Restructuring

3 Months Ended

Jan. 31, 2018

Restructuring and Related Activities [Abstract]

Summary of Restructuring Plans

On September 14, 2015, former Parent's Board of Directors approved a restructuring plan (the "2015 Plan") in connection with the Separation. On May 23, 2012, former Parent adopted a multi-year restructuring plan (the "2012 Plan") designed to simplify business processes, accelerate innovation and deliver better results for customers, employees and stockholders. As of October 31, 2017, the 2015 and 2012 Plans were substantially complete.

Restructuring Activity

Restructuring charges of $3 million and $83 million have been recorded by the Company for the three months ended January 31, 2018 and 2017, respectively, based on restructuring activities impacting the Company's employees and infrastructure. For details on restructuring charges related to HPE Next, see Note 5, "HPE Next".

Restructuring activities related to the Company's employees and infrastructure for the 2015 and 2012 Plans are presented in the table below:



	2015 Plan						2012 Plan
	Employee Severance			Infrastructure and other			Employee Severance and EER			Infrastructure and other			Total
	In millions
Liability as of October 31, 2017	$	219		$	17		$	16		$	2		$	254
Charges	2			2			—			(1		)	3
Cash payments	(108		)	(4		)	(6		)	—			(118		)
Non-cash items	6			—			2			—			8
Liability as of January 31, 2018	$	119		$	15		$	12		$	1		$	147
Total costs incurred to date, as of January 31, 2018	$	744		$	82		$	1,255		$	145		$	2,226
Total costs expected to be incurred, as of January 31, 2018	$	744		$	82		$	1,255		$	145		$	2,226

The current restructuring liability related to the plans in the table above, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets at January 31, 2018 and October 31, 2017, was $75 million and $158 million, respectively. The non-current restructuring liability related to the plans in the table above, reported in Other liabilities in the Condensed Consolidated Balance Sheets at January 31, 2018 and October 31, 2017, was $72 million and $96 million, respectively.

HPE Next

Transformation Costs

The HPE Next initiative is expected to be implemented through fiscal 2020, during which time the Company expects to incur expenses for workforce reductions, to upgrade and simplify its IT infrastructure, and for other non-labor actions. These costs will be partially offset by proceeds received from real estate sales.

During the three months ended January 31, 2018, the Company incurred $245 million in net charges associated with the HPE Next initiative, which were recorded within Transformation costs in the Condensed Consolidated Statement of Earnings and include the following:



	Three months ended January 31, 2018
	In millions
Program management⁽¹⁾	$	24
IT costs	33
Restructuring charges	171
Gain on real estate sales	(1		)
Other	18
Total	$	245


(1)	Primarily consists of consulting fees and other direct costs attributable to the design and execution of the HPE Next initiative.

Restructuring Plan

On October 16, 2017, the Company's Board of Directors approved a restructuring plan in connection with the HPE Next initiative (the "HPE Next Plan"), which will be implemented through fiscal 2020. The changes to the workforce will vary by country, based on local legal requirements and consultations with employee work councils and other employee representatives, as appropriate, and are expected to be completed during fiscal 2019. As of January 31, 2018, the Company estimates that it will incur aggregate pre-tax restructuring charges of approximately $0.9 billion through fiscal 2020 in connection with the HPE Next Plan, of which approximately $0.7 billion relates to workforce reductions and approximately $0.2 billion relates to infrastructure, primarily real estate site exits.



	Employee Severance			Infrastructure and other
	In millions
Liability as of October 31, 2017	$	296		$	—
Charges	162			9
Cash payments	(106		)	(2		)
Non-cash items	7			(3		)
Liability as of January 31, 2018	$	359		$	4
Total costs incurred to date, as of January 31, 2018	$	458		$	9
Total costs expected to be incurred, as of January 31, 2018	$	750		$	180

As of January 31, 2018 and October 31, 2017, the current restructuring liability related to the HPE Next Plan, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets, was $337 million and $287 million, respectively. The non-current restructuring liability related to the HPE Next Plan, reported in Other liabilities in the Condensed Consolidated Balance Sheets as of January 31, 2018 and October 31, 2017 was $26 million and $9 million, respectively.