Chief Executive Officer, President & Director, Hewlett Packard Enterprise Co
HPE President & CEO Antonio Neri Talks Company Growth with AI Usage | Bloomberg Talks
HPE President & CEO Antonio Neri talks with Bloomberg's Paul Sweeney and Scarlet Fu on Bloomberg Intelligence about how AI ...
About Antonio Neri
Antonio Neri, CEO of Hewlett Packard Enterprise, has been active in public appearances and earnings calls discussing the company's growth driven by demand for AI infrastructure. In June 2026, Neri reported a "record breaking" second quarter, citing strong demand across HPE's portfolio in networking, cloud, and AI. He stated that the company raised its fiscal 2026 guidance and provided an early outlook for fiscal 2027, which he attributed to the "durability of the demand" and a pipeline that "remains multiples of the current backlog." Neri described the Juniper acquisition as a "home run" and noted that the combined portfolio is strengthening HPE's market position. At HPE Discover 2026, Neri highlighted the role of networking as a critical enabler and bottleneck for AI, and announced new products and partnerships, including a quantum computing alliance with six companies. He discussed the shift toward "agentic AI" and the "agentic enterprise," stating that AI adoption has accelerated in the last six to nine months. Neri also addressed financial strategy, saying HPE expects to return to two times leverage by the end of fiscal 2026 and return approximately 75% of free cash flow to shareholders starting in 2027. He characterized the current period as a "technology platform shift" driven by AI agents and emphasized that "the future belongs to the fast."
Transcript (9 segments)
✨ AI-enhanced transcript with speaker attribution
N
Narrator0:02
Bloomberg Audio Studios, podcasts, radio, news.
I
Interviewer0:07
Antonio Neri joins us here, CEO of HPE. Antonio, thanks so much for joining us here. Talk to us about what are the key issues for you guys going forward here. This AI story is a story that's playing out across the tech stack.
A
Antonio Neri0:23
Well, good morning, Paul. Thanks for having me. Yes, of course, today the narrative is all around AI and the ability to use AI to change the world. So for us as a technology company, it's about how we accelerate the deployment of AI in the enterprise. Today we talked about the evolution from large language models to agentic models, which allows increasing productivity across the entire enterprise, across processes and functions. We have made a series of announcements here that bring together the infrastructure, the software, and the cloud experience into one integrated unified operating model, including governance and compliance, so that builds trust within the enterprise to go forward.
I
Interviewer1:12
And how does this change your growth trajectory going forward? I know that one year out might look very different from five years out versus 10 years out. Just walk us through how you see this changing what you had anticipated to what you now think you can achieve.
A
Antonio Neri1:29
Yeah, Scarlet. If you go back and read our earnings in Q2, we grew the company as a whole 40% year-over-year on revenues, and we expanded margins because the content we bring into the revenue now has a bigger mix of networking, software, and cloud services. In that context, we believe networking is going to be the thesis of our company. If you think about developing these frontier models, whether proprietary or open-source models, you need a lot of GPU power, but that GPU needs to be very productive. You don't want to keep it idle, and the bottleneck of that is networking. With the acquisition of Juniper, we now have an amazing portfolio in the three key elements: scale up, scale out, and scale across, which position us to be a core element of that infrastructure buildout. This is why we believe the company is going to grow double digits going forward and will continue to expand operating margins, and that will translate into free cash flow. We already guided, which is unusual in many cases, for six quarters ahead, because of the confidence we have in our growth trajectory.
I
Interviewer2:40
Antonio, where do you think this AI technology story is? A lot of folks are saying we're still in very early innings, but when you think about the amount of capex being spent by a variety of players within the tech stack, it's extraordinary. Where do you think we are in that compendium of AI investment?
A
Antonio Neri3:04
I concur that we're still early, and Paul, you have to understand there are three customer segments to look at. Number one is the model builders and the hyperscalers and the neoclouds building large amounts of compute capacity. We believe by the end of the decade we're going to build 250 gigawatts of power to host these GPUs. That's the capacity you're talking about, but ultimately the mix of that capacity is going to shift from training models to inferencing models, and that's where we'll see the large adoption of AI into the enterprise to drive productivity. But in the context of industrial revolutions in the past, this is very small compared to the spend at every inflection point, including the turn of the past century. So yes, I understand the concern about the amount of capex, but when you put it in the context of changing the way we work and our society, it's still small relative to that.
I
Interviewer4:09
And just looking at how you might be deploying cash. I know you tapped the debt market in March to refinance some upcoming maturities. You've got strong liquidity with cash and equivalents of more than $5 billion at the end of the second quarter. What might prompt you to go to the debt market again to raise more money?
A
Antonio Neri4:31
Well, we do that very regularly because inside HPE we have an operating company. Obviously, we are paying down the debt and refinancing when we need to. That's the operating balance sheet you're referring to. Our balance sheet is super strong. Then we have the financing company, which has $13 billion under asset management. Think about the financing we do for customers as part of the asset lifecycle management services. We have that securitized against those assets, but the return on equity is super high. We use those vehicles when necessary, but what we announced at the beginning of this month in our earnings is that we're going to pay down that debt much faster. In fact, we expect to reach two times leverage by the end of this fiscal year, one year ahead of plan. And we're going to start returning approximately 75% of our free cash flow to shareholders in 2027, which we expect to generate at least $4.5 billion in dividends and share buybacks. That's how we're going to return it. So we are very strong, and that comes back to the question you asked me before, about where it comes from: the growth and the operating margins.