 259 — 259 Other derivatives — — — — — 1 — 1 Total assets $ 2,347 $ 1,401 $ 25 $ 3,773 $ 5,601 $ 1,633 $ 26 $ 7,260 Liabilities Derivative Instruments: Interest rate contracts $ — $ 353 $ — $ 353 $ — $ 142 $ — $ 142 Foreign exchange contracts — 117 — 117 — 335 — 335 Other derivatives — 6 — 6 — — — — Total liabilities $ — $ 476 $ — $ 476 $ — $ 477 $ — $ 477 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Investments, All Other Investments [Abstract] | |
Schedule of cash equivalents and available-for-sale investments | Cash equivalents and available-for-sale investments were as follows: As of As of Cost Gross Gross Fair Cost Gross Gross Fair In millions Cash Equivalents: Time deposits $ 781 $ — $ — $ 781 $ 1,159 $ — $ — $ 1,159 Money market funds 2,340 — — 2,340 5,592 — — 5,592 Total cash equivalents 3,121 — — 3,121 6,751 — — 6,751 Available-for-Sale Investments: Foreign bonds 113 18 — 131 183 40 — 223 Other debt securities 26 — (1 ) 25 37 — (11 ) 26 Total available-for-sale investments 139 18 (1 ) 156 220 40 (11 ) 249 Total cash equivalents and available-for-sale investments $ 3,260 $ 18 $ (1 ) $ 3,277 $ 6,971 $ 40 $ (11 ) $ 7,000 |
Schedule of contractual maturities of investments in available-for-sale debt securities | Contractual maturities of investments in available-for-sale debt securities were as follows: As of Amortized Fair Value In millions Due in more than five years $ 139 $ 156 |
Schedule of gross notional and fair value of derivative instruments in the Combined and Consolidated Balance Sheets | The gross notional and fair value of derivative instruments in the Consolidated Balance Sheets was as follows: As of As of Fair Value Fair Value Outstanding Other Long-Term Other Long-Term Outstanding Other Long-Term Other Long-Term In millions Derivatives designated as hedging instruments Fair value hedges: Interest rate contracts $ 6,850 $ — $ — $ — $ 353 $ 9,500 $ — $ — $ 16 $ 126 Cash flow hedges: Foreign currency contracts 8,423 270 107 11 15 7,202 105 45 101 70 Net investment hedges: Foreign currency contracts 1,737 32 41 13 11 1,944 35 10 36 41 Total derivatives designated as hedging instruments 17,010 302 148 24 379 18,646 140 55 153 237 Derivatives not designated as hedging instruments Foreign currency contracts 6,780 41 5 55 12 9,552 61 3 79 8 Other derivatives 104 — — 6 — 96 1 — — — Total derivatives not designated as hedging instruments 6,884 41 5 61 12 9,648 62 3 79 8 Total derivatives $ 23,894 $ 343 $ 153 $ 85 $ 391 $ 28,294 $ 202 $ 58 $ 232 $ 245 |
Schedule of information related to the potential effect of entity's master netting agreements and collateral security agreements | As of October 31, 2018 and 2017 , information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements was as follows: As of In the Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 496 $ — $ 496 $ 179 $ 205 (1) $ 112 Derivative liabilities $ 476 $ — $ 476 $ 179 $ 302 (2) $ (5 ) As of In the Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 260 $ — $ 260 $ 209 $ 34 (1) $ 17 Derivative liabilities $ 477 $ — $ 477 $ 209 $ 242 (2) $ 26 (1) Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. (2) Represents the collateral posted by the Company in cash or through re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of October 31, 2018, $302 million of collateral posted was entirely cash. As of October 31, 2017, of the $242 million of collateral posted, $220 million was in cash and $22 million was through the re-use of counterparty collateral. |
Schedule of pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship | The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship for the fiscal years ended October 31, 2018 , 2017 and 2016 was as follows: Gains (Losses) Recognized in Income on Derivative and Related Hedged Item Derivative Instrument Location 2018 2017 2016 Hedged Item Location 2018 2017 2016 In millions In millions Interest rate contracts Interest and other, net $ (211 ) $ (245 ) $ 158 Fixed-rate debt Interest and other, net $ 211 $ 245 $ (158 ) |
Schedule of pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the fiscal years ended October 31, 2018 , 2017 and 2016 was as follows: Gains (Losses) Gains (Losses) Reclassified from Accumulated OCI 2018 2017 2016 Location 2018 2017 2016 In millions In millions Cash flow hedges: Foreign currency contracts $ 163 $ (113 ) $ (71 ) Net revenue $ (24 ) $ (68 ) $ (48 ) Foreign currency contracts — (1 ) 1 Cost of products — — — Foreign currency contracts — — — Gain on H3C and MphasiS divestitures — — 8 Foreign currency contracts 6 159 236 Interest and other, net 16 170 243 Subtotal 169 45 166 Net earnings from continuing operations (8 ) 102 203 Foreign currency contracts — 1 60 Net loss from discontinued operations — 43 67 Total cash flow hedges $ 169 $ 46 $ 226 Net earnings $ (8 ) $ 145 $ 270 Net investment hedges: Foreign currency contracts $ 81 $ (71 ) $ (58 ) Interest and other, net $ — $ — $ — |
Schedule of pre-tax effect of derivative instruments not designated as hedging instruments on the Combined and Consolidated Statements of Earnings | The pre-tax effect of derivative instruments not designated as hedging instruments on the Consolidated Statements of Earnings for the fiscal years ended October 31, 2018 , 2017 and 2016 was as follows: Gains (Losses) Recognized in Income on Derivatives Location 2018 2017 2016 In millions Foreign currency contracts Interest and other, net $ 301 $ (443 ) $ (425 ) Other derivatives Interest and other, net (6 ) 3 (4 ) Total $ 295 $ (440 ) $ (429 ) |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of notes payable and short-term borrowings, including the current portion of long-term debt | Notes payable and short-term borrowings, including the current portion of long-term debt, were as follows: As of October 31, 2018 2017 Amount Weighted-Average Amount Weighted-Average Dollars in millions Current portion of long-term debt $ 1,196 2.2 % $ 3,005 3.2 % FS Commercial paper 392 (0.2 )% 401 (0.1 )% Notes payable to banks, lines of credit and other (1) 417 2.5 % 444 1.8 % Total notes payable and short-term borrowings $ 2,005 $ 3,850 (1) Notes payable to banks, lines of credit and other includes $361 million and $390 million at October 31, 2018 and 2017 , respectively, of borrowing- and funding-related activity associated with FS and its subsidiaries. |
Schedule of long-term debt | Long-Term Debt As of October 31, 2018 2017 In millions Hewlett Packard Enterprise Senior Notes $2,650 issued at discount to par at a price of 99.872% in October 2015 at 2.85%, due October 5, 2018, interest payable semi-annually on April 5 and October 5 of each year $ — $ 2,648 $250 issued at par in October 2015 at three-month USD LIBOR plus 1.93%, due October 5, 2018, interest payable quarterly on January 5, April 5, July 5 and October 5 of each year — 250 $1,100 issued at discount to par at a price of 99.994% in September 2017 at 2.10%, due October 4, 2019, interest payable semi-annually on April 4 and October 4 of each year 1,100 1,100 $3,000 issued at discount to par at a price of 99.972% in October 2015 at 3.6%, due October 15, 2020, interest payable semi-annually on April 15 and October 15 of each year 3,000 3,000 $500 issued at discount to par at a price of 99.861% in September 2018 at 3.5%, due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year 499 — $800 issued at par in September 2018 at three-month USD LIBOR plus 0.72% due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year 800 — $1,350 issued at discount to par at a price of 99.802% in October 2015 at 4.4%, due October 15, 2022, interest payable semi-annually on April 15 and October 15 of each year 1,348 1,348 $2,500 issued at discount to par at a price of 99.725% in October 2015 at 4.9%, due October 15, 2025, interest payable semi-annually on April 15 and October 15 of each year 2,495 2,495 $750 issued at discount to par at a price of 99.942% in October 2015 at 6.2%, due October 15, 2035, interest payable semi-annually on April 15 and October 15 of each year 750 750 $1,500 issued at discount to par at a price of 99.932% in October 2015 at 6.35%, due October 15, 2045, interest payable semi-annually on April 15 and October 15 of each year 1,499 1,499 Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030 (1) 236 286 Fair value adjustment related to hedged debt (353 ) (142 ) Unamortized debt issuance costs (42 ) (47 ) Less: current portion (1,196 ) (3,005 ) Total long-term debt $ 10,136 $ 10,182 (1) Other, including capital lease obligations includes $131 million and $160 million as of October 31, 2018 and 2017 , respectively, of borrowing- and funding-related activity associated with FS and its subsidiaries that are collateralized by receivables and underlying assets associated with the related capital and operating leases. For both the periods presented, the carrying amount of the assets approximated the carrying amount of the borrowings. |
Schedule of interest expense on borrowings recognized in the Combined and Consolidated Statements of Earnings | Interest expense on borrowings recognized in the Consolidated Statements of Earnings was as follows: Fiscal years ended October 31, Expense Location 2018 2017 2016 In millions Financing interest Financing interest $ 278 $ 265 $ 249 Interest expense Interest and other, net 353 334 298 Total interest expense $ 631 $ 599 $ 547 |
Schedule of aggregate future maturities of long-term debt at face value | As of October 31, 2018 , aggregate future maturities of the Company's long-term debt at face value (excluding a fair value adjustment related to hedged debt of $353 million and a net discount on debt issuance of $9 million ), including capital lease obligations were as follows: Fiscal year In millions 2019 $ 1,201 2020 3,021 2021 1,344 2022 1,363 2023 16 Thereafter 4,791 Total $ 11,736 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Schedule of tax effects related to changes in Other Comprehensive (Loss) Income | Taxes related to Other Comprehensive Income (Loss) Fiscal years ended October 31, 2018 2017 2016 In millions Taxes on change in net unrealized losses on available-for-sale securities: Tax (provision) benefit on net unrealized losses arising during the period $ — $ (2 ) $ 2 Tax provision (benefit) on (gains) losses reclassified into earnings — 1 (2 ) — (1 ) — Taxes on change in net unrealized gains (losses) on cash flow hedges: Tax (provision) benefit on net unrealized gains arising during the period (22 ) 6 (14 ) Tax (benefit) provision on net losses (gains) reclassified into earnings (1 ) 10 25 (23 ) 16 11 Taxes on change in unrealized components of defined benefit plans: Tax benefit (provision) on (losses) gains arising during the period 2 (49 ) 63 Tax provision on amortization of actuarial loss and prior service benefit (14 ) (19 ) (20 ) Tax provision on curtailments, settlements and other (10 ) (91 ) (1 ) (22 ) (159 ) 42 Taxes on change in cumulative translation adjustment: Tax on cumulative translation adjustment arising during the period 3 (1 ) 20 Tax on release of cumulative translation adjustment as a result of divestitures — — (22 ) 3 (1 ) (2 ) Tax (provision) benefit on other comprehensive (loss) income $ (42 ) $ (145 ) $ 51 |
Schedule of changes and reclassifications related to items of Other Comprehensive (Loss) Income, net of taxes | Changes and reclassifications related to Other Comprehensive Income (Loss), net of taxes Fiscal years ended October 31, 2018 2017 2016 In millions Other comprehensive (loss) income, net of taxes: Change in net unrealized losses on available-for-sale securities: Net unrealized losses arising during the period $ (3 ) $ (10 ) $ (2 ) (Gains) losses reclassified into earnings (9 ) (3 ) 1 (12 ) (13 ) (1 ) Change in net unrealized gains (losses) on cash flow hedges: Net unrealized gains arising during the period 147 52 212 Net losses (gains) reclassified into earnings (1) 7 (135 ) (245 ) 154 (83 ) (33 ) Change in unrealized components of defined benefit plans: (Losses) gains arising during the period (421 ) 895 (1,714 ) Amortization of actuarial loss and prior service benefit (2) 177 266 264 Curtailments, settlements and other 12 (76 ) (19 ) (232 ) 1,085 (1,469 ) Change in cumulative translation adjustment: Cumulative translation adjustment arising during the period (67 ) (15 ) (134 ) Release of cumulative translation adjustment as a result of divestitures and country exits 20 — 53 (47 ) (15 ) (81 ) Other comprehensive (loss) income, net of taxes $ (137 ) $ 974 $ (1,584 ) (1) For more details on reclassification of pre-tax losses (gains) on cash flow hedges into the Consolidated Statements of Earnings, see Note 14, "Financial Instruments". (2) These components are included in the computation of net pension and post-retirement benefit (credit) cost in Note 6, "Retirement and Post-Retirement Benefit Plans". |
Schedule of Accumulated Other Comprehensive loss, net of taxes | The components of accumulated other comprehensive loss, net of taxes as of October 31, 2018 and changes during fiscal 2018 were as follows: Net unrealized Net unrealized Unrealized Cumulative Accumulated In millions Balance at beginning of period $ 29 $ (48 ) $ (2,690 ) $ (186 ) $ (2,895 ) Activity related to separation and merger transactions — — — (186 ) (186 ) Other comprehensive (loss) income before reclassifications (3 ) 147 (421 ) (67 ) (344 ) Reclassifications of (gains) losses into earnings (9 ) 7 189 20 207 Balance at end of period $ 17 $ 106 $ (2,922 ) $ (419 ) $ (3,218 ) |
Net Earnings Per Share (Tables)
Net Earnings Per Share (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Earnings Per Share [Abstract] | |
Basic and diluted net Earnings Per Share calculations | The reconciliations of the numerators and denominators of each of the basic and diluted net EPS calculations were as follows: Fiscal years ended October 31, 2018 2017 2016 In millions, except per share amounts Numerator: Net earnings from continuing operations $ 2,012 $ 436 $ 3,237 Net loss from discontinued operations (104 ) (92 ) (76 ) Net earnings $ 1,908 $ 344 $ 3,161 Denominator: Weighted-average shares used to compute basic net EPS 1,529 1,646 1,715 Dilutive effect of employee stock plans 24 28 24 Weighted-average shares used to compute diluted net EPS 1,553 1,674 1,739 Basic net earnings (loss) per share: Continuing operations $ 1.32 $ 0.26 $ 1.89 Discontinued operations (0.07 ) (0.05 ) (0.05 ) Basic net earnings per share $ 1.25 $ 0.21 $ 1.84 Diluted net earnings (loss) per share: Continuing operations $ 1.30 $ 0.26 $ 1.86 Discontinued operations (1) (0.07 ) (0.05 ) (0.04 ) Diluted net earnings per share $ 1.23 $ 0.21 $ 1.82 Anti-dilutive weighted-average stock awards (2) 2 8 32 (1) U.S. GAAP requires the denominator used in the diluted net EPS calculation for discontinued operations to be the same as that of continuing operations, regardless of net earnings (loss) from continuing operations. (2) The Company excludes shares potentially issuable under employee stock plans that could dilute basic net EPS in the future from the calculation of diluted net earnings (loss) per share, as their effect, if included, would have been anti-dilutive for the periods presented. |
Guarantees, Indemnifications _2
Guarantees, Indemnifications and Warranties (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Guarantees [Abstract] | |
Schedule of indemnified litigation matters and other contingencies | As of October 31, 2018 and 2017, the Company’s receivable and payable balances related to indemnified litigation matters and other contingencies, and income tax-related indemnification covered by these agreements were as follows: As of October 31, 2018 2017 In millions Litigation matters and other contingencies Receivable $ 104 $ 150 Payable $ 83 $ 91 Income tax-related indemnification (1) Indemnification receivable - long-term (2) $ 16 $ 1,430 Indemnification receivable - short-term $ 17 $ — Indemnification payable - long-term $ 9 $ — Indemnification payable - short-term $ 26 $ 36 (1) The actual amount that the Company may receive or pay could vary depending upon the outcome of certain unresolved tax matters, which may not be resolved for several years. (2) Indemnification receivable - long-term in fiscal 2017 primarily included $1.3 billion from HP Inc. for certain tax liabilities that the Company is joint and severally liable for, but for which it is indemnified by HP Inc. under the Tax Matter Agreement, and which was partially settled during fiscal 2018. |
Changes in aggregate product warranty liabilities and changes | The Company's aggregate product warranty liabilities and changes therein were as follows: Fiscal years ended October 31, 2018 2017 In millions Balance at beginning of year $ 475 $ 497 Accruals for warranties issued 265 292 Adjustments related to pre-existing warranties (10 ) (8 ) Settlements made (300 ) (306 ) Balance at end of year $ 430 $ 475 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future annual lease commitments and sublease rental income | As of October 31, 2018 , future minimum lease commitments on the Company's operating leases were as follows: Fiscal Year In millions 2019 $ 226 2020 207 2021 152 2022 131 2023 116 Thereafter 387 Less: Sublease rental income (216 ) Total $ 1,003 |
Future unconditional purchase obligations | As of October 31, 2018 , future unconditional purchase obligations were as follows: Fiscal Year In millions 2019 $ 257 2020 196 2021 110 2022 16 2023 9 Thereafter 49 Total $ 637 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | The difference between the sale date carrying value of the Company's investment in H3C and its proportionate share of the net assets of H3C, created a basis difference of $2.5 billion, which was allocated as follows: In millions Equity method goodwill $ 1,674 Intangible assets 749 In-process research and development 188 Deferred tax liabilities (152 ) Other 75 Basis difference $ 2,534 |
Quarterly Summary (Tables)
Quarterly Summary (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | For the three-month periods January 31 April 30 July 31 October 31 Net revenue $ 7,674 $ 7,468 $ 7,764 $ 7,946 Cost of sales 5,491 5,196 5,384 5,489 Research and development 388 402 434 439 Selling, general and administrative 1,202 1,227 1,203 1,219 Amortization of intangible assets 78 72 72 72 Restructuring charges 3 9 2 5 Transformation costs 245 123 131 (74 ) Impairment of goodwill — — — 88 Acquisition and other related charges 30 16 24 12 Separation costs (24 ) 26 (2 ) 12 Total costs and expenses 7,413 7,071 7,248 7,262 Earnings from continuing operations 261 397 516 684 Interest and other, net (21 ) (78 ) (64 ) (111 ) Tax indemnification adjustments (919 ) (425 ) 2 (12 ) Earnings (loss) from equity interests 22 (10 ) 11 15 (Loss) earnings from continuing operations before taxes (657 ) (116 ) 465 576 Benefit (provision) for taxes 2,139 966 (13 ) (1,348 ) Net earnings (loss) from continuing operations 1,482 850 452 (772 ) Net (loss) earnings from discontinued operations (46 ) (72 ) (1 ) 15 Net earnings (loss) $ 1,436 $ 778 $ 451 $ (757 ) Net earnings (loss) per share: Basic Continuing operations $ 0.93 $ 0.55 $ 0.30 $ (0.53 ) Discontinued operations (0.03 ) (0.05 ) — 0.01 Total basic net earnings (loss) per share $ 0.90 $ 0.50 $ 0.30 $ (0.52 ) Diluted Continuing operations $ 0.92 $ 0.54 $ 0.29 $ (0.53 ) Discontinued operations (0.03 ) (0.05 ) — 0.01 Total diluted net earnings (loss) per share $ 0.89 $ 0.49 $ 0.29 $ (0.52 ) Cash dividends declared per share $ 0.1500 $ 0.1125 $ 0.1125 $ 0.1125 Weighted-average shares used to compute net earnings (loss) per share: Basic 1,591 1,552 1,513 1,459 Diluted 1,619 1,582 1,531 1,459 Quarterly Summary (Unaudited) (In millions, except per share amounts) For the three-month periods January 31 April 30 July 31 October 31 Net revenue $ 6,902 $ 6,808 $ 7,501 $ 7,660 Cost of sales 4,689 4,799 5,306 5,383 Research and development 356 376 390 364 Selling, general and administrative 1,204 1,229 1,285 1,288 Amortization of intangible assets 66 72 97 86 Restructuring charges 83 69 152 113 Transformation costs — — 31 328 Disaster charges — — — 93 Acquisition and other related charges 44 50 56 53 Separation costs 11 30 5 202 Defined benefit plan settlement charges and remeasurement (benefit) (1) (4 ) (12 ) (22 ) (26 ) Total costs and expenses 6,449 6,613 7,300 7,884 Earnings (loss) from continuing operations 453 195 201 (224 ) Interest and other, net (78 ) (86 ) (87 ) (76 ) Tax indemnification adjustments (18 ) 7 10 (2 ) (Loss) earnings from equity interests (22 ) (3 ) 1 1 Earnings (loss) from continuing operations before taxes 335 113 125 (301 ) (Provision) benefit for taxes (84 ) (591 ) 160 679 Net earnings (loss) from continuing operations 251 (478 ) 285 378 Net earnings (loss) from discontinued operations 16 (134 ) (120 ) 146 Net earnings (loss) $ 267 $ (612 ) $ 165 $ 524 Net earnings (loss) per share: Basic Continuing operations $ 0.15 $ (0.29 ) $ 0.17 $ 0.23 Discontinued operations 0.01 (0.08 ) (0.07 ) 0.09 Total basic net earnings (loss) per share $ 0.16 $ (0.37 ) $ 0.10 $ 0.32 Diluted Continuing operations $ 0.15 $ (0.29 ) $ 0.17 $ 0.23 Discontinued operations 0.01 (0.08 ) (0.07 ) 0.09 Total diluted net earnings (loss) per share $ 0.16 $ (0.37 ) $ 0.10 $ 0.32 Cash dividends declared per share $ 0.130 $ 0.065 $ 0.065 $ — Weighted-average shares used to compute net earnings (loss) per share: Basic 1,669 1,658 1,641 1,618 Diluted 1,700 1,658 1,667 1,647 (1) Represents adjustments to the net periodic pension cost resulting from remeasurements of certain Hewlett Packard Enterprise pension plans due to plan separations in connection with the Everett and Seattle Transactions. |
