Topline
Hewlett Packard Enterprise is providing Oracle a warrant to purchase over four million company shares at essentially no cost, according to a Thursday filing, offering the low rate as a sales incentive tied to Oracle’s purchases of HPE networking gear for Artificial Intelligence data centers.
HPE reported the partnership in an SEC filing on Thursday.
Photo by Cheng Xin/Getty Images
Key Facts
HPE disclosed in a Securities and Exchange Commission filing it issued a warrant in July to Oracle allowing it to purchase up to nearly 4.2 million shares of HP common stock at an exercise price of $0.01 per share.
The warrant will become exercisable in tranches and is linked to Oracle purchasing HP networking products for AI data centers, with the warrant remaining valid through June 2029.
Oracle will fork over just $42,000 if it decides to purchase all the shares available to it through the warrant.
The 4.2 million shares carry a market value of roughly $210 million as of 1:15 p.m.
HPE shares tumbled 3% on Thursday afternoon as investors considered the company’s cautious outlook, even as it reported record quarterly revenue and raised its full-year outlook in its third quarter earnings.
Big Number
108%. That is how much HPE shares have risen since the start of the year, surging from around the $24 mark to over $50 per share.
Key Background
HPE posted record revenue of $12.2 billion in its latest quarter, up 34% year-over-year as it benefits from booming AI infrastructure demand. The company also raised its full-year revenue growth outlook into the 34% to 37% range. HPE CEO Antonio Neri called AI a “multi-year growth driver” for the company, with CFO Marie Myers noting its order backlog is at a record level. The deal with Oracle involves HPE’s routing and switching hardware already incorporated into Oracle’s cloud and AI infrastructure, extending the footprint to Oracle’s growing AI supercluster buildout. Like HPE, Oracle revenue is surging amid demand for its cloud and AI infrastructure, posting record revenue of $67.4 billion in its 2026 fiscal year. Cloud revenues jumped 47% in its latest quarter to $9.9 billion as Oracle’s cloud infrastructure grew over 90% and cloud applications rose 10%.
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