10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________________

FORM 10-Q

(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended:	July 31, 2019
Or

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from            to

Commission file number 001-37483

______________________________________________________________________________

HEWLETT PACKARD ENTERPRISE COMPANY

(Exact name of registrant as specified in its charter)

Delaware	47-3298624
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

6280 America Center Drive,	San Jose,	California		95002
(Address of principal executive offices)				(Zip code)
(650)			687-5817
(Registrant's telephone number, including area code)

______________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.01 per share	HPE	NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer (Do not check if a smaller reporting company)	☐	Smaller reporting company	☐
						Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of Hewlett Packard Enterprise Company common stock outstanding as of August 20, 2019 was 1,305,601,258 shares, par value $0.01.

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Form 10-Q

For the Quarterly Period Ended July 31, 2019

Table of Contents

			Page
Forward-Looking Statements			4
Part I.	Financial Information
	Item 1.	Financial Statements and Supplementary Data	5
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	46
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	63
	Item 4.	Controls and Procedures	64
Part II.	Other Information
	Item 1.	Legal Proceedings	65
	Item 1A.	Risk Factors	65
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	65
	Item 5.	Other Information	65
	Item 6.	Exhibits	65
Exhibit Index			66
Signature			72

3

Forward-Looking Statements

This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 2 of Part I, contains forward-looking statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of Hewlett Packard Enterprise Company and its consolidated subsidiaries ("Hewlett Packard Enterprise") may differ materially from those expressed or implied by such forward-looking statements and assumptions. The words "believe", "expect", "anticipate", "optimistic", "intend", "aim", "will", "should" and similar expressions are intended to identify such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any projections of revenue, margins, expenses, effective tax rates, the impact of the U.S. Tax Cuts and Jobs Act of 2017, net earnings, net earnings per share, cash flows, benefit plan funding, deferred tax assets, share repurchases, currency exchange rates or other financial items; any projections of the amount, timing or impact of cost savings or restructuring charges; any statements of the plans, strategies and objectives of management for future operations, as well as the execution of transformation and restructuring plans and any resulting cost savings, revenue or profitability improvements; any statements concerning the expected development, performance, market share or competitive performance relating to products or services; any statements regarding current or future macroeconomic trends or events and the impact of those trends and events on Hewlett Packard Enterprise and its financial performance; any statements regarding pending investigations, claims or disputes; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the need to address the many challenges facing Hewlett Packard Enterprise's businesses; the competitive pressures faced by Hewlett Packard Enterprise's businesses; risks associated with executing Hewlett Packard Enterprise's strategy; the impact of macroeconomic and geopolitical trends and events; the need to manage third-party suppliers and the distribution of Hewlett Packard Enterprise's products and the delivery of Hewlett Packard Enterprise's services effectively; the protection of Hewlett Packard Enterprise's intellectual property assets, including intellectual property licensed from third parties and intellectual property shared with its former Parent; risks associated with Hewlett Packard Enterprise's international operations; the development and transition of new products and services and the enhancement of existing products and services to meet customer needs and respond to emerging technological trends; the execution and performance of contracts by Hewlett Packard Enterprise and its suppliers, customers, clients and partners; the hiring and retention of key employees; integration and other risks associated with business combination and investment transactions; the execution, timing and results of any transformation or restructuring plans, including estimates and assumptions related to the costs and anticipated benefits of implementing the transformation and restructuring plans; the effects of the U.S. Tax Cuts and Jobs Act and related guidance and regulations that may be implemented; the resolution of pending investigations, claims and disputes; and other risks that are described herein, including but not limited to the items discussed or referenced in "Risk Factors" in Item 1A of Part II of this Quarterly Report on Form 10-Q and that are otherwise described or updated from time to time in Hewlett Packard Enterprise's reports filed with the Securities and Exchange Commission. Hewlett Packard Enterprise assumes no obligation and does not intend to update these forward-looking statements.

4

Part I. Financial Information

Item 1. Financial Statements and Supplementary Data.

Index

	Page
Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018 (Unaudited)	6
Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended July 31, 2019 and 2018 (Unaudited)	7
Condensed Consolidated Balance Sheets as of July 31, 2019 (Unaudited) and October 31, 2018 (Audited)	8
Condensed Consolidated Statements of Cash Flows for the nine months ended July 31, 2019 and 2018 (Unaudited)	9
Condensed Consolidated Statements of Stockholders' Equity for the three and nine months ended July 31, 2019 and 2018 (Unaudited)	10
Notes to Condensed Consolidated Financial Statements (Unaudited)	13
Note 1: Overview and Summary of Significant Accounting Policies	13
Note 2: Segment Information	19
Note 3: Restructuring	23
Note 4: HPE Next	24
Note 5: Retirement and Post-Retirement Benefit Plans	25
Note 6: Taxes on Earnings	26
Note 7: Balance Sheet Details	27
Note 8: Financing Receivables and Operating Leases	30
Note 9: Goodwill	32
Note 10: Fair Value	32
Note 11: Financial Instruments	34
Note 12: Borrowings	38
Note 13: Stockholders' Equity	39
Note 14: Net Earnings Per Share	40
Note 15: Litigation and Contingencies	41
Note 16: Indemnifications	44

5

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(Unaudited)

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions, except per share amounts
Net revenue:
Products	$	4,508		$	4,944		$	13,709		$	14,414
Services	2,595			2,711			7,869			8,160
Financing income	114			109			342			332
Total net revenue	7,217			7,764			21,920			22,906
Costs and expenses:
Cost of products	3,069			3,516			9,496			10,432
Cost of services	1,625			1,814			5,102			5,475
Financing interest	74			69			222			207
Research and development	481			435			1,404			1,227
Selling, general and administrative	1,253			1,221			3,678			3,684
Amortization of intangible assets	58			72			199			222
Restructuring charges	—			(1		)	—			14
Transformation costs	170			126			302			491
Disaster charges	—			—			(7		)	—
Acquisition, disposition and other related charges	563			24			710			70
Separation costs	—			(2		)	—			—
Total costs and expenses	7,293			7,274			21,106			21,822
(Loss) earnings from continuing operations	(76		)	490			814			1,084
Interest and other, net	(70		)	(64		)	(139		)	(163		)
Tax indemnification adjustments	(134		)	2			89			(1,342		)
Non-service net periodic benefit credit	12			26			45			90
Earnings from equity interests	3			11			21			23
(Loss) earnings from continuing operations before taxes	(265		)	465			830			(308		)
Benefit (provision) for taxes	238			(13		)	(261		)	3,092
Net (loss) earnings from continuing operations	(27		)	452			569			2,784
Net loss from discontinued operations	—			(1		)	—			(119		)
Net (loss) earnings	$	(27	)	$	451		$	569		$	2,665
Net (loss) earnings per share:
Basic
Continuing operations	$	(0.02	)	$	0.30		$	0.42		$	1.79
Discontinued operations	—			—			—			(0.07		)
Total basic net earnings per share	$	(0.02	)	$	0.30		$	0.42		$	1.72
Diluted
Continuing operations	$	(0.02	)	$	0.29		$	0.41		$	1.76
Discontinued operations	—			—			—			(0.07		)
Total diluted net earnings per share	$	(0.02	)	$	0.29		$	0.41		$	1.69
Cash dividends declared per share	$	0.1125		$	0.1125		$	0.3375		$	0.3750
Weighted-average shares used to compute net earnings per share:
Basic	1,334			1,513			1,367			1,552
Diluted	1,334			1,531			1,380			1,578

The accompanying notes are an integral part of these Condensed

Consolidated Financial Statements.

6

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Net (loss) earnings	$	(27	)	$	451		$	569		$	2,665
Other comprehensive income before taxes:
Change in net unrealized gains (losses) on available-for-sale securities:
Net unrealized gains (losses) arising during the period	3			(2		)	8			(1		)
Gains reclassified into earnings	—			—			(3		)	(9		)
	3			(2		)	5			(10		)
Change in net unrealized gains (losses) on cash flow hedges:
Net unrealized gains arising during the period	63			149			225			50
Net (gains) losses reclassified into earnings	(58		)	(43		)	(259		)	78
	5			106			(34		)	128
Change in unrealized components of defined benefit plans:
Net unrealized losses arising during the period	(31		)	(25		)	(78		)	(23		)
Amortization of net actuarial loss and prior service benefit	54			47			161			143
Curtailments, settlements and other	5			9			12			11
	28			31			95			131
Change in cumulative translation adjustment	(8		)	(40		)	(2		)	(40		)
Other comprehensive income before taxes	28			95			64			209
Benefit (provision) for taxes	2			(19		)	4			(34		)
Other comprehensive income, net of taxes	30			76			68			175
Comprehensive income	$	3		$	527		$	637		$	2,840

The accompanying notes are an integral part of these Condensed

Consolidated Financial Statements.

7

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)

	As of
	July 31, 2019			October 31, 2018
	In millions, except par value
ASSETS
Current assets:
Cash and cash equivalents	$	3,693		$	4,880
Accounts receivable, net of allowance for doubtful accounts	2,965			3,263
Financing receivables	3,567			3,396
Inventory	2,216			2,447
Assets held for sale	52			6
Other current assets	2,624			3,280
Total current assets	15,117			17,272
Property, plant and equipment	6,000			6,138
Long-term financing receivables and other assets	9,092			11,359
Investments in equity interests	2,346			2,398
Goodwill	17,587			17,537
Intangible assets	618			789
Total assets	$	50,760		$	55,493
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable and short-term borrowings	$	2,207		$	2,005
Accounts payable	5,203			6,092
Employee compensation and benefits	1,454			1,412
Taxes on earnings	160			378
Deferred revenue	3,225			3,177
Accrued restructuring	223			294
Other accrued liabilities	4,686			3,840
Total current liabilities	17,158			17,198
Long-term debt	10,453			10,136
Other non-current liabilities	5,569			6,885
Commitments and contingencies
Stockholders' equity
HPE stockholders' equity:
Preferred stock, $0.01 par value (300 shares authorized; none issued and outstanding at July 31, 2019)	—			—
Common stock, $0.01 par value (9,600 shares authorized; 1,310 and 1,423 shares issued and outstanding at July 31, 2019 and October 31, 2018, respectively)	13			14
Additional paid-in capital	28,629			30,342
Accumulated deficit	(7,959		)	(5,899		)
Accumulated other comprehensive loss	(3,150		)	(3,218		)
Total HPE stockholders' equity	17,533			21,239
Non-controlling interests	47			35
Total stockholders' equity	17,580			21,274
Total liabilities and stockholders' equity	$	50,760		$	55,493

The accompanying notes are an integral part of these Condensed

Consolidated Financial Statements.

8

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

	Nine Months Ended July 31,
	2019			2018
	In millions
Cash flows from operating activities:
Net earnings	$	569		$	2,665
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	1,919			1,931
Stock-based compensation expense	207			242
Provision for inventory and doubtful accounts	181			137
Restructuring charges	146			399
Deferred taxes on earnings	885			(1,215		)
Earnings from equity interests	(21		)	(23		)
Dividends received from equity investees	71			47
Other, net	134			55
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	315			137
Financing receivables	(325		)	(228		)
Inventory	66			(545		)
Accounts payable	(826		)	72
Taxes on earnings	(1,121		)	(2,271		)
Restructuring	(261		)	(540		)
Other assets and liabilities	626			775
Net cash provided by operating activities	2,565			1,638
Cash flows from investing activities:
Investment in property, plant and equipment	(2,153		)	(2,129		)
Proceeds from sale of property, plant and equipment	448			561
Purchases of available-for-sale securities and other investments	(33		)	(32		)
Maturities and sales of available-for-sale securities and other investments	12			96
Financial collateral posted	(332		)	(1,396		)
Financial collateral returned	740			1,454
Payments made in connection with business acquisitions, net of cash acquired	(81		)	(207		)
Proceeds from business divestitures, net	—			13
Net cash used in investing activities	(1,399		)	(1,640		)
Cash flows from financing activities:
Short-term borrowings with original maturities less than 90 days, net	25			84
Proceeds from debt, net of issuance costs	1,010			894
Payment of debt	(872		)	(2,538		)
Net proceeds related to stock-based award activities	24			104
Repurchase of common stock	(1,965		)	(2,585		)
Net transfer of cash and cash equivalents to Everett	—			(41		)
Net transfer of cash and cash equivalents from Seattle	—			156
Cash dividends paid to non-controlling interests	—			(9		)
Cash dividends paid	(461		)	(406		)
Net cash used in financing activities	(2,239		)	(4,341		)
Decrease in cash, cash equivalents and restricted cash	(1,073		)	(4,343		)
Cash, cash equivalents and restricted cash at beginning of period	5,084			9,592
Cash, cash equivalents and restricted cash at end of period	$	4,011		$	5,249

The accompanying notes are an integral part of these Condensed

Consolidated Financial Statements.

9

Condensed Consolidated Statements of Stockholders' Equity (Unaudited)

	Common Stock
Three Months Ended July 31, 2019	Number of Shares		Par Value		Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Comprehensive Loss			Equity Attributable to the Company			Non- controlling Interests		Total Equity
	In millions, except number of shares in thousands
Balance at April 30, 2019	1,346,232		$	13	$	29,130		$	(7,765	)	$	(3,180	)	$	18,198		$	43	$	18,241
Net earnings								(27		)				(27		)	4		(23		)
Other comprehensive income											30			30					30
Comprehensive income														3			4		7
Issuance of common stock in connection with employee stock plans and other	2,737				16									16					16
Repurchases of common stock	(39,084	)			(575		)							(575		)			(575		)
Cash dividends declared								(146		)				(146		)			(146		)
Effects of adoption of accounting standard updates(1)								(21		)				(21		)			(21		)
Stock-based compensation expense					58									58					58
Balance at July 31, 2019	1,309,885		$	13	$	28,629		$	(7,959	)	$	(3,150	)	$	17,533		$	47	$	17,580

(1) For the three months ended July 31, 2019, includes an adjustment related to the adoption of the new revenue accounting standard, which the Company adopted in the first quarter of fiscal 2019.

10

	Common Stock
Nine Months Ended July 31, 2019	Number of Shares		Par Value			Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Comprehensive Loss			Equity Attributable to the Company			Non- controlling Interests		Total Equity
	In millions, except number of shares in thousands
Balance at October 31, 2018	1,423,303		$	14		$	30,342		$	(5,899	)	$	(3,218	)	$	21,239		$	35	$	21,274
Net earnings									569						569			12		581
Other comprehensive income												68			68					68
Comprehensive income															637			12		649
Issuance of common stock in connection with employee stock plans and other	15,404					23									23					23
Repurchases of common stock	(128,822	)	(1		)	(1,945		)							(1,946		)			(1,946		)
Cash dividends declared									(446		)				(446		)			(446		)
Effects of adoption of accounting standard updates (1)									(2,183		)				(2,183		)			(2,183		)
Stock-based compensation expense						209									209					209
Balance at July 31, 2019	1,309,885		$	13		$	28,629		$	(7,959	)	$	(3,150	)	$	17,533		$	47	$	17,580

(1) For the nine months ended July 31, 2019, includes $2.3 billion related to an addition to accumulated deficit as a result of the adoption of an accounting standard update for Income Taxes and $122 million related to a reduction to accumulated deficit as a result of the adoption of the new revenue accounting standard.

	Common Stock
Three Months Ended July 31, 2018	Number of Shares		Par Value			Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Comprehensive Loss			Equity Attributable to the Company			Non- controlling Interests		Total Equity
	In millions, except number of shares in thousands
Balance at April 30, 2018	1,527,381		$	15		$	32,205		$	(5,306	)	$	(2,982	)	$	23,932		$	34	$	23,966
Activity related to separation and merger transactions									(1		)				(1		)			(1		)
Net earnings									451						451			2		453
Other comprehensive income												76			76					76
Comprehensive income															527			2		529
Issuance of common stock in connection with employee stock plans and other	13,711		1			10									11					11
Repurchases of common stock	(58,655	)	(1		)	(934		)							(935		)			(935		)
Cash dividends declared									(165		)				(165		)			(165		)
Stock-based compensation expense						57									57					57
Balance at July 31, 2018	1,482,437		$	15		$	31,338		$	(5,021	)	$	(2,906	)	$	23,426		$	36	$	23,462

11

	Common Stock
Nine Months Ended July 31, 2018	Number of Shares		Par Value			Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Comprehensive Loss			Equity Attributable to the Company			Non- controlling Interests			Total Equity
	In millions, except number of shares in thousands
Balance at October 31, 2017	1,595,161		$	16		$	33,583		$	(7,238	)	$	(2,895	)	$	23,466		$	39		$	23,505
Activity related to separation and merger transactions									125			(186		)	(61		)				(61		)
Net earnings									2,665						2,665			(3		)	2,662
Other comprehensive income												175			175						175
Comprehensive income															2,840			(3		)	2,837
Issuance of common stock in connection with employee stock plans and other	47,491		1			73									74						74
Repurchases of common stock	(160,215	)	(2		)	(2,583		)							(2,585		)				(2,585		)
Cash dividends declared									(573		)				(573		)				(573		)
Stock-based compensation expense						265									265						265
Balance at July 31, 2018	1,482,437		$	15		$	31,338		$	(5,021	)	$	(2,906	)	$	23,426		$	36		$	23,462

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

12

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1: Overview and Summary of Significant Accounting Policies

Background

Hewlett Packard Enterprise Company ("Hewlett Packard Enterprise", "HPE", or the "Company") is a global technology leader focused on developing intelligent solutions that allow customers to capture, analyze and act upon data seamlessly from edge to cloud. Hewlett Packard Enterprise enables customers to accelerate business outcomes by driving new business models, creating new customer and employee experiences, and increasing operational efficiency today and into the future. Hewlett Packard Enterprise's customers range from small- and medium-sized businesses ("SMBs") to large global enterprises.

On November 1, 2015, the Company became an independent publicly-traded company through a pro rata distribution by HP Inc. ("former Parent" or "HPI"), formerly known as Hewlett-Packard Company, of 100% of the outstanding shares of Hewlett Packard Enterprise Company to HP Inc.'s stockholders (the "Separation").

Discontinued Operations

On April 1, 2017, HPE completed the separation and merger of its Enterprise Services business with Computer Sciences Corporation ("CSC") (collectively, the "Everett Transaction"). HPE transferred its Enterprise Services business to Everett SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Everett") and distributed all of the shares of Everett to HPE stockholders. Following the distribution, New Everett Merger Sub Inc., a wholly-owned subsidiary of Everett, merged with and into CSC and Everett changed its name to DXC Technology Company ("DXC").

On September 1, 2017, the Company completed the separation and merger of its Software business segment with Micro Focus International plc (“Micro Focus”) (collectively, the “Seattle Transaction”). HPE transferred its Software business segment to Seattle SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Seattle"), and distributed all of the shares of Seattle to HPE stockholders. Following the share distribution, Seattle MergerSub, Inc., an indirect, wholly-owned subsidiary of Micro Focus, merged with and into Seattle.

The historical financial results of Everett and Seattle are reported as Net loss from discontinued operations in the Condensed Consolidated Statements of Earnings. For the three and nine months ended July 31, 2018, this amount totaled $1 million and $119 million, respectively which primarily consisted of tax indemnification adjustments and separation costs.

Acquisition

On May 16, 2019, the Company entered into a definitive agreement to acquire Cray Inc. ("Cray"), a global supercomputer leader, for $35 per share in cash, in a transaction valued at approximately $1.3 billion, net of cash acquired. The transaction is expected to close by the fourth quarter of HPE’s fiscal year 2019, subject to regulatory approvals and other customary closing conditions. Cray's results of operations will be included within the Hybrid IT segment.

Arbitration Settlement

On August 15, 2019, an arbitration panel awarded DXC $666 million as well as post-award interest at 3% per annum compounding quarterly until payment. The panel award was made pursuant to a binding arbitration arising from a previously disclosed dispute under the separation and distribution agreement between DXC and HPE. As of July 31, 2019, the Company had recorded a charge representing the full award settlement in its condensed consolidated financial statements. For more information, see Note 15, "Litigation and Contingencies".

Basis of Presentation

These Condensed Consolidated Financial Statements of the Company were prepared in accordance with United States ("U.S.") Generally Accepted Accounting Principles ("GAAP"). In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements of Hewlett Packard Enterprise contain all adjustments, including normal recurring adjustments, necessary to present fairly the Company's financial position as of July 31, 2019 and October 31, 2018, its results of operations for the three and nine months ended July 31, 2019 and 2018, its cash flows for the nine months ended July 31, 2019 and 2018, and its statements of stockholders equity for the three and nine months ended July 31, 2019 and 2018.

The results of operations for the three and nine months ended July 31, 2019 and its cash flows for the nine months ended July 31, 2019 are not necessarily indicative of the results to be expected for the full year. The information included in this Quarterly

13

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018, including "Management's Discussion and Analysis of Financial Condition and Results of Operations", "Quantitative and Qualitative Disclosures About Market Risk" and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, included therein.

Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and all subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary. All intercompany transactions and accounts within the consolidated businesses of the Company have been eliminated.

The Company accounts for investments in companies over which it has the ability to exercise significant influence but does not hold a controlling interest under the equity method of accounting, and the Company records its proportionate share of income or losses in Earnings (loss) from equity interests in the Condensed Consolidated Statements of Earnings.

Non-controlling interests are presented as a separate component within Total stockholders' equity in the Condensed Consolidated Balance Sheets. Net earnings attributable to non-controlling interests are recorded within Interest and other, net in the Condensed Consolidated Statements of Earnings and are not presented separately, as they were not material for any period presented.

Segment Realignment and Reclassifications

See Note 2, "Segment Information", for a discussion of the Company's segment realignment.

Use of Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company's Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates.

Revenue Recognition

General

As a result of adopting the new revenue recognition standard ("ASC 606"), the Company now accounts for a contract with a customer when both parties have provided written approval and are committed to perform, each party’s rights including payment terms are identified, the contract has commercial substance, and collection of consideration is probable.

The Company enters into contracts with customers that may include combinations of products and services, resulting in arrangements containing multiple performance obligations for hardware and software products and/or various services. The Company determines whether each product or service is distinct in order to identify the performance obligations in the contract and allocate the contract transaction price among the distinct performance obligations. Arrangements are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether the commitment to transfer the product or service to the customer is separately identifiable from other obligations in the contract. The Company classifies its hardware, perpetual software licenses, and software-as-a-service ("SaaS") as distinct performance obligations. Term software licenses represent multiple obligations, which include software licenses and software maintenance. In transactions where the Company delivers hardware or software, it is typically the principal and records revenue and costs of goods sold on a gross basis.

Revenue is recognized when, or as, control of promised products or services is transferred to the customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those products or services. Variable consideration offered in contracts with customers, partners and distributors may include rebates, volume-based discounts, cooperative marketing, price protection, and other incentive programs. Variable consideration is estimated at contract inception and updated at the end of each reporting period as additional information becomes available and recognized only to the extent that it is probable that a significant reversal of any incremental revenue will not occur.

Transfer of control occurs once the customer has the contractual right to use the product, generally upon shipment or once delivery and risk of loss has transferred to the customer. Transfer of control can also occur over time for maintenance and services as the customer receives the benefit over the contract term. The Company's hardware and perpetual software licenses are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses include multiple performance obligations where the term licenses are recognized upfront upon transfer of control, with the associated software

14

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

maintenance revenue recognized ratably over the contract term as services and software updates are provided. SaaS arrangements have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term as the customer consumes the services. On its product sales, the Company records consideration from shipping and handling on a gross basis within net product sales. Revenue is recorded net of any associated sales taxes.

Significant Judgments

The Company allocates the transaction price for the contract among the performance obligations on a relative standalone selling price basis. The standalone selling price ("SSP") is the price at which an entity would sell a promised product or service separately to a customer. The Company establishes SSP for most of its products and services based on the observable price of the products or services when sold separately in similar circumstances to similar customers. When the SSP is not directly observable, the Company estimates SSP based on management judgment by considering available data such as internal margin objectives, pricing strategies, market/competitive conditions, historical profitability data, as well as other observable inputs. The Company establishes SSP ranges for its products and services and reassesses them periodically.

Judgment is applied in determining the transaction price as the Company may be required to estimate variable consideration when determining the amount of revenue to recognize. Variable consideration may include various rebates, volume-based discounts, cooperative marketing, price protection, and other incentive programs that are offered to customers, partners and distributors. When determining the amount of revenue to recognize, the Company estimates the expected usage of these programs, applying the expected value or most likely estimate and updates the estimate at each reporting period as actual utilization becomes available. The Company also considers the customers' right of return in determining the transaction price, where applicable.

Contract Balances

Accounts receivable and contract assets

A receivable is a right to consideration in exchange for products or services the Company has transferred to a customer that is unconditional. A contract asset is a right to consideration in exchange for products or services transferred to a customer that is conditional on something other than the passage of time. A receivable is recorded when the right to consideration becomes unconditional.

The Company’s contract assets include unbilled receivables which are recorded when the Company recognizes revenue in advance of billings. Unbilled receivables generally relate to services contracts where a service has been performed and control has transferred, but invoicing to the customer is subject to future milestone billings or other contractual payment schedules. The Company classifies unbilled receivables as Accounts receivable.

Contract liabilities

A contract liability is an obligation to transfer products or services to a customer for which the entity has received consideration, or the amount is due, from the customer. The Company’s contract liabilities primarily consist of deferred revenue. Deferred revenue is recorded when amounts invoiced to customers are in excess of revenue that can be recognized because performance obligations have not been satisfied and control of the promised products or services has not transferred to the customer. Deferred revenue largely represents amounts invoiced in advance for product (hardware/software) support contracts, consulting projects and product sales where revenue cannot be recognized yet.

Costs to obtain a contract with a customer

The Company capitalizes the incremental costs of obtaining a contract with a customer, primarily sales commissions, if the Company expects to recover those costs. The Company has elected, as a practical expedient, to expense the costs of obtaining a contract as incurred for contracts with terms of one year or less. The typical amortization periods used range from three to six years. The Company periodically reviews the capitalized sales commission costs for possible impairment losses. Capitalized sales commission costs are included in Other current assets and Long-term financing receivables and other assets, and the related amortization expense is included in Selling, general and administrative expense.

Recent Tax Legislation

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act included significant changes to the U.S. corporate income tax structure, including a federal corporate rate reduction from 35% to 21% effective January 1, 2018, limitations on the deductibility of interest expense and executive compensation, creation of new minimum taxes such as the Base Erosion Anti-abuse Tax (“BEAT”) and the Global Intangible Low Taxed Income (“GILTI”) tax and the transition of U.S.

15

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

international taxation from a worldwide tax system to a modified territorial tax system, which resulted in a one-time U.S. tax liability on those earnings which had not previously been repatriated to the U.S. (the “Transition Tax”).

In December 2017, the U.S. Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act ("SAB 118"), which allowed the Company to record provisional amounts during a measurement period not to extend beyond one year of the enactment date, which for the Company ended in the first quarter of fiscal 2019. In accordance with SAB 118, the accounting for the tax effects of the Tax Act was completed based on currently available legislative updates relating to the Tax Act. The Company has elected to treat taxes due on future GILTI inclusions in U.S. taxable income as a current period expense when incurred. For further details, see Note 6, "Taxes on Earnings".

Recently Adopted Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for retirement benefits. The amendments require the presentation of the service cost component of net periodic benefit cost in the same income statement line items as other employee compensation costs, unless eligible for capitalization. The other components of net periodic benefit costs will be presented separately from the service cost as non-operating costs. Effective at the beginning of the first quarter of fiscal 2019, in connection with the adoption of the accounting standards update for retirement benefits, the Company reflected these changes retrospectively by transferring its non-service net periodic benefit (credit) cost from operating expense to Other (income) and expense in its Condensed Consolidated Statements of Earnings. The net periodic benefit (credit) cost transferred to Other (income) and expense during the three and nine months ended July 31, 2018 were as follows. Refer to Note 5, “Retirement and Post-Retirement Benefit Plans” for additional information.

	Three Months Ended July 31, 2018			Nine Months Ended July 31, 2018
	In millions
Cost of products and services	$	(14	)	$	(42	)
Research and development	(1		)	(3		)
Selling, general and administrative	(19		)	(53		)
Restructuring charges and transformation costs	8			8
	$	(26	)	$	(90	)

In November 2016, the FASB amended the existing accounting standards for the classification and presentation of restricted cash in the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. As a result of adopting this accounting standards update, for the nine months ended July 31, 2018, the Company included $43 million of restricted cash movement during the period, which was previously reported within cash used in investing activities, and is now reported within Decrease in cash, cash equivalents and restricted cash in the Company's Condensed Consolidated Statement of Cash Flows.

In October 2016, the FASB amended the existing accounting standards for income taxes. The amendments require the recognition of the income tax consequences for intra-entity transfers of assets other than inventory when the transfer occurs. Prior to the amendments, current and deferred income taxes for intra-entity asset transfers were not recognized until the asset was sold to an outside party or amortized over time. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the modified retrospective method. The Company recognized $2.3 billion of income taxes as an adjustment to retained earnings in the first nine months of fiscal 2019, which was previously reported as prepaid income taxes and deferred tax assets within Corporate and unallocated assets in the Company's allocation of segment assets.

In August 2016, the FASB amended the existing accounting standards for the statement of cash flows. The amendments provide guidance on eight classification issues related to the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. For issues that are impracticable to apply retrospectively, the amendments may be applied prospectively as of the earliest date practicable. The application of this accounting standards update did not have an impact on the Condensed Consolidated Statements of Cash Flows.

In January 2016, the FASB issued guidance that requires equity investments with readily determinable fair values (other than those accounted for under the equity method or those that result in consolidation of the investee) to be measured at fair value and recognize any changes in fair value in net income. For equity investments without readily determinable fair values, the Company has elected to apply the measurement alternative, under which investments are measured at cost, less impairment, and adjusted

16

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

for qualifying observable price changes on a prospective basis. The Company adopted the guidance effective November 1, 2018, and there was no impact on the Condensed Consolidated Financial Statements upon adoption.

In May 2014, the FASB amended the existing accounting standards for revenue recognition. The Company adopted the new revenue standard in the first quarter of fiscal 2019 using the modified retrospective method of transition applied to contracts that were not completed as of November 1, 2018. Results and related disclosures for the reporting periods beginning after November 1, 2018 are presented under the new revenue standard, while comparative prior period results and related disclosures are not adjusted and continue to be reported in accordance with the historic accounting standard. Refer to the Revenue Recognition section above for accounting policy updates upon the adoption of the new revenue standard, and Note 7, "Balance Sheet Details" for further discussion on the impact of adoption. For disaggregation of revenue, see Note 2, "Segment Information".

The following table summarizes the effects of adopting the new revenue standard at November 1, 2018 on the Condensed Consolidated Balance Sheets as an adjustment to the opening balance:

	Historical Accounting Method			Effect of Adoption			As Adjusted
	In millions
Assets
Accounts receivable	$	3,263		$	38		$	3,301
Inventory	2,447			(14)			2,433
Other current assets	3,280			50			3,330
Long-term financing receivables and other assets	11,359			44			11,403
Subtotal assets	$	20,349		$	118		$	20,467
Liabilities
Taxes on earnings	$	378		$	10		$	388
Deferred revenue	3,177			(36)			3,141
Other accrued liabilities(1)	3,840			52			3,892
Other non-current liabilities	6,885			(30)			6,855
Subtotal liabilities	$	14,280		$	(4	)	$	14,276
Stockholders' equity
Accumulated deficit(1)	$	(5,899	)	$	122		$	(5,777	)
Subtotal stockholders' equity	$	(5,899	)	$	122		$	(5,777	)
Subtotal liabilities and stockholders' equity	$	8,381		$	118		$	8,499

(1) Includes an adjustment related to the adoption of ASC 606 that was recorded during the third quarter of fiscal 2019.

The application of ASC 606 increased the Company's total net revenue by $23 million and $41 million for the three and nine months ended July 31, 2019, respectively, and did not have a material impact to the Company's cost of sales or operating expenses for the three or nine months ended July 31, 2019. As of July 31, 2019, the balance sheet changes attributable to the impact of ASC 606 were immaterial.

Recently Enacted Accounting Pronouncements

In August 2018, the FASB issued guidance on a customer's accounting for implementation costs incurred in cloud-computing arrangements that are hosted by a vendor. Certain types of implementation costs should be capitalized and amortized over the term of the hosting arrangement. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In August 2018, the FASB issued guidance which changes the disclosure requirements for fair value measurements and defined benefit plans. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. As the guidance represents a change to disclosure only, the Company does not expect the guidance to have a material impact on its Condensed Consolidated Financial Statements.

17

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

In February 2018, the FASB issued guidance that allows companies to reclassify stranded tax effects resulting from the Tax Act, from accumulated other comprehensive income to retained earnings. The guidance also requires certain new disclosures regardless of the election.  The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In August 2017, the FASB amended the existing accounting standards for hedge accounting. The amendments expand an entity’s ability to hedge non-financial and financial risk components and reduce complexity in fair value hedges of interest rate risk. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also simplifies certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. In April 2019, the FASB issued certain clarifications to address partial term fair value hedges, fair value hedge basis adjustments and certain transition requirements. The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In June 2016, the FASB amended the existing accounting standards for the measurement of credit losses. The amendments require an entity to estimate its lifetime expected credit loss for most financial instruments, including trade and lease receivables, and record an allowance for the portion of the amortized cost the entity does not expect to collect. The estimate of expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments. In April 2019, the FASB further clarified the scope of the credit losses standard and addressed issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayment. In May 2019, the FASB issued further guidance to provide entities with an option to irrevocably elect the fair value option applied on an instrument-by-instrument basis for eligible financial instruments. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted beginning in fiscal 2020. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

The FASB issued guidance in February 2016, with amendments in 2018 and 2019, which changes the accounting standards for leases. The amendments require lessees to record, at lease inception, a lease liability for the obligation to make lease payments and a right-of-use ("ROU") asset for the right to use the underlying asset for the lease term on their balance sheets. Lessees may elect to not recognize lease liabilities and ROU assets for most leases with terms of 12 months or less. The lease liability is measured at the present value of the lease payments over the lease term. The ROU asset will be based on the liability, adjusted for lease prepayments, lease incentives received, and the lessee's initial direct costs. For finance leases, lease expense will be the sum of interest on the lease obligation and amortization of the ROU asset, resulting in a front-loaded expense pattern. For operating leases, lease expense will generally be recognized on a straight-line basis over the lease term. The amended lessor accounting model is similar to the current model, updated to align with certain changes to the lessee model and the new revenue standard. The current sale-leaseback guidance, including guidance applicable to real estate, is also replaced with a new model for both lessees and lessors. The Company plans to adopt the guidance in the first quarter of fiscal 2020, beginning November 1, 2019, using the transition method whereby prior comparative periods will not be retrospectively presented in the Consolidated Financial Statements. The Company is currently evaluating the impact of these amendments and other available practical expedients on its Condensed Consolidated Financial Statements.

In April 2019, the FASB amended its standards on recognizing and measuring financial instruments to address the scope of the guidance, the requirement for remeasurement when using the measurement alternative and certain disclosure requirements. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

There have been no other significant changes to the Company's accounting policies or recently adopted or enacted accounting pronouncements disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

18

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 2: Segment Information

Hewlett Packard Enterprise's operations are organized into four segments for financial reporting purposes: Hybrid IT, Intelligent Edge, Financial Services ("FS"), and Corporate Investments. Hewlett Packard Enterprise's organizational structure is based on a number of factors that the Chief Operating Decision Maker ("CODM"), who is the Chief Executive Officer ("CEO"), uses to evaluate, view and run its business operations, which include, but are not limited to, customer base and homogeneity of products and technology. The segments are based on this organizational structure and information reviewed by Hewlett Packard Enterprise's management to evaluate segment results.