Overview and Summary of Signi_3
Overview and Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | Nov. 01, 2015 | Dec. 31, 2015 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Jan. 31, 2019 |
Segment Reporting Information | ||||||
Net excess tax benefit | $ 65 | |||||
Outstanding shares of company distributed to shareholders of former parent | 100.00% | |||||
Advertising cost | 193 | $ 255 | $ 215 | |||
Net cash provided by operating activities | 2,964 | 1,335 | 5,056 | |||
Net cash provided by (used in) financing activities | (5,592) | 164 | (2,330) | |||
HP Inc. | ||||||
Segment Reporting Information | ||||||
Shares distributed (shares) | 1 | |||||
HP, Inc. | ||||||
Segment Reporting Information | ||||||
Cash allocation transfers to from outside entity | $ 526 | |||||
Accounting Standards Update 2016-09 | ||||||
Segment Reporting Information | ||||||
Net cash provided by operating activities | $ (446) | $ (98) | ||||
Net cash provided by (used in) financing activities | $ (446) | |||||
Forecast | Retained Earnings | Accounting Standards Update 2016-16 | ||||||
Segment Reporting Information | ||||||
Effect of new accounting principle | $ 2,400 |
Overview and Summary of Signi_4
Overview and Summary of Significant Accounting Policies (Details 2) - Major Customers - Accounts Receivable $ in Millions | 12 Months Ended | |
Oct. 31, 2018USD ($)receivable_balance | Oct. 31, 2017USD ($) | |
Concentration Risk | ||
Concentration of credit risk (as a percent) | 10.00% | |
Three largest outsourced manufacturer | ||
Concentration Risk | ||
Number of largest distributor and reseller receivable balances or largest outsourced manufacturer receivable balances | receivable_balance | 3 | |
Concentration of credit risk (as a percent) | 92.00% | 87.00% |
Manufacturer receivables | $ | $ 684 | $ 594 |
Overview and Summary of Signi_5
Overview and Summary of Significant Accounting Policies (Details 3) | 12 Months Ended |
Oct. 31, 2018 | |
Minimum | Intangible Assets | |
Property, Plant and Equipment, Net | |
Estimated useful life for purchased intangible assets | 1 year |
Maximum | Intangible Assets | |
Property, Plant and Equipment, Net | |
Estimated useful life for purchased intangible assets | 10 years |
Buildings and improvements | Minimum | |
Property, Plant and Equipment, Net | |
Estimated useful life for property, plant and equipment | 5 years |
Buildings and improvements | Maximum | |
Property, Plant and Equipment, Net | |
Estimated useful life for property, plant and equipment | 40 years |
Machinery and equipment, including equipment held for lease | Minimum | |
Property, Plant and Equipment, Net | |
Estimated useful life for property, plant and equipment | 3 years |
Machinery and equipment, including equipment held for lease | Maximum | |
Property, Plant and Equipment, Net | |
Estimated useful life for property, plant and equipment | 15 years |
Capitalized internal use software | Minimum | |
Property, Plant and Equipment, Net | |
Estimated useful life for property, plant and equipment | 3 years |
Capitalized internal use software | Maximum | |
Property, Plant and Equipment, Net | |
Estimated useful life for property, plant and equipment | 5 years |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - Everett SpinCo, Inc. and Seattle SpinCo, Inc. - Spinoff - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2017 | Oct. 31, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Depreciation and amortization | $ 526 | $ 1,524 |
Purchases of property, plant and equipment | $ 158 | $ 331 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Discontinued Operations, Financial Results (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Net loss from discontinued operations | $ 15 | $ (1) | $ (72) | $ (46) | $ 146 | $ (120) | $ (134) | $ 16 | $ (104) | $ (92) | $ (76) |
Everett SpinCo, Inc. and Seattle SpinCo, Inc. | Spinoff | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Net revenue | 0 | 8,511 | 19,843 | ||||||||
Cost of revenue | 0 | 5,890 | 15,000 | ||||||||
Expenses | 51 | 3,063 | 4,596 | ||||||||
Interest and other, net | 58 | 39 | 28 | ||||||||
(Loss) earnings from discontinued operations before taxes | (109) | (481) | 219 | ||||||||
Benefit (provision) for taxes | 5 | 389 | (295) | ||||||||
Net loss from discontinued operations | $ (104) | $ (92) | $ (76) |
Segment Information (Detail)
Segment Information (Detail) $ in Millions | 12 Months Ended | |
Oct. 31, 2018USD ($)segment | Oct. 31, 2017USD ($) | |
Segment Reporting [Abstract] | ||
Number of reportable segments | segment | 4 | |
Advance royalty proceeds received from intercompany advanced royalty payments and licensing arrangements | $ | $ 63 | $ 439 |
Segment Information - Operating
Segment Information - Operating Results (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Segment Reporting Information | |||||||||||
Net revenue | $ 7,946 | $ 7,764 | $ 7,468 | $ 7,674 | $ 7,660 | $ 7,501 | $ 6,808 | $ 6,902 | $ 30,852 | $ 28,871 | $ 30,280 |
Segment earnings (loss) from operations | $ 684 | $ 516 | $ 397 | $ 261 | $ (224) | $ 201 | $ 195 | $ 453 | 1,858 | 625 | 3,903 |
Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 24,285 | 22,740 | 23,954 | ||||||||
Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,912 | 2,554 | 2,635 | ||||||||
Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,656 | 3,574 | 3,097 | ||||||||
Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | (1) | 3 | 594 | ||||||||
Intersegment Eliminations | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 780 | 945 | 1,280 | ||||||||
Intersegment Eliminations | Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 748 | 887 | 1,148 | ||||||||
Intersegment Eliminations | Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 17 | 30 | 39 | ||||||||
Intersegment Eliminations | Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 15 | 28 | 93 | ||||||||
Intersegment Eliminations | Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 0 | 0 | 0 | ||||||||
Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 31,632 | 29,816 | 31,560 | ||||||||
Segment earnings (loss) from operations | 3,091 | 2,720 | 3,533 | ||||||||
Operating segments | Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 25,033 | 23,627 | 25,102 | ||||||||
Segment earnings (loss) from operations | 2,654 | 2,274 | 3,182 | ||||||||
Operating segments | Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,929 | 2,584 | 2,674 | ||||||||
Segment earnings (loss) from operations | 237 | 253 | 74 | ||||||||
Operating segments | Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,671 | 3,602 | 3,190 | ||||||||
Segment earnings (loss) from operations | 290 | 299 | 338 | ||||||||
Operating segments | Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | (1) | 3 | 594 | ||||||||
Segment earnings (loss) from operations | $ (90) | $ (106) | $ (61) |
Segment Information (Detail 2)
Segment Information (Detail 2) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Segment Reporting Information | |||||||||||
Net revenue | $ 7,946 | $ 7,764 | $ 7,468 | $ 7,674 | $ 7,660 | $ 7,501 | $ 6,808 | $ 6,902 | $ 30,852 | $ 28,871 | $ 30,280 |
Segment earnings (loss) from operations | 684 | 516 | 397 | 261 | (224) | 201 | 195 | 453 | 1,858 | 625 | 3,903 |
Unallocated stock-based compensation expense | (309) | (454) | (408) | ||||||||
Amortization of intangible assets | (72) | (72) | (72) | (78) | (86) | (97) | (72) | (66) | (294) | (321) | (272) |
Impairment of goodwill | (88) | 0 | 0 | 0 | (88) | 0 | 0 | ||||
Restructuring charges | (5) | (2) | (9) | (3) | (113) | (152) | (69) | (83) | (19) | (417) | (417) |
Transformation costs | 74 | (131) | (123) | (245) | (328) | (31) | 0 | 0 | (425) | (359) | 0 |
Disaster charges | (93) | 0 | 0 | 0 | 0 | (93) | 0 | ||||
Acquisition and other related charges | (12) | (24) | (16) | (30) | (53) | (56) | (50) | (44) | (82) | (203) | (145) |
Separation costs | (12) | 2 | (26) | 24 | (202) | (5) | (30) | (11) | (12) | (248) | (362) |
Defined benefit plan settlement charges and remeasurement (benefit) | 26 | 22 | 12 | 4 | 0 | 64 | 0 | ||||
Gain on H3C and MphasiS divestitures | 0 | 0 | 2,420 | ||||||||
Interest and other, net | (111) | (64) | (78) | (21) | (76) | (87) | (86) | (78) | (274) | (327) | (284) |
Tax indemnification adjustments | (12) | 2 | (425) | (919) | (2) | 10 | 7 | (18) | (1,354) | (3) | 317 |
Earnings (loss) from equity interests | 15 | 11 | (10) | 22 | 1 | 1 | (3) | (22) | 38 | (23) | (76) |
Total Hewlett Packard Enterprise consolidated earnings from continuing operations before taxes | 576 | $ 465 | $ (116) | $ (657) | (301) | $ 125 | $ 113 | $ 335 | 268 | 272 | 3,860 |
Assets | 55,493 | 61,406 | 55,493 | 61,406 | |||||||
Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 24,285 | 22,740 | 23,954 | ||||||||
Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,912 | 2,554 | 2,635 | ||||||||
Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,656 | 3,574 | 3,097 | ||||||||
Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | (1) | 3 | 594 | ||||||||
Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 31,632 | 29,816 | 31,560 | ||||||||
Segment earnings (loss) from operations | 3,091 | 2,720 | 3,533 | ||||||||
Operating segments | Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 25,033 | 23,627 | 25,102 | ||||||||
Segment earnings (loss) from operations | 2,654 | 2,274 | 3,182 | ||||||||
Assets | 25,839 | 25,923 | 25,839 | 25,923 | |||||||
Operating segments | Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,929 | 2,584 | 2,674 | ||||||||
Segment earnings (loss) from operations | 237 | 253 | 74 | ||||||||
Assets | 2,990 | 3,002 | 2,990 | 3,002 | |||||||
Operating segments | Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,671 | 3,602 | 3,190 | ||||||||
Segment earnings (loss) from operations | 290 | 299 | 338 | ||||||||
Assets | 13,746 | 13,470 | 13,746 | 13,470 | |||||||
Operating segments | Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | (1) | 3 | 594 | ||||||||
Segment earnings (loss) from operations | (90) | (106) | (61) | ||||||||
Assets | 170 | 161 | 170 | 161 | |||||||
Eliminations of inter-segment net revenue and other | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 780 | 945 | 1,280 | ||||||||
Eliminations of inter-segment net revenue and other | Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 748 | 887 | 1,148 | ||||||||
Eliminations of inter-segment net revenue and other | Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 17 | 30 | 39 | ||||||||
Eliminations of inter-segment net revenue and other | Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 15 | 28 | 93 | ||||||||
Eliminations of inter-segment net revenue and other | Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 0 | 0 | 0 | ||||||||
Significant Reconciling Items | |||||||||||
Segment Reporting Information | |||||||||||
Unallocated corporate costs and eliminations | (240) | (408) | (720) | ||||||||
Unallocated stock-based compensation expense | (73) | (110) | (134) | ||||||||
Amortization of intangible assets | (294) | (321) | (272) | ||||||||
Impairment of goodwill | (88) | 0 | 0 | ||||||||
Restructuring charges | (19) | (417) | (417) | ||||||||
Transformation costs | (425) | (359) | 0 | ||||||||
Disaster charges | 0 | (93) | 0 | ||||||||
Acquisition and other related charges | (82) | (203) | (145) | ||||||||
Separation costs | (12) | (248) | (362) | ||||||||
Defined benefit plan settlement charges and remeasurement (benefit) | 0 | 64 | 0 | ||||||||
Gain on H3C and MphasiS divestitures | 0 | 0 | (2,420) | ||||||||
Interest and other, net | (274) | (327) | (284) | ||||||||
Tax indemnification adjustments | (1,354) | (3) | 317 | ||||||||
Earnings (loss) from equity interests | 38 | (23) | $ (76) | ||||||||
Corporate and unallocated assets | |||||||||||
Segment Reporting Information | |||||||||||
Assets | $ 12,748 | $ 18,850 | $ 12,748 | $ 18,850 |
Segment Information (Detail 3)
Segment Information (Detail 3) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Segment Reporting Information | |||||||||||
Net revenue | $ 7,946 | $ 7,764 | $ 7,468 | $ 7,674 | $ 7,660 | $ 7,501 | $ 6,808 | $ 6,902 | $ 30,852 | $ 28,871 | $ 30,280 |
Net property, plant and equipment: | |||||||||||
Property, plant and equipment | 6,138 | 6,269 | 6,138 | 6,269 | |||||||
U.S. | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 10,192 | 10,022 | 10,333 | ||||||||
Net property, plant and equipment: | |||||||||||
Property, plant and equipment | 2,813 | 2,673 | 2,813 | 2,673 | |||||||
Other countries | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 20,660 | 18,849 | $ 19,947 | ||||||||
Net property, plant and equipment: | |||||||||||
Property, plant and equipment | $ 3,325 | $ 3,596 | $ 3,325 | $ 3,596 |
Segment Information (Details 4)
Segment Information (Details 4) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Segment Reporting Information | |||||||||||
Net revenue | $ 7,946 | $ 7,764 | $ 7,468 | $ 7,674 | $ 7,660 | $ 7,501 | $ 6,808 | $ 6,902 | $ 30,852 | $ 28,871 | $ 30,280 |
Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 31,632 | 29,816 | 31,560 | ||||||||
Eliminations of inter-segment net revenue and other | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 780 | 945 | 1,280 | ||||||||
Hybrid IT | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 24,285 | 22,740 | 23,954 | ||||||||
Hybrid IT | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 25,033 | 23,627 | 25,102 | ||||||||
Hybrid IT | Operating segments | Hybrid IT Product [Member] | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 17,754 | 16,331 | 17,790 | ||||||||
Hybrid IT | Operating segments | Compute | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 13,823 | 12,837 | 13,994 | ||||||||
Hybrid IT | Operating segments | Storage | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,706 | 3,280 | 3,389 | ||||||||
Hybrid IT | Operating segments | DC Networking | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 225 | 214 | 407 | ||||||||
Hybrid IT | Operating segments | HPE Pointnext | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 7,279 | 7,296 | 7,312 | ||||||||
Hybrid IT | Eliminations of inter-segment net revenue and other | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 748 | 887 | 1,148 | ||||||||
Intelligent Edge | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,912 | 2,554 | 2,635 | ||||||||
Intelligent Edge | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,929 | 2,584 | 2,674 | ||||||||
Intelligent Edge | Operating segments | HPE Aruba Product | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 2,619 | 2,307 | 2,423 | ||||||||
Intelligent Edge | Operating segments | HPE Aruba Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 310 | 277 | 251 | ||||||||
Intelligent Edge | Eliminations of inter-segment net revenue and other | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 17 | 30 | 39 | ||||||||
Financial Services | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,656 | 3,574 | 3,097 | ||||||||
Financial Services | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 3,671 | 3,602 | 3,190 | ||||||||
Financial Services | Eliminations of inter-segment net revenue and other | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | 15 | 28 | 93 | ||||||||
Corporate Investments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | (1) | 3 | 594 | ||||||||
Corporate Investments | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | (1) | 3 | 594 | ||||||||
Corporate Investments | Eliminations of inter-segment net revenue and other | |||||||||||
Segment Reporting Information | |||||||||||
Net revenue | $ 0 | $ 0 | $ 0 |
Restructuring (Details)
Restructuring (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018USD ($) | Jul. 31, 2018USD ($) | Apr. 30, 2018USD ($) | Jan. 31, 2018USD ($) | Oct. 31, 2017USD ($) | Jul. 31, 2017USD ($) | Apr. 30, 2017USD ($) | Jan. 31, 2017USD ($) | Oct. 31, 2018USD ($)position | Oct. 31, 2017USD ($) | Oct. 31, 2016USD ($) | |
Restructuring and related costs | |||||||||||
Reversal of restructuring charges | $ 2 | ||||||||||
Restructuring Reserve | |||||||||||
Charges | $ 5 | $ 2 | $ 9 | $ 3 | $ 113 | $ 152 | $ 69 | $ 83 | $ 19 | $ 417 | 417 |
Short-term portion of restructuring reserve, recorded in Accrued restructuring | 294 | 445 | 294 | 445 | |||||||
Long-term portion of restructuring reserve, recorded in Other liabilities | 31 | 96 | 31 | 96 | |||||||
Restructuring Plan All | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | 254 | 298 | 254 | 298 | 151 | ||||||
Charges | 19 | 417 | 419 | ||||||||
Cash payments | (181) | (412) | (288) | ||||||||
Non-cash items | (8) | (49) | 16 | ||||||||
Balance at the end of the period | 84 | 254 | 84 | 254 | 298 | ||||||
Total costs incurred to date as of October 31, 2018 | 2,242 | 2,242 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | 2,242 | 2,242 | |||||||||
Short-term portion of restructuring reserve, recorded in Accrued restructuring | 53 | 158 | 53 | 158 | |||||||
Fiscal 2015 Plan | |||||||||||
Restructuring Reserve | |||||||||||
Total expected costs to be incurred as of October 31, 2018 | 800 | $ 800 | |||||||||
Expected positions to be eliminated | position | 8,300 | ||||||||||
Fiscal 2015 Plan | Employee Severance | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | 219 | 234 | $ 219 | 234 | 67 | ||||||
Charges | 9 | 374 | 301 | ||||||||
Cash payments | (158) | (355) | (172) | ||||||||
Non-cash items | (8) | (34) | 38 | ||||||||
Balance at the end of the period | 62 | 219 | 62 | 219 | 234 | ||||||
Total costs incurred to date as of October 31, 2018 | 751 | 751 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | 751 | 751 | |||||||||
Fiscal 2015 Plan | Infrastructure and other | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | 17 | 13 | 17 | 13 | 0 | ||||||
Charges | (2) | 37 | 42 | ||||||||
Cash payments | (8) | (19) | (19) | ||||||||
Non-cash items | 3 | (14) | (10) | ||||||||
Balance at the end of the period | 10 | 17 | 10 | 17 | 13 | ||||||
Total costs incurred to date as of October 31, 2018 | 78 | 78 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | 78 | 78 | |||||||||
Fiscal 2015 Plan | Real estate consolidation | |||||||||||
Restructuring Reserve | |||||||||||
Total expected costs to be incurred as of October 31, 2018 | 78 | 78 | |||||||||
Fiscal 2012 Plan | |||||||||||
Restructuring Reserve | |||||||||||
Total costs incurred to date as of October 31, 2018 | 1,400 | 1,400 | |||||||||
Fiscal 2012 Plan | Infrastructure and other | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | 2 | 14 | 2 | 14 | 37 | ||||||
