Cover Page
Cover Page - shares shares in Millions | 3 Months Ended | |
Jan. 31, 2024 | Feb. 27, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jan. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-37483 | |
Entity Registrant Name | HEWLETT PACKARD ENTERPRISE COMPANY | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-3298624 | |
Entity Address, Address Line One | 1701 East Mossy Oaks Road, | |
Entity Address, City or Town | Spring, | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77389 | |
City Area Code | (678) | |
Local Phone Number | 259-9860 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | HPE | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,300 | |
Entity Central Index Key | 0001645590 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --10-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Net Revenue: | ||
Financing income | $ 156 | $ 123 |
Total net revenue | 6,755 | 7,809 |
Costs and Expenses: | ||
Financing cost | 119 | 78 |
Research and development | 582 | 623 |
Selling, general and administrative | 1,216 | 1,257 |
Amortization of intangible assets | 71 | 73 |
Transformation costs | 20 | 102 |
Disaster charges | 0 | 1 |
Acquisition, disposition and other related charges | 43 | 11 |
Total costs and expenses | 6,230 | 7,218 |
Earnings from operations | 525 | 591 |
Interest and other, net | (88) | (26) |
Earnings from equity interests | 46 | 58 |
Earnings before provision for taxes | 483 | 623 |
Provision for taxes | (96) | (122) |
Net earnings | $ 387 | $ 501 |
Net Earnings Per Share: | ||
Basic (in dollars per share) | $ 0.30 | $ 0.39 |
Diluted (in dollars per share) | $ 0.29 | $ 0.38 |
Weighted-average Shares Used to Compute Net Earnings Per Share: | ||
Basic (in shares) | 1,301 | 1,298 |
Diluted (in shares) | 1,316 | 1,315 |
Products | ||
Net Revenue: | ||
Revenues | $ 3,956 | $ 5,114 |
Costs and Expenses: | ||
Cost of products and services | 2,543 | 3,460 |
Services | ||
Net Revenue: | ||
Revenues | 2,643 | 2,572 |
Costs and Expenses: | ||
Cost of products and services | $ 1,636 | $ 1,613 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 387 | $ 501 |
Change in Net Unrealized Gains on Available-for-sale Securities: | ||
Net unrealized gains arising during the period | 6 | 5 |
Change in net unrealized gains (losses) on available-for-sale securities | 6 | 5 |
Change in Net Unrealized Losses on Cash Flow Hedges: | ||
Net unrealized losses arising during the period | (204) | (518) |
Net losses reclassified into earnings | 114 | 247 |
Change in net unrealized gains (losses) on cash flow hedges | (90) | (271) |
Change in Unrealized Components of Defined Benefit Plans: | ||
Amortization of net actuarial loss and prior service benefit | 34 | 35 |
Change in unrealized components of defined benefit plans | 34 | 35 |
Change in Cumulative Translation Adjustment | 13 | 20 |
Other Comprehensive Loss Before Taxes | (37) | (211) |
Benefit for Taxes | 13 | 53 |
Other Comprehensive Loss, Net of Taxes | (24) | (158) |
Comprehensive Income | $ 363 | $ 343 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Current Assets: | ||
Cash and cash equivalents | $ 3,758 | $ 4,270 |
Accounts receivable, net of allowances | 3,781 | 3,481 |
Financing receivables, net of allowances | 3,629 | 3,543 |
Inventory | 6,049 | 4,607 |
Other current assets | 3,027 | 3,047 |
Total current assets | 20,244 | 18,948 |
Property, plant and equipment, net | 5,997 | 5,989 |
Long-term financing receivables and other assets | 11,542 | 11,377 |
Investments in equity interests | 2,249 | 2,197 |
Goodwill | 17,988 | 17,988 |
Intangible assets | 582 | 654 |
Total assets | 58,602 | 57,153 |
Current Liabilities: | ||
Notes payable and short-term borrowings | 4,957 | 4,868 |
Accounts payable | 8,125 | 7,136 |
Employee compensation and benefits | 1,027 | 1,724 |
Taxes on earnings | 182 | 155 |
Deferred revenue | 3,718 | 3,658 |
Accrued restructuring | 121 | 180 |
Other accrued liabilities | 4,505 | 4,161 |
Total current liabilities | 22,635 | 21,882 |
Long-term debt | 7,840 | 7,487 |
Other non-current liabilities | 6,659 | 6,546 |
Commitments and Contingencies | ||
HPE Stockholders' Equity: | ||
Common stock, $0.01 par value (9,600 shares authorized; 1,300 and 1,283 shares issued and outstanding as of January 31, 2024 and October 31, 2023, respectively) | 13 | 13 |
Additional paid-in capital | 28,239 | 28,199 |
Accumulated deficit | (3,728) | (3,946) |
Accumulated other comprehensive loss | (3,108) | (3,084) |
Total HPE stockholders' equity | 21,416 | 21,182 |
Non-controlling interests | 52 | 56 |
Total stockholders' equity | 21,468 | 21,238 |
Total liabilities and stockholders' equity | $ 58,602 | $ 57,153 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jan. 31, 2024 | Oct. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 9,600,000,000 | 9,600,000,000 |
Common stock, shares issued (in shares) | 1,300,000,000 | 1,283,000,000 |
Common stock, shares outstanding (in shares) | 1,300,000,000 | 1,283,000,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Cash Flows from Operating Activities: | ||
Net earnings | $ 387 | $ 501 |
Adjustments to Reconcile Net Earnings to Net Cash Provided by (Used in) Operating Activities: | ||
Depreciation and amortization | 657 | 656 |
Stock-based compensation expense | 141 | 140 |
Provision for inventory and credit losses | 32 | 45 |
Restructuring charges | 7 | 72 |
Deferred taxes on earnings | (22) | 20 |
Earnings from equity interests | (46) | (58) |
Other, net | 72 | (60) |
Changes in Operating Assets and Liabilities, Net of Acquisitions: | ||
Accounts receivable | (310) | (112) |
Financing receivables | (190) | (523) |
Inventory | (1,461) | 495 |
Accounts payable | 1,041 | (2,195) |
Taxes on earnings | 67 | 46 |
Restructuring | (78) | (96) |
Other assets and liabilities | (233) | 240 |
Net cash provided by (used in) operating activities | 64 | (829) |
Cash Flows from Investing Activities: | ||
Investment in property, plant and equipment | (656) | (794) |
Proceeds from sale of property, plant and equipment | 96 | 159 |
Purchases of investments | (16) | 0 |
Proceeds from maturities and sales of investments | 4 | 4 |
Financial collateral posted | (439) | (682) |
Financial collateral received | 271 | 108 |
Payments made in connection with business acquisitions, net of cash acquired | 0 | (32) |
Net cash used in investing activities | (740) | (1,237) |
Cash Flows from Financing Activities: | ||
Short-term borrowings with original maturities less than 90 days, net | (17) | 745 |
Proceeds from debt, net of issuance costs | 859 | 261 |
Payment of debt | (515) | (661) |
Net payments related to stock-based award activities | (94) | (107) |
Repurchase of common stock | (3) | (73) |
Cash dividends paid to non-controlling interests, net of contributions | (8) | 0 |
Cash dividends paid to shareholders | (169) | (156) |
Net cash provided by financing activities | 53 | 9 |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 14 | 138 |
Decrease in cash, cash equivalents and restricted cash | (609) | (1,919) |
Cash, cash equivalents and restricted cash at beginning of period | 4,581 | 4,763 |
Cash, cash equivalents and restricted cash at end of period | $ 3,972 | $ 2,844 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Millions | Total | Equity Attributable to the Company | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non- controlling Interests | Total Equity |
Balance at beginning of period (in shares) at Oct. 31, 2022 | 1,281,037,000 | |||||||
Balance at beginning of period at Oct. 31, 2022 | $ 19,864 | $ 13 | $ 28,299 | $ (5,350) | $ (3,098) | $ 45 | $ 19,909 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings | 501 | 501 | 7 | 508 | ||||
Other comprehensive loss | $ (158) | (158) | (158) | (158) | ||||
Comprehensive income | 343 | 7 | 350 | |||||
Stock-based compensation expense | 140 | 140 | 140 | |||||
Tax withholding related to vesting of employee stock plans | (134) | (134) | (134) | |||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 20,352,000 | |||||||
Issuance of common stock in connection with employee stock plans and other | 24 | 24 | 0 | 24 | ||||
Repurchases of common stock (in shares) | (4,505,000) | |||||||
Repurchases of common stock | (70) | (70) | (70) | |||||
Cash dividends declared | (156) | (156) | (156) | |||||
Balance at beginning of period (in shares) at Jan. 31, 2023 | 1,296,884,000 | |||||||
Balance at end of period at Jan. 31, 2023 | 20,011 | $ 13 | 28,259 | (5,005) | (3,256) | 52 | 20,063 | |
Balance at beginning of period (in shares) at Oct. 31, 2023 | 1,283,000,000 | 1,282,630,000 | ||||||
Balance at beginning of period at Oct. 31, 2023 | $ 21,238 | 21,182 | $ 13 | 28,199 | (3,946) | (3,084) | 56 | 21,238 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings | 387 | 387 | 4 | 391 | ||||
Other comprehensive loss | $ (24) | (24) | (24) | (24) | ||||
Comprehensive income | 363 | 4 | 367 | |||||
Stock-based compensation expense | 141 | 141 | 141 | |||||
Tax withholding related to vesting of employee stock plans | (122) | (122) | (122) | |||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 17,138,000 | |||||||
Issuance of common stock in connection with employee stock plans and other | 21 | 21 | 21 | |||||
Repurchases of common stock (in shares) | ||||||||
Repurchases of common stock | 0 | 0 | ||||||
Cash dividends declared | (169) | (169) | (8) | (177) | ||||
Balance at beginning of period (in shares) at Jan. 31, 2024 | 1,300,000,000 | 1,299,768,000 | ||||||
Balance at end of period at Jan. 31, 2024 | $ 21,468 | $ 21,416 | $ 13 | $ 28,239 | $ (3,728) | $ (3,108) | $ 52 | $ 21,468 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends declared (in dollars per share) | $ 0.13 | $ 0.12 |
Overview and Summary of Signifi
Overview and Summary of Significant Accounting Policies | 3 Months Ended |
Jan. 31, 2024 | |
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 to large global enterprises and governmental entities. Basis of Presentation and Consolidation The Condensed Consolidated Financial Statements of the Company were prepared in accordance with United States ("U.S.") Generally Accepted Accounting Principles ("GAAP"). The Company’s unaudited Condensed Consolidated Financial Statements include the accounts of the Company and all 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. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements of Hewlett Packard Enterprise contain all adjustments, including normal recurring adjustments, necessary to present fairly the Company's financial position as of January 31, 2024 and October 31, 2023, its results of operations for the three months ended January 31, 2024 and 2023, its cash flows for the three months ended January 31, 2024 and 2023, and its statements of stockholders' equity for the three months ended January 31, 2024 and 2023. The results of operations and the cash flows for the three months ended January 31, 2024 are not necessarily indicative of the results to be expected for the full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2023, as filed with the U.S. Securities and Exchange Commission ("SEC") on December 22, 2023. Segment Realignment As previously disclosed, effective as of the beginning of the first quarter of fiscal 2024, in order to align the segment financial reporting more closely with its business structure, the Company established two new reportable segments, Hybrid Cloud and Server. Hybrid Cloud includes the historical Storage segment, HPE GreenLake Flex Solutions (which provides flexible as-a-service IT infrastructure through the HPE GreenLake edge-to-cloud platform and was previously reported under the Compute and the High Performance Computing & Artificial Intelligence ("HPC & AI") segments), Private Cloud, and Software (previously reported under the Corporate Investments and Other segment). The Server segment combines the previously separately reported Compute and HPC & AI segments, with adjustments for certain product lines that are now reported in Hybrid Cloud. Additionally, certain products and services previously reported in the financial results for the HPC & AI segment were moved to be reported in the Hybrid Cloud segment, and the Athonet business and certain components of the Communications and Media Solutions (“CMS”) business, both previously reported in the financial results for Corporate Investments and Other, moved to be reported in the Intelligent Edge segment. As a result, the Company’s new organizational structure consists of the following segments: (i) Server; (ii) Hybrid Cloud; (iii) Intelligent Edge; (iv) Financial Services; and (v) Corporate Investments and Other. The Company is reporting under this re-aligned segment structure beginning with the results of the first quarter of fiscal 2024 included in this Quarterly Report. The Company has reflected these changes to its segment information retrospectively to the earliest period presented, which primarily resulted in the realignment of net revenue and operating profit for each of the segments as described above. These changes had no impact on Hewlett Packard Enterprise’s previously reported consolidated net revenue, net earnings, net earnings per share (“EPS”) or total assets. Significant Accounting Policies There have been no changes to the Company's significant accounting policies described in Part II, Item 8, Note 1, "Overview and Summary of Significant Accounting Policies," of the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2023. Recently Adopted Accounting Pronouncements In September 2022, FASB issued guidance to enhance the transparency of supplier finance programs. The amendments require the disclosure of sufficient information about the program to allow a user of the financial statements to understand the program’s nature, activity during the period, changes from period to period and potential magnitude. The Company adopted this guidance in the first quarter of fiscal 2024 except for the disclosure on the roll forward information, which is effective for fiscal 2025. The Company enters into supplier financing arrangements with external financial institutions. Under these arrangements, suppliers can choose to settle outstanding payment obligations at a discount. The Company holds no economic interest in suppliers' participation, nor does it provide guarantees or pledge assets under these arrangements. Invoices are settled with the financial institutions based on the original supplier payment terms. These arrangements do not alter the Company's rights and obligations towards suppliers, including scheduled payment terms. Liabilities associated with the funded participation in these arrangements, as presented within Accounts Payable on the Condensed Consolidated Balance Sheets, amounted to $387 million, and $295 million as of January 31, 2024 and October 31, 2023, respectively. Recently Enacted Accounting Pronouncements Although there are new accounting pronouncements issued by the Financial Accounting Standards Board ("FASB") that the Company will adopt, as applicable, the Company does not believe any of these accounting pronouncements will have a material impact on its Condensed Consolidated Financial Statements. In December 2023, the FASB issued guidance to provide disaggregated income tax disclosures on the rate reconciliation and income taxes paid. The Company is required to adopt the guidance in the first quarter of fiscal 2026, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements. In November 2023, the FASB issued guidance to improve the disclosures about a public entity’s reportable segments and address requests from investors for additional, more detailed information about a reportable segment’s expenses. The Company is required to adopt the guidance in the first quarter of fiscal 2025, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements. In March 2023, the FASB issued a guidance which amends certain provisions of ASC 842 that apply to arrangements between related parties under common control. It requires that leasehold improvements associated with common control leases be amortized by the lessee over the useful life of the leasehold improvements to the common control group as long as the lessee controls the use of the underlying asset through a lease. In addition, leasehold improvements associated with common control leases should be accounted for as a transfer between entities under common control through an adjustment to equity if, and when, the lessee no longer controls the use of the underlying asset. The Company is required to adopt the guidance in the first quarter of fiscal 2025, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements. |
Segment Information
Segment Information | 3 Months Ended |