A summary description of each segment follows.

Hybrid IT provides a broad portfolio of services-led and software-enabled infrastructure and solutions including secure, software-defined servers, and storage and HPE Pointnext services, thereby combining HPE's hardware, software and services capabilities to make Hybrid IT simple for its customers. Described below are the business unit capabilities within Hybrid IT.

• Hybrid IT Product includes Compute and Storage.

◦ Compute. To address the full array of our customers' computing needs, HPE's compute portfolio offers both Industry Standard Servers ("ISS"), which are general purpose servers for multi-workload computing, as well as Mission-Critical Servers ("MCS"), which are servers optimized for particular workloads. HPE's general purpose servers include HPE ProLiant, secure and versatile rack and tower servers; HPE BladeSystem, a modular infrastructure that converges server, storage and networking; and HPE Synergy, a composable infrastructure for traditional and cloud-native applications. The Company's workload optimized server portfolio includes HPE Apollo for high performance computing and artificial intelligence, HPE Cloudline for cloud data centers, HPE Edgeline for computing at the network edge, HPE Integrity for mission-critical applications, and HPE SimpliVity, a hyperconverged infrastructure for virtualized workloads.

◦ Storage. With storage offerings that are AI-driven and built for cloud environments, HPE provides the right workload optimized destinations for data. Powered by HPE InfoSight advanced analytics and machine learning and HPE Cloud Volumes data mobility, HPE delivers intelligent storage for hybrid cloud environments so that customers can unlock data's full potential and derive business insights. Key solutions include HPE 3PAR Storage and HPE Nimble Storage all-flash arrays for mission critical workloads and general purpose workloads, respectively, and big data solutions running on HPE Apollo Servers. Storage also provides comprehensive data protection with HPE StoreOnce and HPE Recovery Manager Central, solutions for secondary workloads and traditional tape, storage networking and disk products, such as HPE MSA and HPE XP.

• HPE Pointnext creates preferred IT experiences that power the digital business. The HPE Pointnext team and the Company's extensive partner network provide value across the IT life cycle delivering advice, transformation projects, professional services, support services and operational services for Hybrid IT. HPE Pointnext is also a provider of on-premises flexible consumption models, such as HPE GreenLake, that enable IT agility, simplify operations and align cost to business value. HPE Pointnext offerings include Operational Services, and Advisory and Professional Services.

The Intelligent Edge business is comprised of enterprise networking and security solutions for businesses of any size, offering secure connectivity for campus and branch environments, operating under the Aruba brand. The primary business drivers for Intelligent Edge solutions are mobility and the Internet of Things ("IoT").

• HPE Aruba Product includes wired and wireless local area network hardware products such as Wi-Fi access points, switches, routers, sensors, and software products that include network management, network access control, analytics and assurance, and location services software.

• HPE Aruba Services offers professional and support services for the Intelligent Edge portfolio of products.

Financial Services provides flexible investment solutions, such as leasing, financing, IT consumption, and utility programs and asset management services, for customers that facilitate unique technology deployment models and the acquisition of complete IT solutions, including hardware, software and services from Hewlett Packard Enterprise and others. In order to provide flexible services and capabilities that support the entire IT life cycle, FS partners with customers globally to help build investment strategies that enhance their business agility and support their business transformation. FS offers a wide selection of investment solution capabilities for large enterprise customers and channel partners, along with an array of financial options to SMBs and educational and governmental entities.

19

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Corporate Investments includes Hewlett Packard Labs, Communications and Media Solutions ("CMS"), and certain business incubation projects.

Segment Policy

There have been no significant changes to the Company's segment accounting policies disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018, except as described in the 'Segment Realignment' section below.

Hewlett Packard Enterprise does not allocate to its segments certain operating expenses, which it manages at the corporate level. These unallocated costs include certain corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, acquisition, disposition and other related charges, transformation costs, amortization of intangible assets, restructuring charges, disaster charges and separation costs.

Segment Realignment

Effective at the beginning of the first quarter of fiscal 2019, the Company implemented organizational changes to align its segment financial reporting more closely with its current business structure. These organizational changes primarily include: (i) the transfer of the data center networking ("DC Networking") business, which was previously reported within the Hybrid IT Product business unit in the Hybrid IT segment, to the HPE Aruba Product and HPE Aruba Services business units within the Intelligent Edge segment; (ii) the transfer of the edge compute business, which was previously reported within the HPE Aruba Product business unit in the Intelligent Edge segment, to the Hybrid IT Product business unit within the Hybrid IT segment; and (iii) the transfer of the CMS business, which was previously reported within the HPE Pointnext business unit in the Hybrid IT segment, to the Corporate Investments segment.

The Company reflected these changes to its segment information retrospectively to the earliest period presented, which primarily resulted in the transfer of net revenue and operating profit for each of the businesses as described above.

These changes had no impact on Hewlett Packard Enterprise's previously reported consolidated net revenue, earnings from operations, net earnings or net earnings per share ("EPS").

20

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Segment Operating Results

	Hybrid IT		Intelligent Edge		Financial Services		Corporate Investments			Total
	In millions
Three months ended July 31, 2019
Net revenue	$	5,444	$	758	$	885	$	130		$	7,217
Intersegment net revenue and other	105		4		3		—			112
Total segment net revenue	$	5,549	$	762	$	888	$	130		$	7,329
Segment earnings (loss) from operations	$	704	$	37	$	77	$	(25	)	$	793
Three months ended July 31, 2018
Net revenue	$	5,925	$	783	$	922	$	134		$	7,764
Intersegment net revenue and other	184		2		6		—			192
Total segment net revenue	$	6,109	$	785	$	928	$	134		$	7,956
Segment earnings (loss) from operations	$	624	$	101	$	72	$	(25	)	$	772
Nine months ended July 31, 2019
Net revenue	$	16,745	$	2,107	$	2,695	$	373		$	21,920
Intersegment net revenue and other	410		7		8		—			425
Total segment net revenue	$	17,155	$	2,114	$	2,703	$	373		$	22,345
Segment earnings (loss) from operations	$	2,024	$	66	$	231	$	(82	)	$	2,239
Nine months ended July 31, 2018
Net revenue	$	17,649	$	2,132	$	2,721	$	404		$	22,906
Intersegment net revenue and other	511		15		11		—			537
Total segment net revenue	$	18,160	$	2,147	$	2,732	$	404		$	23,443
Segment earnings (loss) from operations	$	1,787	$	191	$	215	$	(79	)	$	2,114

21

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

The reconciliation of segment operating results to Hewlett Packard Enterprise condensed consolidated results was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Net Revenue:
Total segments	$	7,329		$	7,956		$	22,345		$	23,443
Eliminations of intersegment net revenue and other	(112		)	(192		)	(425		)	(537		)
Total Hewlett Packard Enterprise condensed consolidated net revenue	$	7,217		$	7,764		$	21,920		$	22,906
Earnings before taxes:
Total segment earnings from operations	$	793		$	772		$	2,239		$	2,114
Unallocated corporate costs and eliminations	(65		)	(49		)	(179		)	(169		)
Unallocated stock-based compensation expense	(13		)	(14		)	(42		)	(64		)
Amortization of intangible assets	(58		)	(72		)	(199		)	(222		)
Restructuring charges	—			1			—			(14		)
Transformation costs	(170		)	(126		)	(302		)	(491		)
Disaster charges	—			—			7			—
Acquisition, disposition and other related charges	(563		)	(24		)	(710		)	(70		)
Separation costs	—			2			—			—
Interest and other, net	(70		)	(64		)	(139		)	(163		)
Tax indemnification adjustments	(134		)	2			89			(1,342		)
Non-service net periodic benefit credit	12			26			45			90
Earnings from equity interests	3			11			21			23
Total Hewlett Packard Enterprise condensed consolidated (loss) earnings from continuing operations before taxes	$	(265	)	$	465		$	830		$	(308	)

22

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Net revenue by segment and business unit was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Hybrid IT
Hybrid IT Product
Compute	$	3,151		$	3,569		$	9,646		$	10,350
Storage	844			887			2,761			2,747
Total Hybrid IT Product	3,995			4,456			12,407			13,097
HPE Pointnext	1,554			1,653			4,748			5,063
Total Hybrid IT	5,549			6,109			17,155			18,160
Intelligent Edge
HPE Aruba Product	668			703			1,842			1,914
HPE Aruba Services	94			82			272			233
Total Intelligent Edge	762			785			2,114			2,147
Financial Services	888			928			2,703			2,732
Corporate Investments	130			134			373			404
Total segment net revenue	7,329			7,956			22,345			23,443
Eliminations of intersegment net revenue and other	(112		)	(192		)	(425		)	(537		)
Total Hewlett Packard Enterprise condensed consolidated net revenue(1)	$	7,217		$	7,764		$	21,920		$	22,906

(1) Revenue from leasing arrangements within Financial Services and Eliminations of intersegment net revenue and other are not subject to the new revenue standard.

The Company’s net revenue by geographic regions was as follows:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2019		2018		2019		2018
	In millions
Americas	$	2,910	$	3,153	$	8,582	$	9,053
Europe, Middle East and Africa	2,614		2,783		8,251		8,407
Asia Pacific and Japan	1,693		1,828		5,087		5,446
Total Hewlett Packard Enterprise condensed consolidated net revenue(1)	$	7,217	$	7,764	$	21,920	$	22,906

(1) Revenue from leasing arrangements within Financial Services and Eliminations of intersegment net revenue and other are not subject to the new revenue standard.

Note 3: Restructuring

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, 2018, the 2015 and 2012 Plans were complete.

23

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Restructuring Activity

In connection with the 2015 and 2012 Plans, a restructuring credit of $1 million and restructuring charges of $14 million were recorded by the Company for the three and nine months ended July 31, 2018, respectively, based on restructuring activities impacting the Company's employees and infrastructure. For details on restructuring charges related to HPE Next, see Note 4, "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, 2018	$	62		$	10		$	11		$	1	$	84
Cash payments	(25		)	(2		)	(5		)	—		(32		)
Liability as of July 31, 2019	$	37		$	8		$	6		$	1	$	52
Total costs incurred to date, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242
Total costs expected to be incurred, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242

The current restructuring liabilities related to the plans in the table above, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets at July 31, 2019 and October 31, 2018, were $33 million and $53 million, respectively. The non-current restructuring liabilities related to the plans in the table above, reported in Other non-current liabilities in the Condensed Consolidated Balance Sheets at July 31, 2019 and October 31, 2018, were $19 million and $31 million, respectively.

Note 4: 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.

In association with the HPE Next initiative, during the three and nine months ended July 31, 2019, the Company incurred $172 million and $310 million of net charges, of which $170 million and $302 million were recorded within Transformation costs, and $2 million and $8 million were recorded within Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings, respectively. During the three and nine months ended July 31, 2018, the Company incurred $131 million and $499 million of net charges, of which $126 million and $491 million were recorded within Transformation costs, and $5 million and $8 million were recorded within Non-service net periodic benefit credit, in the Condensed Consolidated Statements of Earnings, respectively.

	Three months ended July 31,					Nine months ended July 31,
	2019		2018			2019		2018
	In millions
Program management(1)	$	3	$	28		$	23	$	82
IT costs	41		38			94		107
Restructuring charges(2)	92		129			143		385
Loss (gain) on real estate sales	8		(77		)	1		(114		)
Impairment on real estate assets	19		—			19		—
Other(3)	9		13			30		39
Total	$	172	$	131		$	310	$	499

24

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

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

(2) For the three and nine months ended July 31, 2019 and 2018, a portion of these costs were recorded in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings as described above.

(3) Primarily consists of site relocation costs in connection with 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") and on September 20, 2018, the Company's Board of Directors approved a revision to that restructuring plan. As a result of the revision to the plan, cost amounts and total headcount exits were revised and the completion of the workforce reductions was extended to fiscal 2020. The changes to the workforce will vary by country, based on business needs, local legal requirements and consultations with employee work councils and other employee representatives, as appropriate.

	Employee Severance			Infrastructure and other
	In millions
Liability as of October 31, 2018	$	291		$	33
Charges	115			28
Cash payments	(209		)	(20		)
Non-cash items	(9		)	(9		)
Liability as of July 31, 2019	$	188		$	32
Total costs incurred to date, as of July 31, 2019	$	881		$	89
Total costs expected to be incurred, as of July 31, 2019	$	1,200		$	180

As of July 31, 2019 and October 31, 2018, the current restructuring liability related to the HPE Next Plan, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets, was $190 million and $241 million, respectively. The non-current restructuring liability related to the HPE Next Plan, reported in Other non-current liabilities in the Condensed Consolidated Balance Sheets as of July 31, 2019 and October 31, 2018 was $30 million and $83 million, respectively.

Note 5: Retirement and Post-Retirement Benefit Plans

The Company's net pension benefit cost for defined benefit plans recognized in the Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018, was as follows:

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Service cost	$	21		$	26		$	63		$	79
Interest cost(1)	54			55			165			168
Expected return on plan assets(1)	(126		)	(139		)	(386		)	(423		)
Amortization and deferrals(1):
Actuarial loss	59			52			176			158
Prior service benefit	(4		)	(4		)	(12		)	(12		)
Net periodic benefit cost (credit)	4			(10		)	6			(30		)
Settlement loss(1)	4			9			10			11
Special termination benefits(1)	1			1			2			5
Net benefit cost (credit)	$	9		$	—		$	18		$	(14	)

(1) These non-service components of net periodic benefit cost were included in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings.

25

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Net benefit cost for the Company's post-retirement benefit plans was not material for the three and nine months ended July 31, 2019 and 2018.

Note 6: Taxes on Earnings

Provision for Taxes

The Company's effective tax rate was 89.8% and 2.8% for the three months ended July 31, 2019 and 2018, respectively, and 31.4% and 1,003.9% for the nine months ended July 31, 2019 and 2018, respectively. The effective tax rates for the three and nine months ended July 31, 2019 and 2018 were significantly impacted by the Tax Act and the settlement of certain pre-Separation tax liabilities of HP Inc.

For the three and nine months ended July 31, 2019, the Company recorded $303 million of net income tax benefits and $80 million of net income tax charges, respectively, related to various items discrete to the period. For the three months ended July 31, 2019, this amount primarily included $308 million of income tax benefits predominantly related to the change in pre-Separation tax liabilities as a result of the effective settlement of the U.S. federal income tax audit of fiscal years 2013 through 2015 for HP Inc. for which the Company shares joint and several liability and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement and $18 million of net income tax benefits on transformation costs, and acquisition, disposition and other related charges, partially offset by $19 million of income tax charges related to uncertain tax reserves pertaining to separation activities and $14 million of income tax charges related to changes in U.S. state valuation allowances as a result of impacts of the Tax Act. For the nine months ended July 31, 2019, the amount primarily included $365 million of income tax charges related to changes in U.S. federal and state valuation allowances as a result of impacts of the Tax Act, $40 million of income tax charges related to future withholding tax costs on distributions of earnings, and $19 million of income tax charges related to uncertain tax reserves pertaining to separation activities, partially offset by $264 million of income tax benefits related to the change in pre-Separation tax liabilities for which the Company shares joint and several liability with HP Inc. and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement, and $75 million of income tax benefits on transformation costs, and acquisition, disposition and other related charges.

For the three and nine months ended July 31, 2018, the Company recorded $68 million and $3.3 billion of net income tax benefits, respectively, related to various items discrete to the period. For the three months ended July 31, 2018, this amount primarily included $38 million of income tax benefits from the release of non-U.S. valuation allowances on deferred tax assets following changes in foreign tax laws, $33 million of net income tax benefits for impacts related to U.S. tax reform and $26 million of net excess tax benefits related to stock-based compensation, partially offset by $7 million of income tax charges related to tax indemnification with HP Inc. For the nine months ended July 31, 2018, this amount primarily included $2.0 billion of income tax benefits for the effects of the settlement of certain pre-Separation Hewlett-Packard Company income tax liabilities, $713 million of net income tax benefits for impacts related to U.S. tax reform, $228 million of income tax benefits from foreign tax credits and from the release of non-U.S. valuation allowances on deferred tax assets and liabilities established in connection with the Everett Transaction following changes in foreign tax laws, $203 million of income tax benefits related to the liquidation of an insolvent non-U.S. subsidiary, $74 million of net income tax benefits on restructuring charges, separation costs and acquisition, disposition, and other related charges, $68 million of net excess tax benefits related to stock-based compensation, and $38 million of income tax benefits from the release of non-U.S. valuation allowances on deferred tax assets following changes in foreign tax laws.

Recent Tax Legislation

The Tax Act required the Company to incur a one-time Transition Tax on deferred foreign income not previously subject to U.S. income tax at a rate of 15.5% for foreign cash and certain other net current assets and 8% on the remaining income. The GILTI and BEAT provisions of the Tax Act became effective for the Company beginning November 1, 2018.

The Company has an October 31 fiscal year end; therefore, the lower corporate tax rate enacted by the Tax Act was phased in, resulting in a U.S. statutory federal rate of 23.3% for the fiscal year ending October 31, 2018 and 21% for the current and subsequent fiscal years.

The Company completed its accounting for the tax effects of the Tax Act based on currently available legislative and regulatory updates in the first quarter of fiscal 2019, resulting in an additional tax charge of $426 million. This amount includes $438 million of income tax charges relating to additional valuation allowances against certain U.S. federal deferred tax assets, $56 million of income tax benefits resulting from the release of valuation allowances against certain U.S. state deferred tax assets, an additional $7 million of Transition Tax and $37 million of income tax charges related to future withholding tax costs on distributions of

26

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

earnings. No cash payment is anticipated due to the availability of sufficient tax credits to offset the Transition Tax. The Company has elected to treat taxes due on future GILTI inclusions in U.S. taxable income as a current period expense when incurred.

Uncertain Tax Positions

As of July 31, 2019 and October 31, 2018, the amount of unrecognized tax benefits was $2.6 billion and $8.8 billion, respectively, of which up to $0.8 billion and $1.1 billion, respectively, would affect the Company's effective tax rate if realized as of their respective periods. The Company is joint and severally liable for certain pre-Separation tax liabilities of HP Inc. HP Inc. is subject to numerous ongoing audits by state and foreign tax authorities. During the nine months ended July 31, 2019, HP Inc. effectively settled with the IRS on pre-Separation Hewlett-Packard Company audits for fiscal years 2013 through 2015, for which the Company had been joint and severally liable, primarily contributing to the reduction in the Company's unrecognized tax benefits of $6.2 billion.

The Company recognizes interest income from favorable settlements and interest expense and penalties accrued on unrecognized tax benefits in (Benefit) provision for taxes in the Condensed Consolidated Statements of Earnings. As of July 31, 2019 and October 31, 2018, the Company has recorded $130 million and $142 million, respectively, for interest and penalties in the Condensed Consolidated Balance Sheets.

The Company engages in continuous discussions and negotiations with taxing authorities regarding tax matters in various jurisdictions. The Company does not expect complete resolution of any audit cycle within the next 12 months. However, it is reasonably possible that certain federal, foreign and state tax issues may be concluded in the next 12 months, including issues involving transfer pricing, joint and several tax liabilities and other matters. Accordingly, the Company believes it is reasonably possible that its existing unrecognized tax benefits may be reduced by an amount up to $40 million within the next 12 months, of which $7 million would affect the Company’s effective tax rate if realized.

Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities included in the Condensed Consolidated Balance Sheets were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Deferred tax assets	$	1,657		$	2,403
Deferred tax liabilities	(278		)	(228		)
Deferred tax assets net of deferred tax liabilities	$	1,379		$	2,175

Tax Matters Agreement and Other Income Tax Matters

In connection with the Separation, the Company entered into a Tax Matters Agreement with HP Inc. In connection with the Everett and Seattle Transactions, the Company entered into a DXC Tax Matters Agreement with DXC and a Micro Focus Tax Matters Agreement with Micro Focus, respectively. For more details, see the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

Note 7: Balance Sheet Details

Balance sheet details were as follows:

Cash and cash equivalents

	As of
	July 31, 2019		October 31, 2018
	In millions
Cash and cash equivalents	$	3,693	$	4,880
Restricted cash	318		204
Cash, cash equivalents and restricted cash	$	4,011	$	5,084

27

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Inventory

	As of
	July 31, 2019		October 31, 2018
	In millions
Finished goods	$	1,225	$	1,274
Purchased parts and fabricated assemblies	991		1,173
Total	$	2,216	$	2,447

For the nine months ended July 31, 2019, the decrease in inventory was due primarily to lower commodity costs and slower inventory replenishment as a result of improved market supply availability for key commodities.

Other Current Assets

	As of
	July 31, 2019		October 31, 2018
	In millions
Value-added tax receivables	$	630	$	811
Short-term tax receivables and prepaid taxes	225		535
Manufacturer and other receivables	619		937
Prepaid and other current assets	832		793
Restricted cash	318		204
Total	$	2,624	$	3,280

For the nine months ended July 31, 2019, the decrease in Other current assets was due primarily to a decrease in short-term tax receivables and prepaid taxes following the adoption of the new accounting standard related to income taxes in the first quarter of fiscal 2019, a decrease in manufacturer and other receivables as a result of lower collateral receivables and lower receivables from contract manufacturers, and a decrease in value-added tax receivables.

Property, Plant and Equipment

	As of
	July 31, 2019			October 31, 2018
	In millions
Land	$	293		$	294
Buildings and leasehold improvements	2,157			2,103
Machinery and equipment, including equipment held for lease	9,460			9,419
	11,910			11,816
Accumulated depreciation	(5,910		)	(5,678		)
Total	$	6,000		$	6,138

Notes Payable and Short-Term Borrowings

	As of
	July 31, 2019		October 31, 2018
	In millions
Current portion of long-term debt	$	1,180	$	1,196
FS commercial paper	671		392
Notes payable to banks, lines of credit and other(1)	356		417
Total	$	2,207	$	2,005

28

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

(1) As of July 31, 2019 and October 31, 2018, notes payable to banks, lines of credit and other includes $228 million and $361 million, respectively, of borrowing associated with FS and its subsidiaries.

Warranties

The Company's aggregate product warranty liability as of July 31, 2019, and changes during the nine months then ended were as follows:

	Nine Months Ended July 31, 2019
	In millions
Balance at beginning of period	$	430
Accruals for warranties issued	178
Adjustments related to pre-existing warranties	6
Settlements made	(212		)
Balance at end of period	$	402

Contract balances

The Company’s contract balances consist of contract assets, contract liabilities, and costs to obtain a contract with a customer.

Contract Assets

A summary of accounts receivable, net, including unbilled receivables was as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Accounts receivable, net
Accounts receivable	$	2,786		$	3,117
Unbilled receivables	210			185
Allowance for doubtful accounts	(31		)	(39		)
Total	$	2,965		$	3,263

Contract Liabilities

Contract liabilities consist of deferred revenue. The aggregate balances of current and non-current deferred revenue were $5.9 billion and $5.8 billion as of July 31, 2019 and October 31, 2018, respectively, which included $96 million and $82 million of deferred revenue related to FS, respectively. During the nine months ended July 31, 2019, approximately $5.1 billion of deferred revenue was recognized as revenue.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents contract work that has not yet been performed and does not include contracts where the customer is not committed. Remaining performance obligations estimates are subject to change and are affected by several factors, including contract terminations, changes in the scope of contracts, adjustments for revenue that has not materialized and adjustments for currency.

Remaining performance obligations consist of deferred revenue. As of July 31, 2019, the aggregate amount of remaining performance obligations was $5.9 billion. The Company expects to recognize approximately 22% of this amount as revenue over the remaining fiscal year.

Costs to Obtain a Contract

As of July 31, 2019, the current and non-current portions of the capitalized costs to obtain a contract were $46 million and $69 million, which were included in Other current assets and Long-term financing receivables and other assets, respectively, in the Condensed Consolidated Balance Sheet. During the three and nine months ended July 31, 2019, the Company amortized $12 million and $34 million of the capitalized costs to obtain a contract, respectively.

29

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 8: Financing Receivables and Operating Leases

Financing receivables represent sales-type and direct-financing leases of the Company and third-party products. These receivables typically have terms ranging from two to five years and are usually collateralized by a security interest in the underlying assets. Financing receivables also include billed receivables from operating leases. The components of financing receivables were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Minimum lease payments receivable	$	9,009		$	8,691
Unguaranteed residual value	322			297
Unearned income	(765		)	(732		)
Financing receivables, gross	8,566			8,256
Allowance for doubtful accounts	(133		)	(120		)
Financing receivables, net	8,433			8,136
Less: current portion(1)	(3,567		)	(3,396		)
Amounts due after one year, net(1)	$	4,866		$	4,740

(1) The Company includes the current portion in Financing receivables, and amounts due after one year, net in Long-term financing receivables and other assets, in the accompanying Condensed Consolidated Balance Sheets.

Sale of Financing Receivables

During the nine months ended July 31, 2019 and 2018, the Company entered into arrangements to transfer the contractual payments due under certain financing receivables to third party financial institutions. During the nine months ended July 31, 2019 and 2018, the Company sold $153 million and $127 million, respectively, of financing receivables. The gains recognized on the sales of financing receivables were not material for both periods.

Credit Quality Indicators

The credit risk profile of gross financing receivables, based upon internal risk ratings, was as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Risk Rating:
Low	$	4,377	$	4,238
Moderate	3,913		3,805
High	276		213
Total	$	8,566	$	8,256

Accounts rated low risk typically have the equivalent of a Standard & Poor's rating of BBB– or higher, while accounts rated moderate risk generally have the equivalent of BB+ or lower. The Company classifies accounts as high risk when it considers the financing receivable to be impaired or when management believes there is a significant near-term risk of impairment.

30

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Allowance for Doubtful Accounts

The allowance for doubtful accounts for financing receivables as of July 31, 2019 and October 31, 2018 and the respective changes during the nine and twelve months then ended were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Balance at beginning of period	$	120		$	86
Provision for doubtful accounts	25			49
Write-offs	(12		)	(15		)
Balance at end of period	$	133		$	120

The gross financing receivables and related allowance evaluated for loss were as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Gross financing receivables collectively evaluated for loss	$	8,120	$	7,917
Gross financing receivables individually evaluated for loss(1)	446		339
Total	$	8,566	$	8,256
Allowance for financing receivables collectively evaluated for loss	$	84	$	78
Allowance for financing receivables individually evaluated for loss	49		42
Total	$	133	$	120

(1) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Non-Accrual and Past-Due Financing Receivables

The following table summarizes the aging and non-accrual status of gross financing receivables:

	As of
	July 31, 2019		October 31, 2018
	In millions
Billed:(1)
Current 1-30 days	$	319	$	275
Past due 31-60 days	62		42
Past due 61-90 days	15		13
Past due > 90 days	86		74
Unbilled sales-type and direct-financing lease receivables	8,084		7,852
Total gross financing receivables	$	8,566	$	8,256
Gross financing receivables on non-accrual status(2)	$	297	$	226
Gross financing receivables 90 days past due and still accruing interest(2)	$	149	$	113

(1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables.

(2) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

31

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Operating Leases

Operating lease assets included in Property, plant and equipment in the Condensed Consolidated Balance Sheets were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Equipment leased to customers	$	7,275		$	7,290
Accumulated depreciation	(3,225		)	(3,078		)
Total	$	4,050		$	4,212

Note 9: Goodwill

Goodwill allocated to the Company's reportable segments as of July 31, 2019 and the change in the respective carrying amounts during the nine months then ended were as follows:

	Hybrid IT		Intelligent Edge		Financial Services		Total
	In millions
Balance at October 31, 2018(1) (2)	$	15,479	$	1,914	$	144	$	17,537
Goodwill acquired during the period(3)	48		—		—		48
Goodwill adjustments	2		—		—		2
Balance at July 31, 2019(2)	$	15,529	$	1,914	$	144	$	17,587

(1) As a result of the organizational realignments effective during the first quarter of fiscal 2019, which are described in detail in Note 2, "Segment Information", goodwill was reclassified to the respective segments as of the beginning of the period using a relative fair value approach.

(2) Goodwill is net of an accumulated impairment loss of $88 million related to the Corporate Investments segment which was recorded during the fourth quarter of fiscal 2018. There is no remaining goodwill in the Corporate Investments segment.

(3) Goodwill acquired in connection with the acquisition of BlueData.

Goodwill is tested for impairment at the reporting unit level. As of July 31, 2019, the Company's reporting units containing goodwill are consistent with the reportable segments identified in Note 2, "Segment Information". The Company will continue to evaluate the recoverability of goodwill on an annual basis as of the beginning of its fourth fiscal quarter and whenever events or changes in circumstances indicate there may be a potential impairment.

Note 10: Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.

Fair Value Hierarchy

The Company uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use.

Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement:

Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs.

32

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Level 3—Unobservable inputs for the asset or liability.

The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs.

The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis:

	As of July 31, 2019								As of October 31, 2018
	Fair Value Measured Using								Fair Value Measured Using
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	In millions
Assets
Cash Equivalents and Investments:
Time deposits	$	—	$	908	$	—	$	908	$	—	$	781	$	—	$	781
Money market funds	609		—		—		609		2,340		—		—		2,340
Foreign bonds	7		125		—		132		7		124		—		131
Other debt securities	—		1		32		33		—		—		25		25
Derivative Instruments:
Interest rate contracts	—		20		—		20		—		—		—		—
Foreign exchange contracts	—		467		—		467		—		496		—		496
Total assets	$	616	$	1,521	$	32	$	2,169	$	2,347	$	1,401	$	25	$	3,773
Liabilities
Derivative Instruments:
Interest rate contracts	$	—	$	32	$	—	$	32	$	—	$	353	$	—	$	353
Foreign exchange contracts	—		116		—		116		—		117		—		117
Other derivatives	—		1		—		1		—		6		—		6
Total liabilities	$	—	$	149	$	—	$	149	$	—	$	476	$	—	$	476

During the nine months ended July 31, 2019, there were no transfers between levels within the fair value hierarchy.

Other Fair Value Disclosures

Short- and Long-Term Debt: At July 31, 2019 and October 31, 2018, the estimated fair value of the Company's short-term and long-term debt was $13.5 billion and $12.2 billion, respectively.

33

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 11: Financial Instruments

Cash Equivalents and Available-for-Sale Investments

Cash equivalents and available-for-sale investments were as follows:

	As of July 31, 2019								As of October 31, 2018
	Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value		Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
	In millions
Cash Equivalents:
Time deposits	$	908	$	—	$	—	$	908	$	781	$	—	$	—		$	781
Money market funds	609		—		—		609		2,340		—		—			2,340
Total cash equivalents	1,517		—		—		1,517		3,121		—		—			3,121
Available-for-Sale Investments:
Foreign bonds	110		22		—		132		113		18		—			131
Other debt securities	33		—		—		33		26		—		(1		)	25
Total available-for-sale investments	143		22		—		165		139		18		(1		)	156
Total cash equivalents and available-for-sale debt investments	$	1,660	$	22	$	—	$	1,682	$	3,260	$	18	$	(1	)	$	3,277

As of July 31, 2019 and October 31, 2018, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. Time deposits were primarily issued by institutions outside the U.S. as of July 31, 2019 and October 31, 2018. The estimated fair value of the available-for-sale debt investments may not be representative of values that will be realized in the future.

Contractual maturities of available-for-sale debt investments were as follows:

	July 31, 2019
	Amortized Cost		Fair Value
	In millions
Due in one to five years	$	10	$	10
Due in more than five years	133		155
	$	143	$	165

Equity Investments

Equity securities investments in privately held companies are included in Long-term financing receivables and other assets in the Condensed Consolidated Balance Sheets. The carrying amount of these investments without readily determinable fair values amounted to $184 million and $162 million at July 31, 2019 and October 31, 2018, respectively.

Investments in equity securities that are accounted for using the equity method are included in Investments in equity interests in the Condensed Consolidated Balance Sheets. These investments amounted to $2.3 billion and $2.4 billion at July 31, 2019 and October 31, 2018, respectively.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets

The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows:

	As of July 31, 2019										As of October 31, 2018
			Fair Value										Fair Value
	Outstanding Gross Notional		Other Current Assets		Long-Term Financing Receivables and Other Assets		Other Accrued Liabilities		Long-Term Other Liabilities		Outstanding Gross Notional		Other Current Assets		Long-Term Financing Receivables and Other Assets		Other Accrued Liabilities		Long-Term Other Liabilities
	In millions
Derivatives designated as hedging instruments
Fair value hedges:
Interest rate contracts	$	6,850	$	—	$	20	$	—	$	32	$	6,850	$	—	$	—	$	—	$	353
Cash flow hedges:
Foreign currency contracts	8,539		218		157		24		23		8,423		270		107		11		15
Net investment hedges:
Foreign currency contracts	1,745		25		30		18		18		1,737		32		41		13		11
Total derivatives designated as hedging instruments	17,134		243		207		42		73		17,010		302		148		24		379
Derivatives not designated as hedging instruments
Foreign currency contracts	5,206		36		1		26		7		6,780		41		5		55		12
Other derivatives	103		—		—		1		—		104		—		—		6		—
Total derivatives not designated as hedging instruments	5,309		36		1		27		7		6,884		41		5		61		12
Total derivatives	$	22,443	$	279	$	208	$	69	$	80	$	23,894	$	343	$	153	$	85	$	391

Offsetting of Derivative Instruments

The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheets. The Company's derivative instruments are subject to master netting arrangements and collateral security arrangements. The Company does not offset the fair value of its derivative instruments against the fair value of cash collateral posted under collateral security agreements. As of July 31, 2019 and October 31, 2018, information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows:

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

	As of July 31, 2019
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	487	$	—	$	487	$	125	$	316	(1)	$	46
Derivative liabilities	$	149	$	—	$	149	$	125	$	5	(2)	$	19

	As of October 31, 2018
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	496	$	—	$	496	$	179	$	205	(1)	$	112
Derivative liabilities	$	476	$	—	$	476	$	179	$	302	(2)	$	(5	)

(1) Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date.

(2) Represents the collateral posted by the Company in cash or through the re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of July 31, 2019, of the $5 million of collateral posted, $4 million was in cash and $1 million was through re-use of counterparty collateral. As of October 31, 2018, $302 million of collateral posted was entirely in cash.