Charges | (1) | 0 | 1 | ||||||||
Cash payments | 0 | (6) | (15) | ||||||||
Non-cash items | 0 | (6) | (9) | ||||||||
Balance at the end of the period | 1 | 2 | 1 | 2 | 14 | ||||||
Total costs incurred to date as of October 31, 2018 | 145 | 145 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | 145 | 145 | |||||||||
Fiscal 2012 Plan | Employee Severance and EER | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | $ 16 | $ 37 | 16 | 37 | 47 | ||||||
Charges | 13 | 6 | 75 | ||||||||
Cash payments | (15) | (32) | (82) | ||||||||
Non-cash items | (3) | 5 | (3) | ||||||||
Balance at the end of the period | 11 | $ 16 | 11 | 16 | 37 | ||||||
Total costs incurred to date as of October 31, 2018 | 1,268 | 1,268 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | $ 1,268 | $ 1,268 | |||||||||
Expected positions to be eliminated | position | 10,300 | ||||||||||
Discontinued Operations | |||||||||||
Restructuring Reserve | |||||||||||
Charges | $ 251 | $ 819 |
HPE Next (Details)
HPE Next (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | |||||||||||
Transformation costs | $ (74) | $ 131 | $ 123 | $ 245 | $ 328 | $ 31 | $ 0 | $ 0 | $ 425 | $ 359 | $ 0 |
Short-term portion of restructuring reserve, recorded in Accrued restructuring | 294 | 445 | 294 | 445 | |||||||
Long-term portion of restructuring reserve, recorded in Other liabilities | 31 | 96 | 31 | 96 | |||||||
Assets held for sale | 6 | 14 | 6 | 14 | |||||||
HPE Next | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Transformation costs | 425 | 359 | |||||||||
Expected costs | 1,400 | 1,400 | |||||||||
Short-term portion of restructuring reserve, recorded in Accrued restructuring | 241 | 287 | 241 | 287 | |||||||
Long-term portion of restructuring reserve, recorded in Other liabilities | 83 | $ 9 | 83 | $ 9 | |||||||
HPE Next | Employee Severance | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Expected costs | 1,200 | 1,200 | |||||||||
HPE Next | Infrastructure and other | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Expected costs | $ 200 | 200 | |||||||||
Interest and other, net | HPE Next | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Transformation costs | $ 20 |
HPE Next (Details 1)
HPE Next (Details 1) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | |||||||||||
Restructuring charges | $ 5 | $ 2 | $ 9 | $ 3 | $ 113 | $ 152 | $ 69 | $ 83 | $ 19 | $ 417 | $ 417 |
Total Transformation Costs | $ (74) | $ 131 | $ 123 | $ 245 | $ 328 | $ 31 | $ 0 | $ 0 | 425 | 359 | $ 0 |
HPE Next | |||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||
Program management | 95 | 57 | |||||||||
IT costs | 148 | 34 | |||||||||
Restructuring charges | 531 | 296 | |||||||||
Other2 | 56 | 0 | |||||||||
Gain on real estate sales | (405) | (28) | |||||||||
Total Transformation Costs | $ 425 | $ 359 |
HPE Next (Details 2)
HPE Next (Details 2) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Restructuring Reserve | |||||||||||
Charges | $ 5 | $ 2 | $ 9 | $ 3 | $ 113 | $ 152 | $ 69 | $ 83 | $ 19 | $ 417 | $ 417 |
HPE Next | |||||||||||
Restructuring Reserve | |||||||||||
Charges | 531 | 296 | |||||||||
HPE Next | Employee Severance | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | 296 | 0 | 296 | 0 | |||||||
Charges | 470 | 296 | |||||||||
Cash payments | (452) | ||||||||||
Non-cash items | (23) | ||||||||||
Balance at the end of the period | 291 | 296 | 291 | 296 | 0 | ||||||
Total costs incurred to date as of October 31, 2018 | 766 | 766 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | 1,200 | 1,200 | |||||||||
HPE Next | Infrastructure and other | |||||||||||
Restructuring Reserve | |||||||||||
Balance at the beginning of the period | $ 0 | $ 0 | 0 | 0 | |||||||
Charges | 61 | 0 | |||||||||
Cash payments | (14) | ||||||||||
Non-cash items | (14) | ||||||||||
Balance at the end of the period | 33 | $ 0 | 33 | $ 0 | $ 0 | ||||||
Total costs incurred to date as of October 31, 2018 | 61 | 61 | |||||||||
Total expected costs to be incurred as of October 31, 2018 | $ 180 | $ 180 |
Retirement and Post-Retiremen_3
Retirement and Post-Retirement Benefit Plans (Details) - Defined Benefit Plans $ in Billions | 3 Months Ended |
Oct. 31, 2017USD ($) | |
Defined benefit plans | |
Plan assets | $ 8.3 |
Projected benefit obligation | 8.1 |
Recognized accumulated comprehensive loss | $ 1.9 |
Retirement and Post-Retiremen_4
Retirement and Post-Retirement Benefit Plans (Details 2) - USD ($) $ in Millions | Jan. 01, 2017 | Jan. 01, 2016 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 |
Defined Contribution Plan Disclosure [Line Items] | |||||
Total defined contribution expense | $ 158 | $ 157 | $ 213 | ||
HPE 401(k) Plan | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Percent of equal 401(k) match to employees effective during the period | 50.00% | 100.00% | |||
Percentage of maximum matching contribution | 6.00% | 4.00% |
Retirement and Post-Retiremen_5
Retirement and Post-Retirement Benefit Plans (Details 3) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Post-Retirement Benefit Plans | |||
Net benefit (credit) cost | |||
Service cost | $ 1 | $ 3 | $ 3 |
Interest cost | 7 | 6 | 6 |
Expected return on plan assets | (1) | (2) | (2) |
Amortization and deferrals: | |||
Actuarial loss (gain) | (3) | (2) | (3) |
Prior service benefit | 0 | 0 | 0 |
Net periodic benefit cost | 4 | 5 | 4 |
Curtailment gain | 0 | 0 | 0 |
Settlement loss | 0 | 0 | 0 |
Special termination benefits | 0 | 0 | 0 |
Plan credit allocation | 0 | (1) | (1) |
Net benefit cost (credit) from continuing operations | 4 | 4 | 3 |
Discontinued operations | 0 | 1 | 1 |
Total net benefit (credit) cost | $ 4 | $ 5 | $ 4 |
Weighted average assumptions used to calculate net benefit (credit) cost | |||
Discount rate used to determine benefit obligation | 4.50% | 4.20% | 4.60% |
Discount rate used to determine service cost | 3.70% | 3.70% | 4.60% |
Discount rate used to determine interest cost | 4.20% | 3.80% | 4.60% |
Expected increase in compensation levels | 0.00% | 0.00% | 0.00% |
Expected long-term return on plan assets | 2.60% | 3.10% | 4.00% |
Defined Benefit Plans | Non-U.S. Plans | |||
Net benefit (credit) cost | |||
Service cost | $ 105 | $ 139 | $ 199 |
Interest cost | 225 | 213 | 317 |
Expected return on plan assets | (567) | (548) | (667) |
Amortization and deferrals: | |||
Actuarial loss (gain) | 211 | 264 | 220 |
Prior service benefit | (17) | (17) | (19) |
Net periodic benefit cost | (43) | 51 | 50 |
Curtailment gain | (1) | (1) | 0 |
Settlement loss | 20 | 15 | 4 |
Special termination benefits | 6 | 5 | 5 |
Plan credit allocation | 0 | (14) | (15) |
Net benefit cost (credit) from continuing operations | (18) | 56 | 44 |
Discontinued operations | 0 | 81 | 92 |
Total net benefit (credit) cost | $ (18) | $ 137 | $ 136 |
Weighted average assumptions used to calculate net benefit (credit) cost | |||
Discount rate used to determine benefit obligation | 2.00% | 2.00% | 2.70% |
Discount rate used to determine service cost | 2.40% | 2.00% | 2.70% |
Discount rate used to determine interest cost | 1.70% | 1.80% | 2.70% |
Expected increase in compensation levels | 2.30% | 2.40% | 2.30% |
Expected long-term return on plan assets | 4.40% | 4.40% | 5.80% |
Retirement and Post-Retiremen_6
Retirement and Post-Retirement Benefit Plans (Details 4) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Change in benefit obligation: | |||||||
Settlement | $ 26,000,000 | $ 22,000,000 | $ 12,000,000 | $ 4,000,000 | $ 0 | $ 64,000,000 | $ 0 |
Defined Benefit Plans | U.S. Plans | |||||||
Change in fair value of plan assets: | |||||||
Fair value—beginning of year | 0 | ||||||
Fair value—end of year(3) | 0 | 0 | 0 | ||||
Change in benefit obligation: | |||||||
Projected benefit obligation—beginning of year | 5,000,000 | ||||||
Projected benefit obligation—end of year(3) | 5,000,000 | 5,000,000 | 5,000,000 | ||||
Defined Benefit Plans | U.S. Plans | Discontinued Operations, Disposed of by Means Other than Sale [Member] | Everett Transaction | |||||||
Change in fair value of plan assets: | |||||||
Transfer to Everett/Seattle plans | (702,000,000) | ||||||
Change in benefit obligation: | |||||||
Decrease from transfer | 503,000,000 | ||||||
Defined Benefit Plans | U.S. Plans | Discontinued Operations, Disposed of by Means Other than Sale [Member] | Seattle Transaction | |||||||
Change in fair value of plan assets: | |||||||
Transfer to Everett/Seattle plans | (97,000,000) | ||||||
Change in benefit obligation: | |||||||
Decrease from transfer | 165,000,000 | ||||||
Defined Benefit Plans | Non-U.S. Plans | |||||||
Change in fair value of plan assets: | |||||||
Fair value—beginning of year | 11,989,000,000 | 12,610,000,000 | 11,989,000,000 | ||||
Transfer to Everett/Seattle plans | 6,000,000 | (799,000,000) | |||||
Addition/deletion of plans(2) | 181,000,000 | 5,000,000 | |||||
Actual return on plan assets | 93,000,000 | 941,000,000 | |||||
Employer contributions | 158,000,000 | 266,000,000 | |||||
Participant contributions | 25,000,000 | 17,000,000 | |||||
Benefits paid | (450,000,000) | (408,000,000) | |||||
Settlement | (104,000,000) | (60,000,000) | |||||
Currency impact | (352,000,000) | 659,000,000 | |||||
Fair value—end of year(3) | 12,610,000,000 | 12,167,000,000 | 12,610,000,000 | 11,989,000,000 | |||
Change in benefit obligation: | |||||||
Projected benefit obligation—beginning of year | 13,555,000,000 | 13,069,000,000 | 13,555,000,000 | ||||
Transfer from Parent | 5,000,000 | (668,000,000) | |||||
Addition/deletion of plans(2) | 181,000,000 | 19,000,000 | |||||
Service cost | 105,000,000 | 139,000,000 | 199,000,000 | ||||
Interest cost | 225,000,000 | 213,000,000 | 317,000,000 | ||||
Participant contributions | 25,000,000 | 17,000,000 | |||||
Actuarial (gain) loss | (40,000,000) | (445,000,000) | |||||
Benefits paid | (450,000,000) | (408,000,000) | |||||
Plan amendments | 22,000,000 | (1,000,000) | |||||
Curtailment | (4,000,000) | (1,000,000) | |||||
Settlement | (104,000,000) | (60,000,000) | |||||
Special termination benefits | 6,000,000 | 5,000,000 | |||||
Currency impact | (372,000,000) | 704,000,000 | |||||
Projected benefit obligation—end of year(3) | 13,069,000,000 | 12,668,000,000 | 13,069,000,000 | 13,555,000,000 | |||
Funded status at end of year | (459,000,000) | (501,000,000) | (459,000,000) | ||||
Accumulated benefit obligation | $ 12,832,000,000 | $ 12,446,000,000 | $ 12,832,000,000 | ||||
Weighted average assumptions used to calculate the projected benefit obligations for Direct plans: | |||||||
Discount rate | 2.00% | 2.10% | 2.00% | ||||
Expected increase in compensation levels | 2.30% | 2.50% | 2.30% | ||||
Net amounts recognized for the Direct plans in Combined and Consolidated Balance Sheets: | |||||||
Non-current assets | $ 830,000,000 | $ 829,000,000 | $ 830,000,000 | ||||
Current liabilities | (39,000,000) | (40,000,000) | (39,000,000) | ||||
Non-current liabilities | (1,250,000,000) | (1,290,000,000) | (1,250,000,000) | ||||
Funded status at end of year | (459,000,000) | (501,000,000) | (459,000,000) | ||||
Pretax net actuarial loss (gain) and prior service benefit recognized in accumulated other comprehensive loss for and prior service benefit recognized in Accumulated other comprehensive loss for the Direct defined benefit plans: | |||||||
Net actuarial loss (gain) | 2,938,000,000 | ||||||
Prior service benefit | (65,000,000) | ||||||
Total recognized in accumulated other comprehensive loss | 2,873,000,000 | ||||||
Net actuarial loss and prior service benefit for Direct plans that are expected to be amortized from Accumulated other comprehensive loss and recognized as components of net periodic benefit cost (credit): | |||||||
Net actuarial loss (gain) | 228,000,000 | ||||||
Prior service benefit | (15,000,000) | ||||||
Total expected to be recognized in net periodic benefit cost (credit) | 213,000,000 | ||||||
Direct defined benefit plans with projected benefit obligations exceeding the fair value of plan assets: | |||||||
Aggregate fair value of plan assets | 2,596,000,000 | 2,314,000,000 | 2,596,000,000 | ||||
Aggregate projected benefit obligation | 3,884,000,000 | 3,644,000,000 | 3,884,000,000 | ||||
Direct defined benefit plans with accumulated benefit obligations exceeding the fair value of plan assets: | |||||||
Aggregate fair value of plan assets | 1,272,000,000 | 2,291,000,000 | 1,272,000,000 | ||||
Aggregate accumulated benefit obligation | 2,476,000,000 | 3,495,000,000 | 2,476,000,000 | ||||
Post-Retirement Benefit Plans | |||||||
Change in fair value of plan assets: | |||||||
Fair value—beginning of year | 47,000,000 | 50,000,000 | 47,000,000 | ||||
Transfer to Everett/Seattle plans | 0 | 0 | |||||
Addition/deletion of plans(2) | 0 | 0 | |||||
Actual return on plan assets | 1,000,000 | 1,000,000 | |||||
Employer contributions | 6,000,000 | 4,000,000 | |||||
Participant contributions | 4,000,000 | 4,000,000 | |||||
Benefits paid | (9,000,000) | (6,000,000) | |||||
Settlement | 0 | 0 | |||||
Currency impact | 0 | 0 | |||||
Fair value—end of year(3) | 50,000,000 | 52,000,000 | 50,000,000 | 47,000,000 | |||
Change in benefit obligation: | |||||||
Projected benefit obligation—beginning of year | $ 158,000,000 | 170,000,000 | 158,000,000 | ||||
Transfer from Parent | 0 | 0 | |||||
Addition/deletion of plans(2) | 0 | 0 | |||||
Service cost | 1,000,000 | 3,000,000 | 3,000,000 | ||||
Interest cost | 7,000,000 | 6,000,000 | 6,000,000 | ||||
Participant contributions | 4,000,000 | 4,000,000 | |||||
Actuarial (gain) loss | (9,000,000) | 4,000,000 | |||||
Benefits paid | (9,000,000) | (6,000,000) | |||||
Plan amendments | 0 | 0 | |||||
Curtailment | 0 | 0 | |||||
Settlement | 0 | 0 | |||||
Special termination benefits | 0 | 0 | |||||
Currency impact | (4,000,000) | 1,000,000 | |||||
Projected benefit obligation—end of year(3) | 170,000,000 | 160,000,000 | 170,000,000 | $ 158,000,000 | |||
Funded status at end of year | (120,000,000) | (108,000,000) | (120,000,000) | ||||
Accumulated benefit obligation | $ 0 | $ 0 | $ 0 | ||||
Weighted average assumptions used to calculate the projected benefit obligations for Direct plans: | |||||||
Discount rate | 4.50% | 4.90% | 4.50% | ||||
Expected increase in compensation levels | 0.00% | 0.00% | 0.00% | ||||
Net amounts recognized for the Direct plans in Combined and Consolidated Balance Sheets: | |||||||
Non-current assets | $ 0 | $ 0 | $ 0 | ||||
Current liabilities | (4,000,000) | (6,000,000) | (4,000,000) | ||||
Non-current liabilities | (116,000,000) | (102,000,000) | (116,000,000) | ||||
Funded status at end of year | $ (120,000,000) | (108,000,000) | $ (120,000,000) | ||||
Pretax net actuarial loss (gain) and prior service benefit recognized in accumulated other comprehensive loss for and prior service benefit recognized in Accumulated other comprehensive loss for the Direct defined benefit plans: | |||||||
Net actuarial loss (gain) | (11,000,000) | ||||||
Prior service benefit | 0 | ||||||
Total recognized in accumulated other comprehensive loss | (11,000,000) | ||||||
Net actuarial loss and prior service benefit for Direct plans that are expected to be amortized from Accumulated other comprehensive loss and recognized as components of net periodic benefit cost (credit): | |||||||
Net actuarial loss (gain) | (4,000,000) | ||||||
Prior service benefit | 0 | ||||||
Total expected to be recognized in net periodic benefit cost (credit) | $ (4,000,000) |
Retirement and Post-Retiremen_7
Retirement and Post-Retirement Benefit Plans (Details 5) - USD ($) $ in Millions | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 |
Post-Retirement Benefit Plans | |||
Defined benefit plans | |||
Fair value of plan assets | $ 52 | $ 50 | $ 47 |
Post-Retirement Benefit Plans | Registered Investment Companies | |||
Defined benefit plans | |||
Fair value of plan assets | 52 | 50 | |
Non-U.S. Plans | Defined Benefit Plans | |||
Defined benefit plans | |||
Fair value of plan assets | 12,167 | 12,610 | 11,989 |
Non-U.S. Plans | Defined Benefit Plans | U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 194 | 283 | |
Non-U.S. Plans | Defined Benefit Plans | Non-U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 569 | 505 | |
Non-U.S. Plans | Defined Benefit Plans | Non-U.S. at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 473 | 480 | |
Non-U.S. Plans | Defined Benefit Plans | Corporate | |||
Defined benefit plans | |||
Fair value of plan assets | 1,221 | 1,966 | |
Non-U.S. Plans | Defined Benefit Plans | Government debt securities | |||
Defined benefit plans | |||
Fair value of plan assets | 4,621 | 702 | |
Non-U.S. Plans | Defined Benefit Plans | Government at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 692 | 687 | |
Non-U.S. Plans | Defined Benefit Plans | Private Equity | |||
Defined benefit plans | |||
Fair value of plan assets | 42 | 40 | |
Non-U.S. Plans | Defined Benefit Plans | Hybrids | |||
Defined benefit plans | |||
Fair value of plan assets | 1,346 | 492 | |
Non-U.S. Plans | Defined Benefit Plans | Hybrids At NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 506 | 2,339 | |
Non-U.S. Plans | Defined Benefit Plans | Hedge Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 45 | 63 | |
Non-U.S. Plans | Defined Benefit Plans | Hedge Funds at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 21 | |
Non-U.S. Plans | Defined Benefit Plans | Equities at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 1,929 | 2,547 | |
Non-U.S. Plans | Defined Benefit Plans | Fixed Income at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 639 | 701 | |
Non-U.S. Plans | Defined Benefit Plans | Emerging Markets at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 275 | 368 | |
Non-U.S. Plans | Defined Benefit Plans | Alternative investments at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | 378 | 363 | |
Non-U.S. Plans | Defined Benefit Plans | Real Estate Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 229 | 253 | |
Non-U.S. Plans | Defined Benefit Plans | Insurance Group Annuity Contracts | |||
Defined benefit plans | |||
Fair value of plan assets | 97 | 87 | |
Non-U.S. Plans | Defined Benefit Plans | Cash and cash equivalents | |||
Defined benefit plans | |||
Fair value of plan assets | 423 | 547 | |
Non-U.S. Plans | Defined Benefit Plans | Other | |||
Defined benefit plans | |||
Fair value of plan assets | 290 | 166 | |
Non-U.S. Plans | Defined Benefit Plans | Obligation to Return Cash Received From Repurchase Agreements | |||
Defined benefit plans | |||
Fair value of plan assets | (1,802) | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | |||
Defined benefit plans | |||
Fair value of plan assets | 743 | 900 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 187 | 270 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Non-U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 344 | 365 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Corporate | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Government debt securities | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Private Equity | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Hybrids | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Hybrids At NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Hedge Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Equities at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Fixed Income at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Emerging Markets at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Alternative investments at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Real Estate Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 6 | 38 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Insurance Group Annuity Contracts | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Cash and cash equivalents | |||
Defined benefit plans | |||
Fair value of plan assets | 167 | 184 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Other | |||
Defined benefit plans | |||
Fair value of plan assets | 39 | 43 | |
Non-U.S. Plans | Defined Benefit Plans | Level 1 | Obligation to Return Cash Received From Repurchase Agreements | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | |||