Jan. 31, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Hewlett Packard Enterprise's operations are organized into five segments for financial reporting purposes: Server, Hybrid Cloud, Intelligent Edge, Financial Services ("FS"), and Corporate Investments and Other. Hewlett Packard Enterprise's organizational structure is based on a number of factors that the Chief Operating Decision Maker (“CODM”), who is the Chief Executive Officer, uses to evaluate, view, and run the Company's business operations, which include, but are not limited to, customer base and homogeneity of products, services and technology. The five segments are based on this organizational structure and information reviewed by Hewlett Packard Enterprise's management to evaluate segment results. Effective as of the beginning of the first quarter of fiscal 2024, in order to align the Company’s segment financial reporting more closely with its current business structure, the Company realigned its’ reportable segments, see Note 1, "Overview and Summary of Significant Accounting Policies" to the Condensed Consolidated Financial Statements for additional information. A summary description of each segment follows: Server consists of general-purpose servers for multi-workload computing and workload-optimized servers to deliver the best performance and value for demanding applications, and integrated systems comprised of software and hardware designed to address High-Performance Computing and Supercomputing (including exascale applications), Artificial Intelligence (“AI”), Data Analytics, and Transaction Processing workloads for government and commercial customers globally. This portfolio of products includes our secure and versatile HPE ProLiant Rack and Tower servers; HPE Synergy, a composable infrastructure for traditional and cloud-native applications; HPE Scale Up Servers product lines for critical applications, including large enterprise software applications and data analytics platforms; HPE Edgeline servers; HPE Cray EX; HPE Cray XD (formerly known as HPE Apollo); and HPE NonStop. Server offerings also include operational and support services sold with systems and as standalone services. Hybrid Cloud offers a wide variety of cloud-native and hybrid solutions across storage, private cloud and the infrastructure software-as-a-service space. Storage includes data storage and data management offerings with the HPE Alletra Storage portfolio; unstructured data solutions and analytics for AI; data protection and archiving; and storage networking. It also includes AIOps-driven intelligence with HPE InfoSight and HPE CloudPhysics. In private cloud, our HPE GreenLake offerings include new cloud-native offerings and capabilities for virtual machines, containers, and bare metal; a full suite of private cloud offerings that enable customers to self-manage or choose a fully managed experience; and a portfolio of world-class AI infrastructure delivered as-a-service. This segment also provides self-service private cloud on-demand with HPE GreenLake for Private Cloud Business Edition. Infrastructure software includes monitoring and observability for day two operations and beyond through our acquisition of OpsRamp and unified data access through our HPE Ezmeral Data Fabric and analytics suite, which helps move and transform data for use in AI and other applications. Hybrid Cloud segment also includes data lifecycle management and protection through our suite of offerings, including Zerto Disaster Recovery. Intelligent Edge offers wired and wireless local area networks, campus, branch, and data center switching, software-defined wide-area-networks, private and public cellular network software, network security, and associated services that enable secure connectivity for businesses of any size. The HPE Aruba Networking product portfolio includes hardware products such as Wi-Fi access points, switches, and gateways. The HPE Aruba Networking software and services portfolio includes cloud-based management, network management, network access control, software-defined wide-area networking, network security, analytics and assurance, location services software, private and public cellular core software, and professional and support services, as well as as-a-service and consumption models through the HPE GreenLake edge-to-cloud platform for the Intelligent Edge portfolio of products. Intelligent Edge offerings are consolidated in the edge service platform, which takes a cloud-native approach that provides customers with a unified framework to meet their connectivity, security, and financial needs across campus, branch, data center, and remote worker environments. Financial Services provides flexible investment solutions, such as leasing, financing, IT consumption, utility programs, and asset management services, for customers that facilitate unique technology deployment models and the acquisition of complete IT solutions, including hardware, software, and services from Hewlett Packard Enterprise and others. FS also supports financial solutions for on-premise flexible consumption models, such as the HPE GreenLake edge-to-cloud platform. Corporate Investments and Other includes the Advisory and Professional Services ("A & PS") business, which primarily offers consultative-led services, HPE and partner technology expertise and advice, implementation services as well as complex solution engagement capabilities; CMS, which primarily offers software and related services to the telecommunications industry; and Hewlett Packard Labs, which is responsible for research and development. Segment Policy Hewlett Packard Enterprise does not allocate to its segments certain operating expenses, which it manages at the corporate level. These unallocated operating costs include certain corporate costs and eliminations, stock-based compensation expense, amortization of intangible assets, transformation costs, disaster recovery/charges, and acquisition, disposition and other related charges. Total assets by segment are not presented as that information is not used to allocate resources or assess performance at the segment level and is not reviewed by our CODM. Segment Operating Results Segment net revenue and operating results were as follows: Server Hybrid Cloud Intelligent Edge Financial Corporate Total In millions Three months ended January 31, 2024: Net revenue $ 3,246 $ 1,206 $ 1,193 $ 872 $ 238 $ 6,755 Intersegment net revenue 106 42 8 1 — 157 Total segment net revenue $ 3,352 $ 1,248 $ 1,201 $ 873 $ 238 $ 6,912 Segment earnings (loss) from operations $ 383 $ 47 $ 353 $ 74 $ (10) $ 847 Three months ended January 31, 2023: Net revenue $ 4,184 $ 1,361 $ 1,163 $ 867 $ 234 $ 7,809 Intersegment net revenue 148 23 6 6 — 183 Total segment net revenue $ 4,332 $ 1,384 $ 1,169 $ 873 $ 234 $ 7,992 Segment earnings (loss) from operations $ 678 $ 80 $ 227 $ 63 $ (22) $ 1,026 The reconciliation of segment operating results to Condensed Consolidated Statements of Earnings was as follows: For the three months ended January 31, 2024 2023 In millions Net Revenue: Total segments $ 6,912 $ 7,992 Eliminations of intersegment net revenue (157) (183) Total consolidated net revenue $ 6,755 $ 7,809 Earnings Before Taxes: Total segment earnings from operations $ 847 $ 1,026 Unallocated corporate costs and eliminations (72) (108) Stock-based compensation expense (141) (140) Amortization of intangible assets (71) (73) Transformation costs (20) (102) Disaster recovery (charges) 25 (1) Acquisition, disposition and other related charges (43) (11) Interest and other, net (88) (26) Earnings from equity interests 46 58 Total earnings before provision for taxes $ 483 $ 623 Geographic Information Net revenue by geographic region was as follows: For the three months ended January 31, 2024 2023 In millions Americas: United States $ 2,294 $ 2,885 Americas excluding U.S. 507 569 Total Americas 2,801 3,454 Europe, Middle East and Africa 2,434 2,680 Asia Pacific and Japan 1,520 1,675 Total consolidated net revenue $ 6,755 $ 7,809 |
Transformation Programs
Transformation Programs | 3 Months Ended |
Jan. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Transformation Programs | Transformation Programs Transformation programs are comprised of the Cost Optimization and Prioritization Plan and the HPE Next Plan. During the third quarter of fiscal 2020, the Company launched the Cost Optimization and Prioritization Plan, which focuses on realigning the workforce to areas of growth, real estate strategies, and simplifying and evolving our product portfolio strategy. The transformation costs predominantly related to labor restructuring, non-labor restructuring, IT investments, design and execution charges and real estate initiatives. The primary elements of the Cost Optimization and Prioritization Plan have been substantially completed by the end of fiscal 2023. During the third quarter of fiscal 2017, the Company launched the HPE Next Plan to put in place a purpose-built company designed to compete and win in the markets where it participates. Through this program, the Company has been simplifying the operating model, and streamlining its offerings, business processes and business systems to improve its strategy execution. The primary elements of the HPE Next Plan have been substantially completed by the end of fiscal 2023. Cost Optimization and Prioritization Plan The components of transformation costs relating to the Cost Optimization and Prioritization Plan were as follows: For the three months ended January 31, 2024 2023 In millions Program management $ 1 $ 1 IT costs 4 8 Restructuring charges 8 71 Total $ 13 $ 80 HPE Next Plan The components of transformation costs relating to HPE Next Plan were as follows: For the three months ended January 31, 2024 2023 In millions IT costs 9 21 Restructuring (credits) charges (1) 1 Total $ 8 $ 22 Restructuring Plan Restructuring activities related to the Company's employees and infrastructure under the Cost Optimization and Prioritization Plan and HPE Next Plan are presented in the table below: Cost Optimization and Prioritization Plan HPE Next Plan Employee Infrastructure Employee Infrastructure In millions Liability as of October 31, 2023 $ 152 $ 127 $ 6 $ 27 Charges (credits) 10 (2) — (1) Cash payments (64) (12) (1) (1) Non-cash items 1 1 1 (1) Liability as of January 31, 2024 $ 99 $ 114 $ 6 $ 24 Total costs incurred to date, as of January 31, 2024 $ 803 $ 559 $ 1,267 $ 270 Total expected costs to be incurred as of January 31, 2024 $ 820 $ 560 $ 1,267 $ 270 |
Retirement Benefit Plans
Retirement Benefit Plans | 3 Months Ended |
Jan. 31, 2024 | |
Retirement Benefits [Abstract] | |
Retirement Benefit Plans | Retirement Benefit Plans The Company's net pension benefit cost for defined benefit plans recognized in the Condensed Consolidated Statements of Earnings was as follows: For the three months ended January 31, 2024 2023 In millions Service cost $ 12 $ 13 Interest cost (1) 101 93 Expected return on plan assets (1) (136) (130) Amortization and Deferrals (1) : Actuarial loss 37 39 Prior service benefit (2) (3) Net periodic benefit cost 12 12 Settlement loss and special termination benefits (1) 1 — Total net benefit cost $ 13 $ 12 (1) These non-service components were included in Interest and other, net in the Condensed Consolidated Statements of Earnings. |
Taxes on Earnings
Taxes on Earnings | 3 Months Ended |
Jan. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Taxes on Earnings | Taxes on Earnings Provision for Taxes For the three months ended January 31, 2024 and 2023, the Company recorded income tax expense of $96 million and $122 million, respectively, which reflects an effective tax rate of 19.9% and 19.6%, respectively. The effective tax rate generally differs from the U.S. federal statutory rate of 21% due to favorable tax rates associated with certain earnings from the Company’s operations in lower tax jurisdictions throughout the world but are also impacted by discrete tax adjustments during each fiscal period. For the three months ended January 31, 2024, the Company recorded immaterial net income tax charges related to various items discrete to the period. For the three months ended January 31, 2023, the Company recorded $11 million of net income tax benefits related to various items discrete to the period. The amount primarily included $22 million of net income tax benefits related to transformation costs, and acquisition, disposition and other related charges and $13 million of net excess tax benefits related to stock-based compensation, partially offset by $23 million of net income tax charges related to tax audit settlements and changes in uncertain tax positions. Uncertain Tax Positions As of January 31, 2024 and October 31, 2023, the amount of unrecognized tax benefits was $674 million and $672 million, respectively, of which up to $372 million and $354 million, respectively, would affect the Company's effective tax rate if realized as of their respective periods. For tax liabilities pertaining to unrecognized tax benefits, the Company recognizes interest income from favorable settlements and interest expense and penalties in Provision for taxes in the Condensed Consolidated Statements of Earnings. As of January 31, 2024 and October 31, 2023, the Company had accrued $57 million and $56 million, respectively, for interest and penalties in the Condensed Consolidated Balance Sheets. The Company engages in continuous discussion and negotiation with tax authorities regarding tax matters in various jurisdictions. The Company is no longer subject to U.S. federal tax audits for years prior to 2017. The IRS is conducting audits of the Company's fiscal 2017 through 2022 U.S. federal income tax returns. During the fourth quarter of fiscal 2023, the IRS issued notices of proposed adjustments (“NOPAs”) for 2017, 2018, and 2019 relating to HPE’s intercompany transfer pricing. During the fiscal quarter, the IRS issued a Revenue Agent Report (“RAR”) finalizing their position on the NOPAs for the same issues and same fiscal years. The IRS is seeking to increase taxable income across the three fiscal years by $904 million. As of the balance sheet date, HPE has sufficient tax credit carryforwards to offset any incremental tax liability from the adjustments in the RAR. However, HPE disagrees with the IRS’ adjustments and believes the positions taken on its tax returns are more likely than not to prevail on technical merits, and the Company will defend these positions through the IRS administrative processes, as necessary. Accordingly, no changes have been made to the Company’s reserves for uncertain tax positions as of January 31, 2024 relating to the IRS’ adjustments. With respect to major state and foreign tax jurisdictions, the Company is no longer subject to tax authority examinations for years prior to 2005. Additionally, it is reasonably possible that certain foreign and state tax issues may be concluded in the next 12 months, including issues involving resolution of certain intercompany transactions and other matters; accordingly, the Company believes it is reasonably possible that its existing unrecognized tax benefits for these matters may be reduced by an amount up to $8 million within the next 12 months. Deferred Tax Assets and Liabilities Deferred tax assets and liabilities included in the Condensed Consolidated Balance Sheets were as follows: As of January 31, 2024 October 31, 2023 In millions Deferred tax assets $ 2,328 $ 2,264 Deferred tax liabilities (331) (326) Deferred tax assets net of deferred tax liabilities $ 1,997 $ 1,938 |
Balance Sheet Details
Balance Sheet Details | 3 Months Ended |
Jan. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Details | Balance Sheet Details Cash, Cash Equivalents and Restricted Cash As of January 31, 2024 October 31, 2023 In millions Cash and cash equivalents $ 3,758 $ 4,270 Restricted cash (1) 214 311 Total $ 3,972 $ 4,581 (1) The Company included restricted cash in Other current assets in the accompanying Condensed Consolidated Balance Sheets. Inventory As of January 31, 2024 October 31, 2023 In millions Purchased parts and fabricated assemblies $ 4,733 $ 2,940 Finished goods 1,316 1,667 Total $ 6,049 $ 4,607 Property, Plant and Equipment, net As of January 31, 2024 October 31, 2023 In millions Land $ 66 $ 66 Buildings and leasehold improvements 1,547 1,521 Machinery and equipment, including equipment held for lease 10,564 10,382 Gross property, plant and equipment 12,177 11,969 Accumulated depreciation (6,180) (5,980) Property, plant and equipment, net $ 5,997 $ 5,989 Warranties The Company's aggregate product warranty liabilities and changes for the three months ended January 31, 2024, and the fiscal year ended October 31, 2023 were as follows: As of January 31, 2024 October 31, 2023 In millions Balance at beginning of period $ 318 $ 360 Charges 38 184 Adjustments related to pre-existing warranties 2 (18) Settlements made (46) (208) Balance at end of period $ 312 $ 318 Contract Balances The Company’s contract balances consist of contract assets, contract liabilities, and costs to obtain a contract with a customer. Contract Assets A summary of accounts receivable, net, including unbilled receivables was as follows: As of January 31, 2024 October 31, 2023 In millions Accounts receivable $ 3,540 $ 3,254 Unbilled receivables 277 264 Allowances (36) (37) Total $ 3,781 $ 3,481 The allowances for credit losses related to accounts receivable and changes for the three months ended January 31, 2024, and the fiscal year ended October 31, 2023 were as follows: As of January 31, 2024 October 31, 2023 In millions Balance at beginning of period $ 37 $ 25 Provision for credit losses 17 29 Adjustments to existing allowances, including write offs (18) (17) Balance at end of period $ 36 $ 37 Sale of Trade Receivables The Company has third-party revolving short-term financing arrangements intended to facilitate the working capital requirements of certain customers. For the three months ended January 31, 2024, the Company sold $0.8 billion and for the fiscal year ended October 31, 2023, the Company sold $4.1 billion of trade receivables. The Company recorded an obligation of $50 million and $80 million within Notes payable and short-term borrowings in its Condensed Consolidated Balance Sheets as of January 31, 2024 and October 31, 2023, respectively, related to the trade receivables sold and collected from the third-party for which the revenue recognition was deferred. Contract Liabilities and Remaining Performance Obligations As of January 31, 2024 and October 31, 2023, current deferred revenue of $3.7 billion and $3.6 billion, respectively, were recorded in Deferred revenue, and non-current deferred revenue of $3.4 billion and $3.3 billion, respectively, were recorded in Other non-current liabilities in the Condensed Consolidated Balance Sheets. For the three months ended January 31, 2024, approximately $1.3 billion of revenue was recognized relating to contract liabilities recorded as of October 31, 2023. Revenue allocated to remaining performance obligations represents contract work that has not yet been performed and does not include contracts where the customer is not committed. Remaining performance obligations estimates are subject to change and are affected by several factors, including contract terminations, changes in the scope of contracts, adjustments for revenue that has not materialized and adjustments for currency. As of January 31, 2024, the aggregate amount of remaining performance obligations, or deferred revenue, was $7.1 billion. The Company expects to recognize approximately 45% of this balance over fiscal 2024 with the remainder to be recognized thereafter. Costs to Obtain a Contract As of January 31, 2024, the current and non-current portions of the capitalized costs to obtain a contract were $87 million and $138 million, respectively. As of October 31, 2023, the current and non-current portions of the capitalized costs to obtain a contract were $86 million and $138 million, respectively. The current and non-current portions of the capitalized costs to obtain a contract were included in Other current assets, and Long-term financing receivables and other assets, respectively, in the Condensed Consolidated Balance Sheets. For the three months ended January 31, 2024 and 2023, the Company amortized $26 million and $22 million respectively, of capitalized costs to obtain a contract. The amortized capitalized costs to obtain a contract are included in Selling, general and administrative expense in the Condensed Consolidated Statements of Earnings. |
