Hewlett Packard Enterprise's Backlog of Nearly $6 Billion Is Fueled by a New Wave of AI Spending
The AI infrastructure build-out has entered a new phase, as more companies seek control over their own systems.
Overview
Hewlett Packard Enterprise (NYSE: HPE) has gone from a legacy hardware vendor to an artificial intelligence (AI) infrastructure player in a matter of months. The stock is up 81% year to date, and management recently raised full-year earnings guidance by over 40% after the company blew past expectations in the second quarter.
While the first wave of AI infrastructure spending was dominated by hyperscalers building massive cloud data centers, the second phase is being driven by enterprises building their own on-premises AI capabilities. Running AI workloads with a variety of models on your own hardware is cheaper, and allows companies to protect their intellectual property, data, and competitive advantages.
Details
HPE's timely acquisition of Juniper Networks last year positioned it to benefit from this spending. Businesses are drawn to Hewlett Packard Enterprise's integrated approach, which combines servers, storage, and high-performance networking gear, allowing its customers to build AI factories they control.
Source
Originally published at www.fool.com.
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