Defined benefit plans | |||
Fair value of plan assets | 6,284 | 4,061 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 7 | 13 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Non-U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 225 | 140 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Corporate | |||
Defined benefit plans | |||
Fair value of plan assets | 1,221 | 1,966 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Government debt securities | |||
Defined benefit plans | |||
Fair value of plan assets | 4,621 | 702 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Private Equity | |||
Defined benefit plans | |||
Fair value of plan assets | 2 | 7 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Hybrids | |||
Defined benefit plans | |||
Fair value of plan assets | 1,214 | 492 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Hybrids At NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Hedge Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 45 | 63 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Equities at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Fixed Income at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Emerging Markets at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Alternative investments at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Real Estate Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 186 | 158 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Insurance Group Annuity Contracts | |||
Defined benefit plans | |||
Fair value of plan assets | 59 | 35 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Cash and cash equivalents | |||
Defined benefit plans | |||
Fair value of plan assets | 256 | 363 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Other | |||
Defined benefit plans | |||
Fair value of plan assets | 250 | 122 | |
Non-U.S. Plans | Defined Benefit Plans | Level 2 | Obligation to Return Cash Received From Repurchase Agreements | |||
Defined benefit plans | |||
Fair value of plan assets | (1,802) | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | |||
Defined benefit plans | |||
Fair value of plan assets | 248 | 143 | 129 |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Non-U.S. | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Corporate | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Government debt securities | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Private Equity | |||
Defined benefit plans | |||
Fair value of plan assets | 40 | 33 | 32 |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Hybrids | |||
Defined benefit plans | |||
Fair value of plan assets | 132 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Hybrids At NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Hedge Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Equities at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Fixed Income at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Emerging Markets at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Alternative investments at NAV | |||
Defined benefit plans | |||
Fair value of plan assets | |||
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Real Estate Funds | |||
Defined benefit plans | |||
Fair value of plan assets | 37 | 57 | 26 |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Insurance Group Annuity Contracts | |||
Defined benefit plans | |||
Fair value of plan assets | 38 | 52 | 63 |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Cash and cash equivalents | |||
Defined benefit plans | |||
Fair value of plan assets | 0 | 0 | |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Other | |||
Defined benefit plans | |||
Fair value of plan assets | 1 | 1 | $ 8 |
Non-U.S. Plans | Defined Benefit Plans | Level 3 | Obligation to Return Cash Received From Repurchase Agreements | |||
Defined benefit plans | |||
Fair value of plan assets | $ 0 | $ 0 |
Retirement and Post-Retiremen_8
Retirement and Post-Retirement Benefit Plans (Details 6) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Post-Retirement Benefit Plans | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | $ 50 | $ 47 |
Actual return on plan assets: | ||
Fair value—end of year(3) | 52 | 50 |
Future Contributions and Funding Policy | ||
Employer contributions | 6 | 4 |
Expected contribution to defined benefit plans in fiscal 2018 | 6 | |
Future benefits payable for the retirement and post-retirement plans | ||
2,019 | 9 | |
2,020 | 10 | |
2,021 | 10 | |
2,022 | 10 | |
2,023 | 11 | |
Next five fiscal years to October 31, 2028 | 59 | |
Post-Retirement Benefit Plans | Discontinued Operations | ||
Future Contributions and Funding Policy | ||
Employer contributions | 6 | |
Non-U.S. Plans | Defined Benefit Plans | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 12,610 | 11,989 |
Actual return on plan assets: | ||
Fair value—end of year(3) | $ 12,167 | $ 12,610 |
2018 Target Allocation | 100.00% | |
Plan Assets | 100.00% | 100.00% |
Future Contributions and Funding Policy | ||
Employer contributions | $ 158 | $ 266 |
Expected contribution to defined benefit plans in fiscal 2018 | 190 | |
Future benefits payable for the retirement and post-retirement plans | ||
2,019 | 453 | |
2,020 | 427 | |
2,021 | 449 | |
2,022 | 469 | |
2,023 | 492 | |
Next five fiscal years to October 31, 2028 | 2,704 | |
Non-U.S. Plans | Defined Benefit Plans | Discontinued Operations | ||
Future Contributions and Funding Policy | ||
Employer contributions | 200 | |
Non-U.S. Plans | Defined Benefit Plans | Private Equity | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 40 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | $ 42 | $ 40 |
Plan Assets | 18.70% | 25.70% |
Non-U.S. Plans | Defined Benefit Plans | Hybrids | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | $ 492 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | 1,346 | $ 492 |
Non-U.S. Plans | Defined Benefit Plans | Hedge Funds | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 63 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | 45 | 63 |
Non-U.S. Plans | Defined Benefit Plans | Real Estate Funds | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 253 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | $ 229 | $ 253 |
Plan Assets | 4.20% | 3.30% |
Non-U.S. Plans | Defined Benefit Plans | Insurance Group Annuities | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | $ 87 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | 97 | $ 87 |
Non-U.S. Plans | Defined Benefit Plans | Other | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 166 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | $ 290 | $ 166 |
Non-U.S. Plans | Defined Benefit Plans | Public equity securities | ||
Actual return on plan assets: | ||
Plan Assets | 28.70% | 33.80% |
Non-U.S. Plans | Defined Benefit Plans | Equity-related investments | ||
Actual return on plan assets: | ||
2018 Target Allocation | 56.30% | |
Plan Assets | 51.60% | 62.80% |
Non-U.S. Plans | Defined Benefit Plans | Debt securities | ||
Actual return on plan assets: | ||
2018 Target Allocation | 41.90% | |
Plan Assets | 44.90% | 32.90% |
Non-U.S. Plans | Defined Benefit Plans | Cash and cash equivalents | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | $ 547 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | $ 423 | $ 547 |
2018 Target Allocation | 1.80% | |
Plan Assets | 3.50% | 4.30% |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | $ 143 | $ 129 |
Actual return on plan assets: | ||
Relating to assets held at the reporting date | 1 | (24) |
Relating to assets sold during the period | 5 | 1 |
Purchases, sales, and settlements | 99 | 28 |
Transfers in and/or out of Level 3 | 0 | 9 |
Fair value—end of year(3) | 248 | 143 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Private Equity | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 33 | 32 |
Actual return on plan assets: | ||
Relating to assets held at the reporting date | 6 | 0 |
Relating to assets sold during the period | 5 | 1 |
Purchases, sales, and settlements | (4) | 0 |
Transfers in and/or out of Level 3 | 0 | 0 |
Fair value—end of year(3) | 40 | 33 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Hybrids | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 0 | |
Actual return on plan assets: | ||
Relating to assets held at the reporting date | 2 | |
Relating to assets sold during the period | 0 | |
Purchases, sales, and settlements | 130 | |
Transfers in and/or out of Level 3 | 0 | |
Fair value—end of year(3) | 132 | 0 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Hedge Funds | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 0 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | 0 | 0 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Real Estate Funds | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 57 | 26 |
Actual return on plan assets: | ||
Relating to assets held at the reporting date | 0 | 3 |
Relating to assets sold during the period | 0 | 0 |
Purchases, sales, and settlements | (20) | 0 |
Transfers in and/or out of Level 3 | 0 | 28 |
Fair value—end of year(3) | 37 | 57 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Insurance Group Annuities | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 52 | 63 |
Actual return on plan assets: | ||
Relating to assets held at the reporting date | (7) | (39) |
Relating to assets sold during the period | 0 | 0 |
Purchases, sales, and settlements | (7) | 0 |
Transfers in and/or out of Level 3 | 0 | 28 |
Fair value—end of year(3) | 38 | 52 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Other | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 1 | 8 |
Actual return on plan assets: | ||
Relating to assets held at the reporting date | 0 | 12 |
Relating to assets sold during the period | 0 | 0 |
Purchases, sales, and settlements | 0 | 28 |
Transfers in and/or out of Level 3 | 0 | (47) |
Fair value—end of year(3) | 1 | 1 |
Non-U.S. Plans | Level 3 | Defined Benefit Plans | Cash and cash equivalents | ||
Changes in fair value measurements of Level 3 investments | ||
Fair value—beginning of year | 0 | |
Actual return on plan assets: | ||
Fair value—end of year(3) | 0 | $ 0 |
U.S. non-qualified plan participants | U.S. Plans | ||
Future Contributions and Funding Policy | ||
Expected contribution to defined benefit plans in fiscal 2018 | $ 1 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Detail) - USD ($) | Apr. 01, 2017 | Jan. 25, 2017 | Nov. 01, 2015 | Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 |
Stock-Based Compensation | ||||||||||||||
Stock-based compensation expense | $ 309,000,000 | $ 454,000,000 | $ 408,000,000 | |||||||||||
Income tax benefit | (56,000,000) | (159,000,000) | (131,000,000) | |||||||||||
Stock-based compensation expense, net of tax | 253,000,000 | 295,000,000 | 277,000,000 | |||||||||||
Separation costs | $ 12,000,000 | $ (2,000,000) | $ 26,000,000 | $ (24,000,000) | $ 202,000,000 | $ 5,000,000 | $ 30,000,000 | $ 11,000,000 | 12,000,000 | 248,000,000 | 362,000,000 | |||
Restructuring charges | 5,000,000 | $ 2,000,000 | $ 9,000,000 | $ 3,000,000 | $ 113,000,000 | $ 152,000,000 | $ 69,000,000 | $ 83,000,000 | $ 19,000,000 | $ 417,000,000 | 417,000,000 | |||
Increased expense due to the acceleration | 33,000,000 | |||||||||||||
Shares | ||||||||||||||
Outstanding at end of period (in shares) | 49,274,000 | 49,274,000 | ||||||||||||
Outstanding at end of period (in shares) | 49,274,000 | 49,274,000 | ||||||||||||
Weighted- Average Exercise Price | ||||||||||||||
Outstanding at beginning of period (in dollars per share) | $ 10 | $ 10 | ||||||||||||
Outstanding at end of period (in dollars per share) | $ 10 | $ 10 | ||||||||||||
Aggregate Intrinsic Value | ||||||||||||||
Number of options assumed (in shares) | 8,000,000 | |||||||||||||
Weighted-average exercise price of options assumed (in dollars per share) | $ 16 | |||||||||||||
Employee Stock Purchase Plan | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Stock-based compensation expense, net of tax | $ 0 | |||||||||||||
Corporate and unallocated assets | HP Inc. | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Stock-based compensation expense | $ 8,000,000 | |||||||||||||
Restricted Stock Awards | ||||||||||||||
Shares | ||||||||||||||
Outstanding at beginning of period (in shares) | 48,517,000 | 57,321,000 | 48,517,000 | 57,321,000 | ||||||||||
Converted from former Parent's plan (in shares) | 0 | |||||||||||||
Granted and assumed through acquisition (in shares) | 23,980,000 | |||||||||||||
Additional shares granted due to conversion (shares) | 25,543,000 | |||||||||||||
Vested (in shares) | (51,976,000) | |||||||||||||
Forfeited (in shares) | (6,351,000) | |||||||||||||
Outstanding at end of period (in shares) | 48,517,000 | 48,517,000 | 57,321,000 | |||||||||||
Weighted- Average Grant Date Fair Value Per Share | ||||||||||||||
Outstanding at beginning of period (in dollars per share) | $ 14 | $ 15 | $ 14 | $ 15 | ||||||||||
Converted from former Parent's plan (in dollars per share) | 0 | |||||||||||||
Granted and assumed through acquisition (in dollars per share) | 21 | |||||||||||||
Additional shares granted due to conversion (in dollars per share) | 9 | |||||||||||||
Vested (in dollars per share) | 16 | |||||||||||||
Forfeited (in dollars per share) | 16 | |||||||||||||
Outstanding at end of period (in dollars per share) | $ 14 | $ 14 | $ 15 | |||||||||||
Total grant date fair value of restricted stock vested | $ 270,000,000 | $ 472,000,000 | $ 130,000,000 | |||||||||||
Unrecognized pre-tax stock-based compensation expense and recognition period | ||||||||||||||
Unrecognized pre-tax stock-based compensation expense | 259,000,000 | $ 259,000,000 | ||||||||||||
Remaining weighted-average vesting period over which pre-tax stock-based compensation expense is expected to be recognized | 1 year 4 months 24 days | |||||||||||||
The Plan | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Number of shares authorized and available for issuance (shares) | 210,000,000 | 260,000,000 | ||||||||||||
Number of additional shares authorized | 67,000,000 | |||||||||||||
Vesting period | 3 years | |||||||||||||
Stock Options | ||||||||||||||
Unrecognized pre-tax stock-based compensation expense and recognition period | ||||||||||||||
Unrecognized pre-tax stock-based compensation expense | $ 7,000,000 | $ 7,000,000 | ||||||||||||
Remaining weighted-average vesting period over which pre-tax stock-based compensation expense is expected to be recognized | 1 year 3 months 18 days | |||||||||||||
Weighted-average fair value and the assumptions used to measure fair value | ||||||||||||||
Weighted- average fair value of grants per option (in dollars per share) | $ 6 | $ 4 | ||||||||||||
Expected volatility (as a percent) | 25.70% | 31.10% | ||||||||||||
Risk-free interest rate (as a percent) | 2.00% | 1.70% | ||||||||||||
Expected dividend yield (as a percent) | 1.00% | 1.50% | ||||||||||||
Expected term in years | 6 years 1 month 6 days | 5 years 4 months 12 days | ||||||||||||
Shares | ||||||||||||||
Outstanding at end of period (in shares) | 49,274,000 | 57,498,000 | 49,274,000 | 57,498,000 | ||||||||||
Converted from former Parent's plan (in shares) | 0 | 0 | ||||||||||||
Granted and assumed through acquisitions (in shares) | 316,000 | 6,074,000 | ||||||||||||
Additional shares granted due to post-spin adjustments (in shares) | 0 | 24,523,000 | ||||||||||||
Exercised (in shares) | (26,476,000) | (29,492,000) | ||||||||||||
Forfeited/cancelled/expired (in shares) | (4,851,000) | (9,329,000) | ||||||||||||
Outstanding at end of period (in shares) | 18,263,000 | 49,274,000 | 18,263,000 | 49,274,000 | 57,498,000 | |||||||||
Vested and expected to vest at end of period (in shares) | 18,038,000 | 48,566,000 | 18,038,000 | 48,566,000 | ||||||||||
Exercisable at end of period (in shares) | 14,896,000 | 24,736,000 | 14,896,000 | 24,736,000 | ||||||||||
Weighted- Average Exercise Price | ||||||||||||||
Outstanding at beginning of period (in dollars per share) | $ 10 | $ 15 | $ 10 | $ 15 | ||||||||||
Converted from former Parent's plan (in dollars per share) | 0 | 0 | ||||||||||||
Granted and assumed through acquisition (in dollars per share) | 10 | 23 | ||||||||||||
Additional shares granted due to post-spin adjustments (in dollars per share) | 0 | 11 | ||||||||||||
Exercised (in dollars per share) | 9 | 12 | ||||||||||||
Forfeited/cancelled/expired (in dollars per share) | 13 | 16 | ||||||||||||
Outstanding at end of period (in dollars per share) | $ 10 | $ 10 | 10 | 10 | $ 15 | |||||||||
Vested and expected to vest at end of period (in dollars per share) | 10 | 10 | 10 | 10 | ||||||||||
Exercisable at end of period (in dollars per share) | $ 10 | $ 9 | $ 10 | $ 9 | ||||||||||
Weighted- Average Remaining Contractual Term | ||||||||||||||
Outstanding at end of year(4) | 4 years 2 months 12 days | 4 years 7 months 6 days | ||||||||||||
Vested and expected to vest at end of year(4) | 4 years 2 months 12 days | 4 years 7 months 6 days | ||||||||||||
Exercisable at end of year(4) | 3 years 8 months 12 days | 3 years | ||||||||||||
Aggregate Intrinsic Value | ||||||||||||||
Outstanding at end of year(4) | $ 92,000,000 | $ 207,000,000 | $ 92,000,000 | $ 207,000,000 | ||||||||||
Vested and expected to vest at end of year(4) | 91,000,000 | 205,000,000 | 91,000,000 | 205,000,000 | ||||||||||
Exercisable at end of year(4) | $ 85,000,000 | $ 123,000,000 | 85,000,000 | 123,000,000 | ||||||||||
Options exercised | $ 200,000,000 | $ 218,000,000 | $ 62,000,000 | |||||||||||
The Plan | Restricted Stock Awards | ||||||||||||||
Shares | ||||||||||||||
Outstanding at beginning of period (in shares) | 48,517,000 | 48,517,000 | ||||||||||||
Converted from former Parent's plan (in shares) | 0 | |||||||||||||
Granted and assumed through acquisition (in shares) | 22,131,000 | |||||||||||||
Additional shares granted due to conversion (shares) | 0 | |||||||||||||
Vested (in shares) | (32,659,000) | |||||||||||||
Forfeited (in shares) | (5,572,000) | |||||||||||||
Outstanding at end of period (in shares) | 32,417,000 | 48,517,000 | 32,417,000 | 48,517,000 | ||||||||||
Weighted- Average Grant Date Fair Value Per Share | ||||||||||||||
Outstanding at beginning of period (in dollars per share) | $ 14 | $ 14 | ||||||||||||
Converted from former Parent's plan (in dollars per share) | 0 | |||||||||||||
Granted and assumed through acquisition (in dollars per share) | 15 | |||||||||||||
Additional shares granted due to conversion (in dollars per share) | 0 | |||||||||||||
Vested (in dollars per share) | 14 | |||||||||||||
Forfeited (in dollars per share) | 14 | |||||||||||||
Outstanding at end of period (in dollars per share) | $ 14 | $ 14 | $ 14 | $ 14 | ||||||||||
One Time Retention Stock Awards | Restricted Stock Awards | ||||||||||||||
Shares | ||||||||||||||
Granted and assumed through acquisition (in shares) | 5,000,000 | |||||||||||||
One Time Retention Stock Awards | The Plan | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Vesting period | 3 years | |||||||||||||
Total grant date fair value of options vested | $ 137,000,000 | |||||||||||||
One Time Retention Stock Awards | Stock Options | ||||||||||||||
Shares | ||||||||||||||
Granted and assumed through acquisitions (in shares) | 16,000,000 | |||||||||||||
The Plan | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Separation costs | $ 10,000,000 | $ 41,000,000 | ||||||||||||
Restructuring charges | 3,000,000 | $ 33,000,000 | ||||||||||||
Former Parent Company | Restricted Stock Awards | ||||||||||||||
Shares | ||||||||||||||
Outstanding at beginning of period (in shares) | 0 | 57,321,000 | 57,321,000 | 0 | ||||||||||
Converted from former Parent's plan (in shares) | 42,012,000 | |||||||||||||
Granted and assumed through acquisition (in shares) | 32,752,000 | |||||||||||||
Additional shares granted due to conversion (shares) | 0 | |||||||||||||
Vested (in shares) | (12,747,000) | |||||||||||||
Forfeited (in shares) | (4,696,000) | |||||||||||||
