Hewlett Packard Enterprise on Monday lowered its adjusted profit outlook for the second quarter and full year, after completing the spinoff of its enterprise services (ES) business and merging it with Computer Sciences Corp. to create DXC Technology. The deal is expected to deliver about $13.5 billion to HPE after tax, including an equity stake in DXC, a cash dividend payment to HPE and DXC's assumption of debt. The company lowered its adjusted earnings outlook to reflect the partial-year contribution from ES, which will no longer contribute to its financials. The company is now expecting second-quarter adjusted per-share earnings of 33 cents to 37 cents, down from a prior 41 cents to 45 cents. For the full year, it expects EPS of $1.46 to $1.56, down from a prior $1.88 to $1.98. On a GAAP basis, it expects a second-quarter loss of 7 cents to a loss of 3 cents, compared with a previous estimate of a loss of 3 cents to EPS of 1 cent. Shares rose 1.9% premarket, but are down 23% in the year so far, while the S&P 500 has gained 5%.
Continue Reading Below
Copyright © 2017 MarketWatch, Inc.