HPE shares soar 28% as demand for AI infrastructure powers stellar quarter (updated)

Super Micro Computer

02/06/2026 13:23

Updates shares, adds details in paragraph 3

    June 2 (Reuters) - Hewlett Packard Enterprise HPE.N shares surged 28% on Tuesday after a rosy quarter that put it on track to hit long-term financial targets two years ahead of schedule, the latest evidence of strong demand for its AI servers used in data centers.
The gains, if sustained, would add around $17 billion to the company's market value of $62.36 billion. They follow strong forecasts from rivals Dell and Super Micro Computer as Big Tech presses ahead with around $700 billion in AI spending this year.

    HPE's shares, which had nearly doubled this year as of last close, are on track to record their biggest one-day percentage gain. 
  
The insatiable demand from the AI industry has allowed server makers to pass on higher costs for supply-constrained memory chips to customers, shielding their margins. The firms said strong supplier ties are also helping them navigate the shortage.
"The year of refresh" for enterprise IT equipment, AI modernization and product updates is also benefiting the companies, Piper Sandler analysts said in a client note. 
"While HPE is seeing this tidal wave, we prefer to be in 'other boats' given exposures," Piper Sandler said. Dell shares were down around 2%, while those of Super Micro rose 6%.

    At least 12 brokerages raised their price targets on HPE's stock, giving it a median price target of $66, according to data compiled by LSEG. That is up from $26.50 before the report.          
  
"The biggest takeaway from the quarter was that HPE is benefiting from the same pricing dynamic that has recently driven upside at Dell - customers are absorbing materially higher server prices with little evidence of demand destruction," Morgan Stanley analysts said.
HPE has a 12-month forward price-to-earnings ratio of 15.66, compared with Dell's 23.92 and Super Micro's 14.49.

      

Dell shares outperform those of peers HPE and Super Micro Computer https://reut.rs/4uMs6kD
 (Reporting by Jaspreet Singh and Kanishka Ajmera in Bengaluru; Editing by Mrigank Dhaniwala and Sahal Muhammed)
 ((Kanishka.Ajmera@thomsonreuters.com))