832%. That is HPE’s nine-month increase in operating cash flow, from $454 million to $4.2 billion. The number is so large it makes the rest of the filing look like footnotes.
The rest of the filing shows revenue rose 33.7% to $12.2 billion versus the comparable nine-month period, while operating income jumped 464% to $1.4 billion. Cash reached $6.2 billion, up 36%. HPE is showing a business that is producing far more cash and profit than it did a year earlier.
The margin improvement is doing much of the work. HPE said gross margin rose 8.7 percentage points, with higher revenue in Networking and Cloud & AI as the primary driver.
"The gross profit margin of 37.7% (or $12.1 billion) represents an increase of 8.7 percentage points from the prior-year period, primarily due to higher revenue in the Networking and Cloud & AI segments."
HPE, Form 10-Q, Sept. 3, 2026
That is the clean version of the filing: more of the business is coming from areas management identifies as driving the margin lift. The less clean version is that cost of sales also rose 121.7%, primarily because of Juniper Networks. The Juniper-related costs are rising alongside the broader revenue increase.
Then there is the balance sheet. Inventory grew 65.1%, nearly twice the pace of revenue, while accounts receivable rose 9.4%. HPE disclosed why it has been carrying more stock: component updates, customers moving to next-generation GPUs, supply purchases made ahead of demand, and longer acceptance timelines for AI orders.
"We have experienced higher-than-normal inventory levels, primarily due to frequent component part updates, customers transitioning to the next generation of GPUs, our efforts to secure supply ahead of demand, and longer customer acceptance timelines on AI-related orders."
HPE, Form 10-Q, Sept. 3, 2026
The explanation matters because this is not just a bigger number on a balance sheet. It describes an operating tradeoff around AI hardware: HPE is buying and holding components while customers take longer to accept some orders. The filing does not say how quickly that inventory will convert into sales.
Cash conversion nevertheless improved on the reported numbers. Capital spending rose 14.9%, slower than revenue, and free-cash-flow margin improved by 12.1 percentage points. Research and development expense rose 86.2%, primarily from Juniper-related operating expenses and higher variable employee costs, so HPE is also spending more around the expanded business.
The annual backdrop provides context. HPE’s latest fiscal-year revenue was $34.3 billion, but operating margin was negative 1.3%. The nine-month figures show a sharp change in profitability, while the inventory build leaves a separate question about how much of the AI-related working capital is temporary and how much becomes part of the new operating shape.
HPE’s next quarterly report gives that question a concrete comparison point: whether the $11.8 billion inventory balance has moved lower, held steady, or climbed again.
HPE’s Sept. 3, 2026 Form 10-Q reports $11.8 billion of inventory at July 31, 2026.