Accounting for Leases as a Less
Accounting for Leases as a Lessor | 3 Months Ended |
Jan. 31, 2024 | |
Leases [Abstract] | |
Accounting for Leases as a Lessor | Accounting for Leases as a Lessor Financing receivables represent sales-type and direct-financing leases of the Company and third-party products. These receivables typically have terms ranging from two As of January 31, 2024 October 31, 2023 In millions Minimum lease payments receivable $ 9,535 $ 9,363 Unguaranteed residual value 463 438 Unearned income (1,037) (987) Financing receivables, gross 8,961 8,814 Allowance for credit losses (226) (243) Financing receivables, net 8,735 8,571 Less: current portion (3,629) (3,543) Amounts due after one year, net $ 5,106 $ 5,028 Sale of Financing Receivables The Company enters into arrangements to transfer the contractual payments due under certain financing receivables to third party financial institutions. For the three months ended January 31, 2024 and the fiscal year ended October 31, 2023, the Company sold $23 million and $237 million of financing receivables, respectively. 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 and periodically updates the risk ratings when there is a change in the underlying credit quality. 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 as of January 31, 2024, presented on amortized cost basis by year of origination was as follows: As of January 31, 2024 Risk Rating Low Moderate High Fiscal Year In millions 2024 $ 396 $ 194 $ 4 2023 2,200 1,241 44 2022 1,572 969 52 2021 771 564 63 2020 and prior 366 410 115 Total $ 5,305 $ 3,378 $ 278 The credit risk profile of gross financing receivables, based on internal risk ratings as of October 31, 2023, presented on amortized cost basis by year of origination was as follows: As of October 31, 2023 Risk Rating Low Moderate High Fiscal Year In millions 2023 $ 2,100 $ 1,196 $ 31 2022 1,681 1,052 51 2021 868 645 57 2020 336 285 35 2019 and prior 155 223 99 Total $ 5,140 $ 3,401 $ 273 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. The credit quality indicators do not reflect any mitigation actions taken to transfer credit risk to third parties. Allowance for Credit Losses The allowance for credit losses for financing receivables as of January 31, 2024 and October 31, 2023 and the respective changes for the three and twelve months then ended were as follows: As of January 31, 2024 October 31, 2023 In millions Balance at beginning of period $ 243 $ 325 Provision for credit losses 11 58 Write-offs (28) (140) Balance at end of period $ 226 $ 243 Non-Accrual and Past-Due Financing Receivables The following table summarizes the aging and non-accrual status of gross financing receivables: As of January 31, 2024 October 31, 2023 In millions Billed: (1) Current 1-30 days $ 374 $ 320 Past due 31-60 days 38 30 Past due 61-90 days 25 13 Past due > 90 days 89 100 Unbilled sales-type and direct-financing lease receivables 8,435 8,351 Total gross financing receivables $ 8,961 $ 8,814 Gross financing receivables on non-accrual status (2) $ 224 $ 227 Gross financing receivables 90 days past due and still accruing interest (2) $ 83 $ 81 (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. The following table presents amounts included in the Condensed Consolidated Statements of Earnings related to lessor activity: For the three months ended January 31, Location 2024 2023 In millions Interest income from sales-type leases and direct financing leases Financing Income $ 156 $ 123 Lease income from operating leases Services 599 589 Total lease income $ 755 $ 712 Variable Interest Entities The Company has issued asset-backed debt securities under a fixed-term securitization program to private investors. The asset-backed debt securities are collateralized by the U.S. fixed-term financing receivables and leased equipment in the offering, which is held by a Special Purpose Entity ("SPE"). The SPE meets the definition of a Variable Interest Entity ("VIE") and is consolidated, along with the associated debt, into the Condensed Consolidated Financial Statements as the Company is the primary beneficiary of the VIE. The SPE is a bankruptcy-remote legal entity with separate assets and liabilities. The purpose of the SPE is to facilitate the funding of customer receivables and leased equipment in the capital markets. The Company’s risk of loss related to securitized receivables and leased equipment is limited to the amount by which the Company’s right to receive collections for assets securitized exceeds the amount required to pay interest, principal, and fees and expenses related to the asset-backed securities. The following table presents the assets and liabilities held by the consolidated VIE as of January 31, 2024 and October 31, 2023, which are included in the Condensed Consolidated Balance Sheets. The assets in the table below include those that can be used to settle the obligations of the VIE. Additionally, general creditors do not have recourse to the assets of the VIE. As of January 31, 2024 October 31, 2023 Assets held by VIE: In millions Other current assets $ 162 $ 145 Financing receivables Short-term 888 764 Long-term 1,219 983 Property, plant and equipment, net 1,355 1,214 Liabilities held by VIE: Notes payable and short-term borrowings, net of unamortized debt issuance costs 1,528 1,392 Long-term debt, net of unamortized debt issuance costs $ 1,369 $ 1,082 For the three months ended January 31, 2024, financing receivables and leased equipment transferred via securitization through the SPE were $0.6 billion and $0.3 billion, respectively. For the fiscal year ended October 31, 2023, financing receivables and leased equipment transferred via securitization through the SPE were $0.8 billion and $0.7 billion, respectively. |
Acquisitions
Acquisitions | 3 Months Ended |
Jan. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions Pending Merger with Juniper Networks, Inc. On January 9, 2024, the Company entered into a definitive merger agreement under which HPE will acquire Juniper Networks, Inc. (“Juniper Networks”) in an all-cash transaction for $40.00 per share, representing an equity value of approximately $14 billion. The transaction was unanimously approved by the boards of directors of both companies. The transaction is expected to be funded based on financing commitments for $14 billion in term loans. Such financing will ultimately be replaced, in part, with a combination of new debt, mandatory convertible preferred securities, and cash on the |
Goodwill
Goodwill | 3 Months Ended |
Jan. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Goodwill is tested for impairment at the reporting unit level. As of January 31, 2024, the Company's reporting units are consistent with the reportable segments identified in Note 2, “Segment Information”, with the exception of Server and Corporate Investments and Other. The Server segment contains two reporting units, Compute and HPC & AI. The Corporate Investments and Other segment contains two reporting units, A & PS and CMS. The following table represents the carrying value of goodwill, by reportable segment as of January 31, 2024 and October 31, 2023. Server Hybrid Cloud Intelligent Edge Financial Services Corporate Investments and Other Total In millions Balance as of October 31, 2023 and January 31, 2024 $ 10,220 $ 4,716 $ 2,908 $ 144 $ — $ 17,988 Goodwill is tested annually for impairment, as of the first day of the fourth quarter, at the reporting unit level. As a result of the realignment, the Company performed an interim quantitative goodwill impairment test for all of its reporting units as of November 1, 2023, which did not result in any goodwill impairment charges. There has been no change to the accumulated impairment loss from the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2023. The fair value of all reporting units continued to exceed the carrying amount of their net assets. The excess of fair value over carrying amount for our reporting units ranged from approximately 4% to 184% of the respective carrying amounts. In order to evaluate the sensitivity of the estimated fair value of our reporting units in the goodwill impairment test, the Company applied a 10% decrease to the fair value of each reporting unit. Based on the results of this hypothetical 10% decrease, all of the reporting units had an excess of fair value over carrying value with the exception of the Compute and HPC & AI reporting units. The Compute reporting unit has goodwill of $8.2 billion as of January 31, 2024, and excess of fair value over carrying value of 4% as of the interim test date. The Compute business is cyclical in nature. Over the last several years, digital transformation drove increased investment to modernize infrastructure. However, in the current macroeconomic and inflationary environment, customers have slowed their investments resulting in lower server demand and competitive pricing. These dynamics are further compounded by higher supply chain costs. During this cycle, the Compute business continues to focus on capturing market share while maintaining operating margin. If the global macroeconomic or geopolitical conditions worsen, projected revenue growth rates or operating margins decline, weighted average cost of capital increases, or if the Company has significant or sustained decline in its stock price, it is possible its estimates about the Compute reporting unit's ability to successfully address the current challenges may change, which could result in the carrying value of the Compute reporting unit exceeding its estimated fair value and potential impairment charges. The HPC & AI reporting unit has goodwill of $2.0 billion as of January 31, 2024, and excess of fair value over carrying value of 4% as of the interim test date. The HPC & AI business continues to face challenges related to supply chain constraints of key components and other operational challenges impacting our ability to achieve certain customer acceptance milestones required for revenue recognition and resulting cost increases associated with fulfilling contracts over longer than originally anticipated timelines. We currently believe these challenges will be successfully addressed as the supply chain constraints continue to improve. If the global macroeconomic or geopolitical conditions worsen, projected revenue growth rates or operating margins decline, weighted average cost of capital increases, or if the Company has significant or sustained decline in its stock price, it is possible its estimates about the HPC & AI reporting unit's ability to successfully address the current challenges may change, which could result in the carrying value of the HPC & AI reporting unit exceeding its estimated fair value and potential impairment charges. |
Fair Value
Fair Value | 3 Months Ended |
Jan. 31, 2024 | |
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. 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. The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis: As of January 31, 2024 As of October 31, 2023 Fair Value Fair Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Remaining Inputs (Level 2) Significant Other Unobservable Remaining Inputs (Level 3) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Remaining Inputs (Level 2) Significant Other Unobservable Remaining Inputs (Level 3) Total In millions Assets Cash Equivalents and Investments: Time deposits $ — $ 985 $ — $ 985 $ — $ 905 $ — $ 905 Money market funds 1,681 — — 1,681 1,672 — — 1,672 Equity investments — — 81 81 — — 135 135 Foreign bonds 1 102 1 104 1 95 1 97 Other debt securities (1) — — 19 19 — — 22 22 Derivative Instruments: Foreign exchange contracts — 242 — 242 — 464 — 464 Other derivatives — 3 — 3 — — — — Total assets $ 1,682 $ 1,332 $ 101 $ 3,115 $ 1,673 $ 1,464 $ 158 $ 3,295 Liabilities Derivative Instruments: Interest rate contracts $ — $ 104 $ — $ 104 $ — $ 151 $ — $ 151 Foreign exchange contracts — 229 — 229 — 152 — 152 Other derivatives — — — — — 2 — 2 Total liabilities $ — $ 333 $ — $ 333 $ — $ 305 $ — $ 305 ( 1) Available-for-sale debt securities with carrying values that approximate fair value. Other Fair Value Disclosures Short-Term and Long-Term Debt: As of January 31, 2024 and October 31, 2023, the estimated fair value of the Company's short-term and long-term debt was $13.0 billion and $12.2 billion, respectively. As of January 31, 2024 and October 31, 2023, the carrying value of the Company's short-term and long-term debt was $12.8 billion and $12.4 billion, respectively. If measured at fair value in the Condensed 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 nature. If measured at fair value in the Condensed Consolidated Balance Sheets, these other financial instruments would be classified in Level 2 or Level 3 of the fair value hierarchy. Non-Recurring Fair Value Measurements Equity Investments without Readily Determinable Fair Value: Equity investments are recorded at cost and measured at fair value when they are deemed to be impaired or when there is an adjustment from observable price changes. For the three months ended January 31, 2024 the Company recognized a $7 million unrealized net loss on these investments. For the three months ended January 31, 2023, the Company recognized an impairment of $10 million on these investments. If measured at fair value in the Condensed Consolidated Balance Sheets, these would generally be classified in Level 3 of the fair value hierarchy. For investments still held as of January 31, 2024, the cumulative upward adjustments for observable price changes was $39 million and cumulative downward adjustments for observable price changes and impairments was $84 million. Refer to Note 11 “Financial Instruments,” for further information about equity investments. Non-Financial Assets: |
Financial Instruments
Financial Instruments | 3 Months Ended |
Jan. 31, 2024 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | Financial Instruments Cash Equivalents and Available-for-Sale Debt Investments Cash equivalents and available-for-sale debt investments were as follows: As of January 31, 2024 As of October 31, 2023 Cost Gross Unrealized Gains Fair Cost Gross Unrealized Gains (Losses) Fair In millions Cash Equivalents: Time deposits $ 985 $ — $ 985 $ 905 $ — $ 905 Money market funds 1,681 — 1,681 1,672 — 1,672 Total cash equivalents 2,666 — 2,666 2,577 — 2,577 Available-for-sale Debt Investments: Foreign bonds 102 2 104 100 (3) 97 Other debt securities 15 4 19 19 3 22 Total available-for-sale debt investments 117 6 123 119 — 119 Total cash equivalents and available-for-sale debt investments $ 2,783 $ 6 $ 2,789 $ 2,696 $ — $ 2,696 As of January 31, 2024 and October 31, 2023, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. Time deposits were primarily issued by institu t ions outside of the U.S. as of January 31, 2024 and October 31, 2023. The estimated fair value of the available-for-sale debt 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 January 31, 2024 Amortized Cost Fair Value In millions Due in one to five years 5 5 Due in more than five years 112 118 Total $ 117 $ 123 Equity Investments Non-marketable equity investments in privately held companies are included in Long-term financing receivables and other assets in the Condensed Consolidated Balance Sheets. These non-marketable equity investments are carried either at fair value or under the measurement alternative. Measurement alternative equity investments are recorded at cost and measured at fair value when they are deemed to be impaired or when there is an adjustment from observable price changes. The carrying amount of those non-marketable equity investments accounted for under the fair value option was $81 million and $135 million as of January 31, 2024 and October 31, 2023, respectively. For the three months ended January 31, 2024, the Company recorded an unrealized loss of $54 million on these investments. The Company did not recognize any unrealized gains or losses on these equity investments during the three months ended January 31, 2023. This amount is reflected in Interest and other, net in the Condensed Consolidated Statements of Earnings. The carrying amount of those non-marketable equity investments accounted for under the measurement alternative was $154 million and $145 million as of January 31, 2024 and October 31, 2023, respectively. For the three months ended January 31, 2024 the Company recognized a $7 million unrealized net loss on these investments. For the three months ended January 31, 2023, the Company recognized an impairment of $10 million on these investments. These amounts are reflected in Interest and other, net in the Condensed Consolidated Statements of Earnings. Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows: As of January 31, 2024 As of October 31, 2023 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 $ 2,500 $ — $ — $ — $ 104 $ 2,500 $ — $ — $ — $ 151 Cash Flow Hedges: Foreign currency contracts 8,305 106 59 80 48 8,247 252 104 33 23 Net Investment Hedges: Foreign currency contracts 1,904 23 28 25 30 1,972 39 46 34 23 Total derivatives designated as hedging instruments 12,709 129 87 105 182 12,719 291 150 67 197 Derivatives Not Designated as Hedging Instruments Foreign currency contracts 4,447 23 3 27 19 6,786 20 3 23 16 Other derivatives 141 3 — — — 100 — — 2 — Total derivatives not designated as hedging instruments 4,588 26 3 27 19 6,886 20 3 25 16 Total derivatives $ 17,297 $ 155 $ 90 $ 132 $ 201 $ 19,605 $ 311 $ 153 $ 92 $ 213 Offsetting of Derivative Instruments The Company recognizes all derivative instruments on a gross basis in the Condensed 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. The information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows: As of January 31, 2024 In the Condensed Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Not Offset Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 245 $ — $ 245 $ 170 $ 55 (1) $ 20 Derivative liabilities $ 333 $ — $ 333 $ 170 $ 118 (2) $ 45 As of October 31, 2023 In the Condensed Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Not Offset Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 464 $ — $ 464 $ 196 $ 207 (1) $ 61 Derivative liabilities $ 305 $ — $ 305 $ 196 $ 103 (2) $ 6 (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 the 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 January 31, 2024, of the $118 million of collateral posted, $108 million was in cash and $10 million was through the re-use of counterparty collateral. As of October 31, 2023, of the $103 million of collateral posted, $56 million was in cash and $47 million was through the re-use of counterparty collateral. The amounts recorded on the Condensed Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges were as follows: Carrying Amount of the Hedged Liabilities Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/ (Liabilities) As of As of January 31, 2024 October 31, 2023 January 31, 2024 October 31, 2023 In millions Long-term debt $ (2,393) $ (2,345) $ 104 $ 151 The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships recognized in Other Comprehensive Income ("OCI") were as follows: Gains (Losses) Recognized in OCI on Derivatives For the three months ended January 31, 2024 2023 In millions Derivatives in Cash Flow Hedging Relationship: Foreign exchange contracts $ (204) $ (518) Derivatives in Net Investment Hedging Relationship: Foreign exchange contracts (39) (107) Total $ (243) $ (625) As of January 31, 2024, the Company expects to reclassify an estimated net accumulated other comprehensive loss of approximately $8 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. Effect of Derivative Instruments on the Condensed Consolidated Statements of Earnings The following table represents the pre-tax effect of derivative instruments on total amounts of income and expense line items presented in the Condensed Consolidated Statements of Earnings in which the effects of fair value hedges and derivatives not designated as hedging instruments are recorded: Gains (Losses) Recognized in Income For the three months ended January 31, 2024 2023 Net Revenue Interest and Other, net Net Revenue Interest and Other, net In millions Total net revenue and interest and other, net $ 6,755 $ (88) $ 7,809 $ (26) Gains (Losses) on Derivatives in Fair Value Hedging Relationships: Interest Rate Contracts Hedged items $ — $ (47) $ — $ (41) Derivatives designated as hedging instruments — 47 — 41 Gains (Losses) on Derivatives in Cash Flow Hedging Relationships: Foreign Exchange Contracts Amount of gains (losses) reclassified from accumulated other comprehensive income into income 24 (138) 50 (297) Gains (Losses) on Derivatives not Designated as Hedging Instruments: Foreign exchange contracts — (44) — (194) Other derivatives — 4 — — Total gains (losses) $ 24 $ (178) $ 50 $ (491) |