Outstanding at end of period (in shares) | 57,321,000 | |||||||||||||
Weighted- Average Grant Date Fair Value Per Share | ||||||||||||||
Outstanding at beginning of period (in dollars per share) | $ 0 | $ 15 | $ 15 | $ 0 | ||||||||||
Converted from former Parent's plan (in dollars per share) | 15 | |||||||||||||
Granted and assumed through acquisition (in dollars per share) | 15 | |||||||||||||
Additional shares granted due to conversion (in dollars per share) | 0 | |||||||||||||
Vested (in dollars per share) | 15 | |||||||||||||
Forfeited (in dollars per share) | 15 | |||||||||||||
Outstanding at end of period (in dollars per share) | $ 15 | |||||||||||||
Former Parent Company | Stock Options | ||||||||||||||
Shares | ||||||||||||||
Outstanding at end of period (in shares) | 0 | 57,498,000 | 57,498,000 | 0 | ||||||||||
Converted from former Parent's plan (in shares) | 42,579,000 | |||||||||||||
Granted and assumed through acquisitions (in shares) | 25,390,000 | |||||||||||||
Additional shares granted due to post-spin adjustments (in shares) | 0 | |||||||||||||
Exercised (in shares) | (7,845,000) | |||||||||||||
Forfeited/cancelled/expired (in shares) | (2,626,000) | |||||||||||||
Outstanding at end of period (in shares) | 57,498,000 | |||||||||||||
Vested and expected to vest at end of period (in shares) | 55,716,000 | |||||||||||||
Exercisable at end of period (in shares) | 26,204,000 | |||||||||||||
Weighted- Average Exercise Price | ||||||||||||||
Outstanding at beginning of period (in dollars per share) | $ 0 | $ 15 | $ 15 | $ 0 | ||||||||||
Converted from former Parent's plan (in dollars per share) | 15 | |||||||||||||
Granted and assumed through acquisition (in dollars per share) | 15 | |||||||||||||
Additional shares granted due to post-spin adjustments (in dollars per share) | 0 | |||||||||||||
Exercised (in dollars per share) | 11 | |||||||||||||
Forfeited/cancelled/expired (in dollars per share) | 20 | |||||||||||||
Outstanding at end of period (in dollars per share) | 15 | |||||||||||||
Vested and expected to vest at end of period (in dollars per share) | 15 | |||||||||||||
Exercisable at end of period (in dollars per share) | $ 13 | |||||||||||||
Weighted- Average Remaining Contractual Term | ||||||||||||||
Outstanding at end of year(4) | 5 years 4 months 24 days | |||||||||||||
Vested and expected to vest at end of year(4) | 5 years 3 months 18 days | |||||||||||||
Exercisable at end of year(4) | 3 years 9 months 18 days | |||||||||||||
Aggregate Intrinsic Value | ||||||||||||||
Outstanding at end of year(4) | $ 437,000,000 | |||||||||||||
Vested and expected to vest at end of year(4) | 425,000,000 | |||||||||||||
Exercisable at end of year(4) | 241,000,000 | |||||||||||||
Discontinued Operations | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Stock-based compensation expense | 0 | $ 166,000,000 | 189,000,000 | |||||||||||
Restructuring charges | 251,000,000 | $ 819,000,000 | ||||||||||||
SGI And Nimble Storage | The Plan | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Restructuring charges | $ 10,000,000 | $ 23,000,000 | ||||||||||||
2017 Acquisitions | Restricted Stock Awards | ||||||||||||||
Weighted- Average Grant Date Fair Value Per Share | ||||||||||||||
Shares assumed in period (in shares) | 11,000,000 | |||||||||||||
Granted (in dollars per share) | $ 18 | |||||||||||||
Everett and Seattle Transactions | Restricted Stock Awards | ||||||||||||||
Shares | ||||||||||||||
Vested (in shares) | (14,000,000) | |||||||||||||
Forfeited (in shares) | (300,000) | |||||||||||||
Weighted- Average Grant Date Fair Value Per Share | ||||||||||||||
Vested (in dollars per share) | $ 17 | |||||||||||||
Forfeited (in dollars per share) | $ 18 | |||||||||||||
Everett Transaction | Restricted Stock Awards | ||||||||||||||
Shares | ||||||||||||||
Vested (in shares) | (6,000,000) | |||||||||||||
Weighted- Average Grant Date Fair Value Per Share | ||||||||||||||
Vested (in dollars per share) | $ 14 | |||||||||||||
Everett Transaction | The Plan | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Separation costs | $ 126,000,000 | |||||||||||||
Restructuring charges | 34,000,000 | |||||||||||||
Everett Transaction | Net Income (Loss) | Discontinued Operations | ||||||||||||||
Stock-Based Compensation | ||||||||||||||
Stock-based compensation expense | $ 92,000,000 |
Stock-Based Compensation (Det_2
Stock-Based Compensation (Detail 2) - Stock Options shares in Thousands | 12 Months Ended |
Oct. 31, 2018$ / sharesshares | |
Information about options outstanding, by exercise price range | |
Options Outstanding - Shares Outstanding (shares) | shares | 18,263 |
Weighted- Average Remaining Contractual Term | 4 years 2 months 12 days |
Options Outstanding - Weighted Average Exercise Price (in dollars per share) | $ 10 |
Options Exercisable - Shares Exercisable (shares) | shares | 14,896 |
Options Exercisable - Weighted-Average Exercise Price (in dollars per share) | $ 10 |
$0-$9.99 | |
Information about options outstanding, by exercise price range | |
Exercise price range, lower range limit (in dollars per share) | 0 |
Exercise price range, upper range limit (in dollars per share) | $ 9.99 |
Options Outstanding - Shares Outstanding (shares) | shares | 10,862 |
Weighted- Average Remaining Contractual Term | 3 years 9 months 18 days |
Options Outstanding - Weighted Average Exercise Price (in dollars per share) | $ 8 |
Options Exercisable - Shares Exercisable (shares) | shares | 10,368 |
Options Exercisable - Weighted-Average Exercise Price (in dollars per share) | $ 8 |
$10-$19.99 | |
Information about options outstanding, by exercise price range | |
Exercise price range, lower range limit (in dollars per share) | 10 |
Exercise price range, upper range limit (in dollars per share) | $ 19.99 |
Options Outstanding - Shares Outstanding (shares) | shares | 7,358 |
Weighted- Average Remaining Contractual Term | 4 years 9 months 18 days |
Options Outstanding - Weighted Average Exercise Price (in dollars per share) | $ 14 |
Options Exercisable - Shares Exercisable (shares) | shares | 4,485 |
Options Exercisable - Weighted-Average Exercise Price (in dollars per share) | $ 13 |
$20-$29.99 | |
Information about options outstanding, by exercise price range | |
Exercise price range, lower range limit (in dollars per share) | 20 |
Exercise price range, upper range limit (in dollars per share) | $ 29.99 |
Options Outstanding - Shares Outstanding (shares) | shares | 43 |
Weighted- Average Remaining Contractual Term | 2 years 9 months 18 days |
Options Outstanding - Weighted Average Exercise Price (in dollars per share) | $ 25 |
Options Exercisable - Shares Exercisable (shares) | shares | 43 |
Options Exercisable - Weighted-Average Exercise Price (in dollars per share) | $ 25 |
Stock-Based Compensation (Det_3
Stock-Based Compensation (Details 3) - USD ($) | 12 Months Ended | |||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Nov. 01, 2015 | |
Share-based compensation | ||||
Common stock, authorized (shares) | 9,600,000,000 | 9,600,000,000 | ||
Maximum contribution limit as percentage of base compensation (as a percent) | 15.00% | |||
Offering period | 6 months | |||
Current offering period | 24 months | |||
Stock-based compensation expense, net of tax | $ 253,000,000 | $ 295,000,000 | $ 277,000,000 | |
Employee Stock Purchase Plan | ||||
Share-based compensation | ||||
Common stock, authorized (shares) | 80,000,000 | |||
Maximum contribution limit as percentage of base compensation (as a percent) | 10.00% | |||
Stock purchase price as a percentage of the fair market value on the purchase date | 95.00% | |||
Stock-based compensation expense, net of tax | $ 0 | |||
Cash received from option exercises and purchases | 279,000,000 | 411,000,000 | 119,000,000 | |
Benefit realized for the tax deduction from option exercises of share-based payment awards | 61,000,000 | $ 69,000,000 | $ 21,000,000 | |
Stock Options | ||||
Share-based compensation | ||||
Unrecognized pre-tax stock-based compensation expense | $ 7,000,000 |
Taxes on Earnings (Details)
Taxes on Earnings (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Domestic and foreign components of earnings (loss) before taxes | |||||||||||
U.S.(1) | $ (2,805) | $ (1,929) | $ (1,758) | ||||||||
Non-U.S.(1) | 3,073 | 2,201 | 5,618 | ||||||||
Earnings from continuing operations before taxes | $ 576 | $ 465 | $ (116) | $ (657) | $ (301) | $ 125 | $ 113 | $ 335 | 268 | 272 | 3,860 |
U.S. federal taxes: | |||||||||||
Current | (2,177) | 560 | 940 | ||||||||
Deferred | 150 | (1,366) | (959) | ||||||||
Non-U.S. taxes: | |||||||||||
Current | 419 | 64 | 874 | ||||||||
Deferred | (188) | 25 | (58) | ||||||||
State taxes: | |||||||||||
Current | 52 | (107) | 36 | ||||||||
Deferred | 0 | 660 | (210) | ||||||||
Provision for (benefit from) taxes on earnings | $ 1,348 | $ 13 | $ (966) | $ (2,139) | $ (679) | $ (160) | $ 591 | $ 84 | $ (1,744) | $ (164) | $ 623 |
Taxes on Earnings (Detail 2)
Taxes on Earnings (Detail 2) | 9 Months Ended | 12 Months Ended | ||
Jul. 31, 2018 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Differences between the U.S. federal statutory income tax rate and HP's effective tax rate | ||||
U.S. federal statutory income tax rate | 23.30% | 23.30% | 35.00% | 35.00% |
State income taxes, net of federal tax benefit | 4.30% | 3.00% | 1.00% | |
Lower rates in other jurisdictions, net | (121.40%) | (426.30%) | (24.50%) | |
Valuation allowance | (59.80%) | 310.00% | (14.70%) | |
U.S. permanent differences | 39.30% | 27.80% | (2.30%) | |
Uncertain tax positions | (694.80%) | (8.40%) | 23.10% | |
Impacts of the Tax Act | 158.00% | 0.00% | 0.00% | |
Other, net | 0.40% | (1.40%) | (1.50%) | |
Effective tax rate (as a percent) | (650.70%) | (60.30%) | 16.10% |
Taxes on Earnings (Detail 3)
Taxes on Earnings (Detail 3) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Jul. 31, 2018 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2015 | |
Income Tax Examination [Line Items] | |||||||||||||
Income tax benefits related to items unique to the year | $ (2,000) | $ 554 | $ (250) | ||||||||||
Provision for (benefit from) taxes on earnings | $ 1,348 | $ 13 | $ (966) | $ (2,139) | $ (679) | $ (160) | $ 591 | $ 84 | (1,744) | (164) | 623 | ||
Income tax benefits related to acquisition, separation, divestiture | 208 | 88 | |||||||||||
Valuation allowance on deferred tax assets | 8,209 | 2,789 | 8,209 | 2,789 | |||||||||
Income tax charges related to tax indemnification | 699 | ||||||||||||
Settlement of pre-separation liabilities | 125 | 326 | |||||||||||
Share-based compensation cost | 65 | ||||||||||||
Income tax benefits related to restructuring and separation related costs | 647 | ||||||||||||
Income tax benefits for adjustments to uncertain tax positions | 169 | ||||||||||||
Income tax charges related to state tax impacts | 124 | ||||||||||||
Income tax benefits, reduced rates for subsidiaries in certain countries | $ 792 | $ 378 | $ 401 | ||||||||||
Income tax benefits, reduced rates for subsidiaries in certain countries (in dollars per share) | $ 0.51 | $ 0.23 | $ 0.23 | ||||||||||
U.S. federal statutory income tax rate | 23.30% | 23.30% | 35.00% | 35.00% | |||||||||
Transition tax | $ 1,700 | ||||||||||||
Estimated change in income tax expense (benefit) | (1,700) | ||||||||||||
Tax benefit related to reversal of deferred tax recognized | 3,700 | 3,700 | |||||||||||
Estimated deferred tax asset valuation alllowance | 687 | ||||||||||||
Spinoff | Everett SpinCo, Inc. and Seattle SpinCo, Inc. | |||||||||||||
Income Tax Examination [Line Items] | |||||||||||||
Provision for (benefit from) taxes on earnings | (2,000) | ||||||||||||
Disposed of by sale | HC3 | |||||||||||||
Income Tax Examination [Line Items] | |||||||||||||
Provision for (benefit from) taxes on earnings | $ 473 | ||||||||||||
State | |||||||||||||
Income Tax Examination [Line Items] | |||||||||||||
Valuation allowance on deferred tax assets | 422 | 422 | |||||||||||
Income tax benefits related to valuation allowances | $ 714 | ||||||||||||
Foreign | |||||||||||||
Income Tax Examination [Line Items] | |||||||||||||
Income tax benefits related to valuation allowances | (509) | ||||||||||||
Deferred tax asset valuation allowance | |||||||||||||
Income Tax Examination [Line Items] | |||||||||||||
Provision for (benefit from) taxes on earnings | 166 | (848) | 203 | ||||||||||
Valuation allowance on deferred tax assets | $ 8,209 | $ 2,789 | 8,209 | 2,789 | 2,095 | $ 1,572 | |||||||
Valuation allowance offsetting current year losses recorded | $ 5,028 | $ 0 | $ 0 |
Taxes on Earnings (Detail 4)
Taxes on Earnings (Detail 4) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018USD ($)country | Oct. 31, 2017USD ($) | Oct. 31, 2016USD ($) | |
Reconciliation of unrecognized tax benefits | |||
Balance at beginning of year | $ 11,262 | $ 11,411 | $ 4,901 |
Increases: | |||
For current year's tax positions | 163 | 28 | 1,456 |
For prior years' tax positions | 66 | 311 | 820 |
Net transfers from former Parent through equity | 0 | 0 | 4,455 |
Decreases: | |||
For prior years' tax positions | (82) | (202) | (114) |
Statute of limitations expiration | (86) | (70) | (47) |
Settlements with taxing authorities | (2) | (216) | (60) |
Settlements related to joint and several positions of former Parent | (2,495) | 0 | 0 |
Balance at end of year | 8,826 | 11,262 | 11,411 |
Unrecognized tax benefits that would affect effective tax rate if realized | 1,100 | 3,000 | $ 2,700 |
Increase in unrecognized tax benefit related to the timing of intercompany royalty income recognition | 2,400 | ||
Income tax benefit including interest, penalties and offsetting benefits | 2,000 | ||
Increase in unrecognized tax benefits | 149 | ||
Accrued income tax for interest and penalties | $ 142 | $ 304 | |
Likelihood of no resolution period | 12 months | ||
Likelihood of conclusion period for certain federal, foreign and state tax issues | 12 months | ||
Reasonably possible decrease in existing unrecognized tax benefits within the next 12 months | $ 6,400 | ||
Number of other countries in which HP is subject to income taxes | country | 110 | ||
Undistributed earnings from non-U.S. operations | $ 7,900 |
Taxes on Earnings (Detail 5)
Taxes on Earnings (Detail 5) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Deferred tax assets: | ||
Loss and credit carry-forwards | $ 9,149 | $ 4,775 |
Inventory valuation | 77 | 79 |
Intercompany transactions—royalty prepayments | 48 | 4,267 |
Intercompany transactions—excluding royalty prepayments | 63 | 129 |
Warranty | 81 | 156 |
Employee and retiree benefits | 498 | 661 |
Restructuring | 101 | 186 |
Deferred revenue | 518 | 757 |
Intangible assets | 48 | 0 |
Other | 432 | 593 |
Total deferred tax assets | 11,015 | 11,603 |
Valuation allowance | (8,209) | (2,789) |
Total deferred tax assets net of valuation allowance | 2,806 | 8,814 |
Deferred tax liabilities: | ||
Unremitted earnings of foreign subsidiaries | (161) | (3,824) |
Fixed assets | (470) | (385) |
Intangible assets | 0 | (46) |
Total deferred tax liabilities | (631) | (4,255) |
Deferred tax assets net of deferred tax liabilities | 2,175 | $ 4,559 |
Reversal of deferred tax assets | 2,100 | |
Tax benefit related to reversal of deferred tax recognized | $ 3,700 |
Taxes on Earnings (Detail 6)
Taxes on Earnings (Detail 6) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Current and long term deferred tax assets and liabilities | ||
Deferred tax assets | $ 2,403 | $ 4,663 |
Deferred tax liabilities | (228) | (104) |
Deferred tax assets net of deferred tax liabilities | 2,175 | 4,559 |
Advance royalty proceeds received from multi-year intercompany licensing arrangements | 63 | 439 |
Operating loss carryforwards | ||
Adjustment to reduce deferred tax asset | 101 | 186 |
Valuation allowance on deferred tax assets | 8,209 | $ 2,789 |
Federal | ||
Operating loss carryforwards | ||
Operating loss carryforwards | 769 | |
Capital loss carryforwards | 6,100 | |
Federal | Capital Loss Carryforwards | ||
Operating loss carryforwards | ||
Valuation allowance on deferred tax assets | 1,200 | |
State | ||
Operating loss carryforwards | ||
Operating loss carryforwards | 2,800 | |
Valuation allowance on deferred tax assets | 422 | |
Capital loss carryforwards | 6,400 | |
State | Operating loss carryforwards | ||
Operating loss carryforwards | ||
Valuation allowance on deferred tax assets | 160 | |
State | Capital Loss Carryforwards | ||
Operating loss carryforwards | ||
Valuation allowance on deferred tax assets | 238 | |
Foreign | ||
Operating loss carryforwards | ||
Operating loss carryforwards | 19,900 | |
Capital loss carryforwards | 58 | |
Foreign | Operating loss carryforwards | ||
Operating loss carryforwards | ||
Valuation allowance on deferred tax assets | 5,000 | |
Foreign | Capital Loss Carryforwards | ||
Operating loss carryforwards | ||
Valuation allowance on deferred tax assets | 13 | |
Additional Paid-in Capital | ||
Operating loss carryforwards | ||
Adjustment to reduce deferred tax asset | $ 55 |
Taxes on Earnings (Detail 7)
Taxes on Earnings (Detail 7) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Carryforward | |||||||||||
U.S. foreign tax credits | $ 1,832 | $ 1,832 | |||||||||
U.S. research and development and other credits | 122 | 122 | |||||||||
Tax credits in state and foreign jurisdictions | 158 | 158 | |||||||||
Balance at end of year | 2,112 | 2,112 | |||||||||
Valuation Allowance | |||||||||||
U.S. foreign tax credits | (687) | (687) | |||||||||
Tax credits in state and foreign jurisdictions | (124) | (124) | |||||||||
Balance at end of year | (811) | (811) | |||||||||
Valuation allowance balance | |||||||||||
Balance at beginning of year | $ 2,789 | 2,789 | |||||||||
Income tax expense | (1,348) | $ (13) | $ 966 | 2,139 | $ 679 | $ 160 | $ (591) | $ (84) | 1,744 | $ 164 | $ (623) |
Balance at end of year | 8,209 | 2,789 | 8,209 | 2,789 | |||||||
Increase (decrease) in valuation allowances | 5,400 | 694 | |||||||||
Deferred tax asset valuation allowance | |||||||||||
Valuation allowance balance | |||||||||||
Balance at beginning of year | $ 2,789 | $ 2,095 | 2,789 | 2,095 | 1,572 | ||||||
Income tax expense | (166) | 848 | (203) | ||||||||
Income tax expense related to the Tax Act | 687 | 0 | 0 | ||||||||
Valuation allowance offsetting current year losses recorded | 5,028 | 0 | 0 | ||||||||
Other comprehensive income, currency translation and charges to other accounts | (129) | (154) | 726 | ||||||||
Balance at end of year | $ 8,209 | $ 2,789 | $ 8,209 | $ 2,789 | $ 2,095 |
Balance Sheet Details (Detail)
Balance Sheet Details (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2018 | Oct. 31, 2017 | |
Accounts Receivable, Net | |||||
Unbilled receivable | $ 185 | $ 223 | |||
Accounts receivable | 3,117 | 2,892 | |||
Allowance for doubtful accounts | $ (42) | $ (49) | $ (72) | (39) | (42) |
Accounts receivable, net | 3,263 | 3,073 | |||
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||||
Balance at beginning of year | 42 | 49 | 72 | ||
Provision for doubtful accounts | 20 | 16 | 22 | ||
Deductions, net of recoveries | (23) | (23) | (45) | ||
Balance at end of year | 39 | 42 | 49 | ||
Trade receivables sold and cash received | |||||
Balance at beginning of period | 121 | 145 | 68 | ||
Trade receivables sold | 4,844 | 3,910 | 3,015 | ||
Cash receipts | (4,794) | (3,937) | (2,931) | ||
Foreign currency and other | (5) | 3 | (7) | ||
Balance at end of period | $ 166 | $ 121 | $ 145 | ||
Inventory | |||||
Finished goods | 1,274 | 1,236 | |||
Purchased parts and fabricated assemblies | 1,173 | 1,079 | |||
Inventory, net | 2,447 | 2,315 | |||
Other Current Assets | |||||
Value-added taxes receivable | 811 | 819 | |||
Manufacturer and other receivables | 1,141 | 1,185 | |||
Prepaid and other current assets | 1,328 | 1,081 | |||
Other current assets, total | 3,280 | 3,085 | |||
Other Accrued Liabilities | |||||
Accrued taxes - other | 1,010 | 929 | |||
Warranty - short-term | 241 | 269 | |||
Sales and marketing programs | 910 | 780 | |||
Other | 1,679 | 1,866 | |||
Total | 3,840 | 3,844 | |||
Other Liabilities | |||||