Effect of Derivative Instruments on the Condensed Consolidated Statements of Earnings

The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship for the three and nine months ended July 31, 2019 and 2018 were as follows:

	Gains (Losses) Recognized in Earnings on Derivative and Related Hedged Item
Derivative Instrument	Location	Three months ended July 31, 2019		Nine months ended July 31, 2019		Hedged Item	Location	Three months ended July 31, 2019			Nine months ended July 31, 2019
		In millions						In millions
Interest rate contracts	Interest and other, net	$	123	$	341	Fixed-rate debt	Interest and other, net	$	(123	)	$	(341	)

	Gains (Losses) Recognized in Earnings on Derivative and Related Hedged Item
Derivative Instrument	Location	Three months ended July 31, 2018		Nine months ended July 31, 2018			Hedged Item	Location	Three months ended July 31, 2018			Nine months ended July 31, 2018
		In millions							In millions
Interest rate contracts	Interest and other, net	$	16	$	(194	)	Fixed-rate debt	Interest and other, net	$	(16	)	$	194

36

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the three and nine months ended July 31, 2019 were as follows:

	Gains (Losses) Recognized in Other Comprehensive Income ("OCI") on Derivatives (Effective Portion)						Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion)
	Three months ended July 31, 2019			Nine months ended July 31, 2019			Location	Three months ended July 31, 2019		Nine months ended July 31, 2019
	In millions							In millions
Cash flow hedges:
Foreign currency contracts	$	43		$	102		Net revenue	$	42	$	168
Foreign currency contracts	20			123			Interest and other, net	16		91
Total cash flow hedges	$	63		$	225		Net earnings from continuing operations	$	58	$	259
Net investment hedges:
Foreign currency contracts	$	(18	)	$	(23	)	Interest and other, net	$	—	$	—

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the three and nine months ended July 31, 2018 was as follows:

	Gains (Losses) Recognized in Other Comprehensive Income ("OCI") on Derivatives (Effective Portion)					Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion)
	Three months ended July 31, 2018		Nine months ended July 31, 2018			Location	Three months ended July 31, 2018		Nine months ended July 31, 2018
	In millions						In millions
Cash flow hedges:
Foreign currency contracts	$	121	$	59		Net revenue	$	29	$	(82	)
Foreign currency contracts	28		(9		)	Interest and other, net	14		4
Total cash flow hedges	$	149	$	50		Net earnings from continuing operations	$	43	$	(78	)
Net investment hedges:
Foreign currency contracts	$	57	$	31		Interest and other, net	$	—	$	—

As of July 31, 2019 and 2018, no portion of the hedging instruments' gain or loss was excluded from the assessment of effectiveness for fair value, cash flow or net investment hedges. Hedge ineffectiveness for fair value, cash flow, and net investment hedges was not material for the three and nine months ended July 31, 2019 and 2018.

As of July 31, 2019, the Company expects to reclassify an estimated net Accumulated other comprehensive gain of approximately $80 million, net of taxes, to earnings in the next twelve months, along with the earnings effects of the related forecasted transactions associated with cash flow hedges.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

The pre-tax effect of derivative instruments not designated as hedging instruments on the Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018 was as follows:

		Gains (Losses) Recognized in Earnings on Derivatives
	Location	Three months ended July 31, 2019			Three months ended July 31, 2018		Nine months ended July 31, 2019			Nine months ended July 31, 2018
		In millions
Foreign currency contracts	Interest and other, net	$	55		$	233	$	(68	)	$	104
Other derivatives	Interest and other, net	(2		)	—		5			—
Total		$	53		$	233	$	(63	)	$	104

Note 12: Borrowings

Commercial Paper

Hewlett Packard Enterprise's Board of Directors has authorized the issuance of up to $4.0 billion in aggregate principal amount of commercial paper by Hewlett Packard Enterprise. Hewlett Packard Enterprise's subsidiaries are authorized to issue up to an additional $1.0 billion in aggregate principal amount of commercial paper. Hewlett Packard Enterprise maintains two commercial paper programs, and a wholly-owned subsidiary maintains a third program. Hewlett Packard Enterprise's U.S. program provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $4.0 billion. Hewlett Packard Enterprise's euro commercial paper program provides for the issuance of commercial paper outside of the U.S. denominated in U.S. dollars, euros or British pounds up to a maximum aggregate principal amount of $3.0 billion or the equivalent in those alternative currencies. The combined aggregate principal amount of commercial paper outstanding under those programs at any one time cannot exceed the $4.0 billion authorized by Hewlett Packard Enterprise's Board of Directors. The Hewlett Packard Enterprise subsidiary's euro Commercial Paper/Certificate of Deposit Program provides for the issuance of commercial paper in various currencies of up to a maximum aggregate principal amount of $1.0 billion, which was increased from $500 million, by way of an amendment in April 2019. As of July 31, 2019 and October 31, 2018, no borrowings were outstanding under Hewlett Packard Enterprise’s two commercial paper programs, and $671 million and $392 million, respectively, were outstanding under the subsidiary’s program.

Revolving Credit Facility

On August 16, 2019, the Company entered into a revolving credit facility (the "Credit Agreement"), together with the lenders named therein, JPMorgan Chase Bank, N.A. ("JPMorgan"), as co-administrative agent and administrative processing agent, and Citibank, N.A., as co-administrative agent, providing for a senior, unsecured revolving credit facility with aggregate lending commitments of $4.75 billion. Loans under the revolving credit facility may be used for general corporate purposes. Commitments under the Credit Agreement are available for a period of five years, which period may be extended, subject to satisfaction of certain conditions, by up to two one-year periods. Commitment fees, interest rates and other terms of borrowing under the credit facility vary based on Hewlett Packard Enterprise's external credit rating. This credit facility replaces the Company's prior credit facility that was entered into on November 1, 2015, which was terminated in connection with its entering into the new credit facility.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 13: Stockholders' Equity

Taxes related to Other Comprehensive Income

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Taxes on change in net unrealized gains (losses) on cash flow hedges:
Tax (provision) on net unrealized gains arising during the period	$	(6	)	$	(20	)	$	(24	)	$	(6	)
Tax provision (benefit) on net (gains) losses reclassified into earnings	7			5			31			(11		)
	1			(15		)	7			(17		)
Taxes on change in unrealized components of defined benefit plans:
Tax benefit on net unrealized losses arising during the period	5			3			13			2
Tax provision on amortization of net actuarial loss and prior service benefit	(3		)	(4		)	(9		)	(10		)
Tax provision on curtailments, settlements and other	—			(5		)	(7		)	(12		)
	2			(6		)	(3		)	(20		)
Tax (provision) benefit on change in cumulative translation adjustment	(1		)	2			—			3
Tax benefit (provision) on other comprehensive income	$	2		$	(19	)	$	4		$	(34	)

Changes and reclassifications related to Other Comprehensive Income, net of taxes

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Other comprehensive income, net of taxes:
Change in net unrealized gains (losses) on available-for-sale securities:
Net unrealized gains (losses) arising during the period	$	3		$	(2	)	$	8		$	(1	)
Gains reclassified into earnings	—			—			(3		)	(9		)
	3			(2		)	5			(10		)
Change in net unrealized gains (losses) on cash flow hedges:
Net unrealized gains arising during the period	57			129			201			44
Net (gains) losses reclassified into earnings(1)	(51		)	(38		)	(228		)	67
	6			91			(27		)	111
Change in unrealized components of defined benefit plans:
Net unrealized losses arising during the period	(26		)	(22		)	(65		)	(21		)
Amortization of net actuarial loss and prior service benefit(2)	51			43			152			133
Curtailments, settlements and other	5			4			5			(1		)
	30			25			92			111
Change in cumulative translation adjustment	(9		)	(38		)	(2		)	(37		)
Other comprehensive income, net of taxes	$	30		$	76		$	68		$	175

39

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

(1) For more details on the reclassification of pre-tax net (gains) losses on cash flow hedges into the Condensed Consolidated Statements of Earnings, see Note 11, "Financial Instruments".

(2) These components are included in the computation of net pension and post-retirement benefit cost in Note 5, "Retirement and Post-Retirement Benefit Plans".

The components of Accumulated other comprehensive loss, net of taxes as of July 31, 2019, and changes during the nine months ended July 31, 2019 were as follows:

	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gains (losses) on cash flow hedges			Unrealized components of defined benefit plans			Cumulative translation adjustment			Accumulated other comprehensive loss
	In millions
Balance at beginning of period	$	17		$	106		$	(2,922	)	$	(419	)	$	(3,218	)
Other comprehensive income (loss) before reclassifications	8			201			(65		)	(2		)	142
Reclassifications of (gains) losses into earnings	(3		)	(228		)	157			—			(74		)
Balance at end of period	$	22		$	79		$	(2,830	)	$	(421	)	$	(3,150	)

Share Repurchase Program

For the nine months ended July 31, 2019, the Company repurchased and settled a total of 130 million shares under its share repurchase program through open market repurchases, which included 2.4 million shares that were unsettled open market repurchases as of October 31, 2018. Additionally, as of July 31, 2019, the Company had unsettled open market repurchases of 1.2 million shares. Shares repurchased during the nine months ended July 31, 2019 were recorded as a $1.9 billion reduction to stockholders' equity. As of July 31, 2019, the Company had a remaining authorization of $2.7 billion for future share repurchases.

Note 14: Net Earnings Per Share

The Company calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes the weighted-average dilutive effect of restricted stock units, stock options, and performance-based awards.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

The reconciliations of the numerators and denominators of each of the basic and diluted net EPS calculations were as follows:

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019		2018
	In millions, except per share amounts
Numerator:
Net (loss) earnings from continuing operations	$	(27	)	$	452		$	569	$	2,784
Net loss from discontinued operations	—			(1		)	—		(119		)
Net (loss) earnings	$	(27	)	$	451		$	569	$	2,665
Denominator:
Weighted-average shares used to compute basic net EPS	1,334			1,513			1,367		1,552
Dilutive effect of employee stock plans	—			18			13		26
Weighted-average shares used to compute diluted net EPS	1,334			1,531			1,380		1,578
Basic net (loss) earnings per share:
Continuing operations	$	(0.02	)	$	0.30		$	0.42	$	1.79
Discontinued operations(1)	—			—			—		(0.07		)
Basic net (loss) earnings per share	$	(0.02	)	$	0.30		$	0.42	$	1.72
Diluted net (loss) earnings per share:
Continuing operations	$	(0.02	)	$	0.29		$	0.41	$	1.76
Discontinued operations(1)(2)	—			—			—		(0.07		)
Diluted net (loss) earnings per share	$	(0.02	)	$	0.29		$	0.41	$	1.69
Anti-dilutive weighted-average stock awards(3)	44			2			4		3

(1) EPS for discontinued operations was calculated by deducting the EPS from continuing operations from the total EPS.

(2) U.S. GAAP requires the denominator used in the diluted net EPS calculation for discontinued operations to be the same as that of continuing operations, regardless of net earnings (loss) from continuing operations.

(3) The Company excludes shares potentially issuable under employee stock plans that could dilute basic net EPS in the future from the calculation of diluted net earnings (loss) per share, as their effect, if included, would have been anti-dilutive for the periods presented.

Note 15: Litigation and Contingencies

Hewlett Packard Enterprise is involved in various lawsuits, claims, investigations and proceedings including those consisting of Intellectual Property ("IP"), commercial, securities, employment, employee benefits and environmental matters, which arise in the ordinary course of business. In addition, as part of the Separation and Distribution Agreement, Hewlett Packard Enterprise and HP Inc. (formerly known as "Hewlett-Packard Company") agreed to cooperate with each other in managing certain existing litigation related to both parties' businesses. The Separation and Distribution Agreement included provisions that allocate liability and financial responsibility for pending litigation involving the parties, as well as provide for cross-indemnification of the parties against liabilities to one party arising out of liabilities allocated to the other party. The Separation and Distribution Agreement also included provisions that assign to the parties responsibility for managing pending and future litigation related to the general corporate matters of HP Inc. arising prior to the Separation. Hewlett Packard Enterprise records a liability when it believes that it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Significant judgment is required to determine both the probability of having incurred a liability and the estimated amount of the liability. Hewlett Packard Enterprise reviews these matters at least quarterly and adjusts these liabilities to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other updated information and events pertaining to a particular matter. Litigation is inherently unpredictable. However, Hewlett Packard Enterprise believes it has valid defenses with respect to legal matters pending against us. Nevertheless, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these contingencies. Hewlett Packard Enterprise believes it has recorded adequate provisions for any such matters and, as of July 31, 2019, it was not reasonably possible that a material loss had been incurred in connection with such matters in excess of the amounts recognized in its financial statements.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Litigation, Proceedings and Investigations

DXC Technology Indemnification Demand. On March 27, 2018, DXC Technology (“DXC”) served an arbitration demand on HPE under the Separation and Distribution Agreement by and between HPE and DXC (f/k/a Everett SpinCo, Inc.) dated May 24, 2016, relating to the separation of HPE’s Enterprise Services business (the “ES Business”). The arbitration demand asserts that HPE is required to indemnify DXC for any transferred long-term capitalized lease obligations of the ES Business that exceed the threshold amount of $250 million. DXC contends that this $250 million threshold was exceeded by approximately $1.0 billion because the valuation of the assets underlying certain leases did not justify their classification as operating leases based on the terms of such leases, thereby rendering them long-term capitalized lease obligations. The arbitration demand follows DXC's November 8, 2017 request for indemnification on this same issue. On August 15, 2019, the arbitration panel ruled in DXC’s favor, issuing DXC an award in the amount of $632 million. The arbitration panel also awarded pre-judgment interest of $34 million.

Ross and Rogus v. Hewlett Packard Enterprise Company. On November 8, 2018, a putative class action complaint was filed in the Superior Court of California, County of Santa Clara alleging that HPE pays its California-based female employees “systemically lower compensation” than HPE pays male employees performing substantially similar work. The complaint alleges various California state law claims, including California’s Equal Pay Act, Fair Employment and Housing Act, and Unfair Competition Law, and seeks certification of a California-only class of female employees employed in certain “Covered Positions.” The complaint seeks damages, statutory and civil penalties, attorneys’ fees and costs. On April 2, 2019, HPE filed a demurrer to all causes of action and an alternative motion to strike portions of the complaint. On July 2, 2019, the court denied HPE’s demurrer as to the claims of the putative class and granted HPE’s demurrer as to the claims of the individual plaintiffs.

India Directorate of Revenue Intelligence Proceedings. On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the "DRI") issued show cause notices to Hewlett-Packard India Sales Private Ltd ("HP India"), a subsidiary of HP Inc., seven HP India employees and one former HP India employee alleging that HP India underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately $370 million, plus penalties. Prior to the issuance of the show cause notices, HP India deposited approximately $16 million with the DRI and agreed to post a provisional bond in exchange for the DRI's agreement to not seize HP India products and spare parts and to not interrupt the transaction of business by HP India.

On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related show cause notice affirming certain duties and penalties against HP India and the named individuals of approximately $386 million, of which HP India had already deposited $9 million. On December 11, 2012, HP India voluntarily deposited an additional $10 million in connection with the products-related show cause notice. On April 20, 2012, the Commissioner issued an order on the parts-related show cause notice affirming certain duties and penalties against HP India and certain of the named individuals of approximately $17 million, of which HP India had already deposited $7 million. After the order, HP India deposited an additional $3 million in connection with the parts-related show cause notice so as to avoid certain penalties.

HP India filed appeals of the Commissioner's orders before the Customs Tribunal along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The Customs Department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HP India to deposit an additional $24 million against the products order, which HP India deposited in March 2013. The Customs Tribunal did not order any additional deposit to be made under the parts order. In December 2013, HP India filed applications before the Customs Tribunal seeking early hearing of the appeals as well as an extension of the stay of deposit as to HP India and the individuals already granted until final disposition of the appeals. On February 7, 2014, the application for extension of the stay of deposit was granted by the Customs Tribunal until disposal of the appeals. On October 27, 2014, the Customs Tribunal commenced hearings on the cross-appeals of the Commissioner's orders. The Customs Tribunal rejected HP India's request to remand the matter to the Commissioner on procedural grounds. The hearings were scheduled to reconvene on April 6, 2015, and again on November 3, 2015 and April 11, 2016, but were canceled at the request of the Customs Tribunal. The hearing was rescheduled for January 15, 2019 but was postponed and has not yet been rescheduled.

ECT Proceedings. In January 2011, the postal service of Brazil, Empresa Brasileira de Correios e Telégrafos ("ECT"), notified a former subsidiary of HP Inc. in Brazil ("HP Brazil") that it had initiated administrative proceedings to consider whether to suspend HP Brazil's right to bid and contract with ECT related to alleged improprieties in the bidding and contracting processes whereby employees of HP Brazil and employees of several other companies allegedly coordinated their bids and fixed results for three ECT contracts in 2007 and 2008. In late July 2011, ECT notified HP Brazil it had decided to apply the penalties against HP Brazil and suspend HP Brazil's right to bid and contract with ECT for five years, based upon the evidence before it. In August 2011, HP Brazil appealed ECT's decision. In April 2013, ECT rejected HP Brazil's appeal, and the administrative proceedings were closed with the penalties against HP Brazil remaining in place. In parallel, in September 2011, HP Brazil filed a civil action against ECT

42

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

seeking to have ECT's decision revoked. HP Brazil also requested an injunction suspending the application of the penalties until a final ruling on the merits of the case. The court of first instance has not issued a decision on the merits of the case, but it has denied HP Brazil's request for injunctive relief. HP Brazil appealed the denial of its request for injunctive relief to the intermediate appellate court, which issued a preliminary ruling denying the request for injunctive relief but reducing the length of the sanctions from five to two years. HP Brazil appealed that decision and, in December 2011, obtained a ruling staying enforcement of ECT's sanctions until a final ruling on the merits of the case. HP Brazil expects the decision to be issued in 2019 and any subsequent appeal on the merits to last several years.

Forsyth, et al. vs. HP Inc. and Hewlett Packard Enterprise. This purported class and collective action was filed on August 18, 2016 and an amended complaint was filed on December 19, 2016 in the United States District Court for the Northern District of California, against HP Inc. and Hewlett Packard Enterprise alleging defendants violated the Federal Age Discrimination in Employment Act ("ADEA"), the California Fair Employment and Housing Act, California public policy and the California Business and Professions Code by terminating older workers and replacing them with younger workers.  Plaintiffs seek to certify a nationwide collective action under the ADEA comprised of all individuals aged 40 and older who had their employment terminated by an HP entity pursuant to a work force reduction ("WFR") plan on or after December 9, 2014 for individuals terminated in deferral states and on or after April 8, 2015 in non-deferral states. Plaintiffs also seek to certify a Rule 23 class under California law comprised of all persons 40 years or older employed by defendants in the state of California and terminated pursuant to a WFR plan on or after August 18, 2012. On September 20, 2017, the court granted the defendants' motion to compel arbitration and administratively closed the case pending resolution of the arbitration proceedings. On November 30, 2017, three named plaintiffs filed a single arbitration demand. Thirteen additional plaintiffs later joined the arbitration. On December 22, 2017, defendants filed a motion to (1) stay the case pending arbitrations and (2) enjoin the demanded arbitration and require each plaintiff to file a separate arbitration demand. On February 6, 2018, the court granted the motion to stay and denied the motion to enjoin. The claims of these sixteen arbitration named plaintiffs have been resolved. Additional opt-in plaintiffs have since been added to the litigation and the parties are engaged in the arbitration process for those claims. The Forsyth class action remains stayed.

Wall v. Hewlett Packard Enterprise Company and HP Inc. This certified California class action and Private Attorney General Act action was filed against Hewlett-Packard Company on January 17, 2012 and the fifth amended (and operative) complaint was filed against HP Inc. and Hewlett Packard Enterprise on June 28, 2016 in the Superior Court of California, County of Orange. The complaint alleges that the defendants paid earned incentive compensation late and failed to timely pay final wages in violation of the California Labor Code. On August 9, 2016, the court ordered the class certified without prejudice to a future motion to amend or modify the class certification order or to decertify. The scheduled January 22, 2018 trial date was vacated following the parties’ notification to the court that they had reached a preliminary agreement to resolve the dispute. The parties subsequently finalized and executed a settlement agreement and, on May 9, 2018, plaintiff filed a motion seeking preliminary approval of the settlement. On July 2, 2018, the court issued an order granting preliminary approval of the settlement. On December 21, 2018, the court issued an order granting final approval of the settlement and setting a hearing for September 27, 2019 to confirm that the settlement distributions have been made.  A Qualified Settlement Fund has been fully funded.

Jackson, et al. v. HP Inc. and Hewlett Packard Enterprise. This putative nationwide class action was filed on July 24, 2017 in the United States District Court for the Northern District of California, San Jose Division. Plaintiffs purport to bring the lawsuit on behalf of themselves and other similarly situated African-Americans and individuals over the age of forty. Plaintiffs allege that defendants engaged in a pattern and practice of racial and age discrimination in lay-offs and promotions. Plaintiffs filed an amended complaint on September 29, 2017. Plaintiffs seek damages, attorneys’ fees and costs, and declaratory and injunctive relief. On January 12, 2018, defendants moved to transfer the matter to the federal district court in the Northern District of Georgia. Defendants also moved to dismiss the claims on various grounds and to strike certain aspects of the proposed class definition. On July 11, 2018, the court granted defendants' motion to dismiss this action for improper venue, and also partially dismissed and struck certain claims without prejudice to re-filing in the appropriate venue. On July 23, 2018, plaintiffs re-filed their lawsuit in the United States District Court for the Northern District of Georgia. On August 9, 2018, Plaintiffs filed a notice of appeal of the dismissal of the Northern District of California action with the Ninth Circuit Court of Appeals. On August 15, 2018, Plaintiffs filed a motion to stay their lawsuit in the Northern District of Georgia, which was granted by the court.

Hewlett-Packard Company v. Oracle (Itanium). On June 15, 2011, HP Inc. filed suit against Oracle in the Superior Court of California, County of Santa Clara in connection with Oracle's March 2011 announcement that it was discontinuing software support for HP Inc.’s Itanium-based line of mission critical servers.  HP Inc. asserted, among other things, that Oracle’s actions breached the contract that was signed by the parties as part of the settlement of the litigation relating to Oracle’s hiring of Mark Hurd. The matter eventually progressed to trial, which was bifurcated into two phases. HP Inc. prevailed in the first phase of the trial, in which the court ruled that the contract at issue required Oracle to continue to offer its software products on HP Inc.'s Itanium-based servers for as long as HP Inc. decided to sell such servers. Phase 2 of the trial was then postponed by Oracle’s appeal of the

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

trial court’s denial of Oracle’s “anti-SLAPP” motion, in which Oracle argued that HP Inc.’s damages claim infringed on Oracle’s First Amendment rights.  On August 27, 2015, the California Court of Appeal rejected Oracle’s appeal. The matter was remanded to the trial court for Phase 2 of the trial, which began on May 23, 2016, and was submitted to the jury on June 29, 2016.  On June 30, 2016, the jury returned a verdict in favor of HP Inc., awarding HP Inc. approximately $3 billion in damages:  $1.7 billion for past lost profits and $1.3 billion for future lost profits. On October 20, 2016, the court entered judgment for this amount with interest accruing until the judgment is paid. Oracle’s motion for a new trial was denied on December 19, 2016, and Oracle filed its notice of appeal from the trial court’s judgment on January 17, 2017. On February 2, 2017, HP Inc. filed a notice of cross-appeal challenging the trial court’s denial of prejudgment interest. Oracle filed its opening brief in the California Court of Appeal on March 7, 2019. HP Inc.’s answering/cross-opening brief was filed on June 12, 2019. On May 16, 2019, HP Inc. filed its application to renew the judgment. As of May 16, 2019, the renewed judgment is approximately $3.8 billion. Daily interest on the renewed judgment is now accruing at $1.037 million. Pursuant to the terms of the Separation and Distribution Agreement, HP Inc. and Hewlett Packard Enterprise will share equally in any recovery from Oracle once Hewlett Packard Enterprise has been reimbursed for all costs incurred in the prosecution of the action prior to the HP Inc. /Hewlett Packard Enterprise separation on November 1, 2015.

Oracle America, Inc., et al. v. Hewlett Packard Enterprise Company (Terix copyright matter). On March 22, 2016, Oracle filed a complaint against HPE in the United States District Court for the Northern District of California, alleging copyright infringement, interference with contract, intentional interference with prospective economic relations, and unfair competition.  Oracle’s claims arise out of HPE’s prior use of a third-party maintenance provider named Terix Computer Company, Inc. (“Terix”). Oracle contends that in connection with HPE’s use of Terix as a subcontractor for certain customers of HPE’s multivendor support business, Oracle’s copyrights were infringed, and HPE is liable for vicarious and contributory infringement and related claims. The lawsuit against HPE follows a prior lawsuit brought by Oracle against Terix in 2013 relating to Terix’s alleged unauthorized provision of Solaris patches to customers on Oracle hardware. On June 14, 2018, the court heard oral argument on HPE's and Oracle's cross-motions for summary judgment. The court has not yet ruled on the parties' motions. On January 29, 2019, the court granted HPE’s Motion for Summary Judgment as to all of Oracle’s claims and vacated the trial date. On February 20, 2019, the court entered judgment in favor of HPE, dismissing Oracle’s claims in their entirety. Oracle has appealed the trial court’s ruling to the United States Court of Appeals for the Ninth Circuit. Oracle’s opening brief was filed on July 29, 2019. HPE’s responsive brief currently is due September 27, 2019.

Network-1 Technologies, Inc. v. Alcatel-Lucent USA Inc., et al. This patent infringement action was filed on September 15, 2011 in the United States District Court for the Eastern District of Texas, alleging that various Hewlett Packard Enterprise switches and access points infringe Network-1’s patent relating to the 802.3af and 802.3at “Power over Ethernet” standards. Network-1 seeks damages, attorneys’ fees and costs, and declaratory and injunctive relief. The Network-1 patent at issue expires in 2020. A jury trial was conducted beginning on November 6, 2017. On November 13, 2017, the jury returned a verdict in favor of HPE, finding that HPE did not infringe Network-1’s patent and that the patent was invalid. On August 29 2018, the court denied Network-1's motion for a new trial on infringement and entered the jury's verdict finding that HPE does not infringe the relevant Network-1 patent. The court also granted Network-1's motion for Judgment as a Matter of Law on validity. Network-1 has appealed the jury verdict of non-infringement to the United States Court of Appeals for the Federal Circuit. HPE has cross-appealed the court’s decision to grant Network-1's motion for Judgment as a Matter of Law on validity. Appellate briefing has been completed.

Shared Litigation with HP Inc., DXC and Micro Focus

As part of the Separation and Distribution Agreements between Hewlett Packard Enterprise and HP Inc., Hewlett Packard Enterprise and DXC, and Hewlett Packard Enterprise and Seattle SpinCo, the parties to each agreement agreed to cooperate with each other in managing certain existing litigation related to both parties' businesses. The Separation and Distribution Agreements also included provisions that assign to the parties responsibility for managing pending and future litigation related to the general corporate matters of HP Inc. (in the case of the separation of Hewlett Packard Enterprise from HP Inc.) or of Hewlett Packard Enterprise (in the case of the separation of DXC from Hewlett Packard Enterprise and the separation of Seattle SpinCo from Hewlett Packard Enterprise), in each case arising prior to the applicable separation.

Note 16: Indemnifications

General Cross-indemnification and Tax Matters Agreements with HP Inc., DXC and Micro Focus

In connection with the Separation and the Everett and Seattle Transactions, the Company entered into a Separation and Distribution Agreement and Tax Matters Agreement with HP Inc., DXC and affiliates, and Micro Focus and affiliates, effective November 1, 2015, March 31, 2017 and September 1, 2017, respectively. For further details on these agreements, see the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

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Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

As of July 31, 2019 and October 31, 2018, the Company’s receivable and payable balances related to indemnified litigation matters and other contingencies, and income tax-related indemnification covered by these agreements were as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Litigation matters and other contingencies
Receivable	$	88	$	104
Payable	$	57	$	83
Income tax-related indemnification(1)
Net indemnification receivable - long-term(2)	$	266	$	16
Net indemnification receivable - short-term	$	13	$	17
Net indemnification payable - long-term	$	9	$	9
Net indemnification payable - short-term(3)	$	102	$	26

(1) The actual amount that the Company may receive or pay could vary depending upon the outcome of certain unresolved tax matters, which may not be resolved for several years.

(2) For the nine months ended July 31, 2019, the increase in Net indemnification receivable - long-term was due primarily to the effects of U.S. tax reform on tax attributes related to fiscal periods prior to the Separation.

(3) For the nine months ended July 31, 2019, the increase in Net indemnification payable - short-term was due primarily to the effective settlement of the U.S. federal income tax audit of fiscal years 2013 through 2015 for HP Inc. for which the Company was joint and severally liable and for which the Company was partially indemnified by HP Inc. under the Tax Matters Agreement.

45

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

This Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is organized as follows:

• Overview.  A discussion of our business and overall analysis of financial and other highlights affecting the Company to provide context for the remainder of MD&A. The overview analysis compares the three and nine months ended July 31, 2019 to the prior-year periods.

• Critical Accounting Policies and Estimates.  A discussion of accounting policies and estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results.

• Results of Operations.  An analysis of our financial results comparing the three and nine months ended July 31, 2019 to the prior-year periods. A discussion of the results of operations at the consolidated level is followed by a discussion of the results of operations at the segment level.

• Liquidity and Capital Resources.  An analysis of changes in our cash flows and a discussion of our financial condition and liquidity.

• Contractual and Other Obligations.  An overview of contractual obligations, retirement and post-retirement benefit plan funding, restructuring plans, uncertain tax positions, cross-indemnifications with HP Inc. (formerly known as "Hewlett-Packard Company"), DXC Technology Company ("DXC"), and Micro Focus International plc ("Micro Focus") and off-balance sheet arrangements.

We intend the discussion of our financial condition and results of operations that follows to provide information that will assist the reader in understanding our Condensed Consolidated Financial Statements, the changes in certain key items in those financial statements from year to year, and the primary factors that accounted for those changes, as well as how certain accounting principles, policies and estimates affect our Condensed Consolidated Financial Statements. This discussion should be read in conjunction with our Condensed Consolidated Financial Statements and the related notes that appear elsewhere in this document.

On November 1, 2015, we became an independent publicly-traded company through a pro rata distribution by HP Inc. ("former Parent" or "HPI"), formerly known as Hewlett-Packard Company, of 100% of our outstanding shares to HP Inc.'s stockholders (the "Separation").

On April 1, 2017 and September 1, 2017, we completed the separation and merger of our Enterprise Services business with Computer Sciences Corporation ("CSC") (collectively, the "Everett Transaction") and the separation and merger of our Software business segment with Micro Focus (collectively, the “Seattle Transaction”), respectively. The historical financial results of Everett and Seattle are reported as Net loss from discontinued operations in the Condensed Consolidated Statements of Earnings.

The following Overview, Results of Operations and Liquidity discussions and analysis compare the three and nine months ended July 31, 2019 to the prior-year periods, unless otherwise noted. The Capital Resources and Contractual and Other Obligations discussions present information as of July 31, 2019, unless otherwise noted.

        For purposes of this MD&A section, we use the terms "Hewlett Packard Enterprise", "HPE", the "Company", "we", "us" and "our" to refer to Hewlett Packard Enterprise Company.

OVERVIEW

We are a global technology leader focused on developing intelligent solutions that allow customers to capture, analyze and act upon data seamlessly from edge to cloud. We enable customers to accelerate business outcomes by driving new business models, creating new customer and employee experiences, and increasing operational efficiency today and into the future. Our legacy dates back to a partnership founded in 1939 by William R. Hewlett and David Packard, and we strive every day to uphold and enhance that legacy through our dedication to providing innovative technological solutions to our customers.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

We organize our business into four segments for financial reporting purposes: Hybrid IT, Intelligent Edge, Financial Services ("FS") and Corporate Investments. The following provides an overview of our key financial metrics by segment for the three months ended July 31, 2019, as compared to the prior-year period:

	HPE Consolidated			Hybrid IT			Intelligent Edge			Financial Services			Corporate Investments
	Dollars in millions, except for per share amounts
Net revenue(1)	$	7,217		$	5,549		$	762		$	888		$	130
Year-over-year change %		(7.0	)%		(9.2	)%		(2.9	)%		(4.3	)%		(3.0	)%
(Loss) earnings from continuing operations(2)	$	(76	)	$	704		$	37		$	77		$	(25	)
(Loss) earnings from continuing operations as a % of net revenue		(1.1	)%		12.7	%		4.9	%		8.7	%		(19.2	)%
Year-over-year change percentage points		(7.4	)pts		2.5	pts		(8.0	)pts		0.9	pts		(0.5	)pts
Net loss from continuing operations	$	(27	)
Net (loss) earnings per share
Basic net EPS from continuing operations	$	(0.02	)
Diluted net EPS from continuing operations	$	(0.02	)

(1) HPE consolidated net revenue excludes intersegment net revenue and other.

(2) Segment earnings from operations exclude certain unallocated corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, acquisition, disposition and other related charges, transformation costs, amortization of intangible assets, restructuring charges and separation costs.

Three months ended July 31, 2019 compared with three months ended July 31, 2018

Net revenue decreased by $547 million, or 7.0% (decreased 5.4% on a constant currency basis), for the three months ended July 31, 2019, as compared to the prior-year period in part due to deliberate actions we are taking to minimize revenue from less profitable product categories and certain markets, from challenges related to market weakness and go-to-market execution issues. The leading contributor to the net revenue decrease was lower revenue of $560 million in Hybrid IT due primarily to a combination of factors which include: a decline in Tier-1 server sales and lower revenue from China, both of which was primarily experienced within Compute; demand weakness resulting in lower revenue from Industry Standard Server ("ISS") core products within Compute and lower HPE Pointnext services revenue; a decline in revenue from Storage products resulting from market weakness; and unfavorable currency fluctuations. Additionally, we experienced a revenue decline in Intelligent Edge due to lower sales of campus switching products within HPE Aruba Products and a revenue decline in Financial Services due to lower rental revenue and unfavorable currency fluctuations. The overall net revenue decline was partially offset by revenue growth in HPE Aruba Services within Intelligent Edge and in HPE Nimble Storage within Hybrid IT.

We continue to execute on our HPE Next initiative, which includes streamlining our offerings and business processes, and shifting investments in innovation towards high growth and higher margin solutions and services, which provided a favorable impact to the performance of certain business units in the current period. Gross margin was 33.9% ($2.4 billion) and 30.5% ($2.4 billion) for the three months ended July 31, 2019 and 2018, respectively. The 3.4 percentage point increase in gross margin was due primarily to Hybrid IT as a result of the year-over-year decrease in commodity costs, cost management initiatives and a lower mix of revenue from Tier-1 server sales along with a higher mix of revenue from higher-margin products. Operating margin decreased 7.4 percentage points in the three months ended July 31, 2019, as compared to the prior-year period, due primarily to higher acquisition, disposition and other related charges as a result of a one-time charge associated with an arbitration settlement, higher transformation costs related to the HPE Next initiative and higher research and development expense and selling, general and administrative expense as a percentage of net revenue, partially offset by the gross margin increase.

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

The following provides an overview of our key financial metrics by segment for the nine months ended July 31, 2019 as compared to the prior-year period:

	HPE Consolidated			Hybrid IT			Intelligent Edge			Financial Services			Corporate Investments
		Dollars in millions, except for per share amounts
Net revenue(1)	$	21,920		$	17,155		$	2,114		$	2,703		$	373
Year-over-year change %		(4.3	)%		(5.5	)%		(1.5	)%		(1.1	)%		(7.7	)%
Earnings (loss) from operations(2)	$	814		$	2,024		$	66		$	231		$	(82	)
Earnings (loss) from operations as a % of net revenue		3.7	%		11.8	%		3.1	%		8.5	%		(22.0	)%
Year-over-year change percentage points		(1.0	)pts		2.0pts			(5.8)pts			0.6pts			(2.4)pts
Net earnings from continuing operations	$	569
Net earnings per share
Basic EPS from continuing operations	$	0.42
Diluted EPS from continuing operations	$	0.41

(1) HPE consolidated net revenue excludes intersegment net revenue and other.

(2) Segment earnings from operations exclude certain unallocated corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, acquisition, disposition and other related charges, transformation costs, amortization of intangible assets, restructuring charges and disaster charges.