Borrowings
Borrowings | 3 Months Ended |
Jan. 31, 2024 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings Notes Payable, Short-Term Borrowings and Long-Term Debt Notes payable, short-term borrowings, including the current portion of long-term debt, and long-terms debt were as follows: As of January 31, 2024 October 31, 2023 In millions Current portion of long-term debt (1) $ 4,131 $ 4,022 Commercial paper 674 679 Notes payable to banks, lines of credit and other 152 167 Total notes payable and short-term borrowings 4,957 4,868 Long-term debt 7,840 7,487 Total $ 12,797 $ 12,355 (1) As of January 31, 2024, the Current portion of long-term debt, net of discount and issuance costs, included $1.5 billion associated with the asset-backed debt securities issued by the Company. Asset-backed Debt Securities In January 2024, the Company issued $796 million of asset-backed debt securities in six tranches at a weighted average price of 99.99% and a weighted average interest rate of 5.476%, payable monthly from February 2024 with a stated final maturity date of November 2031. Commercial Paper Hewlett Packard Enterprise maintains two commercial paper programs, collectively "the Parent Programs", and a wholly-owned subsidiary maintains a third program. The commercial paper program in the U.S. provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $4.75 billion. The commercial paper program outside the U.S. provides for the issuance of commercial paper 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 two programs at any one time cannot exceed the $4.75 billion as authorized by Hewlett Packard Enterprise's Board of Directors. In addition, 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 $1.0 billion. As of January 31, 2024 and October 31, 2023, no borrowings were outstanding under the Parent Programs. As of January 31, 2024 and October 31, 2023, $674 million and $679 million, respectively, were outstanding under the subsidiary’s program. Revolving Credit Facility The Company maintains a senior unsecured revolving credit facility that was entered into in December 2021 with an aggregate lending commitment of $4.75 billion for a period of five years. As of January 31, 2024 and October 31, 2023, no borrowings were outstanding under this credit facility. Uncommitted Credit Facility The Company maintains an uncommitted short-term advance facility with Societe Generale that was entered into in September 2023 with a principal amount of up to $500 million for a period of five years. As of January 31, 2024 and October 31, 2023, no borrowings were outstanding under this credit facility. Juniper Acquisition Committed Financing |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Jan. 31, 2024 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity The components of accumulated other comprehensive loss, net of taxes as of January 31, 2024, and changes for the three months ended January 31, 2024 were as follows: Net unrealized Net unrealized Unrealized Cumulative Accumulated In millions Balance at beginning of period $ — $ 61 $ (2,507) $ (638) $ (3,084) Other comprehensive income (loss) before reclassifications 6 (204) — 13 (185) Reclassifications of losses into earnings — 114 34 — 148 Tax benefit (provision) — 18 (4) (1) 13 Balance at end of period $ 6 $ (11) $ (2,477) $ (626) $ (3,108) The components of accumulated other comprehensive loss, net of taxes as of January 31, 2023, and changes for the three months ended January 31, 2023 were as follows: Net unrealized Net unrealized Unrealized Cumulative Accumulated In millions Balance at beginning of period $ (1) $ 109 $ (2,596) $ (610) $ (3,098) Other comprehensive income (loss) before reclassifications 5 (518) — 20 (493) Reclassifications of losses into earnings — 247 35 — 282 Tax benefit (provision) — 55 (3) 1 53 Balance at end of period $ 4 $ (107) $ (2,564) $ (589) $ (3,256) Share Repurchase Program For the three months ended January 31, 2024, the Company settled 0.2 million shares that were unsettled open market repurchases under its share repurchase program as of October 31, 2023. The Company did not repurchase or settle any additional shares during the three months ended January 31, 2024. As of January 31, 2024, the Company had a remaining authorization of approximately $1.0 billion for future share repurchases. |
Net Earnings Per Share
Net Earnings Per Share | 3 Months Ended |
Jan. 31, 2024 | |
Earnings Per Share [Abstract] | |
Net Earnings Per Share | Net Earnings Per Share The Company calculates basic net earnings per share ("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 outstanding 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: For the three months ended January 31, 2024 2023 In millions, except per share amounts Numerator: Net earnings $ 387 $ 501 Denominator: Weighted-average shares used to compute basic net EPS 1,301 1,298 Dilutive effect of employee stock plans 15 17 Weighted-average shares used to compute diluted net EPS 1,316 1,315 Net Earnings per Share: Basic $ 0.30 $ 0.39 Diluted $ 0.29 $ 0.38 Anti-dilutive weighted-average stock awards (1) 1 9 (1) 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 per share, as their effect, if included, would have been anti-dilutive for the periods presented. |
Litigation, Contingencies, and
Litigation, Contingencies, and Commitments | 3 Months Ended |
Jan. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation, Contingencies, and Commitments | Litigation, Contingencies, and Commitments Litigation 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 (the "Separation and Distribution Agreement") entered into in connection with Hewlett Packard Enterprise's spin-off from HP Inc. (formerly known as "Hewlett-Packard Company") (the "Separation"), Hewlett Packard Enterprise and HP Inc. 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 January 31, 2024, 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 Ross and Rogus v. Hewlett Packard Enterprise Company. On November 8, 2018, a putative class action complaint was filed in the Superior Court of California, County of Santa Clara 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.” The parties subsequently reached an agreement to resolve this class action. The terms of the settlement are reflected in Plaintiff’s Motion for Preliminary Approval of Class Action Settlement and Certification of Settlement Class, which was filed with the Court on September 26, 2022. On November 3, 2022, the Court granted Plaintiff’s motion and preliminarily approved the terms of the class settlement, which defines the settlement class as all “[w]omen actively employed in California by Defendant at any point from November 1, 2015, through the date of Preliminary Approval” who were employed in a covered job code. The settlement class excludes certain individuals, including those who previously executed an arbitration agreement with HPE or an agreement that resulted in a release or waiver of claims. On April 28, 2023, the Court granted Plaintiffs’ Motion for Final Approval of the Class Action Settlement and Certification of the Settlement Class. On February 6, 2024, the Court entered final judgment, approving the settlement and dismissing the action. India Directorate of Revenue Intelligence Proceedings . On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the "DRI") issued 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. On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related notices affirming duties and penalties against HP India and the named individuals for approximately $386 million. On April 20, 2012, the Commissioner issued an order on the spare parts-related notice affirming duties and penalties against HP India and certain of the named individuals for approximately $17 million. HP India filed appeals of the Commissioner's orders before the Customs Tribunal. The Customs Department filed cross-appeals before the Customs Tribunal. 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 return the matter to the Commissioner on procedural grounds. The hearings before the Customs Tribunal were subsequently delayed, have been postponed on several occasions since 2014, and have not yet been rescheduled. 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, which was denied. 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 Forsyth, et al. vs. HP Inc. and Hewlett Packard Enterprise. This purported class and collective action was filed on August 18, 2016 in the United States District Court for the Northern District of California, against HP Inc. and Hewlett Packard Enterprise (collectively, “Defendants”) 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 individuals aged 40 years and older who had their employment terminated by an HP entity pursuant to a work force reduction (“WFR”) plan. Plaintiffs also seek to certify a class under California law consisting 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 April 14, 2021, Plaintiffs’ Motion for Conditional Class Certification was granted. The conditionally certified collective action consists of all individuals who had their employment terminated by Defendants pursuant to a WFR Plan on or after November 1, 2015, and who were 40 years or older at the time of such termination. The collective action excludes all individuals who signed a Waiver and General Release Agreement or an Agreement to Arbitrate Claims. The parties have reached an agreement to resolve this matter. Plaintiffs filed a Motion for Preliminary Approval of the Class Action and Collective Action Settlement on September 21, 2023. On November 3, 2023, the Court issued an order granting preliminary approval to the Class Action and Collective Action Settlement. The Court has scheduled a Fairness Hearing to address the parties’ Motion for Final Approval for March 28, 2024. Q3 Networking Litigation. On September 21 and September 22, 2020, Q3 Networking LLC filed complaints against HPE, Aruba Networks, Commscope and Netgear in the United States District Court for the District of Delaware and the United States International Trade Commission (“ITC”). Both complaints allege infringement of four patents, and the ITC complaint defines the “accused products” as “routers, access points, controllers, network management servers, other networking products, and hardware and software components thereof.” The ITC action was instituted on October 23, 2020. The District of Delaware action has been stayed pending resolution of the ITC action. On December 7, 2021, the Administrative Law Judge issued his initial determination finding no violation of section 337 of the Tariff Act. On May 3, 2022, the ITC issued its Notice of Final Determination, affirming the initial determination and terminating the investigation. On June 18, 2022, Q3 Networking filed a petition for review of the ITC ruling with the United States Court of Appeals for the Federal Circuit. R2 Semiconductor Patent Litigation. In November 2022, R2 Semiconductor, Inc. (“R2”) filed a lawsuit in the Dusseldorf Regional Court in Germany against Intel Deutschland GmbH, Hewlett-Packard GmbH, and other Intel customers. R2 asserts that one European patent is infringed by certain Intel processors and the HPE products that contain those Intel processors. On February 7, 2024, the Dusseldorf Regional Court ruled in R2’s favor, issuing an injunction that, if enforced by R2, would prevent the sale in Germany of any products with infringing Intel processors, and require HPE to correspond with its direct customers in Germany requesting return of the products with infringing Intel processors. The injunction would remain in place unless the ruling is overturned on appeal, the patent is invalidated by the German Federal Patent Court, or the matter is resolved by the parties. On February 8, 2024, HPE filed an appeal and request for a stay of the judgement pending appeal. Intel is indemnifying HPE pursuant to the terms of the parties’ agreement regarding patent indemnification. Given the procedural posture and nature of the case, HPE is currently unable to make a reasonable estimate of the potential loss or range of losses, if any, that may arise from this lawsuit and that would not be indemnifiable by Intel. 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 the environment, including laws addressing the discharge of pollutants into the air and water; the management, movement, and disposal of hazardous substances and wastes; the clean-up of contaminated sites; product safety and compliance; 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, including those related to addressing climate change and other environmental related issues, or if its products become non-compliant with such 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 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. |
Equity Method Investments
Equity Method Investments | 3 Months Ended |
Jan. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method InvestmentsPursuant to the Shareholders' Agreement among the Company’s relevant subsidiaries, Unisplendour International Technology Limited ("UNIS"), and H3C Technologies Co., Limited ("H3C") dated as of May 1, 2016, as amended from time to time, and most recently on October 28, 2022, the Company delivered a notice to UNIS on December 30, 2022, to exercise its right to put to UNIS, for cash consideration, all of the H3C shares held by the Company, which represent 49% of the total issued share capital of H3C. On May 26, 2023, the Company’s relevant subsidiaries entered into a Put Share Purchase Agreement with UNIS, whereby UNIS has agreed to purchase all of the H3C shares held by the Company, through its subsidiaries, for total pre-tax cash consideration of $3.5 billion. The disposition remains subject to obtaining required regulatory approvals and completion of certain conditions necessary for closing. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net earnings | $ 387 | $ 501 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jan. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Overview and Summary of Signi_2
Overview and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Jan. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The Condensed Consolidated Financial Statements of the Company were prepared in accordance with United States ("U.S.") Generally Accepted Accounting Principles ("GAAP"). The Company’s unaudited Condensed Consolidated Financial Statements include the accounts of the Company and all 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. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements of Hewlett Packard Enterprise contain all adjustments, including normal recurring adjustments, necessary to present fairly the Company's financial position as of January 31, 2024 and October 31, 2023, its results of operations for the three months ended January 31, 2024 and 2023, its cash flows for the three months ended January 31, 2024 and 2023, and its statements of stockholders' equity for the three months ended January 31, 2024 and 2023. The results of operations and the cash flows for the three months ended January 31, 2024 are not necessarily indicative of the results to be expected for the full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2023, as filed with the U.S. Securities and Exchange Commission ("SEC") on December 22, 2023. |