Pension, post-retirement, and post-employment liabilities | 1,434 | 1,413 | |||
Deferred revenue - long-term | 2,646 | 2,487 | |||
Tax liability - long-term | 1,485 | 3,859 | |||
Other long-term liabilities | 1,320 | 1,036 | |||
Other Liabilities, total | 6,885 | 8,795 | |||
Long-Term Financing Receivables and Other Assets | |||||
Financing receivables, net | 4,740 | 4,380 | |||
Deferred tax assets | 2,403 | 4,663 | |||
Prepaid taxes - long-term | 2,340 | 293 | |||
Prepaid pension assets | 829 | 830 | |||
Other | 1,031 | 1,004 | |||
Total | 11,359 | 12,600 | |||
Tax Indemnification | |||||
Long-Term Financing Receivables and Other Assets | |||||
Indemnification receivable - long-term | $ 16 | $ 1,430 |
Balance Sheet Details (Details
Balance Sheet Details (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Property, Plant and Equipment, Net | |||
Property, plant and equipment, gross | $ 11,816 | $ 11,877 | |
Accumulated depreciation | (5,678) | (5,608) | |
Property, plant and equipment, net | 6,138 | 6,269 | |
Depreciation expense | 2,300 | 2,200 | $ 2,000 |
Land | |||
Property, Plant and Equipment, Net | |||
Property, plant and equipment, gross | 294 | 312 | |
Buildings and leasehold improvements | |||
Property, Plant and Equipment, Net | |||
Property, plant and equipment, gross | 2,103 | 2,371 | |
Machinery and equipment, including equipment held for lease | |||
Property, Plant and Equipment, Net | |||
Property, plant and equipment, gross | $ 9,419 | $ 9,194 |
Financing Receivables and Ope_3
Financing Receivables and Operating Leases (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2015 | |
Leases [Abstract] | ||||
Financing receivable term, low end of range | 2 years | |||
Financing receivable term, high end of range | 5 years | |||
Minimum lease payments receivable | $ 8,691 | $ 8,226 | ||
Unguaranteed residual value | 297 | 272 | ||
Unearned income | (732) | (654) | ||
Financing receivables, gross | 8,256 | 7,844 | ||
Allowance for doubtful accounts | (120) | (86) | $ (89) | $ (95) |
Financing receivables, net | 8,136 | 7,758 | ||
Less: current portion | (3,396) | (3,378) | ||
Amounts due after one year, net | 4,740 | 4,380 | ||
Scheduled maturities of minimum lease payments receivable: | ||||
2,019 | 3,746 | |||
2,020 | 2,331 | |||
2,021 | 1,468 | |||
2,022 | 763 | |||
2,023 | 303 | |||
Thereafter | 80 | |||
Total | $ 8,691 | $ 8,226 |
Financing Receivables and Ope_4
Financing Receivables and Operating Leases (Detail 2) - USD ($) $ in Millions | 12 Months Ended | ||||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2018 | Oct. 31, 2017 | |
Leases [Abstract] | |||||
Sold | $ 174 | $ 130 | |||
Gross financing receivables | |||||
Financing receivables, gross | $ 8,256 | $ 7,844 | |||
Aging and non-accrual status of gross financing receivables | |||||
Unbilled sales-type and direct-financing lease receivables | 7,852 | 7,462 | |||
Gross financing receivables on non-accrual status | 226 | 188 | |||
Gross financing receivables 90 days past due and still accruing interest | 113 | 133 | |||
Period past due, after which a write-off or specific reserve is created | 180 days | ||||
Allowance for doubtful accounts | |||||
Balance at beginning of year | $ 86 | 89 | $ 95 | ||
Provision for doubtful accounts | 49 | 23 | 11 | ||
Write-offs | (15) | (26) | (17) | ||
Balance at end of year | 120 | 86 | 89 | ||
Gross financing receivables collectively evaluated for loss | 7,917 | 7,523 | |||
Gross financing receivables individually evaluated for loss | 339 | 321 | |||
Financing receivables, gross | 8,256 | 7,844 | |||
Allowance for financing receivables collectively evaluated for loss | 78 | 67 | |||
Allowance for financing receivables individually evaluated for loss | 42 | 19 | |||
Total | $ 86 | $ 89 | $ 95 | 120 | 86 |
Period past due, after which account is put on non-accrual status | 90 days | ||||
Operating lease assets | |||||
Equipment leased to customers | 7,290 | 7,356 | |||
Accumulated depreciation | (3,078) | (2,943) | |||
Operating lease assets, net | 4,212 | 4,413 | |||
Minimum future rentals on non-cancelable operating leases: | |||||
2,019 | 1,901 | ||||
2,020 | 1,156 | ||||
2,021 | 477 | ||||
2,022 | 69 | ||||
2,023 | 9 | ||||
Thereafter | 1 | ||||
Total | 3,613 | ||||
Low | |||||
Gross financing receivables | |||||
Financing receivables, gross | 4,238 | 4,156 | |||
Allowance for doubtful accounts | |||||
Financing receivables, gross | 4,238 | 4,156 | |||
Moderate | |||||
Gross financing receivables | |||||
Financing receivables, gross | 3,805 | 3,556 | |||
Allowance for doubtful accounts | |||||
Financing receivables, gross | 3,805 | 3,556 | |||
High | |||||
Gross financing receivables | |||||
Financing receivables, gross | 213 | 132 | |||
Allowance for doubtful accounts | |||||
Financing receivables, gross | 213 | 132 | |||
Current 1-30 days | |||||
Aging and non-accrual status of gross financing receivables | |||||
Past due | 275 | 257 | |||
Past due 31-60 days | |||||
Aging and non-accrual status of gross financing receivables | |||||
Past due | 42 | 52 | |||
Past due 61-90 days | |||||
Aging and non-accrual status of gross financing receivables | |||||
Past due | 13 | 15 | |||
Past due 90 days | |||||
Aging and non-accrual status of gross financing receivables | |||||
Past due | $ 74 | $ 58 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures (Details) $ in Millions | Apr. 17, 2017USD ($) | Feb. 17, 2017USD ($) | Nov. 01, 2016USD ($) | May 31, 2016USD ($) | Apr. 30, 2016USD ($) | Apr. 30, 2016₨ / shares | Oct. 31, 2018USD ($)business_acquired | Oct. 31, 2017USD ($)business_acquired | Oct. 31, 2016USD ($)divestiture | Sep. 01, 2016USD ($) |
Acquisitions | ||||||||||
Number of acquisitions | business_acquired | 3 | 6 | ||||||||
Goodwill | $ 17,537 | $ 17,516 | $ 16,090 | |||||||
Divestitures | ||||||||||
Gain on disposal | 0 | 0 | 2,420 | |||||||
Gain on divestiture | $ 0 | $ 0 | 2,420 | |||||||
Nimble Storage | ||||||||||
Acquisitions | ||||||||||
Total fair value of consideration | $ 1,200 | |||||||||
Goodwill | 755 | |||||||||
Intangible assets | $ 291 | |||||||||
Weighted-average useful life | 5 years | |||||||||
SimpliVity | ||||||||||
Acquisitions | ||||||||||
Total fair value of consideration | $ 651 | |||||||||
Goodwill | 442 | |||||||||
Intangible assets | $ 118 | |||||||||
Weighted-average useful life | 5 years | |||||||||
SGI | ||||||||||
Acquisitions | ||||||||||
Total fair value of consideration | $ 349 | |||||||||
Goodwill | 75 | |||||||||
Intangible assets | $ 150 | |||||||||
Weighted-average useful life | 5 years | |||||||||
Spinoff | H3C | ||||||||||
Divestitures | ||||||||||
Earnings | $ 182 | |||||||||
Ownership | 49.00% | |||||||||
Spinoff | H3C | HP China businesses | ||||||||||
Divestitures | ||||||||||
Entity ownership of China businesses (as a percent) | 100.00% | |||||||||
Spinoff | Tsinghua Holdings Subsidiary | H3C | ||||||||||
Divestitures | ||||||||||
Consideration received | $ 2,600 | |||||||||
Interest acquired (as a percent) | 51.00% | |||||||||
Gain on disposal | $ 2,200 | |||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | MphasiS | MphasiS | ||||||||||
Divestitures | ||||||||||
Proceeds (INR per share) | ₨ / shares | ₨ 430 | |||||||||
Disposed of by sale | ||||||||||
Divestitures | ||||||||||
Number of divestitures | divestiture | 3 | |||||||||
Consideration received | $ 3,000 | |||||||||
Disposed of by sale | MphasiS | MphasiS | ||||||||||
Divestitures | ||||||||||
Consideration received | $ 824 | |||||||||
Gain on divestiture | $ 253 | |||||||||
In-process research and development | Nimble Storage | ||||||||||
Acquisitions | ||||||||||
Intangible assets | $ 31 | |||||||||
In-process research and development | SimpliVity | ||||||||||
Acquisitions | ||||||||||
Intangible assets | $ 24 | |||||||||
In-process research and development | SGI | ||||||||||
Acquisitions | ||||||||||
Intangible assets | $ 30 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Table (Details) - USD ($) $ in Millions | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 17,537 | $ 17,516 | $ 16,090 |
2017 Acquisitions | |||
Business Acquisition [Line Items] | |||
Goodwill | 1,427 | ||
Net assets assumed | 340 | ||
Total fair value consideration | 2,455 | ||
2017 Acquisitions | Intangible Assets | |||
Business Acquisition [Line Items] | |||
Intangible assets | 603 | ||
2017 Acquisitions | In-process research and development | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 85 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) - USD ($) | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Goodwill | |||
Balance at beginning of period | $ 17,516,000,000 | $ 16,090,000,000 | |
Goodwill acquired during the period | 104,000,000 | 1,427,000,000 | |
Impairment of goodwill | (88,000,000) | ||
Changes due to foreign currency | 6,000,000 | 1,000,000 | |
Goodwill adjustments | (1,000,000) | (2,000,000) | |
Balance at end of period | 17,537,000,000 | 17,516,000,000 | $ 16,090,000,000 |
CMS Reporting Unit [Member] | |||
Goodwill | |||
Impairment of goodwill | (88,000,000) | 0 | 0 |
Balance at end of period | 0 | ||
Hybrid IT | |||
Goodwill | |||
Balance at beginning of period | 15,454,000,000 | 14,045,000,000 | |
Goodwill acquired during the period | 101,000,000 | 1,410,000,000 | |
Impairment of goodwill | (88,000,000) | ||
Changes due to foreign currency | 6,000,000 | 1,000,000 | |
Goodwill adjustments | (1,000,000) | (2,000,000) | |
Balance at end of period | 15,472,000,000 | 15,454,000,000 | 14,045,000,000 |
Intelligent Edge | |||
Goodwill | |||
Balance at beginning of period | 1,918,000,000 | 1,901,000,000 | |
Goodwill acquired during the period | 3,000,000 | 17,000,000 | |
Impairment of goodwill | 0 | ||
Changes due to foreign currency | 0 | 0 | |
Goodwill adjustments | 0 | 0 | |
Balance at end of period | 1,921,000,000 | 1,918,000,000 | 1,901,000,000 |
Financial Services | |||
Goodwill | |||
Balance at beginning of period | 144,000,000 | 144,000,000 | |
Goodwill acquired during the period | 0 | 0 | |
Impairment of goodwill | 0 | ||
Changes due to foreign currency | 0 | 0 | |
Goodwill adjustments | 0 | 0 | |
Balance at end of period | $ 144,000,000 | $ 144,000,000 | $ 144,000,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details 2) | 3 Months Ended | 12 Months Ended | ||||||||||
Oct. 31, 2018USD ($) | Jul. 31, 2018USD ($) | Apr. 30, 2018USD ($) | Jan. 31, 2018USD ($) | Oct. 31, 2017USD ($) | Jul. 31, 2017USD ($) | Apr. 30, 2017USD ($) | Jan. 31, 2017USD ($) | Oct. 31, 2018USD ($)segment | Oct. 31, 2017USD ($) | Oct. 31, 2016USD ($) | Nov. 01, 2017segment | |
Intangible assets | ||||||||||||
Number of reportable segments | segment | 4 | |||||||||||
Number of reportable segments after realignment | segment | 2 | |||||||||||
Goodwill impairment loss | $ 88,000,000 | |||||||||||
Goodwill | $ 17,537,000,000 | $ 17,516,000,000 | 17,537,000,000 | $ 17,516,000,000 | $ 16,090,000,000 | |||||||
Intangible assets, gross | 1,498,000,000 | 1,563,000,000 | 1,498,000,000 | 1,563,000,000 | ||||||||
Amortizable intangible assets, accumulated amortization | (709,000,000) | (521,000,000) | (709,000,000) | (521,000,000) | ||||||||
Amortizable intangible assets, net | 771,000,000 | 771,000,000 | ||||||||||
Total Intangible Assets- Net | 789,000,000 | 1,042,000,000 | 789,000,000 | 1,042,000,000 | ||||||||
Gross intangible assets acquired | 41,000,000 | 688,000,000 | ||||||||||
Amount of fully amortized intangible assets | 106,000,000 | 384,000,000 | ||||||||||
Amortization of intangible assets | 72,000,000 | $ 72,000,000 | $ 72,000,000 | $ 78,000,000 | 86,000,000 | $ 97,000,000 | $ 72,000,000 | $ 66,000,000 | 294,000,000 | 321,000,000 | 272,000,000 | |
In-process research and development | ||||||||||||
Intangible assets | ||||||||||||
Amortizable intangible assets, gross | 18,000,000 | 75,000,000 | 18,000,000 | 75,000,000 | ||||||||
Amortizable intangible assets, net | 18,000,000 | 75,000,000 | 18,000,000 | 75,000,000 | ||||||||
Customer contracts, customer lists and distribution agreements | ||||||||||||
Intangible assets | ||||||||||||
Amortizable intangible assets, gross | 272,000,000 | 268,000,000 | 272,000,000 | 268,000,000 | ||||||||
Amortizable intangible assets, accumulated amortization | (142,000,000) | (71,000,000) | (142,000,000) | (71,000,000) | ||||||||
Amortizable intangible assets, net | 130,000,000 | 197,000,000 | $ 130,000,000 | 197,000,000 | ||||||||
Weighted-Average Remaining Useful Lives | 4 years | |||||||||||
Developed and core technology and patents | ||||||||||||
Intangible assets | ||||||||||||
Amortizable intangible assets, gross | 1,121,000,000 | 1,133,000,000 | $ 1,121,000,000 | 1,133,000,000 | ||||||||
Amortizable intangible assets, accumulated amortization | (525,000,000) | (427,000,000) | (525,000,000) | (427,000,000) | ||||||||
Amortizable intangible assets, net | 596,000,000 | 706,000,000 | $ 596,000,000 | 706,000,000 | ||||||||
Weighted-Average Remaining Useful Lives | 4 years | |||||||||||
Developed and core technology and patents | In-process research and development | ||||||||||||
Intangible assets | ||||||||||||
Reclassified | 57,000,000 | 10,000,000 | $ 57,000,000 | 10,000,000 | ||||||||
Trade name and trade marks | ||||||||||||
Intangible assets | ||||||||||||
Amortizable intangible assets, gross | 87,000,000 | 87,000,000 | 87,000,000 | 87,000,000 | ||||||||
Amortizable intangible assets, accumulated amortization | (42,000,000) | (23,000,000) | (42,000,000) | (23,000,000) | ||||||||
Amortizable intangible assets, net | 45,000,000 | 64,000,000 | $ 45,000,000 | 64,000,000 | ||||||||
Weighted-Average Remaining Useful Lives | 4 years | |||||||||||
Hybrid IT | ||||||||||||
Intangible assets | ||||||||||||
Goodwill impairment loss | $ 88,000,000 | |||||||||||
Goodwill | 15,472,000,000 | $ 15,454,000,000 | 15,472,000,000 | 15,454,000,000 | 14,045,000,000 | |||||||
CMS Reporting Unit [Member] | ||||||||||||
Intangible assets | ||||||||||||
Goodwill impairment loss | 88,000,000 | $ 0 | $ 0 | |||||||||
Goodwill | $ 0 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Details 3) $ in Millions | Oct. 31, 2018USD ($) |
Estimated future amortization expense related to finite-lived purchased intangible assets | |
2,019 | $ 248 |
2,020 | 197 |
2,021 | 126 |
2,022 | 92 |
2,023 | 68 |
Thereafter | 40 |
Total | $ 771 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Millions | Oct. 31, 2018 | Oct. 31, 2017 |
Fair Value and Carrying Value of Debt | ||
Fair value, short- and long-term debt | $ 12,200 | $ 14,600 |
Carrying value, short- and long-term debt | 12,100 | 14,000 |
Fair Value, Measurements, Recurring | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 3,773 | 7,260 |
Total liabilities | 476 | 477 |
Fair Value, Measurements, Recurring | Time deposits | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 781 | 1,159 |
Fair Value, Measurements, Recurring | Money market funds | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 2,340 | 5,592 |
Fair Value, Measurements, Recurring | Foreign bonds | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 131 | 223 |
Fair Value, Measurements, Recurring | Other debt securities | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 25 | 26 |
Fair Value, Measurements, Recurring | Foreign currency contracts | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 496 | 259 |
Total liabilities | 117 | 335 |
Fair Value, Measurements, Recurring | Other derivatives | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 0 | 1 |
Total liabilities | 6 | 0 |
Fair Value, Measurements, Recurring | Interest rate contracts | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total liabilities | 353 | 142 |
Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 2,347 | 5,601 |
Fair Value, Measurements, Recurring | Level 1 | Money market funds | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 2,340 | 5,592 |
Fair Value, Measurements, Recurring | Level 1 | Foreign bonds | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 7 | 9 |
Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 1,401 | 1,633 |
Total liabilities | 476 | 477 |
Fair Value, Measurements, Recurring | Level 2 | Time deposits | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 781 | 1,159 |
Fair Value, Measurements, Recurring | Level 2 | Foreign bonds | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 124 | 214 |
Fair Value, Measurements, Recurring | Level 2 | Foreign currency contracts | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 496 | 259 |
Total liabilities | 117 | 335 |
Fair Value, Measurements, Recurring | Level 2 | Other derivatives | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 0 | 1 |
Total liabilities | 6 | 0 |
Fair Value, Measurements, Recurring | Level 2 | Interest rate contracts | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total liabilities | 353 | 142 |
Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | 25 | 26 |
Fair Value, Measurements, Recurring | Level 3 | Other debt securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total assets | $ 25 | $ 26 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Cash equivalents and available-for-sale investments | |||
Available-for-sale Debt Securities Gross Unrealized Gains | $ 18 | $ 40 | |
Available-for-sale Debt Securities, Gross Unrealized Losses | (1) | (11) | |
Available-for-sale securities, Gross Unrealized Gains | 18 | 40 | |
Available-for-sale securities, Gross Unrealized Losses | (1) | (11) | |
Interest income | 104 | 104 | $ 105 |
Cost | |||
Cash equivalents and available-for-sale investments | |||
Cash equivalents | 3,121 | 6,751 | |
Available-for-sale securities, Cost | 139 | 220 | |
Total cash equivalents and available-for-sale investments | 3,260 | 6,971 | |
Fair Value | |||
Cash equivalents and available-for-sale investments | |||
Cash equivalents | 3,121 | 6,751 | |
Available-for-sale Debt Securities Fair Value | 156 | 249 | |
Total cash equivalents and available-for-sale investments | 3,277 | 7,000 | |
Foreign bonds | |||
Cash equivalents and available-for-sale investments | |||
Available-for-sale Debt Securities Gross Unrealized Gains | 18 | 40 | |
Foreign bonds | Cost | |||
Cash equivalents and available-for-sale investments | |||
Available-for-sale securities, Cost | 113 | 183 | |
Foreign bonds | Fair Value | |||
Cash equivalents and available-for-sale investments | |||
Available-for-sale Debt Securities Fair Value | 131 | 223 | |
Other debt securities | |||
Cash equivalents and available-for-sale investments | |||
Available-for-sale Debt Securities, Gross Unrealized Losses | (1) | (11) | |
Other debt securities | Cost | |||
Cash equivalents and available-for-sale investments | |||
Available-for-sale securities, Cost | 26 | 37 | |
Other debt securities | Fair Value | |||
Cash equivalents and available-for-sale investments | |||
Available-for-sale Debt Securities Fair Value | 25 | 26 | |
Time deposits | Cost | |||
Cash equivalents and available-for-sale investments | |||
Cash equivalents | 781 | 1,159 | |
Time deposits | Fair Value | |||
Cash equivalents and available-for-sale investments | |||
Cash equivalents | 781 | 1,159 | |
Money market funds | Cost | |||
Cash equivalents and available-for-sale investments | |||
Cash equivalents | 2,340 | 5,592 | |
Money market funds | Fair Value | |||
Cash equivalents and available-for-sale investments | |||
Cash equivalents | $ 2,340 | $ 5,592 |
Financial Instruments (Details
Financial Instruments (Details 2) - USD ($) $ in Millions | Oct. 31, 2018 | Oct. 31, 2017 |
Amortized Cost | ||
Due in more than five years | $ 139 | |
Fair Value | ||
Due in more than five years | 156 | |
Investment Holdings | ||
Investments in equity interests | 2,398 | $ 2,535 |
Equity securities in privately held companies | Long-Term Financing Receivables and Other Assets | ||
Investment Holdings | ||
Investment amount | $ 162 | $ 149 |
Financial Instruments (Detail_2
Financial Instruments (Details 3) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Investments, All Other Investments [Abstract] | ||
Period within which the funds held as collateral and posted as collateral are transferred from or to counterparties | 2 days | |