Nine months ended July 31, 2019 compared with nine months ended July 31, 2018

Net revenue decreased by $986 million, or 4.3% (decreased 3.0% on a constant currency basis), for the nine months ended July 31, 2019, as compared to the prior-year period. The leading contributor to the net revenue decrease was lower revenue of $1.0 billion in Hybrid IT due to a decline in Tier-1 server sales and decreased revenue from China which was primarily experienced within Compute, lower HPE Pointnext services revenue due to demand weakness and unfavorable currency fluctuations. Additionally, we experienced revenue declines in Intelligent Edge due to lower sales of switching products within HPE Aruba Products and in Financial Services due to unfavorable currency fluctuations and lower rental revenue. The overall net revenue decline was partially offset by growth in HPE Aruba Services within Intelligent Edge and growth in Storage within Hybrid IT driven by HPE Nimble Storage.

Gross margin was 32.4% ($7.1 billion) and 29.7% ($6.8 billion) for the nine months ended July 31, 2019 and 2018, respectively. The 2.7 percentage point increase in gross margin was due primarily to Hybrid IT as a result of the year-over-year decrease in commodity costs, cost management initiatives, and a lower mix of revenue from Tier-1 server sales along with a higher mix of revenue from higher-margin products. Operating margin decreased 1.0 percentage points in the nine months ended July 31, 2019, as compared to the prior-year period, due primarily to higher acquisition, disposition and other related charges as a result of a one-time charge associated with an arbitration settlement and higher research and development expense as a percentage of net revenue, partially offset by the gross margin increase and lower transformation costs.

As of July 31, 2019, cash, cash equivalents and restricted cash and long-term investments were $4.1 billion, representing a decrease of approximately $1.0 billion from the October 31, 2018 balance of $5.1 billion. The decrease was due primarily to the following: share repurchases and cash dividend payments of $2.4 billion and investments in property, plant and equipment, net of sales proceeds, of $1.7 billion, partially offset by cash provided by operating activities of $2.6 billion and net financial collateral received of $0.4 billion.

Trends and Uncertainties

We are in the process of addressing many challenges facing our business, a discussion of which is available in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

For a further discussion of trends, uncertainties and other factors that could impact our operating results, see the section entitled "Risk Factors" in Item 1A.

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Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Management's Discussion and Analysis of Financial Condition and Results of Operations is based on our Condensed Consolidated Financial Statements, which have been prepared in accordance with United States ("U.S.") Generally Accepted Accounting Principles ("GAAP"). The preparation of these financial statements requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, net revenues and expenses, and disclosure of contingent liabilities. Management believes that there have been no significant changes during the nine months ended July 31, 2019, with the exception of certain accounting policies that were updated resulting from our adoption of the new revenue recognition standard (See Note 1, "Overview and Summary of Significant Accounting Policies"), to the items that we disclosed as our critical accounting policies and estimates in Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

ACCOUNTING PRONOUNCEMENTS

For a summary of recent accounting pronouncements applicable to our Condensed Consolidated Financial Statements, see Note 1, "Overview and Summary of Significant Accounting Policies".

RESULTS OF OPERATIONS

Revenue from our international operations has historically represented, and we expect will continue to represent, a majority of our overall net revenue. As a result, our revenue growth has been impacted, and we expect will continue to be impacted, by fluctuations in foreign currency exchange rates. In order to provide a framework for assessing performance excluding the impact of foreign currency fluctuations, we present the year-over-year percentage change in revenue on a constant currency basis, which assumes no change in foreign currency exchange rates from the prior-year period and doesn't adjust for any repricing or demand impacts from changes in foreign currency exchange rates. This change in revenue on a constant currency basis is calculated as the quotient of (a) current year revenue converted to U.S. dollars using the prior-year period's foreign currency exchange rates divided by (b) prior-year period revenue. This information is provided so that revenue can be viewed without the effect of fluctuations in foreign currency exchange rates, which is consistent with how management evaluates our revenue results and trends. This constant currency disclosure is provided in addition to, and not as a substitute for, the year-over-year percentage change in revenue on a GAAP basis. Other companies may calculate and define similarly labeled items differently, which may limit the usefulness of this measure for comparative purposes.

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Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Results of operations in dollars and as a percentage of net revenue were as follows:

	Three months ended July 31,										Nine months ended July 31,
	2019					2018					2019					2018
	Dollars			% of Revenue		Dollars			% of Revenue		Dollars			% of Revenue		Dollars			% of Revenue
	Dollars in millions
Net revenue	$	7,217		100.0	%	$	7,764		100.0	%	$	21,920		100.0	%	$	22,906		100.0	%
Cost of sales	4,768			66.1		5,399			69.5		14,820			67.6		16,114			70.3
Gross profit	2,449			33.9		2,365			30.5		7,100			32.4		6,792			29.7
Research and development	481			6.7		435			5.6		1,404			6.4		1,227			5.4
Selling, general and administrative	1,253			17.3		1,221			15.8		3,678			16.8		3,684			16.1
Amortization of intangible assets	58			0.9		72			0.9		199			0.9		222			1.0
Restructuring charges	—			—		(1		)	—		—			—		14			0.1
Transformation costs	170			2.4		126			1.6		302			1.4		491			2.1
Disaster charges	—			—		—			—		(7		)	—		—			—
Acquisition, disposition and other related charges	563			7.7		24			0.3		710			3.2		70			0.3
Separation costs	—			—		(2		)	—		—			—		—			—
(Loss) earnings from continuing operations	(76		)	(1.1	)	490			6.3		814			3.7		1,084			4.7
Interest and other, net	(70		)	(1.0	)	(64		)	(0.7	)	(139		)	(0.6	)	(163		)	(0.6	)
Tax indemnification adjustments	(134		)	(1.8	)	2			—		89			0.4		(1,342		)	(5.9	)
Non-service net periodic benefit credit	12			0.2		26			0.3		45			0.2		90			0.4
Earnings from equity interests	3			—		11			0.1		21			0.1		23			0.1
(Loss) earnings from continuing operations before taxes	(265		)	(3.7	)	465			6.0		830			3.8		(308		)	(1.3	)
Benefit (provision) for taxes	238			3.3		(13		)	(0.2	)	(261		)	(1.2	)	3,092			13.5
Net (loss) earnings from continuing operations	(27		)	(0.4	)	452			5.8		569			2.6		2,784			12.2
Net loss from discontinued operations	—			—		(1		)	—		—			—		(119		)	(0.6	)
Net (loss) earnings	$	(27	)	(0.4	)%	$	451		5.8	%	$	569		2.6	%	$	2,665		11.6	%

Stock-based compensation expense is included within costs and expenses presented in the table above as follows:

	Three months ended July 31,				Nine months ended July 31,
	2019		2018		2019		2018
	In millions
Cost of sales	$	7	$	7	$	30	$	34
Research and development	15		14		55		60
Selling, general and administrative	36		35		122		148
Transformation costs	—		—		2		3
Acquisition, disposition and other related charges	—		1		—		10
Separation costs	—		—		—		10
Stock-based compensation expense from continuing operations	$	58	$	57	$	209	$	265

Net Revenue

For the three months ended July 31, 2019, as compared to the prior-year period, total net revenue decreased by $547 million, or 7.0% (decreased 5.4% on a constant currency basis). U.S. net revenue decreased by $201 million, or 7.6%, to $2.4 billion, and

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

net revenue from outside of the U.S. decreased by $346 million, or 6.7%, to $4.8 billion. For the nine months ended July 31, 2019, as compared to the prior-year period, total net revenue decreased by $986 million, or 4.3% (decreased 3.0% on a constant currency basis). U.S. net revenue decreased by $329 million, or 4.4%, to $7.1 billion, and net revenue from outside of the U.S. decreased by $657 million, or 4.3%, to $14.8 billion.

The components of the weighted net revenue change by segment were as follows:

	Three months ended July 31, 2019		Nine months ended July 31, 2019
	Percentage points
Hybrid IT	(7.2	)	(4.4	)
Intelligent Edge	(0.3	)	(0.1	)
Financial Services	(0.5	)	(0.1	)
Corporate Investments/Other (1)	1.0		0.3
Total HPE	(7.0	)	(4.3	)

(1) Other primarily relates to the elimination of intersegment net revenue.

Three months ended July 31, 2019 compared with the three months ended July 31, 2018

From a segment perspective, the primary factors contributing to the change in total net revenue are summarized as follows:

• Hybrid IT net revenue decreased due to a combination of factors including: lower Tier-1 server sales and lower revenue from China as we continue to exit less profitable product categories and certain markets, which was primarily experienced within Compute, demand weakness resulting in lower revenue from ISS core products within Compute and lower HPE Pointnext services revenue, a decline in revenue from Storage products resulting from market weakness, and unfavorable currency fluctuations;

• Intelligent Edge net revenue decreased due primarily to unfavorable currency fluctuations and lower sales of campus switching products within HPE Aruba Products driven by sales execution issues; and

• FS net revenue decreased due primarily to lower rental revenue from lower average operating leases and unfavorable currency fluctuations.

Nine months ended July 31, 2019 compared with the nine months ended July 31, 2018

From a segment perspective, the primary factors contributing to the change in total net revenue are summarized as follows:

• Hybrid IT net revenue decreased due to a decline in Tier-1 server sales and lower revenue from China which was primarily experienced within Compute, lower HPE Pointnext services revenue due to demand weakness and unfavorable currency fluctuations;

• Intelligent Edge net revenue decreased due primarily to lower sales of our switching products within HPE Aruba Products driven by sales execution issues; and

• FS net revenue decreased due primarily to unfavorable currency fluctuations and lower rental revenue from lower average operating leases.

A more detailed discussion of segment revenue is included under "Segment Information" below.

Gross Margin

For the three and nine months ended July 31, 2019, as compared to the prior-year periods, total gross margin increased 3.4 and 2.7 percentage points, respectively. From a segment perspective, the primary factors impacting gross margin performance are summarized as follows:

• Hybrid IT gross margin increased for the three and nine months ended July 31, 2019, as compared to the prior-year periods, due primarily to a combination of factors including the year-over-year decrease in commodity costs, cost management

51

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

initiatives, and a lower mix of revenue from Tier-1 server sales coupled with a higher mix of revenue from higher-margin products;

• Intelligent Edge gross margin decreased for the three months ended July 31, 2019, as compared to the prior-year period, due primarily to unfavorable rates resulting from competitive pressures on products. Intelligent Edge gross margin increased for the nine months ended July 31, 2019, as compared to the prior-year period, due primarily to favorable currency fluctuations, a higher mix of revenue from higher-margin WLAN products and HPE Aruba Services, and cost management activities; and

• FS gross margin increased for the three and nine months ended July 31, 2019, as compared to the prior-year periods due primarily to higher margins from lease extensions and lease buyouts. Additionally, the nine month period had lower bad debt expense compared to the prior-year period.

A more detailed discussion of segment gross margins and operating margins is included under "Segment Information" below.

Operating Expenses

Research and Development

Research and development ("R&D") expense increased by $46 million or 11% and by $177 million or 14%, for the three and nine months ended July 31, 2019, respectively, as compared to the prior-year periods, due primarily to increased investment in new product development in the Hybrid IT and Intelligent Edge segments, higher variable compensation expenses, and higher costs associated with recent business acquisitions, partially offset by favorable currency fluctuations.

Selling, General and Administrative

Selling, general and administrative expense increased by $32 million or 3% for the three months ended July 31, 2019, as compared to the prior-year period due primarily to higher field selling costs and higher variable compensation expenses, partially offset by favorable currency fluctuations.

For the nine months ended July 31, 2019, as compared to the prior-year period, selling, general and administrative expense decreased by $6 million, due primarily to favorable currency fluctuations and lower marketing and administrative expenses as a result of the HPE Next initiative, partially offset by higher field selling costs, variable compensation expenses and higher costs associated with recent business acquisitions.

Amortization of Intangible Assets

Amortization expense decreased by $14 million or 19%, and by $23 million or 10%, for the three and nine months ended July 31, 2019, respectively, as compared to the prior-year periods, due to certain intangible assets associated with prior acquisitions reaching the end of their amortization periods, partially offset by the addition of intangible assets from recent acquisitions.

Transformation Costs

For the three months ended July 31, 2019, HPE Next transformation costs increased by $44 million or 35%, as compared to the prior-year period, due primarily to the benefit from gains on real estate sales in the prior-year period, impairment charges on real estate assets in the current period and higher IT costs, partially offset by lower restructuring charges and program management costs.

For the nine months ended July 31, 2019, HPE Next transformation costs decreased by $189 million or 38%, compared to the prior-year period, due primarily to lower restructuring charges, program management costs and IT costs, partially offset by the benefit from gains on real estate sales in the prior-year period and impairment charges on real estate assets in the current period.

Disaster Charges

Disaster charges for the nine months ended July 31, 2019, represent a net gain from settlements related to the damage sustained at our facilities in Houston, Texas, as a result of Hurricane Harvey.

52

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Acquisition, Disposition and Other Related Charges

Acquisition, disposition and other related charges increased by $539 million and $640 million for the three and nine months ended July 31, 2019, respectively, as compared to the prior-year periods, due primarily to a charge related to a one-time arbitration settlement, partially offset by reduced costs for acquisition related retention bonuses and integration activities.

Interest and Other, Net

Interest and other, net expense increased by $6 million for the three months ended July 31, 2019, as compared with the prior-year period, due primarily to a net gain on the sale of certain assets in the prior-year period, partially offset by lower net interest expense in the current period.

Interest and other, net expense decreased by $24 million for the nine months ended July 31, 2019, as compared to the prior-year period, due primarily to a net gain from the sale of investments in the current period and a net loss from the sale of investments in the prior-year period.

Non-service net periodic benefit credit

Non-service net periodic benefit credit for the three and nine months ended July 31, 2019, represent adjustments to the net periodic pension benefit cost resulting from the remeasurement of certain Hewlett Packard Enterprise defined benefit pension and post-retirement benefit plans due to factors such as interest cost, expected return on plan assets, amortization of prior plan amendments, amortized actuarial gains or losses and the impact of any plan settlements or curtailments.

Tax Indemnification Adjustments

We recorded tax indemnification expense of $134 million and tax indemnification income of $2 million for the three months ended July 31, 2019 and 2018, respectively, and tax indemnification income of $89 million and tax indemnification expense of $1.3 billion for the nine months ended July 31, 2019 and 2018, respectively. For the three and nine months ended July 31, 2019, the amount was due primarily to the impacts of the effective settlement of the U.S. federal income tax audit of fiscal years 2013 through 2015 for HP Inc. The activity for the nine months ended July 31, 2019 also included the effects of U.S. tax reform on tax attributes related to fiscal periods prior to the Separation. For the three and nine months ended July 31, 2018, the amounts resulted from changes in certain pre-Separation tax liabilities for which we share joint and several liability with HP Inc. and for which we are partially indemnified by HP Inc. under the Tax Matters Agreement.

Earnings from Equity Interests

Earnings from equity interests primarily represents our 49% interest in H3C and the amortization of our interest in a basis difference. For the three and nine months ended July 31, 2019, earnings from equity interests decreased compared to the prior-year periods as a result of lower net income earned by H3C.

Provision for Taxes

Our effective tax rate was 89.8% and 2.8% for the three months ended July 31, 2019 and 2018, respectively, and 31.4% and 1,003.9% for the nine months ended July 31, 2019 and 2018, respectively. Our effective tax rates for the three and nine months ended July 31, 2019 and 2018 were significantly impacted by the Tax Cuts and Jobs Act (the “Tax Act”) and the settlement of certain pre-Separation tax liabilities of HP Inc.

On December 22, 2017, the Tax Act was enacted into law, which significantly changed existing U.S. tax law and included numerous provisions that affect our business, such as imposing a one-time Transition Tax on deemed repatriation of deferred foreign income, reducing the U.S. federal statutory tax rate, and adopting a modified territorial tax system. See Note 6, "Taxes on Earnings", for a full description of the impact of the Tax Act to our operations.

Segment Information

Effective at the beginning of the first quarter of fiscal 2019, the Company implemented organizational changes to align its segment financial reporting more closely with its current business structure. For additional information related to these realignments and for a description of the products and services for each segment, see Note 2, "Segment Information".

53

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Hybrid IT

	Three months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	5,549		$	6,109		(9.2	)%
Earnings from operations	$	704		$	624		12.8	%
Earnings from operations as a % of net revenue	12.7		%	10.2		%

	Nine months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	17,155		$	18,160		(5.5	)%
Earnings from operations	$	2,024		$	1,787		13.3	%
Earnings from operations as a % of net revenue	11.8		%	9.8		%

The components of the weighted net revenue change by business unit were as follows:

	Three months ended July 31,
	Net Revenue				Weighted Net Revenue Change Percentage Points
	2019		2018		2019
	Dollars in millions
Compute	$	3,151	$	3,569	(6.9	)
Storage	844		887		(0.7	)
Hybrid IT Product	3,995		4,456		(7.6	)
HPE Pointnext	1,554		1,653		(1.6	)
Total Hybrid IT	$	5,549	$	6,109	(9.2	)

	Nine months ended July 31,
	Net Revenue				Weighted Net Revenue Change Percentage Points
	2019		2018		2019
	Dollars in millions
Compute	$	9,646	$	10,350	(3.9	)
Storage	2,761		2,747		0.1
Hybrid IT Product	12,407		13,097		(3.8	)
HPE Pointnext	4,748		5,063		(1.7	)
Total Hybrid IT	$	17,155	$	18,160	(5.5	)

54

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Three months ended July 31, 2019 compared with three months ended July 31, 2018

Hybrid IT net revenue decreased by $560 million, or 9.2% (decreased 7.7% on a constant currency basis), for the three months ended July 31, 2019, as we continue to execute on our HPE Next initiative, which includes streamlining our offerings and business processes, and shifting investments in innovation towards high growth and higher margin solutions and services. The decrease in Hybrid IT net revenue was due primarily to a decline in Tier-1 server sales and lower revenue from China as we continue to exit less profitable product categories and certain markets, which was primarily experienced within Compute. The net revenue decline was also due to lower revenue from Compute as a result of a decline in ISS core products due to demand weakness resulting in longer sales cycles, a decline in HPE Pointnext revenue due in part to demand weakness and unfavorable currency fluctuations, and a decline in Storage revenue due to market weakness. Partially offsetting this decrease was revenue growth from HPE Nimble Storage.

Hybrid IT Product net revenue decreased by $461 million, or 10%, with a decline of 12% in Compute and a decline of 5% in Storage.

• The net revenue decrease in Compute was due primarily to a combination of factors, including a decline in Tier-1 server sales and revenue decline from China. The net revenue decrease in Compute was also due to the decrease in ISS core products, which was driven by a decrease in unit shipments as a result of demand weakness, while Average Unit Prices ("AUPs") remained flat. The decline in unit shipments was experienced primarily in the blade category. Mission-critical servers ("MCS") experienced a net revenue decrease led by a revenue decline in Itanium and NonStop products.

• The net revenue decrease in Storage was due primarily to a decline across product categories primarily 3PAR, Big Data, and traditional storage products driven by market weakness, partially offset by revenue growth in HPE Nimble Storage.

HPE Pointnext net revenue decreased by $99 million, or 6%, due primarily to revenue declines in Operational Services from lower demand in prior periods and the impact of unfavorable currency fluctuations.

Hybrid IT earnings from operations as a percentage of net revenue increased 2.5 percentage points for the three months ended July 31, 2019, as compared to the prior-year period, due to an increase in gross margin which was partially offset by an increase in operating expenses as a percentage of net revenue. The increase in gross margin was due primarily to a combination of factors including the year-over-year decrease in commodity costs, lower costs of services and products due to our cost management initiatives and a lower mix of revenue from Tier-1 server sales coupled with a higher mix of revenue from higher-margin products. The increase in gross margin was partially offset by unfavorable currency fluctuations. The increase in operating expenses as a percentage of net revenue was due primarily to the net revenue decline and an increase in operating expenses driven by higher field selling costs and R&D costs, compared to the prior-year period.

Nine months ended July 31, 2019 compared with nine months ended July 31, 2018

Hybrid IT net revenue decreased by $1.0 billion, or 5.5% (decreased 4.4% on a constant currency basis), for the nine months ended July 31, 2019. The decrease in Hybrid IT net revenue was due primarily to a decline in Tier-1 server sales and a decline in revenue from China, both of which was primarily experienced within Compute, and a decline in HPE Pointnext revenue due to demand weakness and unfavorable currency fluctuations. Partially offsetting this decrease was higher revenue from HPE Nimble Storage.

Hybrid IT Product net revenue decreased by $690 million, or 5%, with a decline of 7% in Compute and growth of 1% in Storage.

• The net revenue decrease in Compute was due primarily to a decline in Tier-1 server sales and a decline in revenue from China. Revenue from ISS core remained flat due to a decline in unit shipments, primarily in the blade, tower and rack categories, offset by higher AUPs across core products. MCS experienced a net revenue decrease led by a revenue decline in Itanium and NonStop products.

• The net revenue increase in Storage was due primarily to revenue growth from HPE Nimble Storage and traditional storage products, partially offset by a decline in revenue from 3PAR and Big Data products.

HPE Pointnext net revenue decreased by $315 million, or 6%, due primarily to revenue declines in Operational Services and Advisory and Professional Services resulting in part from demand weakness. Additionally, Advisory and Professional Services experienced lower revenue as a result of our initiative to streamline our go-to-market approach in certain countries. The impact of unfavorable currency fluctuations contributed to the overall revenue decline in HPE Pointnext.

55

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Hybrid IT earnings from operations as a percentage of net revenue increased 2.0 percentage points for the nine months ended July 31, 2019, as compared to the prior-year period, due to an increase in gross margin which was partially offset by an increase in operating expenses as a percentage of net revenue. The increase in gross margin was due primarily to a combination of factors including the year-over-year decrease in commodity costs, lower costs of services and products due to our cost management initiatives and a lower mix of revenue from Tier-1 server sales coupled with a higher mix of revenue from higher-margin products. The increase to gross margin was partially offset by unfavorable currency fluctuations and higher variable compensation expense. The increase in operating expenses as a percentage of net revenue was due primarily to the net revenue decline and higher R&D costs.

Intelligent Edge

	Three months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	762		$	785		(2.9	)%
Earnings from operations	$	37		$	101		(63.4	)%
Earnings from operations as a % of net revenue	4.9		%	12.9		%

	Nine months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	2,114		$	2,147		(1.5	)%
Earnings from operations	$	66		$	191		(65.4	)%
Earnings from operations as a % of net revenue	3.1		%	8.9		%

The components of the weighted net revenue change by business unit were as follows:

	Three months ended July 31,
	Net Revenue				Weighted Net Revenue Change Percentage Points
	2019		2018		2019
	Dollars in millions
HPE Aruba Product	$	668	$	703	(4.6	)
HPE Aruba Services	94		82		1.7
Total Intelligent Edge	$	762	$	785	(2.9	)

	Nine months ended July 31,
	Net Revenue				Weighted Net Revenue Change Percentage Points
	2019		2018		2019
	Dollars in millions
HPE Aruba Product	$	1,842	$	1,914	(3.3	)
HPE Aruba Services	272		233		1.8
Total Intelligent Edge	$	2,114	$	2,147	(1.5	)

56

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Three months ended July 31, 2019 compared with three months ended July 31, 2018

Intelligent Edge net revenue decreased by $23 million, or 2.9% (decreased 1.5% on a constant currency basis), for the three months ended July 31, 2019, as compared to the prior-year period. The decrease in Intelligent Edge net revenue was due to a net decrease in HPE Aruba Product revenue of $35 million, or 5%, partially offset by an increase in HPE Aruba Services revenue of $12 million, or 15%. The decrease in HPE Aruba Product revenue was due primarily to unfavorable currency fluctuations and a revenue decline in campus switching products driven by sales execution issues, particularly in the North America region and weaker demand, while revenue growth from WLAN products was flat. The increase in HPE Aruba Services revenue was due primarily to services attach on a growing product installed base and an increase in renewal rates.

Intelligent Edge earnings from operations as a percentage of net revenue decreased by 8.0 percentage points for the three months ended July 31, 2019, as compared to the prior-year period, due to an increase in operating expenses as a percentage of net revenue as well as a decrease in gross margin. The increase in operating expenses as a percentage of net revenue was due primarily to increased R&D expenses and field selling costs. The gross margin decrease was due primarily to unfavorable rates resulting from competitive pressures on products, partially offset by a higher mix of revenue from higher-margin HPE Aruba Services and WLAN products and cost management activities.

Nine months ended July 31, 2019 compared with nine months ended July 31, 2018

Intelligent Edge net revenue decreased by $33 million, or 1.5% (decreased 0.8% on a constant currency basis), for the nine months ended July 31, 2019, as compared to the prior-year period. The decrease in Intelligent Edge net revenue was due to a net decrease in HPE Aruba Product revenue of $72 million, or 4%, partially offset by an increase in HPE Aruba Services revenue of $39 million, or 17%. The decrease in HPE Aruba Product revenue was due primarily to a revenue decline in our switching products, driven by sales execution issues, particularly in the North America region and weaker demand, partially offset by a slight revenue increase in WLAN products. The increase in HPE Aruba Services revenue was due primarily to services attach on a growing product installed base and an increase in renewal rates.

Intelligent Edge earnings from operations as a percentage of net revenue decreased by 5.8 percentage points for the nine months ended July 31, 2019, as compared to the prior-year period, due to an increase in operating expenses as a percentage of net revenue, partially offset by an increase in gross margin. The increase in operating expenses as a percentage of net revenue was due primarily to increased R&D expenses and field selling costs. The gross margin increase was due primarily to favorable currency fluctuations, a higher mix of revenue from higher-margin WLAN products and HPE Aruba Services, and cost management activities, partially offset by lower margins from unfavorable rates resulting from competitive pressures on products.

Financial Services

	Three months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	888		$	928		(4.3	)%
Earnings from operations	$	77		$	72		6.9	%
Earnings from operations as a % of net revenue	8.7		%	7.8		%

	Nine months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	2,703		$	2,732		(1.1	)%
Earnings from operations	$	231		$	215		7.4	%
Earnings from operations as a % of net revenue	8.5		%	7.9		%

57

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Three months ended July 31, 2019 compared with three months ended July 31, 2018

FS net revenue decreased by $40 million, or 4.3% (decreased 2.0% on a constant currency basis), for the three months ended July 31, 2019. The decrease in net revenue was due primarily to a decrease in rental revenue due to lower average operating leases and unfavorable currency fluctuations, partially offset by higher asset management revenue from lease extensions and end-of-lease monthly rentals.

FS earnings from operations as a percentage of net revenue increased 0.9 percentage points for the three months ended July 31, 2019 due to an increase in gross margin and a decrease in operating expenses as a percentage of net revenue. The increase in gross margin was due primarily to higher margins from lease extensions and lease buyouts, partially offset by lower portfolio margins from increased borrowing costs. Operating expenses as a percentage of net revenue decreased primarily as a result of lower variable compensation expense and lower field selling costs.

Nine months ended July 31, 2019 compared with nine months ended July 31, 2018

FS net revenue decreased by $29 million, or 1.1% (increased 1.9% on a constant currency basis), for the nine months ended July 31, 2019. The decrease in net revenue was due primarily to unfavorable currency fluctuations and a decrease in rental revenue due to lower average operating leases, partially offset by higher asset management revenue from end-of-lease monthly rentals, lease extensions and lease buyouts.

FS earnings from operations as a percentage of net revenue increased 0.6 percentage points for the nine months ended July 31, 2019 due to an increase in gross margin and a decrease in operating expenses as a percentage of net revenue. The increase in gross margin was due primarily to higher margins from lease extensions and lease buyouts, and lower bad debt expense, partially offset by lower portfolio margins from increased borrowing costs. Operating expenses as a percentage of net revenue decreased primarily as a result of lower field selling costs.

Financing Volume

	Three months ended July 31,				Nine months ended July 31,
	2019		2018		2019		2018
	In millions
Total financing volume	$	1,696	$	1,658	$	4,480	$	4,636

New financing volume, which represents the amount of financing provided to customers for equipment and related software and services, including intercompany activity, increased by 2.3% for the three months ended July 31, 2019 as compared to the prior-year period. The increase was primarily driven by higher financing associated with HPE product sales and related service offerings, partially offset by unfavorable currency fluctuations. New financing volume decreased 3.4% for the nine months ended July 31, 2019, as compared to the prior-year period, due primarily to unfavorable currency fluctuations.

58

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Portfolio Assets and Ratios

The portfolio assets and ratios derived from the segment balance sheets for FS were as follows:

	As of
	July 31, 2019			October 31, 2018
	Dollars in millions
Financing receivables, gross	$	8,566		$	8,256
Net equipment under operating leases	4,050			4,212
Capitalized profit on intercompany equipment transactions(1)	400			502
Intercompany leases(1)	103			125
Gross portfolio assets	13,119			13,095
Allowance for doubtful accounts(2)	133			120
Operating lease equipment reserve	62			63
Total reserves	195			183
Net portfolio assets	$	12,924		$	12,912
Reserve coverage	1.5		%	1.4		%
Debt-to-equity ratio(3)	7.0x			7.0x

(1) Intercompany activity is eliminated in consolidation.

(2) Allowance for doubtful accounts for financing receivables includes both the short- and long-term portions.

(3) Debt benefiting FS consists of intercompany equity that is treated as debt for segment reporting purposes, intercompany debt, and borrowing- and funding-related activity associated with FS and its subsidiaries. Debt benefiting FS totaled $11.5 billion and $11.4 billion at July 31, 2019 and October 31, 2018, respectively, and was determined by applying an assumed debt-to-equity ratio, which management believes to be comparable to that of other similar financing companies. FS equity at both July 31, 2019 and October 31, 2018 was $1.6 billion.

As of July 31, 2019 and October 31, 2018, FS net cash and cash equivalents balances were approximately $574 million and $735 million, respectively.

Net portfolio assets as of July 31, 2019 increased 0.1% from October 31, 2018. The increase generally resulted from new financing volume exceeding portfolio runoff during the period.

FS bad debt expense includes charges to general reserves and specific reserves for sales-type, direct-financing and operating leases. For the three and nine months ended July 31, 2019, FS recorded net bad debt expense of $19 million and $51 million, respectively. For the three and nine months ended July 31, 2018, FS recorded net bad debt expense of $22 million and $56 million, respectively.

59

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

Corporate Investments

	Three months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	130		$	134		(3.0	)%
Loss from operations	$	(25	)	$	(25	)	—	%
Loss from operations as a % of net revenue	(19.2		)%	(18.7		)%

	Nine months ended July 31,
	2019			2018			% Change
	Dollars in millions
Net revenue	$	373		$	404		(7.7	)%
Loss from operations	$	(82	)	$	(79	)	(3.8	)%
Loss from operations as a % of net revenue	(22.0		)%	(19.6		)%

Three and nine months ended July 31, 2019 compared with three and nine months ended July 31, 2018

Corporate Investments net revenue decreased by $4 million, or 3.0% (decreased 0.5% on a constant currency basis), for the three months ended July 31, 2019, and decreased by $31 million, or 7.7% (decreased 5.1% on a constant currency basis), for the nine months ended July 31, 2019, as compared to the prior-year periods, respectively. The decrease in Corporate Investments net revenue during both periods was due primarily to lower services revenue from the Communications and Media Solutions ("CMS") business.

Corporate Investments loss from operations as a percentage of net revenue increased 0.5 percentage points for the three months ended July 31, 2019, and increased 2.4 percentage points for the nine months ended July 31, 2019, as compared to the prior-year periods, respectively. For both periods, the increase was due primarily to higher spending in Hewlett Packard Labs, partially offset by margin improvements in the CMS business.

LIQUIDITY AND CAPITAL RESOURCES

We use cash generated by operations as our primary source of liquidity. We believe that internally generated cash flows will be generally sufficient to support our operating businesses, capital expenditures, product development initiatives, acquisitions and disposal activities including legal settlements, restructuring activities, transformation costs, indemnifications, maturing debt, interest payments, income tax payments, in addition to any future investments and any future share repurchases, and future stockholder dividend payments. We expect to supplement this short-term liquidity, if necessary, by accessing the capital markets, issuing commercial paper, and borrowing under credit facilities made available by various domestic and foreign financial institutions. However, our access to capital markets may be constrained and our cost of borrowing may increase under certain business, market and economic conditions. Our liquidity is subject to various risks including the risks identified in the section entitled "Risk Factors" in Item 1A of Part II and market risks identified in the section entitled "Quantitative and Qualitative Disclosures about Market Risk" in Item 3 of Part I.

Our cash balances are held in numerous locations throughout the world, with a substantial amount held outside of the U.S. We utilize a variety of planning and financing strategies in an effort to ensure that our worldwide cash is available when and where it is needed. Our cash position is strong and we expect that our cash balances, anticipated cash flow generated from operations and access to capital markets will be sufficient to cover our expected near-term cash outlays.

Amounts held outside of the U.S. are generally utilized to support non-U.S. liquidity needs, although a portion of those amounts may, from time to time, be subject to short-term intercompany loans into the U.S. Due to the enactment of the Tax Act, all of our cash, cash equivalents and investments held by foreign subsidiaries were subject to U.S. taxation under the one-time Transition Tax as further discussed in Note 6, "Taxes on Earnings". Subsequent repatriations generally will not be taxable from a U.S. federal tax perspective but may be subject to state income or foreign withholding tax. Where local restrictions prevent an efficient intercompany transfer of funds, our intent is to keep cash balances outside of the U.S. and to meet liquidity needs through ongoing cash flows, external borrowings, or both. We do not expect restrictions or potential taxes incurred on repatriation of amounts held outside of the U.S. to have a material effect on our overall liquidity, financial condition or results of operations.

60

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

In connection with the share repurchase program previously authorized by our Board of Directors, during the first nine months of fiscal 2019, we repurchased an aggregate amount of $2.0 billion. As of July 31, 2019, we had a remaining authorization of $2.7 billion for future share repurchases.

For more information on our share repurchase program, refer to Item 2. Unregistered Sales of Equity Securities in Part II. Other Information.

Liquidity

Our key cash flow metrics were as follows:

	Nine months ended July 31, 2019
	2019			2018
	In millions
Net cash provided by operating activities	$	2,565		$	1,638
Net cash used in investing activities	(1,399		)	(1,640		)
Net cash used in financing activities	(2,239		)	(4,341		)
Net decrease in cash, cash equivalents and restricted cash	$	(1,073	)	$	(4,343	)

Following the adoption of the accounting standards update for the classification and presentation of restricted cash in the statements of cash flows, for the nine months ended July 31, 2018, we included $43 million of restricted cash movement during the period, which was previously reported within net cash used in investing activities, and is now reported within Decrease in cash, cash equivalents and restricted cash in our Condensed Consolidated Statement of Cash Flows.

Operating Activities

For the nine months ended July 31, 2019, net cash provided by operating activities increased by $927 million, as compared to the prior-year period. The increase was due primarily to higher pre-tax earnings, as compared to the prior-year period, partially offset by unfavorable net working capital management.

