Hewlett Packard Enterprise reported fourth-quarter revenue that missed analyst expectations, initially sending shares down as much as 9%. The stock rebounded Friday and were largely flat.
The company reported earnings after the bell on Thursday, posting revenue of $9.68 billion, which was up 14% over the year prior but fell short of the $9.94 billion in revenue expected by analysts polled by LSEG.
Revenue for HPE's server segment came in at $4.46 billion, down 5% from the $4.68 billion a year ago. The fourth-quarter number missed StreetAccount analyst expectations of $4.58 billion.
CFO Marie Myers addressed the shortfall on the analyst call Thursday, attributing it to the timing of artificial intelligence service shipments and lower-than-expected government spending.
"Despite these headwinds, we were encouraged by robust server order growth across both traditional server and AI offerings, with demand significantly outpacing revenue in this period," she said.
Server revenue declined 10% from the third quarter.
HPE beat earnings expectations with adjusted earnings of 62 cents per share, coming in above the 58 cents per share expected by LSEG.
Myers said the adjustments came from the "amortization of intangible assets, Juniper-related acquisition costs, stock-based compensation expense and cost reduction plan expense, partially offset by adjustments for taxes and other adjustments."