Collateralized arrangements in net liability position | $ 290 | $ 265 |
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 23,894 | 28,294 |
Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 343 | 202 |
Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 153 | 58 |
Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 85 | 232 |
Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | $ 391 | 245 |
Cash flow hedges | ||
Derivatives, Fair Value | ||
Maturity period of foreign currency cash flow hedges | 12 months | |
Cash flow hedges | Maximum | ||
Derivatives, Fair Value | ||
Duration of lease term for which lease-related forward contracts and intercompany lease loan forward contracts can be extended | 5 years | |
Derivatives designated as hedging instruments | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | $ 17,010 | 18,646 |
Derivatives designated as hedging instruments | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 302 | 140 |
Derivatives designated as hedging instruments | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 148 | 55 |
Derivatives designated as hedging instruments | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 24 | 153 |
Derivatives designated as hedging instruments | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 379 | 237 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 6,850 | 9,500 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 0 | 0 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 0 | 16 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 353 | 126 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 8,423 | 7,202 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 270 | 105 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 107 | 45 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 11 | 101 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 15 | 70 |
Derivatives designated as hedging instruments | Net investment hedges | Foreign currency contracts | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 1,737 | 1,944 |
Derivatives designated as hedging instruments | Net investment hedges | Foreign currency contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 32 | 35 |
Derivatives designated as hedging instruments | Net investment hedges | Foreign currency contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 41 | 10 |
Derivatives designated as hedging instruments | Net investment hedges | Foreign currency contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 13 | 36 |
Derivatives designated as hedging instruments | Net investment hedges | Foreign currency contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 11 | 41 |
Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 6,884 | 9,648 |
Derivatives not designated as hedging instruments | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 41 | 62 |
Derivatives not designated as hedging instruments | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 5 | 3 |
Derivatives not designated as hedging instruments | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 61 | 79 |
Derivatives not designated as hedging instruments | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 12 | 8 |
Derivatives not designated as hedging instruments | Foreign currency contracts | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 6,780 | 9,552 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 41 | 61 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 5 | 3 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 55 | 79 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 12 | 8 |
Derivatives not designated as hedging instruments | Other derivatives | ||
Derivatives, Fair Value | ||
Total derivatives, gross notional amount | 104 | 96 |
Derivatives not designated as hedging instruments | Other derivatives | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 0 | 1 |
Derivatives not designated as hedging instruments | Other derivatives | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 6 | 0 |
Derivatives not designated as hedging instruments | Other derivatives | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | $ 0 | $ 0 |
Financial Instruments (Detail_3
Financial Instruments (Details 4) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Derivative assets | ||
Gross Amount Recognized | $ 496 | $ 260 |
Net Amount Presented | 496 | 260 |
Gross Amounts Not Offset | ||
Derivatives | 179 | 209 |
Financial Collateral | 205 | 34 |
Net Amount | 112 | 17 |
Derivative liabilities | ||
Gross Amount Recognized | 476 | 477 |
Net Amount Presented | 476 | 477 |
Gross Amounts Not Offset | ||
Derivatives | 179 | 209 |
Financial Collateral | 302 | 242 |
Net Amount | $ (5) | $ 26 |
Period within which the funds held as collateral and posted as collateral are transferred from or to counterparties | 2 days | |
Cash collateral posted | $ 220 | |
Re-use of counterparty collateral | $ 22 |
Financial Instruments (Detail 5
Financial Instruments (Detail 5) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Net revenue | $ 7,946 | $ 7,764 | $ 7,468 | $ 7,674 | $ 7,660 | $ 7,501 | $ 6,808 | $ 6,902 | $ 30,852 | $ 28,871 | $ 30,280 |
Cost of products | (7,262) | (7,248) | (7,071) | (7,413) | (7,884) | (7,300) | (6,613) | (6,449) | (28,994) | (28,246) | (26,377) |
Gain on divestiture | 0 | 0 | 2,420 | ||||||||
Interest and other, net | (111) | (64) | (78) | (21) | (76) | (87) | (86) | (78) | (274) | (327) | (284) |
Earnings from continuing operations before taxes | 576 | 465 | (116) | (657) | (301) | 125 | 113 | 335 | 268 | 272 | 3,860 |
Net (loss) earnings from discontinued operations | $ 15 | $ (1) | $ (72) | $ (46) | $ 146 | $ (120) | $ (134) | $ 16 | (104) | (92) | (76) |
Net earnings (loss) | 1,908 | 344 | 3,161 | ||||||||
Pre-tax effect of derivative instruments not designated as hedging instruments on the Consolidated Condensed Statements of Earnings | |||||||||||
Gains (Losses) Recognized in Income on Derivatives | 295 | (440) | (429) | ||||||||
Interest rate contracts | |||||||||||
Pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship | |||||||||||
(Losses) Gains Recognized in Income on Derivative | (211) | (245) | 158 | ||||||||
(Losses) Gains recognized in Income on Related Hedged Item | 211 | 245 | (158) | ||||||||
Foreign currency contracts | |||||||||||
Pre-tax effect of derivative instruments not designated as hedging instruments on the Consolidated Condensed Statements of Earnings | |||||||||||
Gains (Losses) Recognized in Income on Derivatives | 301 | (443) | (425) | ||||||||
Other derivatives | |||||||||||
Pre-tax effect of derivative instruments not designated as hedging instruments on the Consolidated Condensed Statements of Earnings | |||||||||||
Gains (Losses) Recognized in Income on Derivatives | (6) | 3 | (4) | ||||||||
Cash flow hedges | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Loss expected to be reclassified from Accumulated OCI into earnings in next 12 months | 119 | ||||||||||
Cash flow hedges | Foreign currency contracts | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 169 | 46 | 226 | ||||||||
Cash flow hedges | Foreign currency contracts | Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion) | Reclassifications of losses (gains) into earnings | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Net revenue | (24) | (68) | (48) | ||||||||
Cost of products | 0 | 0 | 0 | ||||||||
Gain on divestiture | 0 | 0 | 8 | ||||||||
Interest and other, net | 16 | 170 | 243 | ||||||||
Earnings from continuing operations before taxes | (8) | 102 | 203 | ||||||||
Net (loss) earnings from discontinued operations | 0 | 43 | 67 | ||||||||
Net earnings (loss) | (8) | 145 | 270 | ||||||||
Cash flow hedges | Foreign currency contracts | Net revenue | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 163 | (113) | (71) | ||||||||
Cash flow hedges | Foreign currency contracts | Cost of products | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 0 | (1) | 1 | ||||||||
Cash flow hedges | Foreign currency contracts | Gain on H3C and MphasiS divestitures | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 0 | 0 | 0 | ||||||||
Cash flow hedges | Foreign currency contracts | Interest and other, net | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 6 | 159 | 236 | ||||||||
Cash flow hedges | Foreign currency contracts | Continuing Operations | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 169 | 45 | 166 | ||||||||
Cash flow hedges | Foreign currency contracts | Discontinued Operations | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | 0 | 1 | 60 | ||||||||
Net investment hedges | Foreign currency contracts | Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion) | Reclassifications of losses (gains) into earnings | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Interest and other, net | 0 | 0 | 0 | ||||||||
Net investment hedges | Foreign currency contracts | Interest and other, net | |||||||||||
Pre-tax effect of derivative instruments in cash flow and net investment hedging relationships | |||||||||||
Gains (Losses) Recognized in OCI on Derivatives (Effective Portion) | $ 81 | $ (71) | $ (58) |
Borrowings (Details)
Borrowings (Details) - USD ($) | Oct. 31, 2018 | Oct. 31, 2017 |
Notes Payable and Short-Term Borrowings | ||
Current portion of long-term debt | $ 1,196,000,000 | $ 3,005,000,000 |
Amount Outstanding | $ 2,005,000,000 | $ 3,850,000,000 |
Current portion of long-term debt, weighted average interest rate (as a percent) | 2.20% | 3.20% |
FS Commercial paper | ||
Notes Payable and Short-Term Borrowings | ||
Amount Outstanding | $ 392,000,000 | $ 401,000,000 |
Weighted-Average Interest Rate | (0.20%) | (0.10%) |
Short term borrowings | $ 0 | $ 0 |
Notes payable to banks, lines of credit and other | ||
Notes Payable and Short-Term Borrowings | ||
Amount Outstanding | $ 417,000,000 | $ 444,000,000 |
Weighted-Average Interest Rate | 2.50% | 1.80% |
Notes payable to banks, lines of credit and other | Financial Services | ||
Notes Payable and Short-Term Borrowings | ||
Short term borrowings | $ 361,000,000 | $ 390,000,000 |
Borrowings (Details 2)
Borrowings (Details 2) - USD ($) | 12 Months Ended | |||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Dec. 30, 2016 | |
Long-term debt | ||||
Total long-term debt | $ 10,136,000,000 | $ 10,182,000,000 | ||
Fair value adjustment related to hedged debt | (353,000,000) | (142,000,000) | ||
Unamortized debt issuance costs | (42,000,000) | (47,000,000) | ||
Less: current portion | (1,196,000,000) | (3,005,000,000) | ||
Face amount of debt instrument | $ 0 | $ 14,600,000,000 | ||
Discount to par (as a percent) | 0.00% | |||
Interest rate | 0.00% | |||
Interest expense on borrowings recognized in Combined Statements of Earnings | ||||
Financing interest | 278,000,000 | $ 265,000,000 | $ 249,000,000 | |
Interest expense | 353,000,000 | 334,000,000 | 298,000,000 | |
Total interest expense | 631,000,000 | 599,000,000 | $ 547,000,000 | |
$2,650 issued at discount to par at a price of 99.872% in October 2015 at 2.85%, due October 5, 2018, interest payable semi-annually on April 5 and October 5 of each year | ||||
Long-term debt | ||||
Total long-term debt | 0 | 2,648,000,000 | ||
Face amount of debt instrument | $ 2,650,000,000 | $ 2,650,000,000 | ||
Discount to par (as a percent) | 99.872% | 99.872% | ||
Interest rate | 2.85% | 2.85% | ||
$250 issued at par in October 2015 at three-month USD LIBOR plus 1.93%, due October 5, 2018, interest payable quarterly on January 5, April 5, July 5 and October 5 of each year | LIBOR | ||||
Long-term debt | ||||
Total long-term debt | $ 0 | $ 250,000,000 | ||
Face amount of debt instrument | $ 250,000,000 | $ 250,000,000 | ||
Interest rate | 1.93% | 1.93% | ||
$1,100 issued at discount to par at a price of 99.994% in September 2017 at 2.10%, due October 4, 2019, interest payable semi-annually on April 4 and October 4 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 1,100,000,000 | $ 1,100,000,000 | ||
Face amount of debt instrument | $ 1,100,000,000 | |||
Discount to par (as a percent) | 99.994% | |||
Interest rate | 2.10% | |||
$3,000 issued at discount to par at a price of 99.972% in October 2015 at 3.6%, due October 15, 2020, interest payable semi-annually on April 15 and October 15 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 3,000,000,000 | 3,000,000,000 | ||
Face amount of debt instrument | $ 3,000,000,000 | $ 3,000,000,000 | ||
Discount to par (as a percent) | 99.972% | 99.972% | ||
Interest rate | 3.60% | 3.60% | ||
$500 issued at discount to par at a price of 99.861% in September 2018 at 3.5%, due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 499,000,000 | $ 0 | ||
Face amount of debt instrument | $ 500,000,000 | $ 500,000,000 | ||
Discount to par (as a percent) | 99.861% | 99.861% | ||
Interest rate | 3.50% | 3.50% | ||
$800 issued at par in September 2018 at three-month USD LIBOR plus 0.72% due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 800,000,000 | $ 0 | ||
$800 issued at par in September 2018 at three-month USD LIBOR plus 0.72% due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year | LIBOR | ||||
Long-term debt | ||||
Face amount of debt instrument | $ 800,000,000 | $ 800,000,000 | ||
Interest rate | 0.72% | 0.72% | ||
$1,350 issued at discount to par at a price of 99.802% in October 2015 at 4.4%, due October 15, 2022, interest payable semi-annually on April 15 and October 15 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 1,348,000,000 | $ 1,348,000,000 | ||
Face amount of debt instrument | $ 1,350,000,000 | $ 1,350,000,000 | ||
Discount to par (as a percent) | 99.802% | 99.802% | ||
Interest rate | 4.40% | 4.40% | ||
$2,500 issued at discount to par at a price of 99.725% in October 2015 at 4.9%, due October 15, 2025, interest payable semi-annually on April 15 and October 15 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 2,495,000,000 | $ 2,495,000,000 | ||
Face amount of debt instrument | $ 2,500,000,000 | $ 2,500,000,000 | ||
Discount to par (as a percent) | 99.725% | 99.725% | ||
Interest rate | 4.90% | 4.90% | ||
$750 issued at discount to par at a price of 99.942% in October 2015 at 6.2%, due October 15, 2035, interest payable semi-annually on April 15 and October 15 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 750,000,000 | $ 750,000,000 | ||
Face amount of debt instrument | $ 750,000,000 | $ 750,000,000 | ||
Discount to par (as a percent) | 99.942% | 99.942% | ||
Interest rate | 6.20% | 6.20% | ||
$1,500 issued at discount to par at a price of 99.932% in October 2015 at 6.35%, due October 15, 2045, interest payable semi-annually on April 15 and October 15 of each year | ||||
Long-term debt | ||||
Total long-term debt | $ 1,499,000,000 | $ 1,499,000,000 | ||
Face amount of debt instrument | $ 1,500,000,000 | $ 1,500,000,000 | ||
Discount to par (as a percent) | 99.932% | 99.932% | ||
Interest rate | 6.35% | 6.35% | ||
Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030(1) | ||||
Long-term debt | ||||
Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030(1) | $ 236,000,000 | $ 286,000,000 | ||
Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030(1) | Financial Services | ||||
Long-term debt | ||||
Other, including capital lease obligations | $ 131,000,000 | $ 160,000,000 | ||
Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030(1) | Minimum | ||||
Long-term debt | ||||
Interest rate | 0.00% | 0.00% | ||
Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030(1) | Maximum | ||||
Long-term debt | ||||
Interest rate | 4.91% | 4.91% |
Borrowings (Details 3)
Borrowings (Details 3) | Sep. 19, 2018USD ($) | Sep. 20, 2017USD ($) | Apr. 28, 2017USD ($) | Nov. 01, 2015USD ($)extension_term | Oct. 31, 2018USD ($)commercial_paper_program | Sep. 30, 2018 | Jun. 29, 2018USD ($) | Oct. 31, 2017USD ($) | Dec. 30, 2016USD ($) |
Debt instruments | |||||||||
Face amount of debt instrument | $ 0 | $ 14,600,000,000 | |||||||
Interest rate | 0.00% | ||||||||
Fair value adjustment related to hedged debt | $ 353,000,000 | $ 142,000,000 | |||||||
Discount on debt issuance | 9,000,000 | ||||||||
Aggregate future maturities of debt outstanding including capital lease obligations | |||||||||
2,019 | 1,201,000,000 | ||||||||
2,020 | 3,021,000,000 | ||||||||
2,021 | 1,344,000,000 | ||||||||
2,022 | 1,363,000,000 | ||||||||
2,023 | 16,000,000 | ||||||||
Thereafter | 4,791,000,000 | ||||||||
Total | 11,736,000,000 | ||||||||
Senior Notes | |||||||||
Debt instruments | |||||||||
Interest rate swaps value | 6,900,000,000 | ||||||||
Unsecured revolving credit facility | |||||||||
Debt instruments | |||||||||
Amount available under credit facility | $ 4,000,000,000 | ||||||||
Term of credit facility | 5 years | ||||||||
Number of extension terms | extension_term | 2 | ||||||||
Extension term | 1 year | ||||||||
Borrowings outstanding | 0 | 0 | |||||||
FS Commercial paper | |||||||||
Debt instruments | |||||||||
Maximum approved | $ 4,000,000,000 | ||||||||
Number of commercial paper programs | commercial_paper_program | 2 | ||||||||
Maximum borrowing capacity under credit facility | $ 4,000,000,000 | ||||||||
Amount outstanding | 0 | 0 | |||||||
FS Commercial paper | U.S. program | |||||||||
Debt instruments | |||||||||
Maximum borrowing capacity under credit facility | 4,000,000,000 | ||||||||
FS Commercial paper | Euro program | |||||||||
Debt instruments | |||||||||
Maximum borrowing capacity under credit facility | 3,000,000,000 | ||||||||
Hewlett Packard Enterprise | FS Commercial paper | Euro program | |||||||||
Debt instruments | |||||||||
Additional authorization | 500,000,000 | ||||||||
Amount outstanding | 392,000,000 | 401,000,000 | |||||||
Hewlett-Packard International Bank PLC | FS Commercial paper | Euro Commercial Paper/Certificate of Deposit Programme | |||||||||
Debt instruments | |||||||||
Maximum borrowing capacity under credit facility | $ 500,000,000 | ||||||||
Hewlett Packard Enterprise Company | |||||||||
Debt instruments | |||||||||
Dividends | $ 3,000,000,000 | ||||||||
New Registered Notes Due 2019 | Notes Payable to Banks | |||||||||
Debt instruments | |||||||||
Face amount of debt instrument | $ 1,100,000,000 | ||||||||
Interest rate | 2.10% | ||||||||
2.450% Notes Due October 5, 2017 | Notes Payable to Banks | |||||||||
Debt instruments | |||||||||
Interest rate | 2.45% | 2.45% | |||||||
Debt repaid | $ 750,000,000 | ||||||||
Amount of debt extinguished | $ 1,500,000,000 | ||||||||
Redemption price | $ 1,500,000,000 | ||||||||
Floating Rate Notes Due October 5, 2017 | Notes Payable to Banks | |||||||||
Debt instruments | |||||||||
Debt repaid | $ 350,000,000 | ||||||||
New Notes Due October 5, 2021 | Notes Payable to Banks | |||||||||
Debt instruments | |||||||||
Face amount of debt instrument | $ 1,300,000,000 | ||||||||
New Floating Rate Notes Due October 5, 2021 | Senior Notes | |||||||||
Debt instruments | |||||||||
Face amount of debt instrument | $ 800,000,000 | ||||||||
Spread on reference interest rate (as a percent) | 0.72% | ||||||||
New Fixed Rate Notes Due October 5, 2021 | Notes Payable to Banks | |||||||||
Debt instruments | |||||||||
Face amount of debt instrument | $ 500,000,000 | ||||||||
Interest rate | 3.50% | ||||||||
Fixed 2.85% Notes Due October 2018 | Notes Payable to Banks | |||||||||
Debt instruments | |||||||||
Interest rate | 2.85% | ||||||||
Debt repaid | $ 1,050,000,000 | ||||||||
Floating Rate Notes Due October 2018 | Senior Notes | |||||||||
Debt instruments | |||||||||
Debt repaid | $ 250,000,000 | ||||||||
$2,650 issued at discount to par at a price of 99.872% in October 2015 at 2.85%, due October 5, 2018, interest payable semi-annually on April 5 and October 5 of each year | Senior Notes | |||||||||
Debt instruments | |||||||||
Face amount of debt instrument | $ 2,650,000,000 | ||||||||
Repurchased amount of debt | $ 1,600,000,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Taxes on change in net unrealized losses on available-for-sale securities: | |||
Tax (provision) benefit on net unrealized losses arising during the period | $ 0 | $ (2) | $ 2 |