Working capital metrics for the three months ended July 31, 2019 compared with the three months ended July 31, 2018

	Three months ended July 31,
	2019		2018		Change
Days of sales outstanding in accounts receivable ("DSO")	37		34		3
Days of supply in inventory ("DOS")	42		46		(4	)
Days of purchases outstanding in accounts payable ("DPO")	(98	)	(103	)	5
Cash conversion cycle	(19	)	(23	)	4

DSO measures the average number of days our receivables are outstanding. DSO is calculated by dividing ending accounts receivable, net of allowance for doubtful accounts, by a 90-day average of net revenue. Compared to the corresponding period in fiscal 2018, DSO increased due primarily to lower reserve balances, an increase in billings with extended payment terms, higher aged receivables and the impact from currency fluctuations, partially offset by higher early payments from customers.

DOS measures the average number of days from procurement to sale of our product. DOS is calculated by dividing ending inventory by a 90-day average of cost of goods sold. Compared to the corresponding period in fiscal 2018, DOS decreased due primarily to a reduction in inventory balances following a reduction in buffer levels as a result of improved market supply availability for key commodities and a decrease in commodity costs.

DPO measures the average number of days our accounts payable balances are outstanding. DPO is calculated by dividing ending accounts payable by a 90-day average of cost of goods sold. Compared to the corresponding period in fiscal 2018, the decrease in DPO was due primarily to a reduction in lease payables due to higher payments earlier in the quarter as compared to the prior-year period.

The cash conversion cycle is the sum of DSO and DOS less DPO. Items which may cause the cash conversion cycle in a particular period to differ include, but are not limited to, changes in business mix, changes in payment terms (including extended

61

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

payment terms from suppliers), the extent of receivables factoring, seasonal trends, the timing of revenue recognition and inventory purchases within the period, acquisition activity and the impact of commodity costs.

Investing Activities

For the nine months ended July 31, 2019, net cash used in investing activities decreased by $241 million, as compared to the corresponding period in fiscal 2018. The decrease was due primarily to an increase in net financial collateral received and lower use of cash for business acquisitions, partially offset by a higher investment in property, plant and equipment, net of sales proceeds.

Financing Activities

For the nine months ended July 31, 2019, net cash used in financing activities decreased by $2.1 billion, as compared to the corresponding period in fiscal 2018. The decrease was due primarily to a lower cash usage for debt repayments and share repurchases as compared to the prior-year period. The prior-year period also included a net transfer of cash from Seattle and to Everett.

Capital Resources

Debt Levels

We maintain debt levels that we establish through consideration of a number of factors, including cash flow expectations, cash requirements for operations, investment plans (including acquisitions), share repurchase activities, and our cost of capital and targeted capital structure.

During the first nine months of fiscal 2019, we issued $743 million and repaid $451 million of commercial paper.

Our weighted-average interest rate reflects the average effective rate on our borrowings prevailing during the period and reflects the impact of interest rate swaps. For more information on our interest rate swaps, see Note 11, "Financial Instruments".

In December 2017, we filed a shelf registration statement with the Securities and Exchange Commission that allows us to sell, at any time and from time to time, in one or more offerings, debt securities, preferred stock, common stock, warrants, depositary shares, purchase contracts, guarantees or units.

Revolving Credit Facility

On August 16, 2019, we entered into a five-year revolving credit facility providing for a senior, unsecured revolving credit facility with aggregate lending commitments of $4.8 billion. Loans under the revolving credit facility may be used for general corporate purposes. Commitment fees, interest rates and other terms of borrowing under the credit facility vary based on Hewlett Packard Enterprise's external credit rating. This credit facility replaces our prior credit facility that was entered into on November 1, 2015, which was terminated in connection with us entering into the new credit facility.

Available Borrowing Resources

Hewlett Packard Enterprise's Board of Directors has authorized the issuance of up to $4.0 billion in aggregate principal amount of commercial paper by Hewlett Packard Enterprise. Hewlett Packard Enterprise's subsidiaries are authorized to issue up to an additional $1.0 billion in aggregate principal amount of commercial paper. Hewlett Packard Enterprise maintains two commercial paper programs, and a wholly-owned subsidiary maintains a third program. Hewlett Packard Enterprise's U.S. program provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $4.0 billion. Hewlett Packard Enterprise's euro commercial paper program provides for the issuance of commercial paper outside of the U.S. denominated in U.S. dollars, euros or British pounds up to a maximum aggregate principal amount of $3.0 billion or the equivalent in those alternative currencies. The combined aggregate principal amount of commercial paper outstanding under those programs at any one time cannot exceed the $4.0 billion authorized by Hewlett Packard Enterprise's Board of Directors. The Hewlett Packard Enterprise subsidiary's euro Commercial Paper/Certificate of Deposit Program provides for the issuance of commercial paper in various currencies of up to a maximum aggregate principal amount of $1.0 billion, which was increased from $500 million by way of an amendment in April 2019. As of July 31, 2019 and October 31, 2018, no borrowings were outstanding under Hewlett Packard Enterprise’s two commercial paper programs, and $671 million and $392 million, respectively, were outstanding under the subsidiary’s program.

As of July 31, 2019, we had the following additional liquidity resources available if needed:

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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

Management's Discussion and Analysis of

Financial Condition and Results of Operations (Continued)

	As of July 31, 2019
	In millions
Commercial paper programs	$	4,329
Uncommitted lines of credit	$	1,350

CONTRACTUAL AND OTHER OBLIGATIONS

Contractual Obligations

Our contractual obligations have not changed materially since October 31, 2018. For further information see "Contractual and Other Obligations" in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

Retirement and Post-Retirement Benefit Plan Funding

For the remainder of fiscal 2019, we anticipate making contributions of approximately $42 million to our non-U.S. pension plans. Our policy is to fund our pension plans so that we meet at least the minimum contribution requirements, as established by local government, funding and taxing authorities. For more information on our retirement and post-retirement benefit plans, see Note 5, "Retirement and Post-Retirement Benefit Plans".

Restructuring Plans

As of July 31, 2019, we expect to make future cash payments of approximately $682 million in connection with our approved restructuring plans, which includes $110 million expected to be paid through the remainder of fiscal 2019 and $572 million expected to be paid through fiscal 2022. For more information on our restructuring activities, see Note 3, "Restructuring", and Note 4, "HPE Next".

Uncertain Tax Positions

As of July 31, 2019, we had approximately $535 million of recorded liabilities and related interest and penalties pertaining to uncertain tax positions. These liabilities and related interest and penalties include $21 million expected to be paid within one year. For the remaining amounts, we are unable to make a reasonable estimate as to when cash settlement with the tax authorities might occur due to the uncertainties related to these tax matters. Payments of these obligations would result from settlements with taxing authorities. For more information on our uncertain tax positions, see Note 6, "Taxes on Earnings".

Cross-indemnification with HP Inc., DXC and Micro Focus

As of July 31, 2019, we had approximately $143 million of recorded net receivables pertaining to income tax indemnifications with HP Inc. These amounts include $130 million expected to be paid and $123 million expected to be received within one year. For the remaining amounts, we are unable to make a reasonable estimate as to when cash settlement with HP Inc. might occur due to the uncertainties related to the underlying tax matters. Payments of and receipts from these obligations would result from settlements under the Tax Matters Agreement with HP Inc. For further details related to our tax indemnification balances, see Note 16, "Indemnifications". For details on the Separation and Distribution Agreements and Tax Matters Agreements with HP Inc., DXC and Micro Focus, see our Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

Off-Balance Sheet Arrangements

As part of our ongoing business, we have not participated in transactions that generate material relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk.

For quantitative and qualitative disclosures about market risk affecting HPE, see "Quantitative and Qualitative Disclosures About Market Risk" in Item 7A of Part II of our Annual Report on Form 10-K for the fiscal year ended October 31, 2018. Our exposure to market risk has not changed materially since October 31, 2018.

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Item 4.    Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this report (the "Evaluation Date"). Based on this evaluation, our principal executive officer and principal financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective such that the information relating to the Company, including our consolidated subsidiaries, required to be disclosed in our SEC reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to the Company's management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There were no changes to our internal control over financial reporting during the first nine months of fiscal 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

Information with respect to this item may be found in Note 15, "Litigation and Contingencies".

Item 1A. Risk Factors.

Our operations and financial results are subject to various risks and uncertainties, including those described in Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the fiscal period ended October 31, 2018, and in Part II, Item 1A, "Risk Factors" in our Quarterly Reports on Form 10-Q for the fiscal quarter ended January 31, 2019 and April 30, 2019, which could adversely affect our business, financial condition, results of operations, cash flows, and the trading price of our common stock.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Recent Sales of Unregistered Securities

There were no unregistered sales of equity securities during the period covered by this report.

Issuer Purchases of Equity Securities

Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased under the Plans or Programs
	In thousands, except per share amounts
Month 1 (May 2019)	13,596	$	15.00	13,596	$	3,121,327
Month 2 (June 2019)	12,744	$	14.36	12,744	$	2,938,371
Month 3 (July 2019)	12,752	$	14.87	12,752	$	2,748,772
Total	39,092	$	14.75	39,092

During the three months ended July 31, 2019, the Company repurchased and settled 39 million shares of the Company's common stock, which included 1.2 million shares that were unsettled open market purchases as of April 30, 2019. Additionally, as of July 31, 2019, the Company had unsettled open market repurchases of 1.2 million shares. Shares repurchased during the quarter were recorded as a $575 million reduction to stockholders' equity. During the nine months ended July 31, 2019, the Company repurchased and settled 130 million shares of the Company's common stock, which included 2.4 million shares that were unsettled open market purchases as of October 31, 2018. Shares repurchased during the nine months ended July 31, 2019 were recorded as a $1.9 billion reduction to stockholders' equity. As of July 31, 2019, the Company had a remaining authorization of $2.7 billion for future share repurchases.

Item 5. Other Information.

None.

Item 6. Exhibits.

The Exhibit Index beginning on page 68 of this report sets forth a list of exhibits.

65

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES

EXHIBIT INDEX

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit(s)	Filing Date
2.1	Separation and Distribution Agreement, dated as of October 31, 2015, by and among Hewlett-Packard Company, Hewlett Packard Enterprise Company and the Other Parties Thereto	8-K	001-37483	2.1	November 5, 2015
2.2	Transition Services Agreement, dated as of November 1, 2015, by and between Hewlett-Packard Company and Hewlett Packard Enterprise Company	8-K	001-37483	2.2	November 5, 2015
2.3	Tax Matters Agreement, dated as of October 31, 2015, by and between Hewlett-Packard Company and Hewlett Packard Enterprise Company	8-K	001-37483	2.3	November 5, 2015
2.4	Employee Matters Agreement, dated as of October 31, 2015, by and between Hewlett-Packard Company and Hewlett Packard Enterprise Company	8-K	001-37483	2.4	November 5, 2015
2.5	Real Estate Matters Agreement, dated as of October 31, 2015, by and between Hewlett-Packard Company and Hewlett Packard Enterprise Company	8-K	001-37483	2.5	November 5, 2015
2.6	Master Commercial Agreement, dated as of November 1, 2015, by and between Hewlett-Packard Company and Hewlett Packard Enterprise Company	8-K	001-37483	2.6	November 5, 2015
2.7	Information Technology Service Agreement, dated as of November 1, 2015, by and between Hewlett-Packard Company and HP Enterprise Services, LLC	8-K	001-37483	2.7	November 5, 2015
2.8	Agreement and Plan of Merger, dated as of May 24, 2016, among Hewlett Packard Enterprise Company, Computer Sciences Corporation, Everett SpinCo, Inc. and Everett Merger Sub, Inc.	8-K	001-37483	2.1	May 26, 2016
2.9	Separation and Distribution Agreement, dated as of May 24, 2016, between Hewlett Packard Enterprise Company and Everett SpinCo, Inc.	8-K	001-37483	2.2	May 26, 2016
2.10	Agreement and Plan of Merger, dated as of September 7, 2016, by and among Hewlett Packard Enterprise Company, Micro Focus International plc, Seattle SpinCo, Inc., Seattle Holdings, Inc. and Seattle MergerSub, Inc.	8-K	001-37483	2.1	September 7, 2016
2.11	Separation and Distribution Agreement, dated as of September 7, 2016, by and between Hewlett Packard Enterprise Company and Seattle SpinCo, Inc.	8-K	001-37483	2.2	September 7, 2016
2.12	Employee Matters Agreement, dated as of September 7, 2016, by and among Hewlett Packard Enterprise Company, Seattle SpinCo, Inc. and Micro Focus International plc	8-K	001-37483	2.3	September 7, 2016
2.13	First Amendment to the Agreement and Plan of Merger, dated as of May 24, 2016, among Hewlett Packard Enterprise Company, Computer Sciences Corporation, Everett SpinCo, Inc. and Everett Merger Sub, Inc.	8-K	001-37483	2.1	November 2, 2016
2.14	First Amendment to the Separation and Distribution Agreement, dated as of May 24, 2016, between Hewlett Packard Enterprise Company and Everett SpinCo, Inc.	8-K	001-37483	2.2	November 2, 2016
2.15	Agreement and Plan of Merger, dated as of March 6, 2017, by and among Hewlett Packard Enterprise Company, Nimble Storage, Inc. and Nebraska Merger Sub, Inc.	8-K	001-37483	99.1	March 7, 2017

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2.16	Tender and Support Agreement, dated as of March 6, 2017, by and among Hewlett Packard Enterprise Company, Nebraska Merger Sub, Inc. and each of the persons set forth on Schedule A thereto	8-K	001-37483	99.2	March 7, 2017
2.17	Employee Matters Agreement, dated March 31, 2017, by and among Computer Sciences Corporation, Hewlett Packard Enterprise Company and Everett SpinCo, Inc.	8-K	001-38033	2.1	April 6, 2017
2.18	Tax Matters Agreement, dated March 31, 2017, by and among Computer Sciences Corporation, Hewlett Packard Enterprise Company and Everett SpinCo, Inc. (Incorporated by reference to Exhibit 2.2 to DXC Technology Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on April 6, 2017.)	8-K	001-38033	2.2	April 6, 2017
2.19	Intellectual Property Matters Agreement, dated March 31, 2017, by and among Hewlett Packard Enterprise Company, Hewlett Packard Enterprise Development LP and Everett SpinCo, Inc.	8-K	001-38033	2.3	April 6, 2017
2.20	Transition Services Agreement, dated March 31, 2017, between Hewlett Packard Enterprise Company and Everett SpinCo, Inc.	8-K	001-38033	2.4	April 6, 2017
2.21	Real Estate Matters Agreement, dated March 31, 2017, between Hewlett Packard Enterprise Company and Everett SpinCo, Inc.	8-K	001-38033	2.5	April 6, 2017
2.22	Fourth Amendment to the Separation and Distribution Agreement, dated March 31, 2017, by and between Hewlett Packard Enterprise Company and Everett SpinCo, Inc.	8-K	001-38033	2.6	April 6, 2017
2.23	Tax Matters Agreement, dated September 1, 2017, by and among Hewlett Packard Enterprise Company, Seattle SpinCo, Inc., and Micro Focus International plc	8-K	001-37483	2.1	September 1, 2017
2.24	Intellectual Property Matters Agreement, dated September 1, 2017,  by and among Hewlett Packard Enterprise Company, Seattle SpinCo, Inc., and Micro Focus International plc	8-K	001-37483	2.2	September 1, 2017
2.25	Transition Services Agreement, dated September 1, 2017,  by and among Hewlett Packard Enterprise Company, Seattle SpinCo, Inc., and Micro Focus International plc	8-K	001-37483	2.3	September 1, 2017
2.26	Real Estate Matters Agreement, dated September 1, 2017,  by and among Hewlett Packard Enterprise Company, Seattle SpinCo, Inc., and Micro Focus International plc	8-K	001-37483	2.4	September 1, 2017
2.27	Agreement and Plan of Merger, dated as of May 16, 2019, by and among Hewlett Packard Enterprise Company, Cray Inc. and Canopy Merger Sub, Inc.	8-K	001-37483	2.1	May 17, 2019
3.1	Registrant's Amended and Restated Certificate of Incorporation	8-K	001-37483	3.1	November 5, 2015
3.2	Registrant's Amended and Restated Bylaws effective October 31, 2015	8-K	001-37483	3.2	November 5, 2015
3.3	Certificate of Designation of Series A Junior Participating Redeemable Preferred Stock	8-K	001-37483	3.1	March 20, 2017
3.4	Certificate of Designation of Series B Junior Participating Redeemable Preferred Stock	8-K	001-37483	3.2	March 20, 2017
4.1	Senior Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee	8-K	001-37483	4.1	October 13, 2015

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4.2	First Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 2.450% notes due 2017	8-K	001-37483	4.2	October 13, 2015
4.3	Second Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 2.850% notes due 2018	8-K	001-37483	4.3	October 13, 2015
4.4	Third Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 3.600% notes due 2020	8-K	001-37483	4.4	October 13, 2015
4.5	Fourth Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 4.400% notes due 2022	8-K	001-37483	4.5	October 13, 2015
4.6	Fifth Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 4.900% notes due 2025	8-K	001-37483	4.6	October 13, 2015
4.7	Sixth Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 6.200% notes due 2035	8-K	001-37483	4.7	October 13, 2015
4.8	Seventh Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 6.350% notes due 2045	8-K	001-37483	4.8	October 13, 2015
4.9	Eighth Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's floating rate notes due 2017	8-K	001-37483	4.9	October 13, 2015
4.10	Ninth Supplemental Indenture, dated as of October 9, 2015, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's floating rate notes due 2018	8-K	001-37483	4.10	October 13, 2015
4.11	Guarantee Agreement, dated as of October 9, 2015, between Hewlett-Packard Company, Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, in favor of the holders of the Notes	8-K	001-37483	4.11	October 13, 2015
4.12	Registration Rights Agreement, dated as of October 9, 2015, among Hewlett Packard Enterprise Company, Hewlett-Packard Company, and the representatives of the initial purchasers of the Notes	8-K	001-37483	4.12	October 13, 2015
4.13	Eighth Supplemental Indenture, dated as of November 1, 2015, among Hewlett Packard Enterprise Company, HP Enterprise Services, LLC and the Bank of New York Mellon Trust Company, N.A., as Trustee, relating to HP Enterprise Services LLC's 7.45% Senior Notes due October 2029	10-K	001-04423	4.13	December 17, 2015

68

4.14	Term Loan Agreement, dated as of December 16, 2016, by and among Everett SpinCo, Inc., the lenders and arrangers party thereto and The Bank of Tokyo-Mitsubishi UFJ, Ltd., as administrative agent	8-K	001-37483	10.1	December 22, 2016
4.15	Tenth Supplemental Indenture, dated as of September 20, 2017, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company’s 2.100% notes due 2019	8-K	001-37483	4.1	September 20, 2017
4.16	Form of Indenture between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A.	S-3ASR	333-222102	4.5	December 15, 2017
4.17	Eleventh Supplemental Indenture, dated as of September 19, 2018, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's 3.500% notes due 2021.	8-K	001-37483	4.2	September 19, 2018
4.18	Twelfth Supplemental Indenture, dated as of September 19, 2018, between Hewlett Packard Enterprise Company and The Bank of New York Mellon Trust Company, N.A., as Trustee, relating to Hewlett Packard Enterprise Company's floating rate notes due 2021.	8-K	001-37483	4.3	September 19, 2018
10.1	Amended and Restated Hewlett Packard Enterprise Company 2015 Stock Incentive Plan*	8-K	001-37483	10.1	January 30, 2017
10.2	Hewlett Packard Enterprise Company Severance and Long-Term Incentive Change in Control Plan for Executive Officers*	10	001-37483	10.4	September 28, 2015
10.3	Hewlett Packard Enterprise Executive Deferred Compensation Plan*	S-8	333-207679	4.3	October 30, 2015
10.4	Hewlett Packard Enterprise Grandfathered Executive Deferred Compensation Plan*	S-8	333-207679	4.4	October 30, 2015
10.5	Form of Non-Qualified Stock Option Grant Agreement*	8-K	001-37483	10.4	November 5, 2015
10.6	Form of Restricted Stock Unit Launch Grant Agreement*	8-K	001-37483	10.7	November 5, 2015
10.7	Form of Performance-Contingent Non-Qualified Stock Option Launch Grant Agreement*	8-K	001-37483	10.8	November 5, 2015
10.8	Form of Non-Employee Director Stock Options Grant Agreement*	8-K	001-37483	10.9	November 5, 2015
10.9	Form of Non-Employee Director Restricted Stock Unit Grant Agreement*	8-K	001-37483	10.10	November 5, 2015
10.10	Credit Agreement, dated as of November 1, 2015, by and among Hewlett Packard Enterprise Company, JPMorgan Chase Bank, N.A., Citibank, N.A., and the other parties thereto	8-K	001-37483	10.1	November 5, 2015
10.11	Form of Restricted Stock Units Grant Agreement, as amended and restated effective January 1, 2016*	10-Q	001-37483	10.14	March 10, 2016
10.12	Form of Performance-Adjusted Restricted Stock Unit Agreement, as amended and restated effective January 1, 2016*	10-Q	001-37483	10.15	March 10, 2016
10.13	Description of Amendment to Equity Awards (incorporated by reference to Item 5.02 of the 8-K filed on May 26, 2016)*	8-K	001-37483	10.1	May 26, 2016
10.14	Niara, Inc. 2013 Equity Incentive Plan*	S-8	333-207679	4.3	March 6, 2017
10.15	Nimble Storage, Inc. 2008 Equity Incentive Plan*	S-8	001-37483	4.3	April 18, 2017
10.16	Nimble Storage, Inc. 2013 Equity Incentive Plan*	S-8	001-37483	4.4	April 18, 2017
10.17	SimpliVity Corporation 2009 Stock Plan*	S-8	001-37483	4.3	April 24, 2017

69

10.18	Silicon Graphics International Corp. 2014 Omnibus Incentive Plan, as amended*	10-Q	000-51333	10.1	January 29, 2016
10.19	Silicon Graphics International Corp. 2006 New Recruit Equity Incentive Plan, as amended and restated*	10-K	000-51333	10.48	February 28, 2007
10.20	Silicon Graphics International Corp. 2005 Equity Incentive Plan, as amended*	10-K	000-51333	10.3	September 10, 2012
10.21	Silicon Graphics International Corp. 2005 Non-Employee Directors’ Stock Option*	S-1	000-51333	10.10	February 4, 2005
10.22	Cloud Technology Partners, Inc. 2011 Equity Incentive Plan*	S-8	333-221254	4.3	October 31, 2017
10.23	Amendment to the Cloud Technology Partners, Inc. 2011 Equity Incentive Plan*	S-8	333-221254	4.4	October 31, 2017
10.24	Plexxi Inc. 2011 Stock Plan*	S-8	333-226181	4.3	July 16, 2018
10.25	Amended and Restated Hewlett Packard Enterprise Company 2015 Employee Stock Purchase Plan*	10-Q	001-37483	10.29	September, 4, 2018
10.26	Form of Restricted Stock Units Grant Agreement*	10-Q	001-37483	10.30	September, 4, 2018
10.27	Amendment to Hewlett Packard Enterprise Executive Deferred Compensation Plan*	10-Q	001-37483	10.27	December 12, 2018
10.28	Philip Davis Retention Incentive Agreement *	10-Q	001-37483	10.28	December 12, 2018
10.29	First Amendment to the Hewlett Packard Enterprise Company Severance and Long-Term Incentive Change in Control Plan for Executive Officers*	10-Q	001-37483	10.29	December 12, 2018
10.30	BlueData Software Inc. 2012 Stock Incentive Plan*	S-8	333-229449	4.3	January 31, 2019
10.31	Five-Year Credit Agreement, dated as of August 16, 2019, by and among Hewlett Packard Enterprise Company, the lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Processing Agent and Co-Administrative Agent and Citibank, N.A., as Co-Administrative Agent.	8-K	001-37483	10.1	August 20, 2019
31.1	Certification of Chief Executive Officer pursuant to Rule 13a- 14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended‡
31.2	Certification of Chief Financial Officer pursuant to Rule 13a- 14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended‡
32	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002†
101.INS	XBRL Instance Document‡
101.SCH	XBRL Taxonomy Extension Schema Document‡
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document‡
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document‡
101.LAB	XBRL Taxonomy Extension Label Linkbase Document‡
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document‡

* Indicates management contract or compensation plan, contract or arrangement

‡ Filed herewith

† Furnished herewith

The registrant agrees to furnish to the Commission supplementally upon request a copy of (1) any instrument with respect to long-term debt not filed herewith as to which the total amount of securities authorized thereunder does not exceed

70

10% of the total assets of the registrant and its subsidiaries on a consolidated basis and (ii) schedules or exhibits omitted pursuant to Item 601(b)(2) of Regulation S-K of any material plan of acquisition, disposition or reorganization set forth above.

71

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

HEWLETT PACKARD ENTERPRISE COMPANY

/s/ TAREK A. ROBBIATI

Tarek A. Robbiati

 Executive Vice President and Chief Financial Officer

(Principal Financial Officer and Authorized

Signatory)

Date: August 30, 2019

72

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Antonio F. Neri, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Hewlett Packard Enterprise Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 30, 2019

/s/ ANTONIO F. NERI

Antonio F. Neri

President and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Tarek A. Robbiati, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Hewlett Packard Enterprise Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 30, 2019

/s/ TAREK A. ROBBIATI

Tarek A. Robbiati

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

EX-32

Exhibit 32

CERTIFICATION

OF

CHIEF EXECUTIVE OFFICER

AND

CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Antonio F. Neri, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Hewlett Packard Enterprise Company for the third quarter ended July 31, 2019, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Hewlett Packard Enterprise Company.

Date: August 30, 2019

By:	/s/ ANTONIO F. NERI
	Antonio F. Neri President and Chief Executive Officer

I, Tarek A. Robbiati, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Hewlett Packard Enterprise Company for the third quarter ended July 31, 2019, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Hewlett Packard Enterprise Company.

Date: August 30, 2019

By:	/s/ TAREK A. ROBBIATI
	Tarek A. Robbiati Executive Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to Hewlett Packard Enterprise Company and will be retained by Hewlett Packard Enterprise Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover Page - shares	9 Months Ended
	Jul. 31, 2019	Aug. 20, 2019
Cover page.
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jul. 31, 2019
Document Transition Report	false
Entity File Number	001-37483
Entity Registrant Name	HEWLETT PACKARD ENTERPRISE CO
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	47-3298624
Entity Address, Address Line One	6280 America Center Drive,
Entity Address, City or Town	San Jose,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95002
City Area Code	(650)
Local Phone Number	687-5817
Title of 12(b) Security	Common stock, par value $0.01 per share
Trading Symbol	HPE
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		1,305,601,258
Entity Central Index Key	0001645590
Amendment Flag	false
Current Fiscal Year End Date	--10-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3

XML

Condensed Consolidated Statements of Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Net revenue:
Financing income	$ 114	$ 109	$ 342	$ 332
Total net revenue	7,217	7,764	21,920	22,906
Costs and expenses:
Financing interest	74	69	222	207
Research and development	481	435	1,404	1,227
Selling, general and administrative	1,253	1,221	3,678	3,684
Amortization of intangible assets	58	72	199	222
Restructuring charges	0	(1)	0	14
Transformation costs	170	126	302	491
Disaster charges	0	0	(7)	0
Acquisition, disposition and other related charges	563	24	710	70
Separation costs	0	(2)	0	0
Total costs and expenses	7,293	7,274	21,106	21,822
(Loss) earnings from continuing operations	(76)	490	814	1,084
Interest and other, net	(70)	(64)	(139)	(163)
Tax indemnification adjustments	(134)	2	89	(1,342)
Non-service net periodic benefit credit	12	26	45	90
Earnings from equity interests	3	11	21	23
(Loss) earnings from continuing operations before taxes	(265)	465	830	(308)
Benefit (provision) for taxes	238	(13)	(261)	3,092
Net (loss) earnings from continuing operations	(27)	452	569	2,784
Net loss from discontinued operations	0	(1)	0	(119)
Net (loss) earnings	$ (27)	$ 451	$ 569	$ 2,665
Basic
Continuing operations (in dollars per share)	$ (0.02)	$ 0.30	$ 0.42	$ 1.79
Discontinued operations (in dollars per share)	0	0	0	(0.07)
Total basic net earnings (loss) per share (in dollars per share)	(0.02)	0.30	0.42	1.72
Diluted
Continuing operations (in dollars per share)	(0.02)	0.29	0.41	1.76
Discontinued operations (in dollars per share)	0	0	0	(0.07)
Total diluted net earnings (loss) per share (in dollars per share)	(0.02)	0.29	0.41	1.69
Cash dividends declared per share (in dollars per share)	$ 0.1125	$ 0.1125	$ 0.3375	$ 0.3750
Weighted-average shares used to compute net earnings per share:
Basic (in shares)	1,334	1,513	1,367	1,552
Diluted (in shares)	1,334	1,531	1,380	1,578
Products
Net revenue:
Total net revenue	$ 4,508	$ 4,944	$ 13,709	$ 14,414
Costs and expenses:
Cost of products and services	3,069	3,516	9,496	10,432
Services
Net revenue:
Total net revenue	2,595	2,711	7,869	8,160
Costs and expenses:
Cost of products and services	$ 1,625	$ 1,814	$ 5,102	$ 5,475

XML

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Statement of Comprehensive Income [Abstract]
Net (loss) earnings	$ (27)	$ 451	$ 569	$ 2,665
Change in net unrealized gains (losses) on available-for-sale securities:
Net unrealized gains (losses) arising during the period	3	(2)	8	(1)
Gains reclassified into earnings	0	0	(3)	(9)
Change in net unrealized gains (losses) on available-for-sale securities	3	(2)	5	(10)
Change in net unrealized gains (losses) on cash flow hedges:
Net unrealized gains arising during the period	63	149	225	50
Net (gains) losses reclassified into earnings	(58)	(43)	(259)	78
Change in net unrealized (losses) gains on cash flow hedges	5	106	(34)	128
Change in unrealized components of defined benefit plans:
Net unrealized losses arising during the period	(31)	(25)	(78)	(23)
Amortization of net actuarial loss and prior service benefit	54	47	161	143
Curtailments, settlements and other	5	9	12	11
Change in unrealized components of defined benefit plans	28	31	95	131
Change in cumulative translation adjustment	(8)	(40)	(2)	(40)
Other comprehensive income before taxes	28	95	64	209
Benefit (provision) for taxes	2	(19)	4	(34)
Other comprehensive income, net of taxes	30	76	68	175
Comprehensive income	$ 3	$ 527	$ 637	$ 2,840

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Current assets:
Cash and cash equivalents	$ 3,693	$ 4,880
Accounts receivable, net of allowance for doubtful accounts	2,965	3,263
Financing receivables	3,567	3,396
Inventory	2,216	2,447
Assets held for sale	52	6
Other current assets	2,624	3,280
Total current assets	15,117	17,272
Property, plant and equipment	6,000	6,138
Long-term financing receivables and other assets	9,092	11,359
Investments in equity interests	2,346	2,398
Goodwill	17,587	17,537
Intangible assets	618	789
Total assets	50,760	55,493
Current liabilities:
Notes payable and short-term borrowings	2,207	2,005
Accounts payable	5,203	6,092
Employee compensation and benefits	1,454	1,412
Taxes on earnings	160	378
Deferred revenue	3,225	3,177
Accrued restructuring	223	294
Other accrued liabilities	4,686	3,840
Total current liabilities	17,158	17,198
Long-term debt	10,453	10,136
Other non-current liabilities	5,569	6,885
Commitments and contingencies
HPE stockholders' equity:
Preferred stock, $0.01 par value (300 shares authorized; none issued and outstanding at July 31, 2019)	0	0
Common stock, $0.01 par value (9,600 shares authorized; 1,310 and 1,423 shares issued and outstanding at July 31, 2019 and October 31, 2018, respectively)	13	14
Additional paid-in capital	28,629	30,342
Accumulated deficit	(7,959)	(5,899)
Accumulated other comprehensive loss	(3,150)	(3,218)
Total HPE stockholders' equity	17,533	21,239
Non-controlling interests	47	35
Total stockholders' equity	17,580	21,274
Total liabilities and stockholders' equity	$ 50,760	$ 55,493

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Jul. 31, 2019	Oct. 31, 2018
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	300,000,000	300,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	9,600,000,000	9,600,000,000
Common stock, shares issued	1,310,000,000	1,423,000,000
Common stock, shares outstanding	1,310,000,000	1,423,000,000

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Cash flows from operating activities:
Net earnings	$ 569	$ 2,665
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	1,919	1,931
Stock-based compensation expense	207	242
Provision for inventory and doubtful accounts	181	137
Restructuring charges	146	399
Deferred taxes on earnings	885	(1,215)
Earnings from equity interests	(21)	(23)
Dividends received from equity investees	71	47
Other, net	134	55
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	315	137
Financing receivables	(325)	(228)
Inventory	66	(545)
Accounts payable	(826)	72
Taxes on earnings	(1,121)	(2,271)
Restructuring	(261)	(540)
Other assets and liabilities	626	775
Net cash provided by operating activities	2,565	1,638
Cash flows from investing activities:
Investment in property, plant and equipment	(2,153)	(2,129)
Proceeds from sale of property, plant and equipment	448	561
Purchases of available-for-sale securities and other investments	(33)	(32)
Maturities and sales of available-for-sale securities and other investments	12	96
Financial collateral posted	(332)	(1,396)
Financial collateral returned	740	1,454
Payments made in connection with business acquisitions, net of cash acquired	(81)	(207)
Proceeds from business divestitures, net	0	13
Net cash used in investing activities	(1,399)	(1,640)
Cash flows from financing activities:
Short-term borrowings with original maturities less than 90 days, net	25	84
Proceeds from debt, net of issuance costs	1,010	894
Payment of debt	(872)	(2,538)
Net proceeds related to stock-based award activities	24	104
Repurchase of common stock	(1,965)	(2,585)
Cash dividends paid to non-controlling interests	0	(9)
Cash dividends paid	(461)	(406)
Net cash used in financing activities	(2,239)	(4,341)
Decrease in cash, cash equivalents and restricted cash	(1,073)	(4,343)
Cash, cash equivalents and restricted cash at beginning of period	5,084	9,592
Cash, cash equivalents and restricted cash at end of period	4,011	5,249
Everett SpinCo, Inc.
Cash flows from financing activities:
Net transfer of cash and cash equivalents	0	(41)
Seattle SpinCo, Inc.
Cash flows from financing activities:
Net transfer of cash and cash equivalents	$ 0	$ 156

XML

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Millions		Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	Equity Attributable to the Company	Non-controlling Interests	Total Equity
Balance at beginning of period (in shares) at Oct. 31, 2017			1,595,161
Balance at beginning of period at Oct. 31, 2017			$ 16	$ 33,583	$ (7,238)	$ (2,895)	$ 23,466	$ 39	$ 23,505
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Activity related to separation and merger transactions					125	(186)	(61)		(61)
Net earnings					2,665		2,665	(3)	2,662
Other comprehensive income		$ 175				175	175		175
Comprehensive income							2,840	(3)	2,837
Issuance of common stock in connection with employee stock plans and other (in shares)			47,491
Issuance of common stock in connection with employee stock plans and other			$ 1	73			74		74
Repurchases of common stock (in shares)			(160,215)
Repurchases of common stock			$ (2)	(2,583)			(2,585)		(2,585)
Cash dividends declared					(573)		(573)		(573)
Stock-based compensation expense				265			265		265
Balance at beginning of period (in shares) at Jul. 31, 2018			1,482,437
Balance at end of period at Jul. 31, 2018			$ 15	31,338	(5,021)	(2,906)	23,426	36	23,462
Balance at beginning of period (in shares) at Apr. 30, 2018			1,527,381
Balance at beginning of period at Apr. 30, 2018			$ 15	32,205	(5,306)	(2,982)	23,932	34	23,966
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Activity related to separation and merger transactions					(1)		(1)		(1)
Net earnings					451		451	2	453
Other comprehensive income		$ 76				76	76		76
Comprehensive income							527	2	529
Issuance of common stock in connection with employee stock plans and other (in shares)			13,711
Issuance of common stock in connection with employee stock plans and other			$ 1	10			11		11
Repurchases of common stock (in shares)			(58,655)
Repurchases of common stock			$ (1)	(934)			(935)		(935)
Cash dividends declared					(165)		(165)		(165)
Stock-based compensation expense				57			57		57
Balance at beginning of period (in shares) at Jul. 31, 2018			1,482,437
Balance at end of period at Jul. 31, 2018			$ 15	31,338	(5,021)	(2,906)	23,426	36	23,462
Balance at beginning of period (in shares) at Oct. 31, 2018		1,423,000	1,423,303
Balance at beginning of period at Oct. 31, 2018		$ 21,274	$ 14	30,342	(5,899)	(3,218)	21,239	35	21,274
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings					569		569	12	581
Other comprehensive income		$ 68				68	68		68
Comprehensive income							637	12	649
Issuance of common stock in connection with employee stock plans and other (in shares)			15,404
Issuance of common stock in connection with employee stock plans and other				23			23		23
Repurchases of common stock (in shares)			(128,822)
Repurchases of common stock			$ (1)	(1,945)			(1,946)		(1,946)
Cash dividends declared					(446)		(446)		(446)
Effects of adoption of accounting standard updates	[1]				(2,183)		(2,183)		(2,183)
Effects of adoption of accounting standard updates | Accounting Standards Update 2016-16					2,300
Effects of adoption of accounting standard updates | Accounting Standards Update 2014-09					122
Stock-based compensation expense				209			209		209
Balance at beginning of period (in shares) at Jul. 31, 2019		1,310,000	1,309,885
Balance at end of period at Jul. 31, 2019		$ 17,580	$ 13	28,629	(7,959)	(3,150)	17,533	47	17,580
Balance at beginning of period (in shares) at Apr. 30, 2019			1,346,232
Balance at beginning of period at Apr. 30, 2019			$ 13	29,130	(7,765)	(3,180)	18,198	43	18,241
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings					(27)		(27)	4	(23)
Other comprehensive income		$ 30				30	30		30
Comprehensive income							3	4	7
Issuance of common stock in connection with employee stock plans and other (in shares)			2,737
Issuance of common stock in connection with employee stock plans and other				16			16		16
Repurchases of common stock (in shares)			(39,084)
Repurchases of common stock				(575)			(575)		(575)
Cash dividends declared					(146)		(146)		(146)
Effects of adoption of accounting standard updates	[2]				(21)		(21)		(21)
Stock-based compensation expense				58			58		58
Balance at beginning of period (in shares) at Jul. 31, 2019		1,310,000	1,309,885
Balance at end of period at Jul. 31, 2019		$ 17,580	$ 13	$ 28,629	$ (7,959)	$ (3,150)	$ 17,533	$ 47	$ 17,580

[1] For the nine months ended July 31, 2019, includes $2.3 billion related to an addition to accumulated deficit as a result of the adoption of an accounting standard update for Income Taxes and $122 million related to a reduction to accumulated deficit as a result of the adoption of the new revenue accounting standard.