Segment Realignment | Segment Realignment As previously disclosed, effective as of the beginning of the first quarter of fiscal 2024, in order to align the segment financial reporting more closely with its business structure, the Company established two new reportable segments, Hybrid Cloud and Server. Hybrid Cloud includes the historical Storage segment, HPE GreenLake Flex Solutions (which provides flexible as-a-service IT infrastructure through the HPE GreenLake edge-to-cloud platform and was previously reported under the Compute and the High Performance Computing & Artificial Intelligence ("HPC & AI") segments), Private Cloud, and Software (previously reported under the Corporate Investments and Other segment). The Server segment combines the previously separately reported Compute and HPC & AI segments, with adjustments for certain product lines that are now reported in Hybrid Cloud. Additionally, certain products and services previously reported in the financial results for the HPC & AI segment were moved to be reported in the Hybrid Cloud segment, and the Athonet business and certain components of the Communications and Media Solutions (“CMS”) business, both previously reported in the financial results for Corporate Investments and Other, moved to be reported in the Intelligent Edge segment. As a result, the Company’s new organizational structure consists of the following segments: (i) Server; (ii) Hybrid Cloud; (iii) Intelligent Edge; (iv) Financial Services; and (v) Corporate Investments and Other. The Company is reporting under this re-aligned segment structure beginning with the results of the first quarter of fiscal 2024 included in this Quarterly Report. The Company has reflected these changes to its segment information retrospectively to the earliest period presented, which primarily resulted in the realignment of net revenue and operating profit for each of the segments as described above. These changes had no impact on Hewlett Packard Enterprise’s previously reported consolidated net revenue, net earnings, net earnings per share (“EPS”) or total assets. Segment Policy Hewlett Packard Enterprise does not allocate to its segments certain operating expenses, which it manages at the corporate level. These unallocated operating costs include certain corporate costs and eliminations, stock-based compensation expense, amortization of intangible assets, transformation costs, disaster recovery/charges, and acquisition, disposition and other related charges. Total assets by segment are not presented as that information is not used to allocate resources or assess performance at the segment level and is not reviewed by our CODM. |
Significant Accounting Policies | Significant Accounting Policies There have been no changes to the Company's significant accounting policies described in Part II, Item 8, Note 1, "Overview and Summary of Significant Accounting Policies," of the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2023. |
Recently Adopted Accounting Pronouncements And Recently Enacted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In September 2022, FASB issued guidance to enhance the transparency of supplier finance programs. The amendments require the disclosure of sufficient information about the program to allow a user of the financial statements to understand the program’s nature, activity during the period, changes from period to period and potential magnitude. The Company adopted this guidance in the first quarter of fiscal 2024 except for the disclosure on the roll forward information, which is effective for fiscal 2025. The Company enters into supplier financing arrangements with external financial institutions. Under these arrangements, suppliers can choose to settle outstanding payment obligations at a discount. The Company holds no economic interest in suppliers' participation, nor does it provide guarantees or pledge assets under these arrangements. Invoices are settled with the financial institutions based on the original supplier payment terms. These arrangements do not alter the Company's rights and obligations towards suppliers, including scheduled payment terms. Liabilities associated with the funded participation in these arrangements, as presented within Accounts Payable on the Condensed Consolidated Balance Sheets, amounted to $387 million, and $295 million as of January 31, 2024 and October 31, 2023, respectively. Recently Enacted Accounting Pronouncements Although there are new accounting pronouncements issued by the Financial Accounting Standards Board ("FASB") that the Company will adopt, as applicable, the Company does not believe any of these accounting pronouncements will have a material impact on its Condensed Consolidated Financial Statements. In December 2023, the FASB issued guidance to provide disaggregated income tax disclosures on the rate reconciliation and income taxes paid. The Company is required to adopt the guidance in the first quarter of fiscal 2026, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements. In November 2023, the FASB issued guidance to improve the disclosures about a public entity’s reportable segments and address requests from investors for additional, more detailed information about a reportable segment’s expenses. The Company is required to adopt the guidance in the first quarter of fiscal 2025, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements. In March 2023, the FASB issued a guidance which amends certain provisions of ASC 842 that apply to arrangements between related parties under common control. It requires that leasehold improvements associated with common control leases be amortized by the lessee over the useful life of the leasehold improvements to the common control group as long as the lessee controls the use of the underlying asset through a lease. In addition, leasehold improvements associated with common control leases should be accounted for as a transfer between entities under common control through an adjustment to equity if, and when, the lessee no longer controls the use of the underlying asset. The Company is required to adopt the guidance in the first quarter of fiscal 2025, though early adoption is permitted. The Company is currently evaluating the impact of this amendment on its Condensed Consolidated Financial Statements. |
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. 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. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Segment Reporting [Abstract] | |
Segment Operating Results from Continuing Operations | Segment Operating Results Segment net revenue and operating results were as follows: Server Hybrid Cloud Intelligent Edge Financial Corporate Total In millions Three months ended January 31, 2024: Net revenue $ 3,246 $ 1,206 $ 1,193 $ 872 $ 238 $ 6,755 Intersegment net revenue 106 42 8 1 — 157 Total segment net revenue $ 3,352 $ 1,248 $ 1,201 $ 873 $ 238 $ 6,912 Segment earnings (loss) from operations $ 383 $ 47 $ 353 $ 74 $ (10) $ 847 Three months ended January 31, 2023: Net revenue $ 4,184 $ 1,361 $ 1,163 $ 867 $ 234 $ 7,809 Intersegment net revenue 148 23 6 6 — 183 Total segment net revenue $ 4,332 $ 1,384 $ 1,169 $ 873 $ 234 $ 7,992 Segment earnings (loss) from operations $ 678 $ 80 $ 227 $ 63 $ (22) $ 1,026 |
Reconciliation of Segment Operating Results | The reconciliation of segment operating results to Condensed Consolidated Statements of Earnings was as follows: For the three months ended January 31, 2024 2023 In millions Net Revenue: Total segments $ 6,912 $ 7,992 Eliminations of intersegment net revenue (157) (183) Total consolidated net revenue $ 6,755 $ 7,809 Earnings Before Taxes: Total segment earnings from operations $ 847 $ 1,026 Unallocated corporate costs and eliminations (72) (108) Stock-based compensation expense (141) (140) Amortization of intangible assets (71) (73) Transformation costs (20) (102) Disaster recovery (charges) 25 (1) Acquisition, disposition and other related charges (43) (11) Interest and other, net (88) (26) Earnings from equity interests 46 58 Total earnings before provision for taxes $ 483 $ 623 |
Net Revenue by Geographic Areas | Net revenue by geographic region was as follows: For the three months ended January 31, 2024 2023 In millions Americas: United States $ 2,294 $ 2,885 Americas excluding U.S. 507 569 Total Americas 2,801 3,454 Europe, Middle East and Africa 2,434 2,680 Asia Pacific and Japan 1,520 1,675 Total consolidated net revenue $ 6,755 $ 7,809 |
Transformation Programs (Tables
Transformation Programs (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The components of transformation costs relating to the Cost Optimization and Prioritization Plan were as follows: For the three months ended January 31, 2024 2023 In millions Program management $ 1 $ 1 IT costs 4 8 Restructuring charges 8 71 Total $ 13 $ 80 The components of transformation costs relating to HPE Next Plan were as follows: For the three months ended January 31, 2024 2023 In millions IT costs 9 21 Restructuring (credits) charges (1) 1 Total $ 8 $ 22 |
Schedule of Restructuring Reserve by Cost | Restructuring activities related to the Company's employees and infrastructure under the Cost Optimization and Prioritization Plan and HPE Next Plan are presented in the table below: Cost Optimization and Prioritization Plan HPE Next Plan Employee Infrastructure Employee Infrastructure In millions Liability as of October 31, 2023 $ 152 $ 127 $ 6 $ 27 Charges (credits) 10 (2) — (1) Cash payments (64) (12) (1) (1) Non-cash items 1 1 1 (1) Liability as of January 31, 2024 $ 99 $ 114 $ 6 $ 24 Total costs incurred to date, as of January 31, 2024 $ 803 $ 559 $ 1,267 $ 270 Total expected costs to be incurred as of January 31, 2024 $ 820 $ 560 $ 1,267 $ 270 |
Retirement Benefit Plans (Table
Retirement Benefit Plans (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Retirement Benefits [Abstract] | |
Summary of Net Benefit Cost | The Company's net pension benefit cost for defined benefit plans recognized in the Condensed Consolidated Statements of Earnings was as follows: For the three months ended January 31, 2024 2023 In millions Service cost $ 12 $ 13 Interest cost (1) 101 93 Expected return on plan assets (1) (136) (130) Amortization and Deferrals (1) : Actuarial loss 37 39 Prior service benefit (2) (3) Net periodic benefit cost 12 12 Settlement loss and special termination benefits (1) 1 — Total net benefit cost $ 13 $ 12 (1) These non-service components were included in Interest and other, net in the Condensed Consolidated Statements of Earnings. |
Taxes on Earnings (Tables)
Taxes on Earnings (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities included in the Condensed Consolidated Balance Sheets were as follows: As of January 31, 2024 October 31, 2023 In millions Deferred tax assets $ 2,328 $ 2,264 Deferred tax liabilities (331) (326) Deferred tax assets net of deferred tax liabilities $ 1,997 $ 1,938 |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Cash and Cash Equivalents | Cash, Cash Equivalents and Restricted Cash As of January 31, 2024 October 31, 2023 In millions Cash and cash equivalents $ 3,758 $ 4,270 Restricted cash (1) 214 311 Total $ 3,972 $ 4,581 (1) The Company included restricted cash in Other current assets in the accompanying Condensed Consolidated Balance Sheets. |
Schedule of Inventory | Inventory As of January 31, 2024 October 31, 2023 In millions Purchased parts and fabricated assemblies $ 4,733 $ 2,940 Finished goods 1,316 1,667 Total $ 6,049 $ 4,607 |
Schedule of Property, Plant and Equipment | Property, Plant and Equipment, net As of January 31, 2024 October 31, 2023 In millions Land $ 66 $ 66 Buildings and leasehold improvements 1,547 1,521 Machinery and equipment, including equipment held for lease 10,564 10,382 Gross property, plant and equipment 12,177 11,969 Accumulated depreciation (6,180) (5,980) Property, plant and equipment, net $ 5,997 $ 5,989 |
Changes in Aggregate Product Warranty Liabilities | The Company's aggregate product warranty liabilities and changes for the three months ended January 31, 2024, and the fiscal year ended October 31, 2023 were as follows: As of January 31, 2024 October 31, 2023 In millions Balance at beginning of period $ 318 $ 360 Charges 38 184 Adjustments related to pre-existing warranties 2 (18) Settlements made (46) (208) Balance at end of period $ 312 $ 318 |
Summary of Accounts Receivable, Net | A summary of accounts receivable, net, including unbilled receivables was as follows: As of January 31, 2024 October 31, 2023 In millions Accounts receivable $ 3,540 $ 3,254 Unbilled receivables 277 264 Allowances (36) (37) Total $ 3,781 $ 3,481 |
Schedule of Trade Receivables Sold and Cash Received | The allowances for credit losses related to accounts receivable and changes for the three months ended January 31, 2024, and the fiscal year ended October 31, 2023 were as follows: As of January 31, 2024 October 31, 2023 In millions Balance at beginning of period $ 37 $ 25 Provision for credit losses 17 29 Adjustments to existing allowances, including write offs (18) (17) Balance at end of period $ 36 $ 37 |
Accounting for Leases as a Le_2
Accounting for Leases as a Lessor (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Leases [Abstract] | |
Components of Financing Receivables | The components of financing receivables were as follows: As of January 31, 2024 October 31, 2023 In millions Minimum lease payments receivable $ 9,535 $ 9,363 Unguaranteed residual value 463 438 Unearned income (1,037) (987) Financing receivables, gross 8,961 8,814 Allowance for credit losses (226) (243) Financing receivables, net 8,735 8,571 Less: current portion (3,629) (3,543) Amounts due after one year, net $ 5,106 $ 5,028 |
Credit Risk Profile of Gross Financing Receivables | The credit risk profile of gross financing receivables, based on internal risk ratings as of January 31, 2024, presented on amortized cost basis by year of origination was as follows: As of January 31, 2024 Risk Rating Low Moderate High Fiscal Year In millions 2024 $ 396 $ 194 $ 4 2023 2,200 1,241 44 2022 1,572 969 52 2021 771 564 63 2020 and prior 366 410 115 Total $ 5,305 $ 3,378 $ 278 The credit risk profile of gross financing receivables, based on internal risk ratings as of October 31, 2023, presented on amortized cost basis by year of origination was as follows: As of October 31, 2023 Risk Rating Low Moderate High Fiscal Year In millions 2023 $ 2,100 $ 1,196 $ 31 2022 1,681 1,052 51 2021 868 645 57 2020 336 285 35 2019 and prior 155 223 99 Total $ 5,140 $ 3,401 $ 273 |
Allowance for Doubtful Accounts for Financing Receivables | The allowance for credit losses for financing receivables as of January 31, 2024 and October 31, 2023 and the respective changes for the three and twelve months then ended were as follows: As of January 31, 2024 October 31, 2023 In millions Balance at beginning of period $ 243 $ 325 Provision for credit losses 11 58 Write-offs (28) (140) Balance at end of period $ 226 $ 243 |
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 January 31, 2024 October 31, 2023 In millions Billed: (1) Current 1-30 days $ 374 $ 320 Past due 31-60 days 38 30 Past due 61-90 days 25 13 Past due > 90 days 89 100 Unbilled sales-type and direct-financing lease receivables 8,435 8,351 Total gross financing receivables $ 8,961 $ 8,814 Gross financing receivables on non-accrual status (2) $ 224 $ 227 Gross financing receivables 90 days past due and still accruing interest (2) $ 83 $ 81 (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. |
Lessor Lease Activity | The following table presents amounts included in the Condensed Consolidated Statements of Earnings related to lessor activity: For the three months ended January 31, Location 2024 2023 In millions Interest income from sales-type leases and direct financing leases Financing Income $ 156 $ 123 Lease income from operating leases Services 599 589 Total lease income $ 755 $ 712 |
Schedule of Variable Interest Entities | The assets in the table below include those that can be used to settle the obligations of the VIE. Additionally, general creditors do not have recourse to the assets of the VIE. As of January 31, 2024 October 31, 2023 Assets held by VIE: In millions Other current assets $ 162 $ 145 Financing receivables Short-term 888 764 Long-term 1,219 983 Property, plant and equipment, net 1,355 1,214 Liabilities held by VIE: Notes payable and short-term borrowings, net of unamortized debt issuance costs 1,528 1,392 Long-term debt, net of unamortized debt issuance costs $ 1,369 $ 1,082 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Allocation and Changes in the Carrying Amount of Goodwill | The following table represents the carrying value of goodwill, by reportable segment as of January 31, 2024 and October 31, 2023. Server Hybrid Cloud Intelligent Edge Financial Services Corporate Investments and Other Total In millions Balance as of October 31, 2023 and January 31, 2024 $ 10,220 $ 4,716 $ 2,908 $ 144 $ — $ 17,988 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of 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 January 31, 2024 As of October 31, 2023 Fair Value Fair Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Remaining Inputs (Level 2) Significant Other Unobservable Remaining Inputs (Level 3) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Remaining Inputs (Level 2) Significant Other Unobservable Remaining Inputs (Level 3) Total In millions Assets Cash Equivalents and Investments: Time deposits $ — $ 985 $ — $ 985 $ — $ 905 $ — $ 905 Money market funds 1,681 — — 1,681 1,672 — — 1,672 Equity investments — — 81 81 — — 135 135 Foreign bonds 1 102 1 104 1 95 1 97 Other debt securities (1) — — 19 19 — — 22 22 Derivative Instruments: Foreign exchange contracts — 242 — 242 — 464 — 464 Other derivatives — 3 — 3 — — — — Total assets $ 1,682 $ 1,332 $ 101 $ 3,115 $ 1,673 $ 1,464 $ 158 $ 3,295 Liabilities Derivative Instruments: Interest rate contracts $ — $ 104 $ — $ 104 $ — $ 151 $ — $ 151 Foreign exchange contracts — 229 — 229 — 152 — 152 Other derivatives — — — — — 2 — 2 Total liabilities $ — $ 333 $ — $ 333 $ — $ 305 $ — $ 305 ( 1) Available-for-sale debt securities with carrying values that approximate fair value. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Investments, All Other Investments [Abstract] | |
Cash Equivalents and Available-for-Sale Investments | Cash equivalents and available-for-sale debt investments were as follows: As of January 31, 2024 As of October 31, 2023 Cost Gross Unrealized Gains Fair Cost Gross Unrealized Gains (Losses) Fair In millions Cash Equivalents: Time deposits $ 985 $ — $ 985 $ 905 $ — $ 905 Money market funds 1,681 — 1,681 1,672 — 1,672 Total cash equivalents 2,666 — 2,666 2,577 — 2,577 Available-for-sale Debt Investments: Foreign bonds 102 2 104 100 (3) 97 Other debt securities 15 4 19 19 3 22 Total available-for-sale debt investments 117 6 123 119 — 119 Total cash equivalents and available-for-sale debt investments $ 2,783 $ 6 $ 2,789 $ 2,696 $ — $ 2,696 |
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 January 31, 2024 Amortized Cost Fair Value In millions Due in one to five years 5 5 Due in more than five years 112 118 Total $ 117 $ 123 |
Gross Notional and Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets | The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows: As of January 31, 2024 As of October 31, 2023 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 $ 2,500 $ — $ — $ — $ 104 $ 2,500 $ — $ — $ — $ 151 Cash Flow Hedges: Foreign currency contracts 8,305 106 59 80 48 8,247 252 104 33 23 Net Investment Hedges: Foreign currency contracts 1,904 23 28 25 30 1,972 39 46 34 23 Total derivatives designated as hedging instruments 12,709 129 87 105 182 12,719 291 150 67 197 Derivatives Not Designated as Hedging Instruments Foreign currency contracts 4,447 23 3 27 19 6,786 20 3 23 16 Other derivatives 141 3 — — — 100 — — 2 — Total derivatives not designated as hedging instruments 4,588 26 3 27 19 6,886 20 3 25 16 Total derivatives $ 17,297 $ 155 $ 90 $ 132 $ 201 $ 19,605 $ 311 $ 153 $ 92 $ 213 |