Tax provision (benefit) on (gains) losses reclassified into earnings | 0 | 1 | (2) |
Taxes effect on change in unrealized (losses) gains on available-for-sales securities | 0 | (1) | 0 |
Taxes on change in net unrealized gains (losses) on cash flow hedges: | |||
Tax (provision) benefit on net unrealized gains arising during the period | (22) | 6 | (14) |
Tax (benefit) provision on net losses (gains) reclassified into earnings | (1) | 10 | 25 |
Taxes effect on change in unrealized gains (losses) on cash flow hedges | (23) | 16 | 11 |
Taxes on change in unrealized components of defined benefit plans: | |||
Tax benefit (provision) on (losses) gains arising during the period | 2 | (49) | 63 |
Tax provision on amortization of actuarial loss and prior service benefit | (14) | (19) | (20) |
Tax provision on curtailments, settlements and other | (10) | (91) | (1) |
Tax effect on change in unrealized components of defined benefit plans | (22) | (159) | 42 |
Tax on cumulative translation adjustment arising during the period | 3 | (1) | 20 |
Tax on release of cumulative translation adjustment as a result of divestitures | 0 | 0 | (22) |
Taxes on change in cumulative translation adjustment: | 3 | (1) | (2) |
Tax (provision) benefit on other comprehensive (loss) income | (42) | (145) | 51 |
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income, net of taxes | (137) | 974 | (1,584) |
Cumulative translation adjustment arising during the period | (67) | (15) | (134) |
Release of cumulative translation adjustment as a result of divestitures and country exits | 20 | 0 | 53 |
Change in foreign currency translation adjustment | (47) | (15) | (81) |
Change in net unrealized (losses) gains on available-for-sale securities: | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income before reclassifications | (3) | (10) | (2) |
Reclassifications of (gains) losses into earnings | (9) | ||
Other comprehensive (loss) income, net of taxes | (12) | (13) | (1) |
Change in net unrealized (losses) gains on available-for-sale securities: | Reclassifications of losses (gains) into earnings | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Reclassifications of (gains) losses into earnings | (9) | (3) | 1 |
Net unrealized gains (losses) on cash flow hedges | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income before reclassifications | 147 | 52 | 212 |
Reclassifications of (gains) losses into earnings | 7 | ||
Other comprehensive (loss) income, net of taxes | 154 | (83) | (33) |
Net unrealized gains (losses) on cash flow hedges | Reclassifications of losses (gains) into earnings | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Reclassifications of (gains) losses into earnings | 7 | (135) | (245) |
Change in unrealized components of defined benefit plans: | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income before reclassifications | (421) | ||
Reclassifications of (gains) losses into earnings | 189 | ||
Other comprehensive (loss) income, net of taxes | (232) | 1,085 | (1,469) |
Losses arising during the period | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income before reclassifications | (421) | 895 | (1,714) |
Amortization of actuarial loss and prior service benefit | Reclassifications of losses (gains) into earnings | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Reclassifications of (gains) losses into earnings | 177 | 266 | 264 |
Curtailments, settlements and other | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income, net of taxes | 12 | $ (76) | $ (19) |
Cumulative translation adjustment | |||
Changes and reclassifications related to Other Comprehensive (Loss) Income, net of taxes | |||
Other comprehensive (loss) income before reclassifications | (67) | ||
Reclassifications of (gains) losses into earnings | $ 20 |
Stockholders' Equity (Details
Stockholders' Equity (Details 2) - USD ($) $ / shares in Units, shares in Millions | Feb. 22, 2018 | Feb. 21, 2018 | Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | Oct. 16, 2017 | May 24, 2016 | Oct. 13, 2015 |
Components of accumulated other comprehensive income, net of taxes | ||||||||||||||||
Balance at beginning of period | $ (2,895,000,000) | $ (2,895,000,000) | ||||||||||||||
Balance at end of period | $ (3,218,000,000) | $ (2,895,000,000) | $ (3,218,000,000) | $ (2,895,000,000) | ||||||||||||
Dividends | ||||||||||||||||
Cash dividends declared per share (in dollars per share) | $ 0.1125 | $ 0.075 | $ 0.1125 | $ 0.1125 | $ 0.1125 | $ 0.15 | $ 0 | $ 0.065 | $ 0.065 | $ 0.13 | $ 0.4875 | $ 0.26 | $ 0.22 | |||
Stock Repurchase Program | ||||||||||||||||
Stock repurchase program authorized amount | $ 3,000,000,000 | |||||||||||||||
Remaining authorization | $ 4,700,000,000 | $ 4,700,000,000 | ||||||||||||||
Share Repurchase Program | ||||||||||||||||
Stock Repurchase Program | ||||||||||||||||
Stock repurchase program authorized amount | $ 2,500,000,000 | $ 5,000,000,000 | $ 3,000,000,000 | |||||||||||||
Retired (shares) | 222 | 136 | ||||||||||||||
Open market repurchases (shares) | 2.4 | 1.7 | ||||||||||||||
Open market repurchases | $ 24,000,000 | |||||||||||||||
Accelerated Share Repurchase Agreement | ||||||||||||||||
Stock Repurchase Program | ||||||||||||||||
Repurchased | $ 3,600,000,000 | 2,600,000,000 | ||||||||||||||
Net unrealized gains (losses) on available-for-sale securities | ||||||||||||||||
Components of accumulated other comprehensive income, net of taxes | ||||||||||||||||
Balance at beginning of period | $ 29,000,000 | 29,000,000 | ||||||||||||||
Release of cumulative translation adjustment as a result of divestitures | 0 | |||||||||||||||
Other comprehensive (loss) income before reclassifications | (3,000,000) | (10,000,000) | $ (2,000,000) | |||||||||||||
Reclassifications of (gains) losses into earnings | (9,000,000) | |||||||||||||||
Balance at end of period | 17,000,000 | $ 29,000,000 | 17,000,000 | 29,000,000 | ||||||||||||
Net unrealized gains (losses) on cash flow hedges | ||||||||||||||||
Components of accumulated other comprehensive income, net of taxes | ||||||||||||||||
Balance at beginning of period | (48,000,000) | (48,000,000) | ||||||||||||||
Release of cumulative translation adjustment as a result of divestitures | 0 | |||||||||||||||
Other comprehensive (loss) income before reclassifications | 147,000,000 | 52,000,000 | $ 212,000,000 | |||||||||||||
Reclassifications of (gains) losses into earnings | 7,000,000 | |||||||||||||||
Balance at end of period | 106,000,000 | (48,000,000) | 106,000,000 | (48,000,000) | ||||||||||||
Unrealized components of defined benefit plans | ||||||||||||||||
Components of accumulated other comprehensive income, net of taxes | ||||||||||||||||
Balance at beginning of period | (2,690,000,000) | (2,690,000,000) | ||||||||||||||
Release of cumulative translation adjustment as a result of divestitures | 0 | |||||||||||||||
Other comprehensive (loss) income before reclassifications | (421,000,000) | |||||||||||||||
Reclassifications of (gains) losses into earnings | 189,000,000 | |||||||||||||||
Balance at end of period | (2,922,000,000) | (2,690,000,000) | (2,922,000,000) | (2,690,000,000) | ||||||||||||
Cumulative translation adjustment | ||||||||||||||||
Components of accumulated other comprehensive income, net of taxes | ||||||||||||||||
Balance at beginning of period | (186,000,000) | (186,000,000) | ||||||||||||||
Release of cumulative translation adjustment as a result of divestitures | (186,000,000) | |||||||||||||||
Other comprehensive (loss) income before reclassifications | (67,000,000) | |||||||||||||||
Reclassifications of (gains) losses into earnings | 20,000,000 | |||||||||||||||
Balance at end of period | (419,000,000) | (186,000,000) | (419,000,000) | (186,000,000) | ||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||||
Components of accumulated other comprehensive income, net of taxes | ||||||||||||||||
Balance at beginning of period | $ (2,895,000,000) | (2,895,000,000) | ||||||||||||||
Release of cumulative translation adjustment as a result of divestitures | (186,000,000) | |||||||||||||||
Other comprehensive (loss) income before reclassifications | (344,000,000) | |||||||||||||||
Reclassifications of (gains) losses into earnings | 207,000,000 | |||||||||||||||
Balance at end of period | $ (3,218,000,000) | $ (2,895,000,000) | $ (3,218,000,000) | $ (2,895,000,000) |
Net Earnings Per Share (Detail)
Net Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Numerator: | |||||||||||
Earnings from continuing operations | $ (772) | $ 452 | $ 850 | $ 1,482 | $ 378 | $ 285 | $ (478) | $ 251 | $ 2,012 | $ 436 | $ 3,237 |
Net (loss) earnings from discontinued operations | $ 15 | $ (1) | $ (72) | $ (46) | $ 146 | $ (120) | $ (134) | $ 16 | (104) | (92) | (76) |
Net earnings | $ 1,908 | $ 344 | $ 3,161 | ||||||||
Denominator: | |||||||||||
Weighted-average shares used to compute basic net EPS (in shares) | 1,529 | 1,646 | 1,715 | ||||||||
Dilutive effect of employee stock plans (in shares) | 24 | 28 | 24 | ||||||||
Weighted-average shares used to compute diluted net EPS (in shares) | 1,459 | 1,531 | 1,582 | 1,619 | 1,647 | 1,667 | 1,658 | 1,700 | 1,553 | 1,674 | 1,739 |
Basic net earnings (loss) per share: | |||||||||||
Continuing operations (in dollars per share) | $ (0.53) | $ 0.30 | $ 0.55 | $ 0.93 | $ 0.23 | $ 0.17 | $ (0.29) | $ 0.15 | $ 1.32 | $ 0.26 | $ 1.89 |
Discontinued operations (in dollars per share) | 0.01 | 0 | (0.05) | (0.03) | 0.09 | (0.07) | (0.08) | 0.01 | (0.07) | (0.05) | (0.05) |
Total basic net earnings (loss) per share (in dollars per share) | (0.52) | 0.30 | 0.50 | 0.90 | 0.32 | 0.10 | (0.37) | 0.16 | 1.25 | 0.21 | 1.84 |
Diluted net earnings (loss) per share: | |||||||||||
Continuing operations (in dollars per share) | (0.53) | 0.29 | 0.54 | 0.92 | 0.23 | 0.17 | (0.29) | 0.15 | 1.30 | 0.26 | 1.86 |
Discontinued operations (in dollars per share) | 0.01 | 0 | (0.05) | (0.03) | 0.09 | (0.07) | (0.08) | 0.01 | (0.07) | (0.05) | (0.04) |
Total diluted net earnings (loss) per share (in dollars per share) | $ (0.52) | $ 0.29 | $ 0.49 | $ 0.89 | $ 0.32 | $ 0.10 | $ (0.37) | $ 0.16 | $ 1.23 | $ 0.21 | $ 1.82 |
Anti-dilutive weighted average stock awards (in shares) | 2 | 8 | 32 |
Litigation and Contingencies (D
Litigation and Contingencies (Detail) $ in Millions | Nov. 30, 2017plaintiff | Nov. 08, 2017USD ($) | Jun. 30, 2016USD ($) | Jan. 24, 2013USD ($) | Dec. 11, 2012USD ($) | Apr. 21, 2012USD ($) | May 10, 2010USD ($)employee | Apr. 29, 2010USD ($) | Oct. 31, 2017USD ($) | Jul. 31, 2017USD ($) | Apr. 30, 2017USD ($) | Jan. 31, 2017USD ($) | Oct. 31, 2018USD ($) | Oct. 31, 2017USD ($) | Oct. 31, 2016USD ($) | Oct. 31, 2008contract | Apr. 20, 2012USD ($) | Apr. 11, 2012USD ($) |
Litigation and Contingencies | ||||||||||||||||||
Damages sought | $ 370 | |||||||||||||||||
Disaster charges | $ 93 | $ 0 | $ 0 | $ 0 | $ 0 | $ 93 | $ 0 | |||||||||||
India Directorate of Revenue Intelligence Proceedings | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Number of HP India employees alleging underpaid customs | employee | 7 | |||||||||||||||||
Number of former HP India employees alleging underpaid customs | employee | 1 | |||||||||||||||||
Loss contingency deposit to prevent interruption of business | $ 16 | |||||||||||||||||
Bangalore Commissioner of Customs | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Duties and penalties under show cause notices | $ 17 | $ 386 | ||||||||||||||||
Amount deposited under show cause notice prior to order | $ 7 | $ 9 | ||||||||||||||||
Additional amount deposited against products-related show cause notice | $ 10 | |||||||||||||||||
Additional amount deposited against parts-related show cause notice | $ 3 | |||||||||||||||||
Additional amount deposited against product order | $ 24 | |||||||||||||||||
ECT Proceedings | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Number of ECT contracts related to alleged improprieties | contract | 3 | |||||||||||||||||
ECT Proceedings | Minimum | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Length of sanctions | 2 years | |||||||||||||||||
ECT Proceedings | Maximum | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Length of sanctions | 5 years | |||||||||||||||||
Forsyth, et. gl vs HP Inc. and Hewlett Packard Enterprise [Member] | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Number of plaintiffs | plaintiff | 3 | |||||||||||||||||
Number of additional plaintiffs | plaintiff | 13 | |||||||||||||||||
Oracle | Judicial Ruling | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Settlement amount | $ 3,000 | |||||||||||||||||
Oracle - Past Lost Profits | Judicial Ruling | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Settlement amount | 1,700 | |||||||||||||||||
Oracle - Future Lost Profits | Judicial Ruling | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Settlement amount | $ 1,300 | |||||||||||||||||
Everett SpinCo, Inc. | Cross-Indemnifications | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Damages sought | $ 1,000 | |||||||||||||||||
Everett SpinCo, Inc. | Spinoff | ||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||
Indemnification threshold amount | $ 250 |
Guarantees, Indemnifications _3
Guarantees, Indemnifications and Warranties (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Changes in aggregated product warranty liabilities | ||
Balance at beginning of year | $ 475 | $ 497 |
Accruals for warranties issued | 265 | 292 |
Adjustments related to pre-existing warranties | (10) | (8) |
Settlements made | (300) | (306) |
Balance at end of year | $ 430 | $ 475 |
Guarantees, Indemnifications _4
Guarantees, Indemnifications and Warranties - Litigation Matters and Other Contingencies (Details) - USD ($) $ in Millions | Oct. 31, 2018 | Oct. 31, 2017 |
Tax Indemnification | ||
Other Commitments [Line Items] | ||
Indemnification receivable - long-term | $ 16 | $ 1,430 |
Indemnification receivable - short-term | 17 | 0 |
Indemnification payable - long-term | 9 | 0 |
Indemnification payable - short-term | 26 | 36 |
Cross-Indemnifications | ||
Other Commitments [Line Items] | ||
Receivable | 104 | 150 |
Payable | $ 83 | 91 |
HP Inc. | Tax Indemnification | ||
Other Commitments [Line Items] | ||
Indemnification receivable - long-term | $ 1,300 |
Commitments (Details)
Commitments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $ 289 | $ 290 | $ 307 |
Property under capital lease | 61 | 75 | |
Accumulated depreciation on property under capital lease | 8 | $ 16 | |
Operating lease commitments, sublease rental income | |||
2,019 | 226 | ||
2,020 | 207 | ||
2,021 | 152 | ||
2,022 | 131 | ||
2,023 | 116 | ||
Thereafter | 387 | ||
Less: Sublease rental income | (216) | ||
Total | 1,003 | ||
Unconditional purchase obligations | 600 | ||
Unconditional purchase obligations details | |||
2,019 | 257 | ||
2,020 | 196 | ||
2,021 | 110 | ||
2,022 | 16 | ||
2,023 | 9 | ||
Thereafter | 49 | ||
Total | $ 637 |
Equity Method Investments (Deta
Equity Method Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 | May 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Investments in equity interests | $ 2,398 | $ 2,535 | $ 2,398 | $ 2,535 | ||||||||
(Loss) earnings from equity interests | 15 | $ 11 | $ (10) | $ 22 | 1 | $ 1 | $ (3) | $ (22) | 38 | (23) | $ (76) | |
Equity Method Investee | H3C | ||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Sales to related party | 1,300 | 1,200 | 500 | |||||||||
Purchases from related party | 273 | 331 | 169 | |||||||||
Payable to H3C | 43 | 64 | 43 | 64 | ||||||||
H3C | ||||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||||
Investments in equity interests | $ 2,400 | $ 2,500 | $ 2,400 | 2,500 | ||||||||
Ownership | 49.00% | 49.00% | ||||||||||
Cash dividend | $ 164 | 98 | ||||||||||
Basis difference | $ 2,534 | |||||||||||
Equity method goodwill | 1,674 | |||||||||||
Intangible assets | 749 | |||||||||||
In-process research and development | 188 | |||||||||||
Deferred tax liabilities | (152) | |||||||||||
Other | $ 75 | |||||||||||
Weighted-average useful life | 5 years | |||||||||||
(Loss) earnings from equity interests | $ 38 | (23) | (76) | |||||||||
Investment's earnings | 192 | 127 | 32 | |||||||||
Amortization of difference in basis | 151 | 155 | 93 | |||||||||
Elimination of intra-entity sales | $ 3 | $ 5 | $ 15 |
Quarterly Summary (Details)
Quarterly Summary (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Feb. 22, 2018 | Feb. 21, 2018 | Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2016 |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||
Net revenue | $ 7,946 | $ 7,764 | $ 7,468 | $ 7,674 | $ 7,660 | $ 7,501 | $ 6,808 | $ 6,902 | $ 30,852 | $ 28,871 | $ 30,280 | ||
Cost of sales | 5,489 | 5,384 | 5,196 | 5,491 | 5,383 | 5,306 | 4,799 | 4,689 | |||||
Research and development | 439 | 434 | 402 | 388 | 364 | 390 | 376 | 356 | 1,663 | 1,486 | 1,714 | ||
Selling, general and administrative | 1,219 | 1,203 | 1,227 | 1,202 | 1,288 | 1,285 | 1,229 | 1,204 | 4,851 | 5,006 | 5,380 | ||
Amortization of intangible assets | 72 | 72 | 72 | 78 | 86 | 97 | 72 | 66 | 294 | 321 | 272 | ||
Restructuring charges | 5 | 2 | 9 | 3 | 113 | 152 | 69 | 83 | 19 | 417 | 417 | ||
Transformation costs | (74) | 131 | 123 | 245 | 328 | 31 | 0 | 0 | 425 | 359 | 0 | ||
Disaster charges | 93 | 0 | 0 | 0 | 0 | 93 | 0 | ||||||
Impairment of goodwill | 88 | 0 | 0 | 0 | 88 | 0 | 0 | ||||||
Acquisition and other related charges | 12 | 24 | 16 | 30 | 53 | 56 | 50 | 44 | 82 | 203 | 145 | ||
Separation costs | 12 | (2) | 26 | (24) | 202 | 5 | 30 | 11 | 12 | 248 | 362 | ||
Defined benefit plan settlement charges and remeasurement (benefit) | (26) | (22) | (12) | (4) | 0 | (64) | 0 | ||||||
Total costs and expenses | 7,262 | 7,248 | 7,071 | 7,413 | 7,884 | 7,300 | 6,613 | 6,449 | 28,994 | 28,246 | 26,377 | ||
Segment earnings (loss) from operations | 684 | 516 | 397 | 261 | (224) | 201 | 195 | 453 | 1,858 | 625 | 3,903 | ||
Interest and other, net | (111) | (64) | (78) | (21) | (76) | (87) | (86) | (78) | (274) | (327) | (284) | ||
Tax indemnification adjustments | (12) | 2 | (425) | (919) | (2) | 10 | 7 | (18) | (1,354) | (3) | 317 | ||
(Loss) earnings from equity interests | 15 | 11 | (10) | 22 | 1 | 1 | (3) | (22) | 38 | (23) | (76) | ||
Total Hewlett Packard Enterprise consolidated earnings from continuing operations before taxes | 576 | 465 | (116) | (657) | (301) | 125 | 113 | 335 | 268 | 272 | 3,860 | ||
Income tax expense | (1,348) | (13) | 966 | 2,139 | 679 | 160 | (591) | (84) | 1,744 | 164 | (623) | ||
Net earnings (loss) from continuing operations | (772) | 452 | 850 | 1,482 | 378 | 285 | (478) | 251 | 2,012 | 436 | 3,237 | ||
Net earnings (loss) from discontinued operations | 15 | (1) | (72) | (46) | 146 | (120) | (134) | 16 | (104) | (92) | (76) | ||
Net earnings | $ (757) | $ 451 | $ 778 | $ 1,436 | $ 524 | $ 165 | $ (612) | $ 267 | $ 1,908 | $ 344 | $ 3,161 | ||
Continuing operations (in dollars per share) | $ (0.53) | $ 0.30 | $ 0.55 | $ 0.93 | $ 0.23 | $ 0.17 | $ (0.29) | $ 0.15 | $ 1.32 | $ 0.26 | $ 1.89 | ||
Discontinued operations (in dollars per share) | 0.01 | 0 | (0.05) | (0.03) | 0.09 | (0.07) | (0.08) | 0.01 | (0.07) | (0.05) | (0.05) | ||
Total basic net earnings (loss) per share (in dollars per share) | (0.52) | 0.30 | 0.50 | 0.90 | 0.32 | 0.10 | (0.37) | 0.16 | 1.25 | 0.21 | 1.84 | ||
Continuing operations (in dollars per share) | (0.53) | 0.29 | 0.54 | 0.92 | 0.23 | 0.17 | (0.29) | 0.15 | 1.30 | 0.26 | 1.86 | ||
Discontinued operations (in dollars per share) | 0.01 | 0 | (0.05) | (0.03) | 0.09 | (0.07) | (0.08) | 0.01 | (0.07) | (0.05) | (0.04) | ||
Total diluted net earnings (loss) per share (in dollars per share) | (0.52) | 0.29 | 0.49 | 0.89 | 0.32 | 0.10 | (0.37) | 0.16 | 1.23 | 0.21 | 1.82 | ||
Cash dividends declared per share (in dollars per share) | $ 0.1125 | $ 0.075 | $ 0.1125 | $ 0.1125 | $ 0.1125 | $ 0.15 | $ 0 | $ 0.065 | $ 0.065 | $ 0.13 | $ 0.4875 | $ 0.26 | $ 0.22 |
Basic (in shares) | 1,459 | 1,513 | 1,552 | 1,591 | 1,618 | 1,641 | 1,658 | 1,669 | 1,529 | 1,646 | 1,715 | ||
Diluted (in shares) | 1,459 | 1,531 | 1,582 | 1,619 | 1,647 | 1,667 | 1,658 | 1,700 | 1,553 | 1,674 | 1,739 |