[2] For the three months ended July 31, 2019, includes an adjustment related to the adoption of the new revenue accounting standard, which the Company adopted in the first quarter of fiscal 2019.

XML

Overview and Basis of Presentation

9 Months Ended

Jul. 31, 2019

Accounting Policies [Abstract]

Overview and Summary of Significant Accounting Policies

Overview and Summary of Significant Accounting Policies

Background

Hewlett Packard Enterprise Company ("Hewlett Packard Enterprise", "HPE", or the "Company") is a global technology leader focused on developing intelligent solutions that allow customers to capture, analyze and act upon data seamlessly from edge to cloud. Hewlett Packard Enterprise enables customers to accelerate business outcomes by driving new business models, creating new customer and employee experiences, and increasing operational efficiency today and into the future. Hewlett Packard Enterprise's customers range from small- and medium-sized businesses ("SMBs") to large global enterprises.

On November 1, 2015, the Company became an independent publicly-traded company through a pro rata distribution by HP Inc. ("former Parent" or "HPI"), formerly known as Hewlett-Packard Company, of 100% of the outstanding shares of Hewlett Packard Enterprise Company to HP Inc.'s stockholders (the "Separation").

Discontinued Operations

On April 1, 2017, HPE completed the separation and merger of its Enterprise Services business with Computer Sciences Corporation ("CSC") (collectively, the "Everett Transaction"). HPE transferred its Enterprise Services business to Everett SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Everett") and distributed all of the shares of Everett to HPE stockholders. Following the distribution, New Everett Merger Sub Inc., a wholly-owned subsidiary of Everett, merged with and into CSC and Everett changed its name to DXC Technology Company ("DXC").

On September 1, 2017, the Company completed the separation and merger of its Software business segment with Micro Focus International plc (“Micro Focus”) (collectively, the “Seattle Transaction”). HPE transferred its Software business segment to Seattle SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Seattle"), and distributed all of the shares of Seattle to HPE stockholders. Following the share distribution, Seattle MergerSub, Inc., an indirect, wholly-owned subsidiary of Micro Focus, merged with and into Seattle.

The historical financial results of Everett and Seattle are reported as Net loss from discontinued operations in the Condensed Consolidated Statements of Earnings. For the three and nine months ended July 31, 2018, this amount totaled $1 million and $119 million, respectively which primarily consisted of tax indemnification adjustments and separation costs.

Acquisition

On May 16, 2019, the Company entered into a definitive agreement to acquire Cray Inc. ("Cray"), a global supercomputer leader, for $35 per share in cash, in a transaction valued at approximately $1.3 billion, net of cash acquired. The transaction is expected to close by the fourth quarter of HPE’s fiscal year 2019, subject to regulatory approvals and other customary closing conditions. Cray's results of operations will be included within the Hybrid IT segment.

Arbitration Settlement

On August 15, 2019, an arbitration panel awarded DXC $666 million as well as post-award interest at 3% per annum compounding quarterly until payment. The panel award was made pursuant to a binding arbitration arising from a previously disclosed dispute under the separation and distribution agreement between DXC and HPE. As of July 31, 2019, the Company had recorded a charge representing the full award settlement in its condensed consolidated financial statements. For more information, see Note 15, "Litigation and Contingencies".

Basis of Presentation

These Condensed Consolidated Financial Statements of the Company were prepared in accordance with United States ("U.S.") Generally Accepted Accounting Principles ("GAAP"). In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements of Hewlett Packard Enterprise contain all adjustments, including normal recurring adjustments, necessary to present fairly the Company's financial position as of July 31, 2019 and October 31, 2018, its results of operations for the three and nine months ended July 31, 2019 and 2018, its cash flows for the nine months ended July 31, 2019 and 2018, and its statements of stockholders equity for the three and nine months ended July 31, 2019 and 2018.

The results of operations for the three and nine months ended July 31, 2019 and its cash flows for the nine months ended July 31, 2019 are not necessarily indicative of the results to be expected for the full year. The information included in this Quarterly

Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018, including "Management's Discussion and Analysis of Financial Condition and Results of Operations", "Quantitative and Qualitative Disclosures About Market Risk" and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, included therein.

Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and all subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary. All intercompany transactions and accounts within the consolidated businesses of the Company have been eliminated.

The Company accounts for investments in companies over which it has the ability to exercise significant influence but does not hold a controlling interest under the equity method of accounting, and the Company records its proportionate share of income or losses in Earnings (loss) from equity interests in the Condensed Consolidated Statements of Earnings.

Non-controlling interests are presented as a separate component within Total stockholders' equity in the Condensed Consolidated Balance Sheets. Net earnings attributable to non-controlling interests are recorded within Interest and other, net in the Condensed Consolidated Statements of Earnings and are not presented separately, as they were not material for any period presented.

Segment Realignment and Reclassifications

See Note 2, "Segment Information", for a discussion of the Company's segment realignment.

Use of Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company's Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates.

Revenue Recognition

General

As a result of adopting the new revenue recognition standard ("ASC 606"), the Company now accounts for a contract with a customer when both parties have provided written approval and are committed to perform, each party’s rights including payment terms are identified, the contract has commercial substance, and collection of consideration is probable.

The Company enters into contracts with customers that may include combinations of products and services, resulting in arrangements containing multiple performance obligations for hardware and software products and/or various services. The Company determines whether each product or service is distinct in order to identify the performance obligations in the contract and allocate the contract transaction price among the distinct performance obligations. Arrangements are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether the commitment to transfer the product or service to the customer is separately identifiable from other obligations in the contract. The Company classifies its hardware, perpetual software licenses, and software-as-a-service ("SaaS") as distinct performance obligations. Term software licenses represent multiple obligations, which include software licenses and software maintenance. In transactions where the Company delivers hardware or software, it is typically the principal and records revenue and costs of goods sold on a gross basis.

Revenue is recognized when, or as, control of promised products or services is transferred to the customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those products or services. Variable consideration offered in contracts with customers, partners and distributors may include rebates, volume-based discounts, cooperative marketing, price protection, and other incentive programs. Variable consideration is estimated at contract inception and updated at the end of each reporting period as additional information becomes available and recognized only to the extent that it is probable that a significant reversal of any incremental revenue will not occur.

Transfer of control occurs once the customer has the contractual right to use the product, generally upon shipment or once delivery and risk of loss has transferred to the customer. Transfer of control can also occur over time for maintenance and services as the customer receives the benefit over the contract term. The Company's hardware and perpetual software licenses are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses include multiple performance obligations where the term licenses are recognized upfront upon transfer of control, with the associated software

maintenance revenue recognized ratably over the contract term as services and software updates are provided. SaaS arrangements have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term as the customer consumes the services. On its product sales, the Company records consideration from shipping and handling on a gross basis within net product sales. Revenue is recorded net of any associated sales taxes.

Significant Judgments

The Company allocates the transaction price for the contract among the performance obligations on a relative standalone selling price basis. The standalone selling price ("SSP") is the price at which an entity would sell a promised product or service separately to a customer. The Company establishes SSP for most of its products and services based on the observable price of the products or services when sold separately in similar circumstances to similar customers. When the SSP is not directly observable, the Company estimates SSP based on management judgment by considering available data such as internal margin objectives, pricing strategies, market/competitive conditions, historical profitability data, as well as other observable inputs. The Company establishes SSP ranges for its products and services and reassesses them periodically.

Judgment is applied in determining the transaction price as the Company may be required to estimate variable consideration when determining the amount of revenue to recognize. Variable consideration may include various rebates, volume-based discounts, cooperative marketing, price protection, and other incentive programs that are offered to customers, partners and distributors. When determining the amount of revenue to recognize, the Company estimates the expected usage of these programs, applying the expected value or most likely estimate and updates the estimate at each reporting period as actual utilization becomes available. The Company also considers the customers' right of return in determining the transaction price, where applicable.

Contract Balances

Accounts receivable and contract assets

A receivable is a right to consideration in exchange for products or services the Company has transferred to a customer that is unconditional. A contract asset is a right to consideration in exchange for products or services transferred to a customer that is conditional on something other than the passage of time. A receivable is recorded when the right to consideration becomes unconditional.

The Company’s contract assets include unbilled receivables which are recorded when the Company recognizes revenue in advance of billings. Unbilled receivables generally relate to services contracts where a service has been performed and control has transferred, but invoicing to the customer is subject to future milestone billings or other contractual payment schedules. The Company classifies unbilled receivables as Accounts receivable.

Contract liabilities

A contract liability is an obligation to transfer products or services to a customer for which the entity has received consideration, or the amount is due, from the customer. The Company’s contract liabilities primarily consist of deferred revenue. Deferred revenue is recorded when amounts invoiced to customers are in excess of revenue that can be recognized because performance obligations have not been satisfied and control of the promised products or services has not transferred to the customer. Deferred revenue largely represents amounts invoiced in advance for product (hardware/software) support contracts, consulting projects and product sales where revenue cannot be recognized yet.

Costs to obtain a contract with a customer

The Company capitalizes the incremental costs of obtaining a contract with a customer, primarily sales commissions, if the Company expects to recover those costs. The Company has elected, as a practical expedient, to expense the costs of obtaining a contract as incurred for contracts with terms of one year or less. The typical amortization periods used range from three to six years. The Company periodically reviews the capitalized sales commission costs for possible impairment losses. Capitalized sales commission costs are included in Other current assets and Long-term financing receivables and other assets, and the related amortization expense is included in Selling, general and administrative expense.

Recent Tax Legislation

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act included significant changes to the U.S. corporate income tax structure, including a federal corporate rate reduction from 35% to 21% effective January 1, 2018, limitations on the deductibility of interest expense and executive compensation, creation of new minimum taxes such as the Base Erosion Anti-abuse Tax (“BEAT”) and the Global Intangible Low Taxed Income (“GILTI”) tax and the transition of U.S.

international taxation from a worldwide tax system to a modified territorial tax system, which resulted in a one-time U.S. tax liability on those earnings which had not previously been repatriated to the U.S. (the “Transition Tax”).

In December 2017, the U.S. Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act ("SAB 118"), which allowed the Company to record provisional amounts during a measurement period not to extend beyond one year of the enactment date, which for the Company ended in the first quarter of fiscal 2019. In accordance with SAB 118, the accounting for the tax effects of the Tax Act was completed based on currently available legislative updates relating to the Tax Act. The Company has elected to treat taxes due on future GILTI inclusions in U.S. taxable income as a current period expense when incurred. For further details, see Note 6, "Taxes on Earnings".

Recently Adopted Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for retirement benefits. The amendments require the presentation of the service cost component of net periodic benefit cost in the same income statement line items as other employee compensation costs, unless eligible for capitalization. The other components of net periodic benefit costs will be presented separately from the service cost as non-operating costs. Effective at the beginning of the first quarter of fiscal 2019, in connection with the adoption of the accounting standards update for retirement benefits, the Company reflected these changes retrospectively by transferring its non-service net periodic benefit (credit) cost from operating expense to Other (income) and expense in its Condensed Consolidated Statements of Earnings. The net periodic benefit (credit) cost transferred to Other (income) and expense during the three and nine months ended July 31, 2018 were as follows. Refer to Note 5, “Retirement and Post-Retirement Benefit Plans” for additional information.

	Three Months Ended July 31, 2018			Nine Months Ended July 31, 2018
	In millions
Cost of products and services	$	(14	)	$	(42	)
Research and development	(1		)	(3		)
Selling, general and administrative	(19		)	(53		)
Restructuring charges and transformation costs	8			8
	$	(26	)	$	(90	)

In November 2016, the FASB amended the existing accounting standards for the classification and presentation of restricted cash in the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. As a result of adopting this accounting standards update, for the nine months ended July 31, 2018, the Company included $43 million of restricted cash movement during the period, which was previously reported within cash used in investing activities, and is now reported within Decrease in cash, cash equivalents and restricted cash in the Company's Condensed Consolidated Statement of Cash Flows.

In October 2016, the FASB amended the existing accounting standards for income taxes. The amendments require the recognition of the income tax consequences for intra-entity transfers of assets other than inventory when the transfer occurs. Prior to the amendments, current and deferred income taxes for intra-entity asset transfers were not recognized until the asset was sold to an outside party or amortized over time. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the modified retrospective method. The Company recognized $2.3 billion of income taxes as an adjustment to retained earnings in the first nine months of fiscal 2019, which was previously reported as prepaid income taxes and deferred tax assets within Corporate and unallocated assets in the Company's allocation of segment assets.

In August 2016, the FASB amended the existing accounting standards for the statement of cash flows. The amendments provide guidance on eight classification issues related to the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. For issues that are impracticable to apply retrospectively, the amendments may be applied prospectively as of the earliest date practicable. The application of this accounting standards update did not have an impact on the Condensed Consolidated Statements of Cash Flows.

In January 2016, the FASB issued guidance that requires equity investments with readily determinable fair values (other than those accounted for under the equity method or those that result in consolidation of the investee) to be measured at fair value and recognize any changes in fair value in net income. For equity investments without readily determinable fair values, the Company has elected to apply the measurement alternative, under which investments are measured at cost, less impairment, and adjusted

for qualifying observable price changes on a prospective basis. The Company adopted the guidance effective November 1, 2018, and there was no impact on the Condensed Consolidated Financial Statements upon adoption.

In May 2014, the FASB amended the existing accounting standards for revenue recognition. The Company adopted the new revenue standard in the first quarter of fiscal 2019 using the modified retrospective method of transition applied to contracts that were not completed as of November 1, 2018. Results and related disclosures for the reporting periods beginning after November 1, 2018 are presented under the new revenue standard, while comparative prior period results and related disclosures are not adjusted and continue to be reported in accordance with the historic accounting standard. Refer to the Revenue Recognition section above for accounting policy updates upon the adoption of the new revenue standard, and Note 7, "Balance Sheet Details" for further discussion on the impact of adoption. For disaggregation of revenue, see Note 2, "Segment Information".

The following table summarizes the effects of adopting the new revenue standard at November 1, 2018 on the Condensed Consolidated Balance Sheets as an adjustment to the opening balance:

	Historical Accounting Method			Effect of Adoption			As Adjusted
	In millions
Assets
Accounts receivable	$	3,263		$	38		$	3,301
Inventory	2,447			(14)			2,433
Other current assets	3,280			50			3,330
Long-term financing receivables and other assets	11,359			44			11,403
Subtotal assets	$	20,349		$	118		$	20,467
Liabilities
Taxes on earnings	$	378		$	10		$	388
Deferred revenue	3,177			(36)			3,141
Other accrued liabilities(1)	3,840			52			3,892
Other non-current liabilities	6,885			(30)			6,855
Subtotal liabilities	$	14,280		$	(4	)	$	14,276
Stockholders' equity
Accumulated deficit(1)	$	(5,899	)	$	122		$	(5,777	)
Subtotal stockholders' equity	$	(5,899	)	$	122		$	(5,777	)
Subtotal liabilities and stockholders' equity	$	8,381		$	118		$	8,499

(1) Includes an adjustment related to the adoption of ASC 606 that was recorded during the third quarter of fiscal 2019.

The application of ASC 606 increased the Company's total net revenue by $23 million and $41 million for the three and nine months ended July 31, 2019, respectively, and did not have a material impact to the Company's cost of sales or operating expenses for the three or nine months ended July 31, 2019. As of July 31, 2019, the balance sheet changes attributable to the impact of ASC 606 were immaterial.

Recently Enacted Accounting Pronouncements

In August 2018, the FASB issued guidance on a customer's accounting for implementation costs incurred in cloud-computing arrangements that are hosted by a vendor. Certain types of implementation costs should be capitalized and amortized over the term of the hosting arrangement. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In August 2018, the FASB issued guidance which changes the disclosure requirements for fair value measurements and defined benefit plans. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. As the guidance represents a change to disclosure only, the Company does not expect the guidance to have a material impact on its Condensed Consolidated Financial Statements.

In February 2018, the FASB issued guidance that allows companies to reclassify stranded tax effects resulting from the Tax Act, from accumulated other comprehensive income to retained earnings. The guidance also requires certain new disclosures regardless of the election.  The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In August 2017, the FASB amended the existing accounting standards for hedge accounting. The amendments expand an entity’s ability to hedge non-financial and financial risk components and reduce complexity in fair value hedges of interest rate risk. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also simplifies certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. In April 2019, the FASB issued certain clarifications to address partial term fair value hedges, fair value hedge basis adjustments and certain transition requirements. The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In June 2016, the FASB amended the existing accounting standards for the measurement of credit losses. The amendments require an entity to estimate its lifetime expected credit loss for most financial instruments, including trade and lease receivables, and record an allowance for the portion of the amortized cost the entity does not expect to collect. The estimate of expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments. In April 2019, the FASB further clarified the scope of the credit losses standard and addressed issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayment. In May 2019, the FASB issued further guidance to provide entities with an option to irrevocably elect the fair value option applied on an instrument-by-instrument basis for eligible financial instruments. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted beginning in fiscal 2020. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

The FASB issued guidance in February 2016, with amendments in 2018 and 2019, which changes the accounting standards for leases. The amendments require lessees to record, at lease inception, a lease liability for the obligation to make lease payments and a right-of-use ("ROU") asset for the right to use the underlying asset for the lease term on their balance sheets. Lessees may elect to not recognize lease liabilities and ROU assets for most leases with terms of 12 months or less. The lease liability is measured at the present value of the lease payments over the lease term. The ROU asset will be based on the liability, adjusted for lease prepayments, lease incentives received, and the lessee's initial direct costs. For finance leases, lease expense will be the sum of interest on the lease obligation and amortization of the ROU asset, resulting in a front-loaded expense pattern. For operating leases, lease expense will generally be recognized on a straight-line basis over the lease term. The amended lessor accounting model is similar to the current model, updated to align with certain changes to the lessee model and the new revenue standard. The current sale-leaseback guidance, including guidance applicable to real estate, is also replaced with a new model for both lessees and lessors. The Company plans to adopt the guidance in the first quarter of fiscal 2020, beginning November 1, 2019, using the transition method whereby prior comparative periods will not be retrospectively presented in the Consolidated Financial Statements. The Company is currently evaluating the impact of these amendments and other available practical expedients on its Condensed Consolidated Financial Statements.

In April 2019, the FASB amended its standards on recognizing and measuring financial instruments to address the scope of the guidance, the requirement for remeasurement when using the measurement alternative and certain disclosure requirements. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

There have been no other significant changes to the Company's accounting policies or recently adopted or enacted accounting pronouncements disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

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Segment Information

9 Months Ended

Jul. 31, 2019

Segment Reporting [Abstract]

Segment Information

Segment Information

Hewlett Packard Enterprise's operations are organized into four segments for financial reporting purposes: Hybrid IT, Intelligent Edge, Financial Services ("FS"), and Corporate Investments. Hewlett Packard Enterprise's organizational structure is based on a number of factors that the Chief Operating Decision Maker ("CODM"), who is the Chief Executive Officer ("CEO"), uses to evaluate, view and run its business operations, which include, but are not limited to, customer base and homogeneity of products and technology. The segments are based on this organizational structure and information reviewed by Hewlett Packard Enterprise's management to evaluate segment results.

A summary description of each segment follows.

Hybrid IT provides a broad portfolio of services-led and software-enabled infrastructure and solutions including secure, software-defined servers, and storage and HPE Pointnext services, thereby combining HPE's hardware, software and services capabilities to make Hybrid IT simple for its customers. Described below are the business unit capabilities within Hybrid IT.

• Hybrid IT Product includes Compute and Storage.

◦ Compute. To address the full array of our customers' computing needs, HPE's compute portfolio offers both Industry Standard Servers ("ISS"), which are general purpose servers for multi-workload computing, as well as Mission-Critical Servers ("MCS"), which are servers optimized for particular workloads. HPE's general purpose servers include HPE ProLiant, secure and versatile rack and tower servers; HPE BladeSystem, a modular infrastructure that converges server, storage and networking; and HPE Synergy, a composable infrastructure for traditional and cloud-native applications. The Company's workload optimized server portfolio includes HPE Apollo for high performance computing and artificial intelligence, HPE Cloudline for cloud data centers, HPE Edgeline for computing at the network edge, HPE Integrity for mission-critical applications, and HPE SimpliVity, a hyperconverged infrastructure for virtualized workloads.

◦ Storage. With storage offerings that are AI-driven and built for cloud environments, HPE provides the right workload optimized destinations for data. Powered by HPE InfoSight advanced analytics and machine learning and HPE Cloud Volumes data mobility, HPE delivers intelligent storage for hybrid cloud environments so that customers can unlock data's full potential and derive business insights. Key solutions include HPE 3PAR Storage and HPE Nimble Storage all-flash arrays for mission critical workloads and general purpose workloads, respectively, and big data solutions running on HPE Apollo Servers. Storage also provides comprehensive data protection with HPE StoreOnce and HPE Recovery Manager Central, solutions for secondary workloads and traditional tape, storage networking and disk products, such as HPE MSA and HPE XP.

• HPE Pointnext creates preferred IT experiences that power the digital business. The HPE Pointnext team and the Company's extensive partner network provide value across the IT life cycle delivering advice, transformation projects, professional services, support services and operational services for Hybrid IT. HPE Pointnext is also a provider of on-premises flexible consumption models, such as HPE GreenLake, that enable IT agility, simplify operations and align cost to business value. HPE Pointnext offerings include Operational Services, and Advisory and Professional Services.

The Intelligent Edge business is comprised of enterprise networking and security solutions for businesses of any size, offering secure connectivity for campus and branch environments, operating under the Aruba brand. The primary business drivers for Intelligent Edge solutions are mobility and the Internet of Things ("IoT").

• HPE Aruba Product includes wired and wireless local area network hardware products such as Wi-Fi access points, switches, routers, sensors, and software products that include network management, network access control, analytics and assurance, and location services software.

• HPE Aruba Services offers professional and support services for the Intelligent Edge portfolio of products.

Financial Services provides flexible investment solutions, such as leasing, financing, IT consumption, and utility programs and asset management services, for customers that facilitate unique technology deployment models and the acquisition of complete IT solutions, including hardware, software and services from Hewlett Packard Enterprise and others. In order to provide flexible services and capabilities that support the entire IT life cycle, FS partners with customers globally to help build investment strategies that enhance their business agility and support their business transformation. FS offers a wide selection of investment solution capabilities for large enterprise customers and channel partners, along with an array of financial options to SMBs and educational and governmental entities.

Corporate Investments includes Hewlett Packard Labs, Communications and Media Solutions ("CMS"), and certain business incubation projects.

Segment Policy

There have been no significant changes to the Company's segment accounting policies disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018, except as described in the 'Segment Realignment' section below.

Hewlett Packard Enterprise does not allocate to its segments certain operating expenses, which it manages at the corporate level. These unallocated costs include certain corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, acquisition, disposition and other related charges, transformation costs, amortization of intangible assets, restructuring charges, disaster charges and separation costs.

Segment Realignment

Effective at the beginning of the first quarter of fiscal 2019, the Company implemented organizational changes to align its segment financial reporting more closely with its current business structure. These organizational changes primarily include: (i) the transfer of the data center networking ("DC Networking") business, which was previously reported within the Hybrid IT Product business unit in the Hybrid IT segment, to the HPE Aruba Product and HPE Aruba Services business units within the Intelligent Edge segment; (ii) the transfer of the edge compute business, which was previously reported within the HPE Aruba Product business unit in the Intelligent Edge segment, to the Hybrid IT Product business unit within the Hybrid IT segment; and (iii) the transfer of the CMS business, which was previously reported within the HPE Pointnext business unit in the Hybrid IT segment, to the Corporate Investments segment.

The Company reflected these changes to its segment information retrospectively to the earliest period presented, which primarily resulted in the transfer of net revenue and operating profit for each of the businesses as described above.

These changes had no impact on Hewlett Packard Enterprise's previously reported consolidated net revenue, earnings from operations, net earnings or net earnings per share ("EPS").

Segment Operating Results

	Hybrid IT		Intelligent Edge		Financial Services		Corporate Investments			Total
	In millions
Three months ended July 31, 2019
Net revenue	$	5,444	$	758	$	885	$	130		$	7,217
Intersegment net revenue and other	105		4		3		—			112
Total segment net revenue	$	5,549	$	762	$	888	$	130		$	7,329
Segment earnings (loss) from operations	$	704	$	37	$	77	$	(25	)	$	793
Three months ended July 31, 2018
Net revenue	$	5,925	$	783	$	922	$	134		$	7,764
Intersegment net revenue and other	184		2		6		—			192
Total segment net revenue	$	6,109	$	785	$	928	$	134		$	7,956
Segment earnings (loss) from operations	$	624	$	101	$	72	$	(25	)	$	772
Nine months ended July 31, 2019
Net revenue	$	16,745	$	2,107	$	2,695	$	373		$	21,920
Intersegment net revenue and other	410		7		8		—			425
Total segment net revenue	$	17,155	$	2,114	$	2,703	$	373		$	22,345
Segment earnings (loss) from operations	$	2,024	$	66	$	231	$	(82	)	$	2,239
Nine months ended July 31, 2018
Net revenue	$	17,649	$	2,132	$	2,721	$	404		$	22,906
Intersegment net revenue and other	511		15		11		—			537
Total segment net revenue	$	18,160	$	2,147	$	2,732	$	404		$	23,443
Segment earnings (loss) from operations	$	1,787	$	191	$	215	$	(79	)	$	2,114

The reconciliation of segment operating results to Hewlett Packard Enterprise condensed consolidated results was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Net Revenue:
Total segments	$	7,329		$	7,956		$	22,345		$	23,443
Eliminations of intersegment net revenue and other	(112		)	(192		)	(425		)	(537		)
Total Hewlett Packard Enterprise condensed consolidated net revenue	$	7,217		$	7,764		$	21,920		$	22,906
Earnings before taxes:
Total segment earnings from operations	$	793		$	772		$	2,239		$	2,114
Unallocated corporate costs and eliminations	(65		)	(49		)	(179		)	(169		)
Unallocated stock-based compensation expense	(13		)	(14		)	(42		)	(64		)
Amortization of intangible assets	(58		)	(72		)	(199		)	(222		)
Restructuring charges	—			1			—			(14		)
Transformation costs	(170		)	(126		)	(302		)	(491		)
Disaster charges	—			—			7			—
Acquisition, disposition and other related charges	(563		)	(24		)	(710		)	(70		)
Separation costs	—			2			—			—
Interest and other, net	(70		)	(64		)	(139		)	(163		)
Tax indemnification adjustments	(134		)	2			89			(1,342		)
Non-service net periodic benefit credit	12			26			45			90
Earnings from equity interests	3			11			21			23
Total Hewlett Packard Enterprise condensed consolidated (loss) earnings from continuing operations before taxes	$	(265	)	$	465		$	830		$	(308	)

Net revenue by segment and business unit was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Hybrid IT
Hybrid IT Product
Compute	$	3,151		$	3,569		$	9,646		$	10,350
Storage	844			887			2,761			2,747
Total Hybrid IT Product	3,995			4,456			12,407			13,097
HPE Pointnext	1,554			1,653			4,748			5,063
Total Hybrid IT	5,549			6,109			17,155			18,160
Intelligent Edge
HPE Aruba Product	668			703			1,842			1,914
HPE Aruba Services	94			82			272			233
Total Intelligent Edge	762			785			2,114			2,147
Financial Services	888			928			2,703			2,732
Corporate Investments	130			134			373			404
Total segment net revenue	7,329			7,956			22,345			23,443
Eliminations of intersegment net revenue and other	(112		)	(192		)	(425		)	(537		)
Total Hewlett Packard Enterprise condensed consolidated net revenue(1)	$	7,217		$	7,764		$	21,920		$	22,906

(1) Revenue from leasing arrangements within Financial Services and Eliminations of intersegment net revenue and other are not subject to the new revenue standard.

The Company’s net revenue by geographic regions was as follows:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2019		2018		2019		2018
	In millions
Americas	$	2,910	$	3,153	$	8,582	$	9,053
Europe, Middle East and Africa	2,614		2,783		8,251		8,407
Asia Pacific and Japan	1,693		1,828		5,087		5,446
Total Hewlett Packard Enterprise condensed consolidated net revenue(1)	$	7,217	$	7,764	$	21,920	$	22,906

(1)

Revenue from leasing arrangements within Financial Services and Eliminations of intersegment net revenue and other are not subject to the new revenue standard.

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Restructuring

9 Months Ended

Jul. 31, 2019

Restructuring and Related Activities [Abstract]

Restructuring

Restructuring

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, 2018, the 2015 and 2012 Plans were complete.

Restructuring Activity

In connection with the 2015 and 2012 Plans, a restructuring credit of $1 million and restructuring charges of $14 million were recorded by the Company for the three and nine months ended July 31, 2018, respectively, based on restructuring activities impacting the Company's employees and infrastructure. For details on restructuring charges related to HPE Next, see Note 4, "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, 2018	$	62		$	10		$	11		$	1	$	84
Cash payments	(25		)	(2		)	(5		)	—		(32		)
Liability as of July 31, 2019	$	37		$	8		$	6		$	1	$	52
Total costs incurred to date, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242
Total costs expected to be incurred, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242

The current restructuring liabilities related to the plans in the table above, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets at July 31, 2019 and October 31, 2018, were $33 million and $53 million, respectively. The non-current restructuring liabilities related to the plans in the table above, reported in Other non-current liabilities in the Condensed Consolidated Balance Sheets at July 31, 2019 and October 31, 2018, were $19 million and $31 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.

In association with the HPE Next initiative, during the three and nine months ended July 31, 2019, the Company incurred $172 million and $310 million of net charges, of which $170 million and $302 million were recorded within Transformation costs, and $2 million and $8 million were recorded within Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings, respectively. During the three and nine months ended July 31, 2018, the Company incurred $131 million and $499 million of net charges, of which $126 million and $491 million were recorded within Transformation costs, and $5 million and $8 million were recorded within Non-service net periodic benefit credit, in the Condensed Consolidated Statements of Earnings, respectively.

	Three months ended July 31,					Nine months ended July 31,
	2019		2018			2019		2018
	In millions
Program management(1)	$	3	$	28		$	23	$	82
IT costs	41		38			94		107
Restructuring charges(2)	92		129			143		385
Loss (gain) on real estate sales	8		(77		)	1		(114		)
Impairment on real estate assets	19		—			19		—
Other(3)	9		13			30		39
Total	$	172	$	131		$	310	$	499

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

(2) For the three and nine months ended July 31, 2019 and 2018, a portion of these costs were recorded in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings as described above.

(3) Primarily consists of site relocation costs in connection with 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") and on September 20, 2018, the Company's Board of Directors approved a revision to that restructuring plan. As a result of the revision to the plan, cost amounts and total headcount exits were revised and the completion of the workforce reductions was extended to fiscal 2020. The changes to the workforce will vary by country, based on business needs, local legal requirements and consultations with employee work councils and other employee representatives, as appropriate.

	Employee Severance			Infrastructure and other
	In millions
Liability as of October 31, 2018	$	291		$	33
Charges	115			28
Cash payments	(209		)	(20		)
Non-cash items	(9		)	(9		)
Liability as of July 31, 2019	$	188		$	32
Total costs incurred to date, as of July 31, 2019	$	881		$	89
Total costs expected to be incurred, as of July 31, 2019	$	1,200		$	180

As of July 31, 2019 and October 31, 2018, the current restructuring liability related to the HPE Next Plan, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets, was $190 million and $241 million, respectively. The non-current restructuring liability related to the HPE Next Plan, reported in Other non-current liabilities in the Condensed Consolidated Balance Sheets as of July 31, 2019 and October 31, 2018 was $30 million and $83 million, respectively.

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HPE Next

9 Months Ended

Jul. 31, 2019

Restructuring and Related Activities [Abstract]

HPE Next

Restructuring

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, 2018, the 2015 and 2012 Plans were complete.