Offsetting Assets | The information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows: As of January 31, 2024 In the Condensed Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Not Offset Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 245 $ — $ 245 $ 170 $ 55 (1) $ 20 Derivative liabilities $ 333 $ — $ 333 $ 170 $ 118 (2) $ 45 As of October 31, 2023 In the Condensed Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Not Offset Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 464 $ — $ 464 $ 196 $ 207 (1) $ 61 Derivative liabilities $ 305 $ — $ 305 $ 196 $ 103 (2) $ 6 (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 the 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 January 31, 2024, of the $118 million of collateral posted, $108 million was in cash and $10 million was through the re-use of counterparty collateral. As of October 31, 2023, of the $103 million of collateral posted, $56 million was in cash and $47 million was through the re-use of counterparty collateral. |
Offsetting Liabilities | The information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows: As of January 31, 2024 In the Condensed Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Not Offset Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 245 $ — $ 245 $ 170 $ 55 (1) $ 20 Derivative liabilities $ 333 $ — $ 333 $ 170 $ 118 (2) $ 45 As of October 31, 2023 In the Condensed Consolidated Balance Sheets (i) (ii) (iii) = (i)–(ii) (iv) (v) (vi) = (iii)–(iv)–(v) Gross Amounts Not Offset Gross Gross Net Amount Derivatives Financial Net Amount In millions Derivative assets $ 464 $ — $ 464 $ 196 $ 207 (1) $ 61 Derivative liabilities $ 305 $ — $ 305 $ 196 $ 103 (2) $ 6 (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 the 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 January 31, 2024, of the $118 million of collateral posted, $108 million was in cash and $10 million was through the re-use of counterparty collateral. As of October 31, 2023, of the $103 million of collateral posted, $56 million was in cash and $47 million was through the re-use of counterparty collateral. |
Pre-tax Effect of Derivative Instruments and Related Hedged Items in a Fair Value Hedging Relationship | The amounts recorded on the Condensed Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges were as follows: Carrying Amount of the Hedged Liabilities Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/ (Liabilities) As of As of January 31, 2024 October 31, 2023 January 31, 2024 October 31, 2023 In millions Long-term debt $ (2,393) $ (2,345) $ 104 $ 151 |
Pre-tax Effect of Derivative Instruments in Net Investment Hedging Relationships | The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships recognized in Other Comprehensive Income ("OCI") were as follows: Gains (Losses) Recognized in OCI on Derivatives For the three months ended January 31, 2024 2023 In millions Derivatives in Cash Flow Hedging Relationship: Foreign exchange contracts $ (204) $ (518) Derivatives in Net Investment Hedging Relationship: Foreign exchange contracts (39) (107) Total $ (243) $ (625) |
Pre-tax Effect of Derivative Instruments in Cash Flow Hedging Relationships | The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships recognized in Other Comprehensive Income ("OCI") were as follows: Gains (Losses) Recognized in OCI on Derivatives For the three months ended January 31, 2024 2023 In millions Derivatives in Cash Flow Hedging Relationship: Foreign exchange contracts $ (204) $ (518) Derivatives in Net Investment Hedging Relationship: Foreign exchange contracts (39) (107) Total $ (243) $ (625) |
Effect of Derivative Instruments on the Statement of Earnings | The following table represents the pre-tax effect of derivative instruments on total amounts of income and expense line items presented in the Condensed Consolidated Statements of Earnings in which the effects of fair value hedges and derivatives not designated as hedging instruments are recorded: Gains (Losses) Recognized in Income For the three months ended January 31, 2024 2023 Net Revenue Interest and Other, net Net Revenue Interest and Other, net In millions Total net revenue and interest and other, net $ 6,755 $ (88) $ 7,809 $ (26) Gains (Losses) on Derivatives in Fair Value Hedging Relationships: Interest Rate Contracts Hedged items $ — $ (47) $ — $ (41) Derivatives designated as hedging instruments — 47 — 41 Gains (Losses) on Derivatives in Cash Flow Hedging Relationships: Foreign Exchange Contracts Amount of gains (losses) reclassified from accumulated other comprehensive income into income 24 (138) 50 (297) Gains (Losses) on Derivatives not Designated as Hedging Instruments: Foreign exchange contracts — (44) — (194) Other derivatives — 4 — — Total gains (losses) $ 24 $ (178) $ 50 $ (491) |
Borrowings (Tables)
Borrowings (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable and Short-term Borrowings, Including the Current Portion of Long-term Debt | Notes payable, short-term borrowings, including the current portion of long-term debt, and long-terms debt were as follows: As of January 31, 2024 October 31, 2023 In millions Current portion of long-term debt (1) $ 4,131 $ 4,022 Commercial paper 674 679 Notes payable to banks, lines of credit and other 152 167 Total notes payable and short-term borrowings 4,957 4,868 Long-term debt 7,840 7,487 Total $ 12,797 $ 12,355 (1) As of January 31, 2024, the Current portion of long-term debt, net of discount and issuance costs, included $1.5 billion associated with the asset-backed debt securities issued by the Company. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Loss, Net of Taxes | The components of accumulated other comprehensive loss, net of taxes as of January 31, 2024, and changes for the three months ended January 31, 2024 were as follows: Net unrealized Net unrealized Unrealized Cumulative Accumulated In millions Balance at beginning of period $ — $ 61 $ (2,507) $ (638) $ (3,084) Other comprehensive income (loss) before reclassifications 6 (204) — 13 (185) Reclassifications of losses into earnings — 114 34 — 148 Tax benefit (provision) — 18 (4) (1) 13 Balance at end of period $ 6 $ (11) $ (2,477) $ (626) $ (3,108) The components of accumulated other comprehensive loss, net of taxes as of January 31, 2023, and changes for the three months ended January 31, 2023 were as follows: Net unrealized Net unrealized Unrealized Cumulative Accumulated In millions Balance at beginning of period $ (1) $ 109 $ (2,596) $ (610) $ (3,098) Other comprehensive income (loss) before reclassifications 5 (518) — 20 (493) Reclassifications of losses into earnings — 247 35 — 282 Tax benefit (provision) — 55 (3) 1 53 Balance at end of period $ 4 $ (107) $ (2,564) $ (589) $ (3,256) |
Net Earnings Per Share (Tables)
Net Earnings Per Share (Tables) | 3 Months Ended |
Jan. 31, 2024 | |
Earnings Per Share [Abstract] | |
Reconciliations of the Numerators and Denominators of the Basic and Diluted Net EPS Calculations | The reconciliations of the numerators and denominators of each of the basic and diluted net EPS calculations were as follows: For the three months ended January 31, 2024 2023 In millions, except per share amounts Numerator: Net earnings $ 387 $ 501 Denominator: Weighted-average shares used to compute basic net EPS 1,301 1,298 Dilutive effect of employee stock plans 15 17 Weighted-average shares used to compute diluted net EPS 1,316 1,315 Net Earnings per Share: Basic $ 0.30 $ 0.39 Diluted $ 0.29 $ 0.38 Anti-dilutive weighted-average stock awards (1) 1 9 (1) 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 per share, as their effect, if included, would have been anti-dilutive for the periods presented. |
Overview and Summary of Signi_3
Overview and Summary of Significant Accounting Policies (Details) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 USD ($) segment | Oct. 31, 2023 USD ($) | |
Accounting Policies [Abstract] | ||
Number of new reportable segments | 2 | |
Number of segments | 5 | |
Supplier finance program, obligation | $ | $ 387 | $ 295 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Jan. 31, 2024 segment | |
Segment Reporting [Abstract] | |
Number of segments | 5 |
Segment Information - Segment O
Segment Information - Segment Operating Results from Continuing Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Segment Reporting Information [Line Items] | ||
Net revenue | $ 6,755 | $ 7,809 |
Segment earnings (loss) from operations | 525 | 591 |
Intersegment net revenue | ||
Segment Reporting Information [Line Items] | ||
Net revenue | (157) | (183) |
Operating Segment | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 6,912 | 7,992 |
Segment earnings (loss) from operations | 847 | 1,026 |
Server | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 3,246 | 4,184 |
Server | Intersegment net revenue | ||
Segment Reporting Information [Line Items] | ||
Net revenue | (106) | (148) |
Server | Operating Segment | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 3,352 | 4,332 |
Segment earnings (loss) from operations | 383 | 678 |
Hybrid Cloud | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 1,206 | 1,361 |
Hybrid Cloud | Intersegment net revenue | ||
Segment Reporting Information [Line Items] | ||
Net revenue | (42) | (23) |
Hybrid Cloud | Operating Segment | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 1,248 | 1,384 |
Segment earnings (loss) from operations | 47 | 80 |
Intelligent Edge | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 1,193 | 1,163 |
Intelligent Edge | Intersegment net revenue | ||
Segment Reporting Information [Line Items] | ||
Net revenue | (8) | (6) |
Intelligent Edge | Operating Segment | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 1,201 | 1,169 |
Segment earnings (loss) from operations | 353 | 227 |
Financial Services | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 872 | 867 |
Financial Services | Intersegment net revenue | ||
Segment Reporting Information [Line Items] | ||
Net revenue | (1) | (6) |
Financial Services | Operating Segment | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 873 | 873 |
Segment earnings (loss) from operations | 74 | 63 |
Corporate Investments and Other | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 238 | 234 |
Corporate Investments and Other | Intersegment net revenue | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 0 | 0 |
Corporate Investments and Other | Operating Segment | ||
Segment Reporting Information [Line Items] | ||
Net revenue | 238 | 234 |
Segment earnings (loss) from operations | $ (10) | $ (22) |
Segment Information - Reconcili
Segment Information - Reconciliation of Segment Operating Results (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Net Revenue: | ||
Net revenue | $ 6,755 | $ 7,809 |
Earnings Before Taxes: | ||
Total segment earnings from operations | 525 | 591 |
Amortization of intangible assets | (71) | (73) |
Transformation costs | (20) | (102) |
Acquisition, disposition and other related charges | (43) | (11) |
Interest and other, net | (88) | (26) |
Earnings from equity interests | 46 | 58 |
Earnings before provision for taxes | 483 | 623 |
(Gain) loss on recoveries | 0 | (1) |
Operating Segment | ||
Net Revenue: | ||
Net revenue | 6,912 | 7,992 |
Earnings Before Taxes: | ||
Total segment earnings from operations | 847 | 1,026 |
Elimination of intersegment net revenue and other | ||
Net Revenue: | ||
Net revenue | (157) | (183) |
Segment Reconciling Items | ||
Earnings Before Taxes: | ||
Unallocated corporate costs and eliminations | (72) | (108) |
Stock-based compensation expense | (141) | (140) |
Amortization of intangible assets | (71) | (73) |
Transformation costs | (20) | (102) |
Disaster charges | 25 | (1) |
Acquisition, disposition and other related charges | (43) | (11) |
Interest and other, net | (88) | (26) |
Earnings from equity interests | $ 46 | $ 58 |
Segment Information - Reconci_2
Segment Information - Reconciliation of Segment Assets (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Segment Reporting Information [Line Items] | ||
Assets | $ 58,602 | $ 57,153 |
Segment Information - Revenue b
Segment Information - Revenue by Geographic Region (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Segment Reporting Information [Line Items] | ||
Total consolidated net revenue | $ 6,755 | $ 7,809 |
Total Americas | ||
Segment Reporting Information [Line Items] | ||
Total consolidated net revenue | 2,801 | 3,454 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total consolidated net revenue | 2,294 | 2,885 |
Americas excluding U.S. | ||
Segment Reporting Information [Line Items] | ||
Total consolidated net revenue | 507 | 569 |
Europe, Middle East and Africa | ||
Segment Reporting Information [Line Items] | ||
Total consolidated net revenue | 2,434 | 2,680 |
Asia Pacific and Japan | ||
Segment Reporting Information [Line Items] | ||
Total consolidated net revenue | $ 1,520 | $ 1,675 |
Transformation Programs - Trans
Transformation Programs - Transformation Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Total | $ 20 | $ 102 |
Cost optimization and prioritization plan | ||
Restructuring Cost and Reserve [Line Items] | ||
Program management | 1 | 1 |
IT costs | 4 | 8 |
Restructuring (credits) charges | 8 | 71 |
Total | 13 | 80 |
HPE Next | ||
Restructuring Cost and Reserve [Line Items] | ||
IT costs | 9 | 21 |
Restructuring (credits) charges | (1) | 1 |
Total | $ 8 | $ 22 |
Transformation Programs - Sched
Transformation Programs - Schedule of Restructuring Activity (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Cost optimization and prioritization plan | ||
Restructuring Reserve | ||
Restructuring charges | $ 8 | $ 71 |
Cost optimization and prioritization plan | Employee Severance | ||
Restructuring Reserve | ||
Balance at the beginning of the period | 152 | |
Restructuring charges | 10 | |
Cash payments | (64) | |
Non-cash items | 1 | |
Balance at the end of the period | 99 | |
Total costs incurred to date, as of January 31, 2024 | 803 | |
Total expected costs to be incurred as of January 31, 2024 | 820 | |
Cost optimization and prioritization plan | Infrastructure and other | ||
Restructuring Reserve | ||
Balance at the beginning of the period | 127 | |
Restructuring charges | (2) | |
Cash payments | (12) | |
Non-cash items | 1 | |
Balance at the end of the period | 114 | |
Total costs incurred to date, as of January 31, 2024 | 559 | |
Total expected costs to be incurred as of January 31, 2024 | 560 | |
HPE Next | ||
Restructuring Reserve | ||
Restructuring charges | (1) | $ 1 |
HPE Next | Employee Severance | ||
Restructuring Reserve | ||
Balance at the beginning of the period | 6 | |
Restructuring charges | 0 | |
Cash payments | (1) | |
Non-cash items | 1 | |
Balance at the end of the period | 6 | |
Total costs incurred to date, as of January 31, 2024 | 1,267 | |
Total expected costs to be incurred as of January 31, 2024 | 1,267 | |
HPE Next | Infrastructure and other | ||
Restructuring Reserve | ||
Balance at the beginning of the period | 27 | |
Restructuring charges | (1) | |
Cash payments | (1) | |
Non-cash items | (1) | |
Balance at the end of the period | 24 | |
Total costs incurred to date, as of January 31, 2024 | 270 | |
Total expected costs to be incurred as of January 31, 2024 | $ 270 |
Transformation Programs - Narra
Transformation Programs - Narrative (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Restructuring Cost and Reserve [Line Items] | ||
Current restructuring liability reported in Accrued restructuring | $ 121 | $ 180 |
Transformation Program | ||
Restructuring Cost and Reserve [Line Items] | ||
Current restructuring liability reported in Accrued restructuring | 121 | 180 |
Transformation Program | Other Accrued Liabilities | ||
Restructuring Cost and Reserve [Line Items] | ||
Current restructuring liability reported in Accrued restructuring | 20 | 22 |
Transformation Program | Long-Term Other Liabilities | ||
Restructuring Cost and Reserve [Line Items] | ||
Long-term portion of restructuring reserve, recorded in Other liabilities | $ 102 | $ 110 |
Retirement Benefit Plans (Detai
Retirement Benefit Plans (Details) - Benefit Plans - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2024 | Jan. 31, 2023 | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Service cost | $ 12 | $ 13 | |
Interest cost | [1] | 101 | 93 |
Expected return on plan assets | [1] | (136) | (130) |
Amortization and deferrals: | |||
Actuarial loss | [1] | 37 | 39 |
Prior service benefit | [1] | (2) | (3) |
Net periodic benefit cost | 12 | 12 | |
Settlement loss and special termination benefits | [1] | 1 | 0 |
Total net benefit cost | $ 13 | $ 12 | |
[1] These non-service components were included in Interest and other, net in the Condensed Consolidated Statements of Earnings. |
Taxes on Earnings - Narrative (
Taxes on Earnings - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Jan. 31, 2024 | Jan. 31, 2023 | Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2017 | Oct. 31, 2023 | |
Income Tax Disclosure [Abstract] | ||||||
Provision (benefit) for taxes | $ 96 | $ 122 | ||||
Effective tax rate (as a percent) | 19.90% | 19.60% | ||||
Net income tax expense (benefit) | $ 0 | $ (11) | ||||
Income tax expense (benefit) related to tax audit settlements | 23 | |||||
Income tax benefit on restructuring charges, separation costs, transformation costs and acquisition and other related charges | 22 | |||||
Excess tax benefits related to stock-based compensation | $ 13 | |||||
Unrecognized tax benefits | 674 | $ 672 | ||||
Unrecognized tax benefits that would affect effective tax rate if realized | 372 | 354 | ||||
Accrued income tax for interest and penalties | 57 | $ 56 | ||||
Estimate of possible loss | $ 904 | |||||