Restructuring Activity

In connection with the 2015 and 2012 Plans, a restructuring credit of $1 million and restructuring charges of $14 million were recorded by the Company for the three and nine months ended July 31, 2018, respectively, based on restructuring activities impacting the Company's employees and infrastructure. For details on restructuring charges related to HPE Next, see Note 4, "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, 2018	$	62		$	10		$	11		$	1	$	84
Cash payments	(25		)	(2		)	(5		)	—		(32		)
Liability as of July 31, 2019	$	37		$	8		$	6		$	1	$	52
Total costs incurred to date, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242
Total costs expected to be incurred, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242

The current restructuring liabilities related to the plans in the table above, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets at July 31, 2019 and October 31, 2018, were $33 million and $53 million, respectively. The non-current restructuring liabilities related to the plans in the table above, reported in Other non-current liabilities in the Condensed Consolidated Balance Sheets at July 31, 2019 and October 31, 2018, were $19 million and $31 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.

In association with the HPE Next initiative, during the three and nine months ended July 31, 2019, the Company incurred $172 million and $310 million of net charges, of which $170 million and $302 million were recorded within Transformation costs, and $2 million and $8 million were recorded within Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings, respectively. During the three and nine months ended July 31, 2018, the Company incurred $131 million and $499 million of net charges, of which $126 million and $491 million were recorded within Transformation costs, and $5 million and $8 million were recorded within Non-service net periodic benefit credit, in the Condensed Consolidated Statements of Earnings, respectively.

	Three months ended July 31,					Nine months ended July 31,
	2019		2018			2019		2018
	In millions
Program management(1)	$	3	$	28		$	23	$	82
IT costs	41		38			94		107
Restructuring charges(2)	92		129			143		385
Loss (gain) on real estate sales	8		(77		)	1		(114		)
Impairment on real estate assets	19		—			19		—
Other(3)	9		13			30		39
Total	$	172	$	131		$	310	$	499

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

(2) For the three and nine months ended July 31, 2019 and 2018, a portion of these costs were recorded in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings as described above.

(3) Primarily consists of site relocation costs in connection with 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") and on September 20, 2018, the Company's Board of Directors approved a revision to that restructuring plan. As a result of the revision to the plan, cost amounts and total headcount exits were revised and the completion of the workforce reductions was extended to fiscal 2020. The changes to the workforce will vary by country, based on business needs, local legal requirements and consultations with employee work councils and other employee representatives, as appropriate.

	Employee Severance			Infrastructure and other
	In millions
Liability as of October 31, 2018	$	291		$	33
Charges	115			28
Cash payments	(209		)	(20		)
Non-cash items	(9		)	(9		)
Liability as of July 31, 2019	$	188		$	32
Total costs incurred to date, as of July 31, 2019	$	881		$	89
Total costs expected to be incurred, as of July 31, 2019	$	1,200		$	180

As of July 31, 2019 and October 31, 2018, the current restructuring liability related to the HPE Next Plan, reported in Accrued restructuring in the Condensed Consolidated Balance Sheets, was $190 million and $241 million, respectively. The non-current restructuring liability related to the HPE Next Plan, reported in Other non-current liabilities in the Condensed Consolidated Balance Sheets as of July 31, 2019 and October 31, 2018 was $30 million and $83 million, respectively.

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Retirement and Post-Retirement Benefit Plans

9 Months Ended

Jul. 31, 2019

Retirement Benefits [Abstract]

Retirement and Post-Retirement Benefit Plans

Retirement and Post-Retirement Benefit Plans

The Company's net pension benefit cost for defined benefit plans recognized in the Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018, was as follows:

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Service cost	$	21		$	26		$	63		$	79
Interest cost(1)	54			55			165			168
Expected return on plan assets(1)	(126		)	(139		)	(386		)	(423		)
Amortization and deferrals(1):
Actuarial loss	59			52			176			158
Prior service benefit	(4		)	(4		)	(12		)	(12		)
Net periodic benefit cost (credit)	4			(10		)	6			(30		)
Settlement loss(1)	4			9			10			11
Special termination benefits(1)	1			1			2			5
Net benefit cost (credit)	$	9		$	—		$	18		$	(14	)

(1) These non-service components of net periodic benefit cost were included in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings.

Net benefit cost for the Company's post-retirement benefit plans was not material for the three and nine months ended July 31, 2019 and 2018.

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Taxes on Earnings

9 Months Ended

Jul. 31, 2019

Income Tax Disclosure [Abstract]

Taxes on Earnings

Taxes on Earnings

Provision for Taxes

The Company's effective tax rate was 89.8% and 2.8% for the three months ended July 31, 2019 and 2018, respectively, and 31.4% and 1,003.9% for the nine months ended July 31, 2019 and 2018, respectively. The effective tax rates for the three and nine months ended July 31, 2019 and 2018 were significantly impacted by the Tax Act and the settlement of certain pre-Separation tax liabilities of HP Inc.

For the three and nine months ended July 31, 2019, the Company recorded $303 million of net income tax benefits and $80 million of net income tax charges, respectively, related to various items discrete to the period. For the three months ended July 31, 2019, this amount primarily included $308 million of income tax benefits predominantly related to the change in pre-Separation tax liabilities as a result of the effective settlement of the U.S. federal income tax audit of fiscal years 2013 through 2015 for HP Inc. for which the Company shares joint and several liability and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement and $18 million of net income tax benefits on transformation costs, and acquisition, disposition and other related charges, partially offset by $19 million of income tax charges related to uncertain tax reserves pertaining to separation activities and $14 million of income tax charges related to changes in U.S. state valuation allowances as a result of impacts of the Tax Act. For the nine months ended July 31, 2019, the amount primarily included $365 million of income tax charges related to changes in U.S. federal and state valuation allowances as a result of impacts of the Tax Act, $40 million of income tax charges related to future withholding tax costs on distributions of earnings, and $19 million of income tax charges related to uncertain tax reserves pertaining to separation activities, partially offset by $264 million of income tax benefits related to the change in pre-Separation tax liabilities for which the Company shares joint and several liability with HP Inc. and for which the Company is partially indemnified by HP Inc. under the Tax Matters Agreement, and $75 million of income tax benefits on transformation costs, and acquisition, disposition and other related charges.

For the three and nine months ended July 31, 2018, the Company recorded $68 million and $3.3 billion of net income tax benefits, respectively, related to various items discrete to the period. For the three months ended July 31, 2018, this amount primarily included $38 million of income tax benefits from the release of non-U.S. valuation allowances on deferred tax assets following changes in foreign tax laws, $33 million of net income tax benefits for impacts related to U.S. tax reform and $26 million of net excess tax benefits related to stock-based compensation, partially offset by $7 million of income tax charges related to tax indemnification with HP Inc. For the nine months ended July 31, 2018, this amount primarily included $2.0 billion of income tax benefits for the effects of the settlement of certain pre-Separation Hewlett-Packard Company income tax liabilities, $713 million of net income tax benefits for impacts related to U.S. tax reform, $228 million of income tax benefits from foreign tax credits and from the release of non-U.S. valuation allowances on deferred tax assets and liabilities established in connection with the Everett Transaction following changes in foreign tax laws, $203 million of income tax benefits related to the liquidation of an insolvent non-U.S. subsidiary, $74 million of net income tax benefits on restructuring charges, separation costs and acquisition, disposition, and other related charges, $68 million of net excess tax benefits related to stock-based compensation, and $38 million of income tax benefits from the release of non-U.S. valuation allowances on deferred tax assets following changes in foreign tax laws.

Recent Tax Legislation

The Tax Act required the Company to incur a one-time Transition Tax on deferred foreign income not previously subject to U.S. income tax at a rate of 15.5% for foreign cash and certain other net current assets and 8% on the remaining income. The GILTI and BEAT provisions of the Tax Act became effective for the Company beginning November 1, 2018.

The Company has an October 31 fiscal year end; therefore, the lower corporate tax rate enacted by the Tax Act was phased in, resulting in a U.S. statutory federal rate of 23.3% for the fiscal year ending October 31, 2018 and 21% for the current and subsequent fiscal years.

The Company completed its accounting for the tax effects of the Tax Act based on currently available legislative and regulatory updates in the first quarter of fiscal 2019, resulting in an additional tax charge of $426 million. This amount includes $438 million of income tax charges relating to additional valuation allowances against certain U.S. federal deferred tax assets, $56 million of income tax benefits resulting from the release of valuation allowances against certain U.S. state deferred tax assets, an additional $7 million of Transition Tax and $37 million of income tax charges related to future withholding tax costs on distributions of

earnings. No cash payment is anticipated due to the availability of sufficient tax credits to offset the Transition Tax. The Company has elected to treat taxes due on future GILTI inclusions in U.S. taxable income as a current period expense when incurred.

Uncertain Tax Positions

As of July 31, 2019 and October 31, 2018, the amount of unrecognized tax benefits was $2.6 billion and $8.8 billion, respectively, of which up to $0.8 billion and $1.1 billion, respectively, would affect the Company's effective tax rate if realized as of their respective periods. The Company is joint and severally liable for certain pre-Separation tax liabilities of HP Inc. HP Inc. is subject to numerous ongoing audits by state and foreign tax authorities. During the nine months ended July 31, 2019, HP Inc. effectively settled with the IRS on pre-Separation Hewlett-Packard Company audits for fiscal years 2013 through 2015, for which the Company had been joint and severally liable, primarily contributing to the reduction in the Company's unrecognized tax benefits of $6.2 billion.

The Company recognizes interest income from favorable settlements and interest expense and penalties accrued on unrecognized tax benefits in (Benefit) provision for taxes in the Condensed Consolidated Statements of Earnings. As of July 31, 2019 and October 31, 2018, the Company has recorded $130 million and $142 million, respectively, for interest and penalties in the Condensed Consolidated Balance Sheets.

The Company engages in continuous discussions and negotiations with taxing authorities regarding tax matters in various jurisdictions. The Company does not expect complete resolution of any audit cycle within the next 12 months. However, it is reasonably possible that certain federal, foreign and state tax issues may be concluded in the next 12 months, including issues involving transfer pricing, joint and several tax liabilities and other matters. Accordingly, the Company believes it is reasonably possible that its existing unrecognized tax benefits may be reduced by an amount up to $40 million within the next 12 months, of which $7 million would affect the Company’s effective tax rate if realized.

Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities included in the Condensed Consolidated Balance Sheets were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Deferred tax assets	$	1,657		$	2,403
Deferred tax liabilities	(278		)	(228		)
Deferred tax assets net of deferred tax liabilities	$	1,379		$	2,175

Tax Matters Agreement and Other Income Tax Matters

In connection with the Separation, the Company entered into a Tax Matters Agreement with HP Inc. In connection with the Everett and Seattle Transactions, the Company entered into a DXC Tax Matters Agreement with DXC and a Micro Focus Tax Matters Agreement with Micro Focus, respectively. For more details, see the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

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Balance Sheet Details

9 Months Ended

Jul. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Details

Balance Sheet Details

Balance sheet details were as follows:

Cash and cash equivalents

	As of
	July 31, 2019		October 31, 2018
	In millions
Cash and cash equivalents	$	3,693	$	4,880
Restricted cash	318		204
Cash, cash equivalents and restricted cash	$	4,011	$	5,084

Inventory

	As of
	July 31, 2019		October 31, 2018
	In millions
Finished goods	$	1,225	$	1,274
Purchased parts and fabricated assemblies	991		1,173
Total	$	2,216	$	2,447

For the nine months ended July 31, 2019, the decrease in inventory was due primarily to lower commodity costs and slower inventory replenishment as a result of improved market supply availability for key commodities.

Other Current Assets

	As of
	July 31, 2019		October 31, 2018
	In millions
Value-added tax receivables	$	630	$	811
Short-term tax receivables and prepaid taxes	225		535
Manufacturer and other receivables	619		937
Prepaid and other current assets	832		793
Restricted cash	318		204
Total	$	2,624	$	3,280

For the nine months ended July 31, 2019, the decrease in Other current assets was due primarily to a decrease in short-term tax receivables and prepaid taxes following the adoption of the new accounting standard related to income taxes in the first quarter of fiscal 2019, a decrease in manufacturer and other receivables as a result of lower collateral receivables and lower receivables from contract manufacturers, and a decrease in value-added tax receivables.

Property, Plant and Equipment

	As of
	July 31, 2019			October 31, 2018
	In millions
Land	$	293		$	294
Buildings and leasehold improvements	2,157			2,103
Machinery and equipment, including equipment held for lease	9,460			9,419
	11,910			11,816
Accumulated depreciation	(5,910		)	(5,678		)
Total	$	6,000		$	6,138

Notes Payable and Short-Term Borrowings

	As of
	July 31, 2019		October 31, 2018
	In millions
Current portion of long-term debt	$	1,180	$	1,196
FS commercial paper	671		392
Notes payable to banks, lines of credit and other(1)	356		417
Total	$	2,207	$	2,005

(1) As of July 31, 2019 and October 31, 2018, notes payable to banks, lines of credit and other includes $228 million and $361 million, respectively, of borrowing associated with FS and its subsidiaries.

Warranties

The Company's aggregate product warranty liability as of July 31, 2019, and changes during the nine months then ended were as follows:

	Nine Months Ended July 31, 2019
	In millions
Balance at beginning of period	$	430
Accruals for warranties issued	178
Adjustments related to pre-existing warranties	6
Settlements made	(212		)
Balance at end of period	$	402

Contract balances

The Company’s contract balances consist of contract assets, contract liabilities, and costs to obtain a contract with a customer.

Contract Assets

A summary of accounts receivable, net, including unbilled receivables was as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Accounts receivable, net
Accounts receivable	$	2,786		$	3,117
Unbilled receivables	210			185
Allowance for doubtful accounts	(31		)	(39		)
Total	$	2,965		$	3,263

Contract Liabilities

Contract liabilities consist of deferred revenue. The aggregate balances of current and non-current deferred revenue were $5.9 billion and $5.8 billion as of July 31, 2019 and October 31, 2018, respectively, which included $96 million and $82 million of deferred revenue related to FS, respectively. During the nine months ended July 31, 2019, approximately $5.1 billion of deferred revenue was recognized as revenue.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents contract work that has not yet been performed and does not include contracts where the customer is not committed. Remaining performance obligations estimates are subject to change and are affected by several factors, including contract terminations, changes in the scope of contracts, adjustments for revenue that has not materialized and adjustments for currency.

Remaining performance obligations consist of deferred revenue. As of July 31, 2019, the aggregate amount of remaining performance obligations was $5.9 billion. The Company expects to recognize approximately 22% of this amount as revenue over the remaining fiscal year.

Costs to Obtain a Contract

As of July 31, 2019, the current and non-current portions of the capitalized costs to obtain a contract were $46 million and $69 million, which were included in Other current assets and Long-term financing receivables and other assets, respectively, in the Condensed Consolidated Balance Sheet. During the three and nine months ended July 31, 2019, the Company amortized $12 million and $34 million of the capitalized costs to obtain a contract, respectively.

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Financing Receivables and Operating Leases

9 Months Ended

Jul. 31, 2019

Leases [Abstract]

Financing Receivables and Operating Leases

Financing Receivables and Operating Leases

Financing receivables represent sales-type and direct-financing leases of the Company and third-party products. These receivables typically have terms ranging from two to five years and are usually collateralized by a security interest in the underlying assets. Financing receivables also include billed receivables from operating leases. The components of financing receivables were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Minimum lease payments receivable	$	9,009		$	8,691
Unguaranteed residual value	322			297
Unearned income	(765		)	(732		)
Financing receivables, gross	8,566			8,256
Allowance for doubtful accounts	(133		)	(120		)
Financing receivables, net	8,433			8,136
Less: current portion(1)	(3,567		)	(3,396		)
Amounts due after one year, net(1)	$	4,866		$	4,740

(1) The Company includes the current portion in Financing receivables, and amounts due after one year, net in Long-term financing receivables and other assets, in the accompanying Condensed Consolidated Balance Sheets.

Sale of Financing Receivables

During the nine months ended July 31, 2019 and 2018, the Company entered into arrangements to transfer the contractual payments due under certain financing receivables to third party financial institutions. During the nine months ended July 31, 2019 and 2018, the Company sold $153 million and $127 million, respectively, of financing receivables. The gains recognized on the sales of financing receivables were not material for both periods.

Credit Quality Indicators

The credit risk profile of gross financing receivables, based upon internal risk ratings, was as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Risk Rating:
Low	$	4,377	$	4,238
Moderate	3,913		3,805
High	276		213
Total	$	8,566	$	8,256

Accounts rated low risk typically have the equivalent of a Standard & Poor's rating of BBB– or higher, while accounts rated moderate risk generally have the equivalent of BB+ or lower. The Company classifies accounts as high risk when it considers the financing receivable to be impaired or when management believes there is a significant near-term risk of impairment.

Allowance for Doubtful Accounts

The allowance for doubtful accounts for financing receivables as of July 31, 2019 and October 31, 2018 and the respective changes during the nine and twelve months then ended were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Balance at beginning of period	$	120		$	86
Provision for doubtful accounts	25			49
Write-offs	(12		)	(15		)
Balance at end of period	$	133		$	120

The gross financing receivables and related allowance evaluated for loss were as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Gross financing receivables collectively evaluated for loss	$	8,120	$	7,917
Gross financing receivables individually evaluated for loss(1)	446		339
Total	$	8,566	$	8,256
Allowance for financing receivables collectively evaluated for loss	$	84	$	78
Allowance for financing receivables individually evaluated for loss	49		42
Total	$	133	$	120

(1) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Non-Accrual and Past-Due Financing Receivables

The following table summarizes the aging and non-accrual status of gross financing receivables:

	As of
	July 31, 2019		October 31, 2018
	In millions
Billed:(1)
Current 1-30 days	$	319	$	275
Past due 31-60 days	62		42
Past due 61-90 days	15		13
Past due > 90 days	86		74
Unbilled sales-type and direct-financing lease receivables	8,084		7,852
Total gross financing receivables	$	8,566	$	8,256
Gross financing receivables on non-accrual status(2)	$	297	$	226
Gross financing receivables 90 days past due and still accruing interest(2)	$	149	$	113

(1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables.

(2) Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Operating Leases

Operating lease assets included in Property, plant and equipment in the Condensed Consolidated Balance Sheets were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Equipment leased to customers	$	7,275		$	7,290
Accumulated depreciation	(3,225		)	(3,078		)
Total	$	4,050		$	4,212

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Goodwill

9 Months Ended

Jul. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

Goodwill

Goodwill allocated to the Company's reportable segments as of July 31, 2019 and the change in the respective carrying amounts during the nine months then ended were as follows:

	Hybrid IT		Intelligent Edge		Financial Services		Total
	In millions
Balance at October 31, 2018(1) (2)	$	15,479	$	1,914	$	144	$	17,537
Goodwill acquired during the period(3)	48		—		—		48
Goodwill adjustments	2		—		—		2
Balance at July 31, 2019(2)	$	15,529	$	1,914	$	144	$	17,587

(1) As a result of the organizational realignments effective during the first quarter of fiscal 2019, which are described in detail in Note 2, "Segment Information", goodwill was reclassified to the respective segments as of the beginning of the period using a relative fair value approach.

(2) Goodwill is net of an accumulated impairment loss of $88 million related to the Corporate Investments segment which was recorded during the fourth quarter of fiscal 2018. There is no remaining goodwill in the Corporate Investments segment.

(3) Goodwill acquired in connection with the acquisition of BlueData.

Goodwill is tested for impairment at the reporting unit level. As of July 31, 2019, the Company's reporting units containing goodwill are consistent with the reportable segments identified in Note 2, "Segment Information". The Company will continue to evaluate the recoverability of goodwill on an annual basis as of the beginning of its fourth fiscal quarter and whenever events or changes in circumstances indicate there may be a potential impairment.

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Fair Value

9 Months Ended

Jul. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.

Fair Value Hierarchy

The Company uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use.

Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement:

Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs.

Level 3—Unobservable inputs for the asset or liability.

The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs.

The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis:

	As of July 31, 2019								As of October 31, 2018
	Fair Value Measured Using								Fair Value Measured Using
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	In millions
Assets
Cash Equivalents and Investments:
Time deposits	$	—	$	908	$	—	$	908	$	—	$	781	$	—	$	781
Money market funds	609		—		—		609		2,340		—		—		2,340
Foreign bonds	7		125		—		132		7		124		—		131
Other debt securities	—		1		32		33		—		—		25		25
Derivative Instruments:
Interest rate contracts	—		20		—		20		—		—		—		—
Foreign exchange contracts	—		467		—		467		—		496		—		496
Total assets	$	616	$	1,521	$	32	$	2,169	$	2,347	$	1,401	$	25	$	3,773
Liabilities
Derivative Instruments:
Interest rate contracts	$	—	$	32	$	—	$	32	$	—	$	353	$	—	$	353
Foreign exchange contracts	—		116		—		116		—		117		—		117
Other derivatives	—		1		—		1		—		6		—		6
Total liabilities	$	—	$	149	$	—	$	149	$	—	$	476	$	—	$	476

During the nine months ended July 31, 2019, there were no transfers between levels within the fair value hierarchy.

Other Fair Value Disclosures

Short- and Long-Term Debt: At July 31, 2019 and October 31, 2018, the estimated fair value of the Company's short-term and long-term debt was $13.5 billion and $12.2 billion, respectively.

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Financial Instruments

9 Months Ended

Jul. 31, 2019

Investments, All Other Investments [Abstract]

Financial Instruments

Financial Instruments

Cash Equivalents and Available-for-Sale Investments

Cash equivalents and available-for-sale investments were as follows:

	As of July 31, 2019								As of October 31, 2018
	Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value		Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
	In millions
Cash Equivalents:
Time deposits	$	908	$	—	$	—	$	908	$	781	$	—	$	—		$	781
Money market funds	609		—		—		609		2,340		—		—			2,340
Total cash equivalents	1,517		—		—		1,517		3,121		—		—			3,121
Available-for-Sale Investments:
Foreign bonds	110		22		—		132		113		18		—			131
Other debt securities	33		—		—		33		26		—		(1		)	25
Total available-for-sale investments	143		22		—		165		139		18		(1		)	156
Total cash equivalents and available-for-sale debt investments	$	1,660	$	22	$	—	$	1,682	$	3,260	$	18	$	(1	)	$	3,277

As of July 31, 2019 and October 31, 2018, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. Time deposits were primarily issued by institutions outside the U.S. as of July 31, 2019 and October 31, 2018. The estimated fair value of the available-for-sale debt investments may not be representative of values that will be realized in the future.

Contractual maturities of available-for-sale debt investments were as follows:

	July 31, 2019
	Amortized Cost		Fair Value
	In millions
Due in one to five years	$	10	$	10
Due in more than five years	133		155
	$	143	$	165

Equity Investments

Equity securities investments in privately held companies are included in Long-term financing receivables and other assets in the Condensed Consolidated Balance Sheets. The carrying amount of these investments without readily determinable fair values amounted to $184 million and $162 million at July 31, 2019 and October 31, 2018, respectively.

Investments in equity securities that are accounted for using the equity method are included in Investments in equity interests in the Condensed Consolidated Balance Sheets. These investments amounted to $2.3 billion and $2.4 billion at July 31, 2019 and October 31, 2018, respectively.

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets

The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows:

	As of July 31, 2019										As of October 31, 2018
			Fair Value										Fair Value
	Outstanding Gross Notional		Other Current Assets		Long-Term Financing Receivables and Other Assets		Other Accrued Liabilities		Long-Term Other Liabilities		Outstanding Gross Notional		Other Current Assets		Long-Term Financing Receivables and Other Assets		Other Accrued Liabilities		Long-Term Other Liabilities
	In millions
Derivatives designated as hedging instruments
Fair value hedges:
Interest rate contracts	$	6,850	$	—	$	20	$	—	$	32	$	6,850	$	—	$	—	$	—	$	353
Cash flow hedges:
Foreign currency contracts	8,539		218		157		24		23		8,423		270		107		11		15
Net investment hedges:
Foreign currency contracts	1,745		25		30		18		18		1,737		32		41		13		11
Total derivatives designated as hedging instruments	17,134		243		207		42		73		17,010		302		148		24		379
Derivatives not designated as hedging instruments
Foreign currency contracts	5,206		36		1		26		7		6,780		41		5		55		12
Other derivatives	103		—		—		1		—		104		—		—		6		—
Total derivatives not designated as hedging instruments	5,309		36		1		27		7		6,884		41		5		61		12
Total derivatives	$	22,443	$	279	$	208	$	69	$	80	$	23,894	$	343	$	153	$	85	$	391

Offsetting of Derivative Instruments

The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheets. The Company's derivative instruments are subject to master netting arrangements and collateral security arrangements. The Company does not offset the fair value of its derivative instruments against the fair value of cash collateral posted under collateral security agreements. As of July 31, 2019 and October 31, 2018, information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows:

	As of July 31, 2019
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	487	$	—	$	487	$	125	$	316	(1)	$	46
Derivative liabilities	$	149	$	—	$	149	$	125	$	5	(2)	$	19

	As of October 31, 2018
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	496	$	—	$	496	$	179	$	205	(1)	$	112
Derivative liabilities	$	476	$	—	$	476	$	179	$	302	(2)	$	(5	)

(1) Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date.

(2) Represents the collateral posted by the Company in cash or through the re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of July 31, 2019, of the $5 million of collateral posted, $4 million was in cash and $1 million was through re-use of counterparty collateral. As of October 31, 2018, $302 million of collateral posted was entirely in cash.

Effect of Derivative Instruments on the Condensed Consolidated Statements of Earnings

The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship for the three and nine months ended July 31, 2019 and 2018 were as follows:

	Gains (Losses) Recognized in Earnings on Derivative and Related Hedged Item
Derivative Instrument	Location	Three months ended July 31, 2019		Nine months ended July 31, 2019		Hedged Item	Location	Three months ended July 31, 2019			Nine months ended July 31, 2019
		In millions						In millions
Interest rate contracts	Interest and other, net	$	123	$	341	Fixed-rate debt	Interest and other, net	$	(123	)	$	(341	)

	Gains (Losses) Recognized in Earnings on Derivative and Related Hedged Item
Derivative Instrument	Location	Three months ended July 31, 2018		Nine months ended July 31, 2018			Hedged Item	Location	Three months ended July 31, 2018			Nine months ended July 31, 2018
		In millions							In millions
Interest rate contracts	Interest and other, net	$	16	$	(194	)	Fixed-rate debt	Interest and other, net	$	(16	)	$	194

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the three and nine months ended July 31, 2019 were as follows:

	Gains (Losses) Recognized in Other Comprehensive Income ("OCI") on Derivatives (Effective Portion)						Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion)
	Three months ended July 31, 2019			Nine months ended July 31, 2019			Location	Three months ended July 31, 2019		Nine months ended July 31, 2019
	In millions							In millions
Cash flow hedges:
Foreign currency contracts	$	43		$	102		Net revenue	$	42	$	168
Foreign currency contracts	20			123			Interest and other, net	16		91
Total cash flow hedges	$	63		$	225		Net earnings from continuing operations	$	58	$	259
Net investment hedges:
Foreign currency contracts	$	(18	)	$	(23	)	Interest and other, net	$	—	$	—

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the three and nine months ended July 31, 2018 was as follows:

	Gains (Losses) Recognized in Other Comprehensive Income ("OCI") on Derivatives (Effective Portion)					Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion)
	Three months ended July 31, 2018		Nine months ended July 31, 2018			Location	Three months ended July 31, 2018		Nine months ended July 31, 2018
	In millions						In millions
Cash flow hedges:
Foreign currency contracts	$	121	$	59		Net revenue	$	29	$	(82	)
Foreign currency contracts	28		(9		)	Interest and other, net	14		4
Total cash flow hedges	$	149	$	50		Net earnings from continuing operations	$	43	$	(78	)
Net investment hedges:
Foreign currency contracts	$	57	$	31		Interest and other, net	$	—	$	—

As of July 31, 2019 and 2018, no portion of the hedging instruments' gain or loss was excluded from the assessment of effectiveness for fair value, cash flow or net investment hedges. Hedge ineffectiveness for fair value, cash flow, and net investment hedges was not material for the three and nine months ended July 31, 2019 and 2018.

As of July 31, 2019, the Company expects to reclassify an estimated net Accumulated other comprehensive gain of approximately $80 million, net of taxes, to earnings in the next twelve months, along with the earnings effects of the related forecasted transactions associated with cash flow hedges.

The pre-tax effect of derivative instruments not designated as hedging instruments on the Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018 was as follows:

		Gains (Losses) Recognized in Earnings on Derivatives
	Location	Three months ended July 31, 2019			Three months ended July 31, 2018		Nine months ended July 31, 2019			Nine months ended July 31, 2018
		In millions
Foreign currency contracts	Interest and other, net	$	55		$	233	$	(68	)	$	104
Other derivatives	Interest and other, net	(2		)	—		5			—
Total		$	53		$	233	$	(63	)	$	104

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Borrowings

9 Months Ended

Jul. 31, 2019

Debt Disclosure [Abstract]

Borrowings

Borrowings

Commercial Paper

Hewlett Packard Enterprise's Board of Directors has authorized the issuance of up to $4.0 billion in aggregate principal amount of commercial paper by Hewlett Packard Enterprise. Hewlett Packard Enterprise's subsidiaries are authorized to issue up to an additional $1.0 billion in aggregate principal amount of commercial paper. Hewlett Packard Enterprise maintains two commercial paper programs, and a wholly-owned subsidiary maintains a third program. Hewlett Packard Enterprise's U.S. program provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $4.0 billion. Hewlett Packard Enterprise's euro commercial paper program provides for the issuance of commercial paper outside of the U.S. denominated in U.S. dollars, euros or British pounds up to a maximum aggregate principal amount of $3.0 billion or the equivalent in those alternative currencies. The combined aggregate principal amount of commercial paper outstanding under those programs at any one time cannot exceed the $4.0 billion authorized by Hewlett Packard Enterprise's Board of Directors. The Hewlett Packard Enterprise subsidiary's euro Commercial Paper/Certificate of Deposit Program provides for the issuance of commercial paper in various currencies of up to a maximum aggregate principal amount of $1.0 billion, which was increased from $500 million, by way of an amendment in April 2019. As of July 31, 2019 and October 31, 2018, no borrowings were outstanding under Hewlett Packard Enterprise’s two commercial paper programs, and $671 million and $392 million, respectively, were outstanding under the subsidiary’s program.

Revolving Credit Facility

On August 16, 2019, the Company entered into a revolving credit facility (the "Credit Agreement"), together with the lenders named therein, JPMorgan Chase Bank, N.A. ("JPMorgan"), as co-administrative agent and administrative processing agent, and Citibank, N.A., as co-administrative agent, providing for a senior, unsecured revolving credit facility with aggregate lending commitments of $4.75 billion. Loans under the revolving credit facility may be used for general corporate purposes. Commitments under the Credit Agreement are available for a period of five years, which period may be extended, subject to satisfaction of certain conditions, by up to two one-year periods. Commitment fees, interest rates and other terms of borrowing under the credit facility vary based on Hewlett Packard Enterprise's external credit rating. This credit facility replaces the Company's prior credit facility that was entered into on November 1, 2015, which was terminated in connection with its entering into the new credit facility.

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Stockholders' Equity

9 Months Ended

Jul. 31, 2019

Equity [Abstract]

Stockholders' Equity

Stockholders' Equity

Taxes related to Other Comprehensive Income

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Taxes on change in net unrealized gains (losses) on cash flow hedges:
Tax (provision) on net unrealized gains arising during the period	$	(6	)	$	(20	)	$	(24	)	$	(6	)
Tax provision (benefit) on net (gains) losses reclassified into earnings	7			5			31			(11		)
	1			(15		)	7			(17		)
Taxes on change in unrealized components of defined benefit plans:
Tax benefit on net unrealized losses arising during the period	5			3			13			2
Tax provision on amortization of net actuarial loss and prior service benefit	(3		)	(4		)	(9		)	(10		)
Tax provision on curtailments, settlements and other	—			(5		)	(7		)	(12		)
	2			(6		)	(3		)	(20		)
Tax (provision) benefit on change in cumulative translation adjustment	(1		)	2			—			3
Tax benefit (provision) on other comprehensive income	$	2		$	(19	)	$	4		$	(34	)

Changes and reclassifications related to Other Comprehensive Income, net of taxes

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Other comprehensive income, net of taxes:
Change in net unrealized gains (losses) on available-for-sale securities:
Net unrealized gains (losses) arising during the period	$	3		$	(2	)	$	8		$	(1	)
Gains reclassified into earnings	—			—			(3		)	(9		)
	3			(2		)	5			(10		)
Change in net unrealized gains (losses) on cash flow hedges:
Net unrealized gains arising during the period	57			129			201			44
Net (gains) losses reclassified into earnings(1)	(51		)	(38		)	(228		)	67
	6			91			(27		)	111
Change in unrealized components of defined benefit plans:
Net unrealized losses arising during the period	(26		)	(22		)	(65		)	(21		)
Amortization of net actuarial loss and prior service benefit(2)	51			43			152			133
Curtailments, settlements and other	5			4			5			(1		)
	30			25			92			111
Change in cumulative translation adjustment	(9		)	(38		)	(2		)	(37		)
Other comprehensive income, net of taxes	$	30		$	76		$	68		$	175

(1) For more details on the reclassification of pre-tax net (gains) losses on cash flow hedges into the Condensed Consolidated Statements of Earnings, see Note 11, "Financial Instruments".

(2) These components are included in the computation of net pension and post-retirement benefit cost in Note 5, "Retirement and Post-Retirement Benefit Plans".

The components of Accumulated other comprehensive loss, net of taxes as of July 31, 2019, and changes during the nine months ended July 31, 2019 were as follows:

	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gains (losses) on cash flow hedges			Unrealized components of defined benefit plans			Cumulative translation adjustment			Accumulated other comprehensive loss
	In millions
Balance at beginning of period	$	17		$	106		$	(2,922	)	$	(419	)	$	(3,218	)
Other comprehensive income (loss) before reclassifications	8			201			(65		)	(2		)	142
Reclassifications of (gains) losses into earnings	(3		)	(228		)	157			—			(74		)
Balance at end of period	$	22		$	79		$	(2,830	)	$	(421	)	$	(3,150	)

Share Repurchase Program

For the nine months ended July 31, 2019, the Company repurchased and settled a total of 130 million shares under its share repurchase program through open market repurchases, which included 2.4 million shares that were unsettled open market repurchases as of October 31, 2018. Additionally, as of July 31, 2019, the Company had unsettled open market repurchases of 1.2 million shares. Shares repurchased during the nine months ended July 31, 2019 were recorded as a $1.9 billion reduction to stockholders' equity. As of July 31, 2019, the Company had a remaining authorization of $2.7 billion for future share repurchases.

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Net Earnings Per Share

9 Months Ended

Jul. 31, 2019

Earnings Per Share [Abstract]

Net Earnings Per Share

Net Earnings Per Share

The Company calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes the weighted-average dilutive effect of restricted stock units, stock options, and performance-based awards.

The reconciliations of the numerators and denominators of each of the basic and diluted net EPS calculations were as follows:

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019		2018
	In millions, except per share amounts
Numerator:
Net (loss) earnings from continuing operations	$	(27	)	$	452		$	569	$	2,784
Net loss from discontinued operations	—			(1		)	—		(119		)
Net (loss) earnings	$	(27	)	$	451		$	569	$	2,665
Denominator:
Weighted-average shares used to compute basic net EPS	1,334			1,513			1,367		1,552
Dilutive effect of employee stock plans	—			18			13		26
Weighted-average shares used to compute diluted net EPS	1,334			1,531			1,380		1,578
Basic net (loss) earnings per share:
Continuing operations	$	(0.02	)	$	0.30		$	0.42	$	1.79
Discontinued operations(1)	—			—			—		(0.07		)
Basic net (loss) earnings per share	$	(0.02	)	$	0.30		$	0.42	$	1.72
Diluted net (loss) earnings per share:
Continuing operations	$	(0.02	)	$	0.29		$	0.41	$	1.76
Discontinued operations(1)(2)	—			—			—		(0.07		)
Diluted net (loss) earnings per share	$	(0.02	)	$	0.29		$	0.41	$	1.69
Anti-dilutive weighted-average stock awards(3)	44			2			4		3

(1) EPS for discontinued operations was calculated by deducting the EPS from continuing operations from the total EPS.