Income tax examination, description | The Company engages in continuous discussion and negotiation with tax authorities regarding tax matters in various jurisdictions. The Company is no longer subject to U.S. federal tax audits for years prior to 2017. The IRS is conducting audits of the Company's fiscal 2017 through 2022 U.S. federal income tax returns. During the fourth quarter of fiscal 2023, the IRS issued notices of proposed adjustments (“NOPAs”) for 2017, 2018, and 2019 relating to HPE’s intercompany transfer pricing. During the fiscal quarter, the IRS issued a Revenue Agent Report (“RAR”) finalizing their position on the NOPAs for the same issues and same fiscal years. The IRS is seeking to increase taxable income across the three fiscal years by $904 million. As of the balance sheet date, HPE has sufficient tax credit carryforwards to offset any incremental tax liability from the adjustments in the RAR. However, HPE disagrees with the IRS’ adjustments and believes the positions taken on its tax returns are more likely than not to prevail on technical merits, and the Company will defend these positions through the IRS administrative processes, as necessary. Accordingly, no changes have been made to the Company’s reserves for uncertain tax positions as of January 31, 2024 relating to the IRS’ adjustments. With respect to major state and foreign tax jurisdictions, the Company is no longer subject to tax authority examinations for years prior to 2005. Additionally, it is reasonably possible that certain foreign and state tax issues may be concluded in the next 12 months, including issues involving resolution of certain intercompany transactions and other matters; accordingly, the Company believes it is reasonably possible that its existing unrecognized tax benefits for these matters may be reduced by an amount up to $8 million within the next 12 months. | |||||
Income tax examination, year under examination | 2019 | 2018 | 2017 | |||
Income tax examination likelihood of conclusion period | 12 months | |||||
Decrease in unrecognized tax benefits is reasonably possible | $ 8 |
Taxes on Earnings - Schedule of
Taxes on Earnings - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets | $ 2,328 | $ 2,264 |
Deferred tax liabilities | (331) | (326) |
Deferred tax assets net of deferred tax liabilities | $ 1,997 | $ 1,938 |
Balance Sheet Details - Schedul
Balance Sheet Details - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 | Jan. 31, 2023 | Oct. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Cash and cash equivalents | $ 3,758 | $ 4,270 | |||
Restricted cash | [1] | 214 | 311 | ||
Total | $ 3,972 | $ 4,581 | $ 2,844 | $ 4,763 | |
[1]The Company included restricted cash in Other current assets in the accompanying Condensed Consolidated Balance Sheets. |
Balance Sheet Details - Sched_2
Balance Sheet Details - Schedule of Inventory (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Purchased parts and fabricated assemblies | $ 4,733 | $ 2,940 |
Finished goods | 1,316 | 1,667 |
Total | $ 6,049 | $ 4,607 |
Balance Sheet Details - Sched_3
Balance Sheet Details - Schedule of Property, Plant and Equipment and Narrative (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Property, Plant and Equipment, Net | ||
Gross property, plant and equipment | $ 12,177 | $ 11,969 |
Accumulated depreciation | (6,180) | (5,980) |
Property, plant and equipment, net | 5,997 | 5,989 |
Land | ||
Property, Plant and Equipment, Net | ||
Gross property, plant and equipment | 66 | 66 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment, Net | ||
Gross property, plant and equipment | 1,547 | 1,521 |
Machinery and equipment, including equipment held for lease | ||
Property, Plant and Equipment, Net | ||
Gross property, plant and equipment | $ 10,564 | $ 10,382 |
Balance Sheet Details - Changes
Balance Sheet Details - Changes in Aggregate Product Warranty Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Jan. 31, 2024 | Oct. 31, 2023 | |
Changes in aggregated product warranty liabilities | ||
Balance at beginning of period | $ 318 | $ 360 |
Charges | 38 | 184 |
Adjustments related to pre-existing warranties | 2 | (18) |
Settlements made | (46) | (208) |
Balance at end of period | $ 312 | $ 318 |
Balance Sheet Details - Summary
Balance Sheet Details - Summary of Accounts Receivable, Net (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 | Oct. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accounts receivable | $ 3,540 | $ 3,254 | |
Unbilled receivables | 277 | 264 | |
Allowances | (36) | (37) | $ (25) |
Total | $ 3,781 | $ 3,481 |
Balance Sheet Details - Allowan
Balance Sheet Details - Allowance for Doubtful Accounts (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Jan. 31, 2024 | Oct. 31, 2023 | |
Accounts Receivable, Allowance for Credit Loss | ||
Balance at beginning of year | $ 37 | $ 25 |
Provision for credit losses | 17 | 29 |
Adjustments to existing allowances, including write offs | (18) | (17) |
Balance at end of year | $ 36 | $ 37 |
Balance Sheet Details - Narrati
Balance Sheet Details - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | Oct. 31, 2023 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Trade receivables sold | $ 800 | $ 4,100 | |
Deferred revenue | 3,718 | 3,658 | |
Deferred revenue, current | 3,700 | 3,600 | |
Deferred revenue, noncurrent | 3,400 | 3,300 | |
Unearned revenue recognized | 1,300 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Unsatisfied performance obligations | 7,100 | ||
Non-current portion of capitalized costs | 138 | 138 | |
Current portion of capitalized costs | 87 | 86 | |
Amortization of capitalized costs to obtain a contract | $ 26 | $ 22 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-02-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Unsatisfied performance obligation expected to be recognized over the remainder of the year | 45% | ||
Expected timing of satisfaction | 9 months | ||
Notes payable and short-term borrowings | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Deferred revenue | $ 50 | $ 80 |
Accounting for Leases as a Le_3
Accounting for Leases as a Lessor - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Jan. 31, 2024 | Oct. 31, 2023 | |
Lessor, Lease, Description [Line Items] | ||
Financing receivable term, low end of range | 2 years | |
Financing receivable term, high end of range | 5 years | |
Financing receivable sold | $ 23 | $ 237 |
Financing Receivable | ||
Lessor, Lease, Description [Line Items] | ||
Amount transferred via securitization | 600 | 800 |
Operating Lease, Right-of-Use Asset | ||
Lessor, Lease, Description [Line Items] | ||
Amount transferred via securitization | $ 300 | $ 700 |
Accounting for Leases as a Le_4
Accounting for Leases as a Lessor - Components of Financing Receivables (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 | Oct. 31, 2022 |
Leases [Abstract] | |||
Minimum lease payments receivable | $ 9,535 | $ 9,363 | |
Unguaranteed residual value | 463 | 438 | |
Unearned income | (1,037) | (987) | |
Financing receivables, gross | 8,961 | 8,814 | |
Allowance for credit losses | (226) | (243) | $ (325) |
Financing receivables, net | 8,735 | 8,571 | |
Less: current portion | (3,629) | (3,543) | |
Amounts due after one year, net | $ 5,106 | $ 5,028 |
Accounting for Leases as a Le_5
Accounting for Leases as a Lessor - Credit Risk Profile of Financing Receivables (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
Financing receivables, gross | $ 8,961 | $ 8,814 |
Low | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
2023/2022 | 396 | 2,100 |
2022/2021 | 2,200 | 1,681 |
2021/2020 | 1,572 | 868 |
2020/2019 | 771 | 336 |
2019/2018 and prior | 366 | 155 |
Financing receivables, gross | 5,305 | 5,140 |
Moderate | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
2023/2022 | 194 | 1,196 |
2022/2021 | 1,241 | 1,052 |
2021/2020 | 969 | 645 |
2020/2019 | 564 | 285 |
2019/2018 and prior | 410 | 223 |
Financing receivables, gross | 3,378 | 3,401 |
High | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
2023/2022 | 4 | 31 |
2022/2021 | 44 | 51 |
2021/2020 | 52 | 57 |
2020/2019 | 63 | 35 |
2019/2018 and prior | 115 | 99 |
Financing receivables, gross | $ 278 | $ 273 |
Accounting for Leases as a Le_6
Accounting for Leases as a Lessor - Allowance for Doubtful Accounts for Financing Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | Oct. 31, 2023 | |
Allowance for doubtful accounts | |||
Balance at beginning of period | $ 243 | $ 325 | $ 325 |
Provision for credit losses | 11 | 58 | |
Write-offs | (28) | (140) | |
Balance at end of period | 226 | $ 243 | |
Financing cost | $ 119 | $ 78 |
Accounting for Leases as a Le_7
Accounting for Leases as a Lessor - Summary of the Aging and Non-accrual Status of Gross Financing Receivables (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 | |
Financing Receivable, Past Due [Line Items] | |||
Financing receivables, net | $ 8,961 | $ 8,814 | |
Gross financing receivables on non-accrual status | [1] | 224 | 227 |
Gross financing receivables 90 days past due and still accruing interest | [1] | 83 | 81 |
Unbilled | |||
Financing Receivable, Past Due [Line Items] | |||
Financing receivables, net | 8,435 | 8,351 | |
Current 1-30 days | Billed | |||
Financing Receivable, Past Due [Line Items] | |||
Financing receivables, net | [2] | 374 | 320 |
Past due 31-60 days | Billed | |||
Financing Receivable, Past Due [Line Items] | |||
Financing receivables, net | [2] | 38 | 30 |
Past due 61-90 days | Billed | |||
Financing Receivable, Past Due [Line Items] | |||
Financing receivables, net | [2] | 25 | 13 |
Past due > 90 days | Billed | |||
Financing Receivable, Past Due [Line Items] | |||
Financing receivables, net | [2] | $ 89 | $ 100 |
[1] Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables. Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables. |
Accounting for Leases as a Le_8
Accounting for Leases as a Lessor - Lessor Activity Included in Income Statement (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Leases [Abstract] | ||
Interest income from sales-type leases and direct financing leases | $ 156 | $ 123 |
Lease income from operating leases | 599 | 589 |
Total lease income | $ 755 | $ 712 |
Accounting for Leases as a Le_9
Accounting for Leases as a Lessor - Assets and Liabilities of VIE (Details) - VIE Primary Beneficiary - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Assets held by VIE: | ||
Other current assets | $ 162 | $ 145 |
Financing receivables, short-term | 888 | 764 |
Financing receivables, long-term | 1,219 | 983 |
Property, plant and equipment, net | 1,355 | 1,214 |
Liabilities held by VIE: | ||
Notes payable and short-term borrowings, net of unamortized debt issuance costs | 1,528 | 1,392 |
Long-term debt, net of unamortized debt issuance costs | $ 1,369 | $ 1,082 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - Juniper Networks, Inc $ / shares in Units, $ in Billions | Jan. 09, 2024 USD ($) $ / shares |
Business Acquisition [Line Items] | |
Business Acquisition, Share Price | $ / shares | $ 40 |
Purchase price consideration | $ 14 |
Liabilities incurred | $ 14 |
Goodwill - Carrying Value of Go
Goodwill - Carrying Value of Goodwill by Reportable Segment (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Goodwill | ||
Goodwill | $ 17,988 | $ 17,988 |
Server | ||
Goodwill | ||
Goodwill | 10,220 | 10,220 |
Hybrid Cloud | ||
Goodwill | ||
Goodwill | 4,716 | 4,716 |
Intelligent Edge | ||
Goodwill | ||
Goodwill | 2,908 | 2,908 |
Financial Services | ||
Goodwill | ||
Goodwill | 144 | 144 |
Corporate Investments and Other | ||
Goodwill | ||
Goodwill | $ 0 | $ 0 |
Goodwill - Narrative (Details)
Goodwill - Narrative (Details) $ in Millions | 3 Months Ended | ||
Jan. 31, 2024 USD ($) reportingUnit | Nov. 01, 2023 | Oct. 31, 2023 USD ($) | |
Goodwill | |||
Hypothetical decrease to fair value (as a percent) | 0.10 | ||
Goodwill | $ 17,988 | $ 17,988 | |
Server | |||
Goodwill | |||
Number of reporting units | reportingUnit | 2 | ||
Goodwill | $ 10,220 | 10,220 | |
Server | HPC & AI | |||
Goodwill | |||
Percentage of fair value in excess of carrying amount | 4% | ||
Goodwill | 2,000 | ||
Server | Compute Segment | |||
Goodwill | |||
Percentage of fair value in excess of carrying amount | 4% | ||
Goodwill | 8,200 | ||
Hybrid Cloud | |||
Goodwill | |||
Goodwill | 4,716 | 4,716 | |
Intelligent Edge | |||
Goodwill | |||
Goodwill | $ 2,908 | 2,908 | |
Corporate Investments and Other | |||
Goodwill | |||
Number of reporting units | reportingUnit | 2 | ||
Goodwill | $ 0 | $ 0 | |
Minimum | |||
Goodwill | |||
Percentage of fair value in excess of carrying amount | 4% | ||
Maximum | |||
Goodwill | |||
Percentage of fair value in excess of carrying amount | 184% |
Fair Value - Schedule of Assets
Fair Value - Schedule of Assets and Liabilities on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Assets | ||
Total assets | $ 3,115 | $ 3,295 |
Liabilities | ||
Total liabilities | 333 | 305 |
Time deposits | ||
Assets | ||
Total assets | 985 | 905 |
Money market funds | ||
Assets | ||
Total assets | 1,681 | 1,672 |
Equity investments | ||
Assets | ||
Total assets | 81 | 135 |
Foreign bonds | ||
Assets | ||
Total assets | 104 | 97 |
Other debt securities (1) | ||
Assets | ||
Total assets | 19 | 22 |
Foreign exchange contracts | ||
Assets | ||
Total assets | 242 | 464 |
Liabilities | ||
Total liabilities | 229 | 152 |
Other derivatives | ||
Assets | ||
Total assets | 3 | 0 |
Liabilities | ||
Total liabilities | 0 | 2 |
Interest rate contracts | ||
Liabilities | ||
Total liabilities | 104 | 151 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets | ||
Total assets | 1,682 | 1,673 |
Liabilities | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Time deposits | ||
Assets | ||
Total assets | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market funds | ||
Assets | ||
Total assets | 1,681 | 1,672 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity investments | ||
Assets | ||
Total assets | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreign bonds | ||
Assets | ||
Total assets | 1 | 1 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other debt securities (1) | ||
Assets | ||
Total assets | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreign exchange contracts | ||
Assets | ||
Total assets | 0 | 0 |
Liabilities | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other derivatives | ||
Assets | ||
Total assets | 0 | 0 |
Liabilities | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate contracts | ||
Liabilities | ||
Total liabilities | 0 | 0 |
Significant Other Observable Remaining Inputs (Level 2) | ||
Assets | ||
Total assets | 1,332 | 1,464 |
Liabilities | ||
Total liabilities | 333 | 305 |
Significant Other Observable Remaining Inputs (Level 2) | Time deposits | ||
Assets | ||
Total assets | 985 | 905 |
Significant Other Observable Remaining Inputs (Level 2) | Money market funds | ||
Assets | ||
Total assets | 0 | 0 |
Significant Other Observable Remaining Inputs (Level 2) | Equity investments | ||
Assets | ||
Total assets | 0 | 0 |
Significant Other Observable Remaining Inputs (Level 2) | Foreign bonds | ||
Assets | ||
Total assets | 102 | 95 |
Significant Other Observable Remaining Inputs (Level 2) | Other debt securities (1) | ||
Assets | ||
Total assets | 0 | 0 |
Significant Other Observable Remaining Inputs (Level 2) | Foreign exchange contracts | ||
Assets | ||
Total assets | 242 | 464 |
Liabilities | ||
Total liabilities | 229 | 152 |
Significant Other Observable Remaining Inputs (Level 2) | Other derivatives | ||
Assets | ||
Total assets | 3 | 0 |
Liabilities | ||
Total liabilities | 0 | 2 |
Significant Other Observable Remaining Inputs (Level 2) | Interest rate contracts | ||
Liabilities | ||
Total liabilities | 104 | 151 |
Significant Other Unobservable Remaining Inputs (Level 3) | ||
Assets | ||
Total assets | 101 | 158 |
Liabilities | ||
Total liabilities | 0 | 0 |
Significant Other Unobservable Remaining Inputs (Level 3) | Time deposits | ||
Assets | ||
Total assets | 0 | 0 |
Significant Other Unobservable Remaining Inputs (Level 3) | Money market funds | ||
Assets | ||
Total assets | 0 | 0 |
Significant Other Unobservable Remaining Inputs (Level 3) | Equity investments | ||
Assets | ||
Total assets | 81 | 135 |
Significant Other Unobservable Remaining Inputs (Level 3) | Foreign bonds | ||
Assets | ||
Total assets | 1 | 1 |
Significant Other Unobservable Remaining Inputs (Level 3) | Other debt securities (1) | ||
Assets | ||
Total assets | 19 | 22 |
Significant Other Unobservable Remaining Inputs (Level 3) | Foreign exchange contracts | ||
Assets | ||
Total assets | 0 | 0 |
Liabilities | ||
Total liabilities | 0 | 0 |
Significant Other Unobservable Remaining Inputs (Level 3) | Other derivatives | ||
Assets | ||
Total assets | 0 | 0 |
Liabilities | ||
Total liabilities | 0 | 0 |
Significant Other Unobservable Remaining Inputs (Level 3) | Interest rate contracts | ||
Liabilities | ||
Total liabilities | $ 0 | $ 0 |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) - USD ($) $ in Billions | Jan. 31, 2024 | Oct. 31, 2023 |
Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Fair value, short-term and long-term debt | $ 13 | $ 12.2 |
Carrying Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Fair value, short-term and long-term debt | $ 12.8 | $ 12.4 |
Fair Value - Schedule of Non-Re
Fair Value - Schedule of Non-Recurring Fair Value Measurements (Details) - Measurement Alternative - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Equity Securities without Readily Determinable Fair Value [Line Items] | ||
Unrealized gain (loss) on equity securities | $ (7) | |
Impairment loss | $ 10 | |
Fair Value, Nonrecurring | ||
Equity Securities without Readily Determinable Fair Value [Line Items] | ||
Cumulative upward price adjustment | 39 | |
Cumulative downward price adjustment | $ (84) |
Financial Instruments - Cash Eq
Financial Instruments - Cash Equivalents and Available-for-Sale Investments (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Cash and Cash Equivalents [Line Items] | ||
Debt securities, available-for-sale, amortized cost, total | $ 117 | |
Gross Unrealized Gains (Losses) | 6 | $ 0 |
Fair Value | 123 | |
Total cash and equivalents and available-for-sale investments, Cost basis | 2,783 | 2,696 |
Total cash equivalents and available-for-sale debt investments | 2,789 | 2,696 |
Cost | ||
Cash and Cash Equivalents [Line Items] | ||
Total cash equivalents | 2,666 | 2,577 |
Cost | Time deposits | ||
Cash and Cash Equivalents [Line Items] | ||
Total cash equivalents | 985 | 905 |
Cost | Money market funds | ||
Cash and Cash Equivalents [Line Items] | ||
Total cash equivalents | 1,681 | 1,672 |
Fair Value | ||
Cash and Cash Equivalents [Line Items] | ||
Total cash equivalents | 2,666 | 2,577 |
Fair Value | Time deposits | ||
Cash and Cash Equivalents [Line Items] | ||
Total cash equivalents | 985 | 905 |
Fair Value | Money market funds | ||
Cash and Cash Equivalents [Line Items] | ||
Total cash equivalents | 1,681 | 1,672 |
Debt securities | ||
Cash and Cash Equivalents [Line Items] | ||
Debt securities, available-for-sale, amortized cost, total | 117 | 119 |
Gross Unrealized Gains (Losses) | 6 | 0 |
Fair Value | 123 | 119 |
Foreign bonds | ||
Cash and Cash Equivalents [Line Items] | ||
Debt securities, available-for-sale, amortized cost, total | 102 | 100 |
Gross Unrealized Gains (Losses) | 2 | (3) |
Fair Value | 104 | 97 |
Other debt securities (1) | ||
Cash and Cash Equivalents [Line Items] | ||
Debt securities, available-for-sale, amortized cost, total | 15 | 19 |
Gross Unrealized Gains (Losses) | 4 | 3 |
Fair Value | $ 19 | $ 22 |
Financial Instruments - Contrac
Financial Instruments - Contractual Maturities of Investments in Available-for-Sale Debt Securities (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2024 | Jan. 31, 2023 | Oct. 31, 2023 | |
Amortized Cost | |||
Due in one to five years | $ 5 | ||
Due in more than five years | 112 | ||
Debt securities, available-for-sale, amortized cost, total | 117 | ||
Fair Value | |||
Due in one to five years | 5 | ||
Due in more than five years | 118 | ||
Debt securities, fair value | 123 | ||
Fair Value | |||
Summary of Investment Holdings [Line Items] | |||
Equity securities without readily determinable fair value, amount | 81 | $ 135 | |
Unrealized gain (loss) on equity securities | (54) | $ 0 | |
Measurement Alternative | |||
Summary of Investment Holdings [Line Items] | |||
Equity securities without readily determinable fair value, amount | 154 | $ 145 | |
Impairment loss | $ 10 | ||
Unrealized gain (loss) on equity securities | $ (7) |
Financial Instruments - Gross N
Financial Instruments - Gross Notional and Fair Value of Instruments in the Balance Sheets (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Derivatives, Fair Value | ||
Outstanding Gross Notional | $ 17,297 | $ 19,605 |
Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 155 | 311 |
Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 90 | 153 |
Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 132 | 92 |
Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 201 | 213 |
Derivatives Designated as Hedging Instruments | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 12,709 | 12,719 |
Derivatives Designated as Hedging Instruments | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 129 | 291 |
Derivatives Designated as Hedging Instruments | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 87 | 150 |
Derivatives Designated as Hedging Instruments | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 105 | 67 |
Derivatives Designated as Hedging Instruments | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 182 | 197 |
Derivatives Designated as Hedging Instruments | Fair Value Hedges: | Interest rate contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 2,500 | 2,500 |
Derivatives Designated as Hedging Instruments | Fair Value Hedges: | Interest rate contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 0 | 0 |
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 | 0 |
Derivatives Designated as Hedging Instruments | Fair Value Hedges: | Interest rate contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 104 | 151 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedges: | Foreign exchange contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 8,305 | 8,247 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedges: | Foreign exchange contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 106 | 252 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedges: | Foreign exchange contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 59 | 104 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedges: | Foreign exchange contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 80 | 33 |
Derivatives Designated as Hedging Instruments | Cash Flow Hedges: | Foreign exchange contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 48 | 23 |
Derivatives Designated as Hedging Instruments | Net Investment Hedges: | Foreign exchange contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 1,904 | 1,972 |
Derivatives Designated as Hedging Instruments | Net Investment Hedges: | Foreign exchange contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 23 | 39 |
Derivatives Designated as Hedging Instruments | Net Investment Hedges: | Foreign exchange contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 28 | 46 |
Derivatives Designated as Hedging Instruments | Net Investment Hedges: | Foreign exchange contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 25 | 34 |
Derivatives Designated as Hedging Instruments | Net Investment Hedges: | Foreign exchange contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 30 | 23 |
Derivatives Not Designated as Hedging Instruments | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 4,588 | 6,886 |
Derivatives Not Designated as Hedging Instruments | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 26 | 20 |
Derivatives Not Designated as Hedging Instruments | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 3 | 3 |
Derivatives Not Designated as Hedging Instruments | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 27 | 25 |
Derivatives Not Designated as Hedging Instruments | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 19 | 16 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 4,447 | 6,786 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 23 | 20 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 3 | 3 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 27 | 23 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 19 | 16 |
Derivatives Not Designated as Hedging Instruments | Other derivatives | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 141 | 100 |
Derivatives Not Designated as Hedging Instruments | Other derivatives | Other Current Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 3 | 0 |
Derivatives Not Designated as Hedging Instruments | Other derivatives | Long-Term Financing Receivables and Other Assets | ||
Derivatives, Fair Value | ||
Derivative asset, fair value | 0 | 0 |
Derivatives Not Designated as Hedging Instruments | Other derivatives | Other Accrued Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | 0 | 2 |
Derivatives Not Designated as Hedging Instruments | Other derivatives | Long-Term Other Liabilities | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | $ 0 | $ 0 |
Financial Instruments - Offsett
Financial Instruments - Offsetting Assets and Liabilities (Details) $ in Millions | Jan. 31, 2024 USD ($) businessDay | Oct. 31, 2023 USD ($) businessDay | |
Derivative assets | |||
Gross Amount Recognized | $ 245 | $ 464 | |
Gross Amount Offset | 0 | 0 | |
Net Amount Presented | 245 | 464 | |
Gross Amounts Not Offset | |||
Derivatives | 170 | 196 | |
Financial Collateral | [1] | 55 | 207 |
Net Amount | 20 | 61 | |
Derivative liabilities | |||
Gross Amount Recognized | 333 | 305 | |
Gross Amount Offset | 0 | 0 | |
Net Amount Presented | 333 | 305 | |
Gross Amounts Not Offset | |||
Derivatives | 170 | 196 | |
Financial Collateral | [2] | 118 | 103 |
Net Amount | $ 45 | $ 6 | |
Business days prior to respective reporting date | businessDay | 2 | 2 | |
Cash collateral | $ 108 | $ 56 | |
Counterparty collateral | $ 10 | $ 47 | |
[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. Represents the collateral posted by the Company in cash or through the 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 January 31, 2024, of the $118 million of collateral posted, $108 million was in cash and $10 million was through the re-use of counterparty collateral. As of October 31, 2023, of the $103 million of collateral posted, $56 million was in cash and $47 million was through the re-use of counterparty collateral. |
Financial Instruments - Amounts
Financial Instruments - Amounts Recorded in the Balance Sheet (Details) - Long-term debt - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 |
Derivatives, Fair Value | ||
Carrying Amount of the Hedged Liabilities | $ (2,393) | $ (2,345) |
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/ (Liabilities) | $ 104 | $ 151 |
Financial Instruments - Pre-tax
Financial Instruments - Pre-tax Effect of Derivative Instruments in Hedging Relationships on OCI (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Cash flow hedge, gain (loss), before reclassification and tax, foreign exchange contracts | $ (204) | $ (518) |
Total | (243) | (625) |
Expected amount of AOCI expected to be reclassified in the next 12 months | 8 | |
Foreign currency contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Cash flow hedge, gain (loss), before reclassification and tax, foreign exchange contracts | (204) | (518) |
Investment hedge, gain (loss), before reclassification and tax, foreign exchange contracts | $ (39) | $ (107) |
Financial Instruments - Pre-t_2
Financial Instruments - Pre-tax Effect of Derivative Instruments on Statement of Earnings (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Net revenue | $ 6,755 | $ 7,809 |
Interest and other, net | (88) | (26) |
Net Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total gains (losses) | 24 | 50 |
Interest and Other, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total gains (losses) | (178) | (491) |
Interest rate contracts | Net Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives in Fair Value Hedging Relationships: | 0 | 0 |
Interest rate contracts | Interest and Other, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives in Fair Value Hedging Relationships: | (47) | (41) |
Foreign currency contracts | Net Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of gains (losses) reclassified from accumulated other comprehensive income into income | 24 | 50 |
Foreign currency contracts | Interest and Other, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of gains (losses) reclassified from accumulated other comprehensive income into income | (138) | (297) |
Derivatives Designated as Hedging Instruments | Interest rate contracts | Net Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives in Fair Value Hedging Relationships: | 0 | 0 |
Derivatives Designated as Hedging Instruments | Interest rate contracts | Interest and Other, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives in Fair Value Hedging Relationships: | 47 | 41 |
Derivatives Not Designated as Hedging Instruments | Foreign currency contracts | Net Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives not Designated as Hedging Instruments: | 0 | 0 |
Derivatives Not Designated as Hedging Instruments | Foreign currency contracts | Interest and Other, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives not Designated as Hedging Instruments: | (44) | (194) |
Derivatives Not Designated as Hedging Instruments | Other derivatives | Net Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives not Designated as Hedging Instruments: | 0 | 0 |
Derivatives Not Designated as Hedging Instruments | Other derivatives | Interest and Other, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (Losses) on Derivatives not Designated as Hedging Instruments: | $ 4 | $ 0 |
Borrowings - Notes Payable and
Borrowings - Notes Payable and Short-Term Borrowings (Details) - USD ($) $ in Millions | Jan. 31, 2024 | Oct. 31, 2023 | |
Short-term Debt [Line Items] | |||
Current portion of long-term debt | $ 4,131 | [1] | $ 4,022 |
Commercial paper | 674 | 679 | |
Notes payable to banks, lines of credit and other | 152 | 167 | |
Total notes payable and short-term borrowings | 4,957 | 4,868 | |
Long-term debt | 7,840 | 7,487 | |
Total | 12,797 | $ 12,355 | |
Asset-backed Debt Securities | |||
Short-term Debt [Line Items] | |||
Current portion of long-term debt | $ 1,500 | ||
[1]As of January 31, 2024, the Current portion of long-term debt, net of discount and issuance costs, included $1.5 billion associated with the asset-backed debt securities issued by the Company. |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) | 1 Months Ended | 3 Months Ended | |||
Jan. 09, 2024 USD ($) | Sep. 30, 2023 USD ($) | Dec. 31, 2021 USD ($) | Jan. 31, 2024 USD ($) program tranche | Oct. 31, 2023 USD ($) | |
Unsecured Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 4,750,000,000 | ||||
Debt term | 5 years | ||||
Line of credit | $ 0 | $ 0 | |||
Commercial Paper | |||||
Line of Credit Facility [Line Items] | |||||
Number of commercial paper programs | program | 2 | ||||
Maximum borrowing capacity under credit facility | $ 4,750,000,000 | ||||
Amount outstanding | 0 | 0 | |||
Commercial Paper | Euro Commercial Paper Program | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | 3,000,000,000 | ||||
Commercial Paper | Euro Commercial Paper Certificate of Deposit Programme | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | 1,000,000,000 | ||||
Commercial Paper | Euro Commercial Paper Certificate of Deposit Programme | Hewlett Packard Enterprise | |||||
Line of Credit Facility [Line Items] | |||||
Amount outstanding | 674,000,000 | 679,000,000 | |||
Uncommitted Credit Facility | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 500,000,000 | ||||
Debt term | 5 years | ||||
Line of credit | 0 | $ 0 | |||
Senior Unsecured Delayed Draw Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 14,000,000,000 | ||||
Payments of financing costs | 42,000,000 | ||||
Debt, Long-Term and Short-Term, Combined Amount | 0 | ||||
Senior Unsecured Delayed Draw Term Loan | Line of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 11,000,000,000 | ||||
Debt term | 364 days | ||||
Asset-backed Debt Securities | Asset-Backed Debt Securities Issued January 2024 | |||||
Line of Credit Facility [Line Items] | |||||
Amount issued | $ 796,000,000 | ||||
Number of tranches | tranche | 6 | ||||
Percent of principal (as a percentage) | 99.99% | ||||
Weighted average interest rate (as a percent) | 5.476% | ||||
Line of Credit | Senior Unsecured Delayed Draw Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Amount issued | $ 3,000,000,000 | ||||
Debt term | 3 years |
Stockholders' Equity - Componen
Stockholders' Equity - Components of AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Components of accumulated other comprehensive loss, net of taxes | ||
Balance at beginning of period | $ 21,238 | |
Balance at end of period | 21,468 | |
Net unrealized gains on available-for-sale securities | ||
Components of accumulated other comprehensive loss, net of taxes | ||
Balance at beginning of period | 0 | $ (1) |
Other comprehensive income (loss) before reclassifications | 6 | 5 |
Reclassifications of losses into earnings | 0 | 0 |
Tax benefit (provision) | 0 | 0 |
Balance at end of period | 6 | 4 |
Net unrealized gains (losses) on cash flow hedges | ||
Components of accumulated other comprehensive loss, net of taxes | ||
Balance at beginning of period | 61 | 109 |
Other comprehensive income (loss) before reclassifications | (204) | (518) |
Reclassifications of losses into earnings | 114 | 247 |
Tax benefit (provision) | 18 | 55 |
Balance at end of period | (11) | (107) |
Unrealized components of defined benefit plans | ||
Components of accumulated other comprehensive loss, net of taxes | ||
Balance at beginning of period | (2,507) | (2,596) |
Other comprehensive income (loss) before reclassifications | 0 | 0 |
Reclassifications of losses into earnings | 34 | 35 |
Tax benefit (provision) | (4) | (3) |
Balance at end of period | (2,477) | (2,564) |
Cumulative translation adjustment | ||
Components of accumulated other comprehensive loss, net of taxes | ||
Balance at beginning of period | (638) | (610) |
Other comprehensive income (loss) before reclassifications | 13 | 20 |
Reclassifications of losses into earnings | 0 | 0 |
Tax benefit (provision) | (1) | 1 |
Balance at end of period | (626) | (589) |
Accumulated other comprehensive loss | ||
Components of accumulated other comprehensive loss, net of taxes | ||
Balance at beginning of period | (3,084) | (3,098) |
Other comprehensive income (loss) before reclassifications | (185) | (493) |
Reclassifications of losses into earnings | 148 | 282 |
Tax benefit (provision) | 13 | 53 |
Balance at end of period | $ (3,108) | $ (3,256) |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - Share Repurchase Program shares in Millions, $ in Billions | 3 Months Ended |
Jan. 31, 2024 USD ($) shares | |
Equity, Class of Treasury Stock [Line Items] | |
Stock settled during period (in shares) | 0.2 |
Additional stock settled during period (in shares) | 0 |
Common stock retired (in shares) | 0 |
Remaining authorized repurchase amount | $ | $ 1 |
Net Earnings Per Share (Details
Net Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | ||
Jan. 31, 2024 | Jan. 31, 2023 | ||
Numerator: | |||
Net earnings | $ 387 | $ 501 | |
Denominator: | |||
Weighted-average shares used to compute basic net EPS (in shares) | 1,301 | 1,298 | |
Dilutive effect of employee stock plans (in shares) | 15 | 17 | |
Weighted-average shares used to compute diluted net EPS (in shares) | 1,316 | 1,315 | |
Net Earnings per Share: | |||
Basic (in dollars per share) | $ 0.30 | $ 0.39 | |
Diluted (in dollars per share) | $ 0.29 | $ 0.38 | |
Anti-dilutive weighted-average stock awards (in shares) | [1] | 1 | 9 |
[1] 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 per share, as their effect, if included, would have been anti-dilutive for the periods presented. |
Litigation, Contingencies, an_2
Litigation, Contingencies, and Commitments (Details) $ in Millions | 1 Months Ended | 24 Months Ended | ||||||
Sep. 22, 2020 patent | Aug. 18, 2016 | May 10, 2010 USD ($) employee | Sep. 30, 2011 | Jul. 31, 2011 | Oct. 31, 2008 contract | Apr. 20, 2012 USD ($) | Apr. 11, 2012 USD ($) | |
Q3 Networking Litigation | ||||||||
Litigation and Contingencies | ||||||||
Number of patents allegedly infringed | patent | 4 | |||||||
Minimum | Forsyth, et al. vs HP Inc. and Hewlett Packard Enterprise | ||||||||
Litigation and Contingencies | ||||||||
Age of terminated employees | 40 years | |||||||
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 | |||||||
Damages sought | $ | $ 370 | |||||||
Bangalore Commissioner of Customs | ||||||||
Litigation and Contingencies | ||||||||
Duties and penalties under show cause notices | $ | $ 17 | $ 386 | ||||||
ECT proceedings | ||||||||
Litigation and Contingencies | ||||||||
Number of ECT contracts related to alleged improprieties | contract | 3 | |||||||
Bid and contract term | 5 years | |||||||
ECT proceedings | Maximum | ||||||||
Litigation and Contingencies | ||||||||
Length of sanctions | 5 years | |||||||
ECT proceedings | Minimum | ||||||||
Litigation and Contingencies | ||||||||
Length of sanctions | 2 years |
Equity Method Investments (Deta
Equity Method Investments (Details) - H3C - USD ($) $ in Billions | May 26, 2023 | Dec. 30, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Ownership | 49% | |
Put share purchase agreement | $ 3.5 |