(2) U.S. GAAP requires the denominator used in the diluted net EPS calculation for discontinued operations to be the same as that of continuing operations, regardless of net earnings (loss) from continuing operations.

(3)

The Company excludes shares potentially issuable under employee stock plans that could dilute basic net EPS in the future from the calculation of diluted net earnings (loss) per share, as their effect, if included, would have been anti-dilutive for the periods presented.

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Litigation and Contingencies

9 Months Ended

Jul. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Litigation and Contingencies

Litigation and Contingencies

Hewlett Packard Enterprise is involved in various lawsuits, claims, investigations and proceedings including those consisting of Intellectual Property ("IP"), commercial, securities, employment, employee benefits and environmental matters, which arise in the ordinary course of business. In addition, as part of the Separation and Distribution Agreement, Hewlett Packard Enterprise and HP Inc. (formerly known as "Hewlett-Packard Company") agreed to cooperate with each other in managing certain existing litigation related to both parties' businesses. The Separation and Distribution Agreement included provisions that allocate liability and financial responsibility for pending litigation involving the parties, as well as provide for cross-indemnification of the parties against liabilities to one party arising out of liabilities allocated to the other party. The Separation and Distribution Agreement also included provisions that assign to the parties responsibility for managing pending and future litigation related to the general corporate matters of HP Inc. arising prior to the Separation. Hewlett Packard Enterprise records a liability when it believes that it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Significant judgment is required to determine both the probability of having incurred a liability and the estimated amount of the liability. Hewlett Packard Enterprise reviews these matters at least quarterly and adjusts these liabilities to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other updated information and events pertaining to a particular matter. Litigation is inherently unpredictable. However, Hewlett Packard Enterprise believes it has valid defenses with respect to legal matters pending against us. Nevertheless, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these contingencies. Hewlett Packard Enterprise believes it has recorded adequate provisions for any such matters and, as of July 31, 2019, it was not reasonably possible that a material loss had been incurred in connection with such matters in excess of the amounts recognized in its financial statements.

Litigation, Proceedings and Investigations

DXC Technology Indemnification Demand. On March 27, 2018, DXC Technology (“DXC”) served an arbitration demand on HPE under the Separation and Distribution Agreement by and between HPE and DXC (f/k/a Everett SpinCo, Inc.) dated May 24, 2016, relating to the separation of HPE’s Enterprise Services business (the “ES Business”). The arbitration demand asserts that HPE is required to indemnify DXC for any transferred long-term capitalized lease obligations of the ES Business that exceed the threshold amount of $250 million. DXC contends that this $250 million threshold was exceeded by approximately $1.0 billion because the valuation of the assets underlying certain leases did not justify their classification as operating leases based on the terms of such leases, thereby rendering them long-term capitalized lease obligations. The arbitration demand follows DXC's November 8, 2017 request for indemnification on this same issue. On August 15, 2019, the arbitration panel ruled in DXC’s favor, issuing DXC an award in the amount of $632 million. The arbitration panel also awarded pre-judgment interest of $34 million.

Ross and Rogus v. Hewlett Packard Enterprise Company. On November 8, 2018, a putative class action complaint was filed in the Superior Court of California, County of Santa Clara alleging that HPE pays its California-based female employees “systemically lower compensation” than HPE pays male employees performing substantially similar work. The complaint alleges various California state law claims, including California’s Equal Pay Act, Fair Employment and Housing Act, and Unfair Competition Law, and seeks certification of a California-only class of female employees employed in certain “Covered Positions.” The complaint seeks damages, statutory and civil penalties, attorneys’ fees and costs. On April 2, 2019, HPE filed a demurrer to all causes of action and an alternative motion to strike portions of the complaint. On July 2, 2019, the court denied HPE’s demurrer as to the claims of the putative class and granted HPE’s demurrer as to the claims of the individual plaintiffs.

India Directorate of Revenue Intelligence Proceedings. On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the "DRI") issued show cause notices to Hewlett-Packard India Sales Private Ltd ("HP India"), a subsidiary of HP Inc., seven HP India employees and one former HP India employee alleging that HP India underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately $370 million, plus penalties. Prior to the issuance of the show cause notices, HP India deposited approximately $16 million with the DRI and agreed to post a provisional bond in exchange for the DRI's agreement to not seize HP India products and spare parts and to not interrupt the transaction of business by HP India.

On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related show cause notice affirming certain duties and penalties against HP India and the named individuals of approximately $386 million, of which HP India had already deposited $9 million. On December 11, 2012, HP India voluntarily deposited an additional $10 million in connection with the products-related show cause notice. On April 20, 2012, the Commissioner issued an order on the parts-related show cause notice affirming certain duties and penalties against HP India and certain of the named individuals of approximately $17 million, of which HP India had already deposited $7 million. After the order, HP India deposited an additional $3 million in connection with the parts-related show cause notice so as to avoid certain penalties.

HP India filed appeals of the Commissioner's orders before the Customs Tribunal along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The Customs Department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HP India to deposit an additional $24 million against the products order, which HP India deposited in March 2013. The Customs Tribunal did not order any additional deposit to be made under the parts order. In December 2013, HP India filed applications before the Customs Tribunal seeking early hearing of the appeals as well as an extension of the stay of deposit as to HP India and the individuals already granted until final disposition of the appeals. On February 7, 2014, the application for extension of the stay of deposit was granted by the Customs Tribunal until disposal of the appeals. On October 27, 2014, the Customs Tribunal commenced hearings on the cross-appeals of the Commissioner's orders. The Customs Tribunal rejected HP India's request to remand the matter to the Commissioner on procedural grounds. The hearings were scheduled to reconvene on April 6, 2015, and again on November 3, 2015 and April 11, 2016, but were canceled at the request of the Customs Tribunal. The hearing was rescheduled for January 15, 2019 but was postponed and has not yet been rescheduled.

ECT Proceedings. In January 2011, the postal service of Brazil, Empresa Brasileira de Correios e Telégrafos ("ECT"), notified a former subsidiary of HP Inc. in Brazil ("HP Brazil") that it had initiated administrative proceedings to consider whether to suspend HP Brazil's right to bid and contract with ECT related to alleged improprieties in the bidding and contracting processes whereby employees of HP Brazil and employees of several other companies allegedly coordinated their bids and fixed results for three ECT contracts in 2007 and 2008. In late July 2011, ECT notified HP Brazil it had decided to apply the penalties against HP Brazil and suspend HP Brazil's right to bid and contract with ECT for five years, based upon the evidence before it. In August 2011, HP Brazil appealed ECT's decision. In April 2013, ECT rejected HP Brazil's appeal, and the administrative proceedings were closed with the penalties against HP Brazil remaining in place. In parallel, in September 2011, HP Brazil filed a civil action against ECT

seeking to have ECT's decision revoked. HP Brazil also requested an injunction suspending the application of the penalties until a final ruling on the merits of the case. The court of first instance has not issued a decision on the merits of the case, but it has denied HP Brazil's request for injunctive relief. HP Brazil appealed the denial of its request for injunctive relief to the intermediate appellate court, which issued a preliminary ruling denying the request for injunctive relief but reducing the length of the sanctions from five to two years. HP Brazil appealed that decision and, in December 2011, obtained a ruling staying enforcement of ECT's sanctions until a final ruling on the merits of the case. HP Brazil expects the decision to be issued in 2019 and any subsequent appeal on the merits to last several years.

Forsyth, et al. vs. HP Inc. and Hewlett Packard Enterprise. This purported class and collective action was filed on August 18, 2016 and an amended complaint was filed on December 19, 2016 in the United States District Court for the Northern District of California, against HP Inc. and Hewlett Packard Enterprise alleging defendants violated the Federal Age Discrimination in Employment Act ("ADEA"), the California Fair Employment and Housing Act, California public policy and the California Business and Professions Code by terminating older workers and replacing them with younger workers.  Plaintiffs seek to certify a nationwide collective action under the ADEA comprised of all individuals aged 40 and older who had their employment terminated by an HP entity pursuant to a work force reduction ("WFR") plan on or after December 9, 2014 for individuals terminated in deferral states and on or after April 8, 2015 in non-deferral states. Plaintiffs also seek to certify a Rule 23 class under California law comprised of all persons 40 years or older employed by defendants in the state of California and terminated pursuant to a WFR plan on or after August 18, 2012. On September 20, 2017, the court granted the defendants' motion to compel arbitration and administratively closed the case pending resolution of the arbitration proceedings. On November 30, 2017, three named plaintiffs filed a single arbitration demand. Thirteen additional plaintiffs later joined the arbitration. On December 22, 2017, defendants filed a motion to (1) stay the case pending arbitrations and (2) enjoin the demanded arbitration and require each plaintiff to file a separate arbitration demand. On February 6, 2018, the court granted the motion to stay and denied the motion to enjoin. The claims of these sixteen arbitration named plaintiffs have been resolved. Additional opt-in plaintiffs have since been added to the litigation and the parties are engaged in the arbitration process for those claims. The Forsyth class action remains stayed.

Wall v. Hewlett Packard Enterprise Company and HP Inc. This certified California class action and Private Attorney General Act action was filed against Hewlett-Packard Company on January 17, 2012 and the fifth amended (and operative) complaint was filed against HP Inc. and Hewlett Packard Enterprise on June 28, 2016 in the Superior Court of California, County of Orange. The complaint alleges that the defendants paid earned incentive compensation late and failed to timely pay final wages in violation of the California Labor Code. On August 9, 2016, the court ordered the class certified without prejudice to a future motion to amend or modify the class certification order or to decertify. The scheduled January 22, 2018 trial date was vacated following the parties’ notification to the court that they had reached a preliminary agreement to resolve the dispute. The parties subsequently finalized and executed a settlement agreement and, on May 9, 2018, plaintiff filed a motion seeking preliminary approval of the settlement. On July 2, 2018, the court issued an order granting preliminary approval of the settlement. On December 21, 2018, the court issued an order granting final approval of the settlement and setting a hearing for September 27, 2019 to confirm that the settlement distributions have been made.  A Qualified Settlement Fund has been fully funded.

Jackson, et al. v. HP Inc. and Hewlett Packard Enterprise. This putative nationwide class action was filed on July 24, 2017 in the United States District Court for the Northern District of California, San Jose Division. Plaintiffs purport to bring the lawsuit on behalf of themselves and other similarly situated African-Americans and individuals over the age of forty. Plaintiffs allege that defendants engaged in a pattern and practice of racial and age discrimination in lay-offs and promotions. Plaintiffs filed an amended complaint on September 29, 2017. Plaintiffs seek damages, attorneys’ fees and costs, and declaratory and injunctive relief. On January 12, 2018, defendants moved to transfer the matter to the federal district court in the Northern District of Georgia. Defendants also moved to dismiss the claims on various grounds and to strike certain aspects of the proposed class definition. On July 11, 2018, the court granted defendants' motion to dismiss this action for improper venue, and also partially dismissed and struck certain claims without prejudice to re-filing in the appropriate venue. On July 23, 2018, plaintiffs re-filed their lawsuit in the United States District Court for the Northern District of Georgia. On August 9, 2018, Plaintiffs filed a notice of appeal of the dismissal of the Northern District of California action with the Ninth Circuit Court of Appeals. On August 15, 2018, Plaintiffs filed a motion to stay their lawsuit in the Northern District of Georgia, which was granted by the court.

Hewlett-Packard Company v. Oracle (Itanium). On June 15, 2011, HP Inc. filed suit against Oracle in the Superior Court of California, County of Santa Clara in connection with Oracle's March 2011 announcement that it was discontinuing software support for HP Inc.’s Itanium-based line of mission critical servers.  HP Inc. asserted, among other things, that Oracle’s actions breached the contract that was signed by the parties as part of the settlement of the litigation relating to Oracle’s hiring of Mark Hurd. The matter eventually progressed to trial, which was bifurcated into two phases. HP Inc. prevailed in the first phase of the trial, in which the court ruled that the contract at issue required Oracle to continue to offer its software products on HP Inc.'s Itanium-based servers for as long as HP Inc. decided to sell such servers. Phase 2 of the trial was then postponed by Oracle’s appeal of the

trial court’s denial of Oracle’s “anti-SLAPP” motion, in which Oracle argued that HP Inc.’s damages claim infringed on Oracle’s First Amendment rights.  On August 27, 2015, the California Court of Appeal rejected Oracle’s appeal. The matter was remanded to the trial court for Phase 2 of the trial, which began on May 23, 2016, and was submitted to the jury on June 29, 2016.  On June 30, 2016, the jury returned a verdict in favor of HP Inc., awarding HP Inc. approximately $3 billion in damages:  $1.7 billion for past lost profits and $1.3 billion for future lost profits. On October 20, 2016, the court entered judgment for this amount with interest accruing until the judgment is paid. Oracle’s motion for a new trial was denied on December 19, 2016, and Oracle filed its notice of appeal from the trial court’s judgment on January 17, 2017. On February 2, 2017, HP Inc. filed a notice of cross-appeal challenging the trial court’s denial of prejudgment interest. Oracle filed its opening brief in the California Court of Appeal on March 7, 2019. HP Inc.’s answering/cross-opening brief was filed on June 12, 2019. On May 16, 2019, HP Inc. filed its application to renew the judgment. As of May 16, 2019, the renewed judgment is approximately $3.8 billion. Daily interest on the renewed judgment is now accruing at $1.037 million. Pursuant to the terms of the Separation and Distribution Agreement, HP Inc. and Hewlett Packard Enterprise will share equally in any recovery from Oracle once Hewlett Packard Enterprise has been reimbursed for all costs incurred in the prosecution of the action prior to the HP Inc. /Hewlett Packard Enterprise separation on November 1, 2015.

Oracle America, Inc., et al. v. Hewlett Packard Enterprise Company (Terix copyright matter). On March 22, 2016, Oracle filed a complaint against HPE in the United States District Court for the Northern District of California, alleging copyright infringement, interference with contract, intentional interference with prospective economic relations, and unfair competition.  Oracle’s claims arise out of HPE’s prior use of a third-party maintenance provider named Terix Computer Company, Inc. (“Terix”). Oracle contends that in connection with HPE’s use of Terix as a subcontractor for certain customers of HPE’s multivendor support business, Oracle’s copyrights were infringed, and HPE is liable for vicarious and contributory infringement and related claims. The lawsuit against HPE follows a prior lawsuit brought by Oracle against Terix in 2013 relating to Terix’s alleged unauthorized provision of Solaris patches to customers on Oracle hardware. On June 14, 2018, the court heard oral argument on HPE's and Oracle's cross-motions for summary judgment. The court has not yet ruled on the parties' motions. On January 29, 2019, the court granted HPE’s Motion for Summary Judgment as to all of Oracle’s claims and vacated the trial date. On February 20, 2019, the court entered judgment in favor of HPE, dismissing Oracle’s claims in their entirety. Oracle has appealed the trial court’s ruling to the United States Court of Appeals for the Ninth Circuit. Oracle’s opening brief was filed on July 29, 2019. HPE’s responsive brief currently is due September 27, 2019.

Network-1 Technologies, Inc. v. Alcatel-Lucent USA Inc., et al. This patent infringement action was filed on September 15, 2011 in the United States District Court for the Eastern District of Texas, alleging that various Hewlett Packard Enterprise switches and access points infringe Network-1’s patent relating to the 802.3af and 802.3at “Power over Ethernet” standards. Network-1 seeks damages, attorneys’ fees and costs, and declaratory and injunctive relief. The Network-1 patent at issue expires in 2020. A jury trial was conducted beginning on November 6, 2017. On November 13, 2017, the jury returned a verdict in favor of HPE, finding that HPE did not infringe Network-1’s patent and that the patent was invalid. On August 29 2018, the court denied Network-1's motion for a new trial on infringement and entered the jury's verdict finding that HPE does not infringe the relevant Network-1 patent. The court also granted Network-1's motion for Judgment as a Matter of Law on validity. Network-1 has appealed the jury verdict of non-infringement to the United States Court of Appeals for the Federal Circuit. HPE has cross-appealed the court’s decision to grant Network-1's motion for Judgment as a Matter of Law on validity. Appellate briefing has been completed.

Shared Litigation with HP Inc., DXC and Micro Focus

As part of the Separation and Distribution Agreements between Hewlett Packard Enterprise and HP Inc., Hewlett Packard Enterprise and DXC, and Hewlett Packard Enterprise and Seattle SpinCo, the parties to each agreement agreed to cooperate with each other in managing certain existing litigation related to both parties' businesses. The Separation and Distribution Agreements also included provisions that assign to the parties responsibility for managing pending and future litigation related to the general corporate matters of HP Inc. (in the case of the separation of Hewlett Packard Enterprise from HP Inc.) or of Hewlett Packard Enterprise (in the case of the separation of DXC from Hewlett Packard Enterprise and the separation of Seattle SpinCo from Hewlett Packard Enterprise), in each case arising prior to the applicable separation.

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Indemnifications

9 Months Ended

Jul. 31, 2019

Guarantees and Product Warranties [Abstract]

Indemnifications

Indemnifications

General Cross-indemnification and Tax Matters Agreements with HP Inc., DXC and Micro Focus

In connection with the Separation and the Everett and Seattle Transactions, the Company entered into a Separation and Distribution Agreement and Tax Matters Agreement with HP Inc., DXC and affiliates, and Micro Focus and affiliates, effective November 1, 2015, March 31, 2017 and September 1, 2017, respectively. For further details on these agreements, see the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

As of July 31, 2019 and October 31, 2018, the Company’s receivable and payable balances related to indemnified litigation matters and other contingencies, and income tax-related indemnification covered by these agreements were as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Litigation matters and other contingencies
Receivable	$	88	$	104
Payable	$	57	$	83
Income tax-related indemnification(1)
Net indemnification receivable - long-term(2)	$	266	$	16
Net indemnification receivable - short-term	$	13	$	17
Net indemnification payable - long-term	$	9	$	9
Net indemnification payable - short-term(3)	$	102	$	26

(1) The actual amount that the Company may receive or pay could vary depending upon the outcome of certain unresolved tax matters, which may not be resolved for several years.

(2) For the nine months ended July 31, 2019, the increase in Net indemnification receivable - long-term was due primarily to the effects of U.S. tax reform on tax attributes related to fiscal periods prior to the Separation.

(3)

For the nine months ended July 31, 2019, the increase in Net indemnification payable - short-term was due primarily to the effective settlement of the U.S. federal income tax audit of fiscal years 2013 through 2015 for HP Inc. for which the Company was joint and severally liable and for which the Company was partially indemnified by HP Inc. under the Tax Matters Agreement.

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Overview and Basis of Presentation (Policies)

9 Months Ended

Jul. 31, 2019

Accounting Policies [Abstract]

Discontinued Operations

Discontinued Operations

On April 1, 2017, HPE completed the separation and merger of its Enterprise Services business with Computer Sciences Corporation ("CSC") (collectively, the "Everett Transaction"). HPE transferred its Enterprise Services business to Everett SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Everett") and distributed all of the shares of Everett to HPE stockholders. Following the distribution, New Everett Merger Sub Inc., a wholly-owned subsidiary of Everett, merged with and into CSC and Everett changed its name to DXC Technology Company ("DXC").

On September 1, 2017, the Company completed the separation and merger of its Software business segment with Micro Focus International plc (“Micro Focus”) (collectively, the “Seattle Transaction”). HPE transferred its Software business segment to Seattle SpinCo, Inc. (a wholly-owned subsidiary of HPE) ("Seattle"), and distributed all of the shares of Seattle to HPE stockholders. Following the share distribution, Seattle MergerSub, Inc., an indirect, wholly-owned subsidiary of Micro Focus, merged with and into Seattle.

The historical financial results of Everett and Seattle are reported as Net loss from discontinued operations in the Condensed Consolidated Statements of Earnings.

Acquisition

Acquisition

On May 16, 2019, the Company entered into a definitive agreement to acquire Cray Inc. ("Cray"), a global supercomputer leader, for $35 per share in cash, in a transaction valued at approximately $1.3 billion, net of cash acquired. The transaction is expected to close by the fourth quarter of HPE’s fiscal year 2019, subject to regulatory approvals and other customary closing conditions. Cray's results of operations will be included within the Hybrid IT segment.

Arbitration Settlement

Arbitration Settlement

On August 15, 2019, an arbitration panel awarded DXC $666 million as well as post-award interest at 3% per annum compounding quarterly until payment. The panel award was made pursuant to a binding arbitration arising from a previously disclosed dispute under the separation and distribution agreement between DXC and HPE. As of July 31, 2019, the Company had recorded a charge representing the full award settlement in its condensed consolidated financial statements. For more information, see Note 15, "Litigation and Contingencies".

Basis of Presentation

Basis of Presentation

These Condensed Consolidated Financial Statements of the Company were prepared in accordance with United States ("U.S.") Generally Accepted Accounting Principles ("GAAP"). In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements of Hewlett Packard Enterprise contain all adjustments, including normal recurring adjustments, necessary to present fairly the Company's financial position as of July 31, 2019 and October 31, 2018, its results of operations for the three and nine months ended July 31, 2019 and 2018, its cash flows for the nine months ended July 31, 2019 and 2018, and its statements of stockholders equity for the three and nine months ended July 31, 2019 and 2018.

The results of operations for the three and nine months ended July 31, 2019 and its cash flows for the nine months ended July 31, 2019 are not necessarily indicative of the results to be expected for the full year. The information included in this Quarterly

Report on Form 10-Q should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018, including "Management's Discussion and Analysis of Financial Condition and Results of Operations", "Quantitative and Qualitative Disclosures About Market Risk" and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, included therein.

Principles of Consolidation

Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and all subsidiaries and affiliates in which the Company has a controlling financial interest or is the primary beneficiary. All intercompany transactions and accounts within the consolidated businesses of the Company have been eliminated.

The Company accounts for investments in companies over which it has the ability to exercise significant influence but does not hold a controlling interest under the equity method of accounting, and the Company records its proportionate share of income or losses in Earnings (loss) from equity interests in the Condensed Consolidated Statements of Earnings.

Non-controlling interests are presented as a separate component within Total stockholders' equity in the Condensed Consolidated Balance Sheets. Net earnings attributable to non-controlling interests are recorded within Interest and other, net in the Condensed Consolidated Statements of Earnings and are not presented separately, as they were not material for any period presented.

Use of Estimates

Use of Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company's Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates.

Revenue Recognition

Revenue Recognition

General

As a result of adopting the new revenue recognition standard ("ASC 606"), the Company now accounts for a contract with a customer when both parties have provided written approval and are committed to perform, each party’s rights including payment terms are identified, the contract has commercial substance, and collection of consideration is probable.

The Company enters into contracts with customers that may include combinations of products and services, resulting in arrangements containing multiple performance obligations for hardware and software products and/or various services. The Company determines whether each product or service is distinct in order to identify the performance obligations in the contract and allocate the contract transaction price among the distinct performance obligations. Arrangements are distinct based on whether the customer can benefit from the product or service on its own or together with other resources that are readily available and whether the commitment to transfer the product or service to the customer is separately identifiable from other obligations in the contract. The Company classifies its hardware, perpetual software licenses, and software-as-a-service ("SaaS") as distinct performance obligations. Term software licenses represent multiple obligations, which include software licenses and software maintenance. In transactions where the Company delivers hardware or software, it is typically the principal and records revenue and costs of goods sold on a gross basis.

Revenue is recognized when, or as, control of promised products or services is transferred to the customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those products or services. Variable consideration offered in contracts with customers, partners and distributors may include rebates, volume-based discounts, cooperative marketing, price protection, and other incentive programs. Variable consideration is estimated at contract inception and updated at the end of each reporting period as additional information becomes available and recognized only to the extent that it is probable that a significant reversal of any incremental revenue will not occur.

Transfer of control occurs once the customer has the contractual right to use the product, generally upon shipment or once delivery and risk of loss has transferred to the customer. Transfer of control can also occur over time for maintenance and services as the customer receives the benefit over the contract term. The Company's hardware and perpetual software licenses are distinct performance obligations where revenue is recognized upfront upon transfer of control. Term software licenses include multiple performance obligations where the term licenses are recognized upfront upon transfer of control, with the associated software

maintenance revenue recognized ratably over the contract term as services and software updates are provided. SaaS arrangements have one distinct performance obligation which is satisfied over time with revenue recognized ratably over the contract term as the customer consumes the services. On its product sales, the Company records consideration from shipping and handling on a gross basis within net product sales. Revenue is recorded net of any associated sales taxes.

Significant Judgments

The Company allocates the transaction price for the contract among the performance obligations on a relative standalone selling price basis. The standalone selling price ("SSP") is the price at which an entity would sell a promised product or service separately to a customer. The Company establishes SSP for most of its products and services based on the observable price of the products or services when sold separately in similar circumstances to similar customers. When the SSP is not directly observable, the Company estimates SSP based on management judgment by considering available data such as internal margin objectives, pricing strategies, market/competitive conditions, historical profitability data, as well as other observable inputs. The Company establishes SSP ranges for its products and services and reassesses them periodically.

Judgment is applied in determining the transaction price as the Company may be required to estimate variable consideration when determining the amount of revenue to recognize. Variable consideration may include various rebates, volume-based discounts, cooperative marketing, price protection, and other incentive programs that are offered to customers, partners and distributors. When determining the amount of revenue to recognize, the Company estimates the expected usage of these programs, applying the expected value or most likely estimate and updates the estimate at each reporting period as actual utilization becomes available. The Company also considers the customers' right of return in determining the transaction price, where applicable.

Contract Balances

Accounts receivable and contract assets

A receivable is a right to consideration in exchange for products or services the Company has transferred to a customer that is unconditional. A contract asset is a right to consideration in exchange for products or services transferred to a customer that is conditional on something other than the passage of time. A receivable is recorded when the right to consideration becomes unconditional.

The Company’s contract assets include unbilled receivables which are recorded when the Company recognizes revenue in advance of billings. Unbilled receivables generally relate to services contracts where a service has been performed and control has transferred, but invoicing to the customer is subject to future milestone billings or other contractual payment schedules. The Company classifies unbilled receivables as Accounts receivable.

Contract liabilities

A contract liability is an obligation to transfer products or services to a customer for which the entity has received consideration, or the amount is due, from the customer. The Company’s contract liabilities primarily consist of deferred revenue. Deferred revenue is recorded when amounts invoiced to customers are in excess of revenue that can be recognized because performance obligations have not been satisfied and control of the promised products or services has not transferred to the customer. Deferred revenue largely represents amounts invoiced in advance for product (hardware/software) support contracts, consulting projects and product sales where revenue cannot be recognized yet.

Costs to obtain a contract with a customer

The Company capitalizes the incremental costs of obtaining a contract with a customer, primarily sales commissions, if the Company expects to recover those costs. The Company has elected, as a practical expedient, to expense the costs of obtaining a contract as incurred for contracts with terms of one year or less. The typical amortization periods used range from three to six years. The Company periodically reviews the capitalized sales commission costs for possible impairment losses. Capitalized sales commission costs are included in Other current assets and Long-term financing receivables and other assets, and the related amortization expense is included in Selling, general and administrative expense.

Recent Tax Legislation

Recent Tax Legislation

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act included significant changes to the U.S. corporate income tax structure, including a federal corporate rate reduction from 35% to 21% effective January 1, 2018, limitations on the deductibility of interest expense and executive compensation, creation of new minimum taxes such as the Base Erosion Anti-abuse Tax (“BEAT”) and the Global Intangible Low Taxed Income (“GILTI”) tax and the transition of U.S.

international taxation from a worldwide tax system to a modified territorial tax system, which resulted in a one-time U.S. tax liability on those earnings which had not previously been repatriated to the U.S. (the “Transition Tax”).

In December 2017, the U.S. Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act ("SAB 118"), which allowed the Company to record provisional amounts during a measurement period not to extend beyond one year of the enactment date, which for the Company ended in the first quarter of fiscal 2019. In accordance with SAB 118, the accounting for the tax effects of the Tax Act was completed based on currently available legislative updates relating to the Tax Act. The Company has elected to treat taxes due on future GILTI inclusions in U.S. taxable income as a current period expense when incurred. For further details, see Note 6, "Taxes on Earnings".

Recently Adopted Accounting Pronouncements and Recently Enacted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board ("FASB") amended the existing accounting standards for retirement benefits. The amendments require the presentation of the service cost component of net periodic benefit cost in the same income statement line items as other employee compensation costs, unless eligible for capitalization. The other components of net periodic benefit costs will be presented separately from the service cost as non-operating costs. Effective at the beginning of the first quarter of fiscal 2019, in connection with the adoption of the accounting standards update for retirement benefits, the Company reflected these changes retrospectively by transferring its non-service net periodic benefit (credit) cost from operating expense to Other (income) and expense in its Condensed Consolidated Statements of Earnings. The net periodic benefit (credit) cost transferred to Other (income) and expense during the three and nine months ended July 31, 2018 were as follows. Refer to Note 5, “Retirement and Post-Retirement Benefit Plans” for additional information.

	Three Months Ended July 31, 2018			Nine Months Ended July 31, 2018
	In millions
Cost of products and services	$	(14	)	$	(42	)
Research and development	(1		)	(3		)
Selling, general and administrative	(19		)	(53		)
Restructuring charges and transformation costs	8			8
	$	(26	)	$	(90	)

In November 2016, the FASB amended the existing accounting standards for the classification and presentation of restricted cash in the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. As a result of adopting this accounting standards update, for the nine months ended July 31, 2018, the Company included $43 million of restricted cash movement during the period, which was previously reported within cash used in investing activities, and is now reported within Decrease in cash, cash equivalents and restricted cash in the Company's Condensed Consolidated Statement of Cash Flows.

In October 2016, the FASB amended the existing accounting standards for income taxes. The amendments require the recognition of the income tax consequences for intra-entity transfers of assets other than inventory when the transfer occurs. Prior to the amendments, current and deferred income taxes for intra-entity asset transfers were not recognized until the asset was sold to an outside party or amortized over time. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the modified retrospective method. The Company recognized $2.3 billion of income taxes as an adjustment to retained earnings in the first nine months of fiscal 2019, which was previously reported as prepaid income taxes and deferred tax assets within Corporate and unallocated assets in the Company's allocation of segment assets.

In August 2016, the FASB amended the existing accounting standards for the statement of cash flows. The amendments provide guidance on eight classification issues related to the statement of cash flows. The Company adopted the guidance in the first quarter of fiscal 2019, beginning November 1, 2018, using the retrospective method. For issues that are impracticable to apply retrospectively, the amendments may be applied prospectively as of the earliest date practicable. The application of this accounting standards update did not have an impact on the Condensed Consolidated Statements of Cash Flows.

In January 2016, the FASB issued guidance that requires equity investments with readily determinable fair values (other than those accounted for under the equity method or those that result in consolidation of the investee) to be measured at fair value and recognize any changes in fair value in net income. For equity investments without readily determinable fair values, the Company has elected to apply the measurement alternative, under which investments are measured at cost, less impairment, and adjusted

for qualifying observable price changes on a prospective basis. The Company adopted the guidance effective November 1, 2018, and there was no impact on the Condensed Consolidated Financial Statements upon adoption.

In May 2014, the FASB amended the existing accounting standards for revenue recognition. The Company adopted the new revenue standard in the first quarter of fiscal 2019 using the modified retrospective method of transition applied to contracts that were not completed as of November 1, 2018. Results and related disclosures for the reporting periods beginning after November 1, 2018 are presented under the new revenue standard, while comparative prior period results and related disclosures are not adjusted and continue to be reported in accordance with the historic accounting standard. Refer to the Revenue Recognition section above for accounting policy updates upon the adoption of the new revenue standard, and Note 7, "Balance Sheet Details" for further discussion on the impact of adoption. For disaggregation of revenue, see Note 2, "Segment Information".

The following table summarizes the effects of adopting the new revenue standard at November 1, 2018 on the Condensed Consolidated Balance Sheets as an adjustment to the opening balance:

	Historical Accounting Method			Effect of Adoption			As Adjusted
	In millions
Assets
Accounts receivable	$	3,263		$	38		$	3,301
Inventory	2,447			(14)			2,433
Other current assets	3,280			50			3,330
Long-term financing receivables and other assets	11,359			44			11,403
Subtotal assets	$	20,349		$	118		$	20,467
Liabilities
Taxes on earnings	$	378		$	10		$	388
Deferred revenue	3,177			(36)			3,141
Other accrued liabilities(1)	3,840			52			3,892
Other non-current liabilities	6,885			(30)			6,855
Subtotal liabilities	$	14,280		$	(4	)	$	14,276
Stockholders' equity
Accumulated deficit(1)	$	(5,899	)	$	122		$	(5,777	)
Subtotal stockholders' equity	$	(5,899	)	$	122		$	(5,777	)
Subtotal liabilities and stockholders' equity	$	8,381		$	118		$	8,499

(1) Includes an adjustment related to the adoption of ASC 606 that was recorded during the third quarter of fiscal 2019.

The application of ASC 606 increased the Company's total net revenue by $23 million and $41 million for the three and nine months ended July 31, 2019, respectively, and did not have a material impact to the Company's cost of sales or operating expenses for the three or nine months ended July 31, 2019. As of July 31, 2019, the balance sheet changes attributable to the impact of ASC 606 were immaterial.

Recently Enacted Accounting Pronouncements

In August 2018, the FASB issued guidance on a customer's accounting for implementation costs incurred in cloud-computing arrangements that are hosted by a vendor. Certain types of implementation costs should be capitalized and amortized over the term of the hosting arrangement. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In August 2018, the FASB issued guidance which changes the disclosure requirements for fair value measurements and defined benefit plans. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. As the guidance represents a change to disclosure only, the Company does not expect the guidance to have a material impact on its Condensed Consolidated Financial Statements.

In February 2018, the FASB issued guidance that allows companies to reclassify stranded tax effects resulting from the Tax Act, from accumulated other comprehensive income to retained earnings. The guidance also requires certain new disclosures regardless of the election.  The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In August 2017, the FASB amended the existing accounting standards for hedge accounting. The amendments expand an entity’s ability to hedge non-financial and financial risk components and reduce complexity in fair value hedges of interest rate risk. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also simplifies certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. In April 2019, the FASB issued certain clarifications to address partial term fair value hedges, fair value hedge basis adjustments and certain transition requirements. The Company is required to adopt the guidance in the first quarter of fiscal 2020. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

In June 2016, the FASB amended the existing accounting standards for the measurement of credit losses. The amendments require an entity to estimate its lifetime expected credit loss for most financial instruments, including trade and lease receivables, and record an allowance for the portion of the amortized cost the entity does not expect to collect. The estimate of expected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments. In April 2019, the FASB further clarified the scope of the credit losses standard and addressed issues related to accrued interest receivable balances, recoveries, variable interest rates and prepayment. In May 2019, the FASB issued further guidance to provide entities with an option to irrevocably elect the fair value option applied on an instrument-by-instrument basis for eligible financial instruments. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted beginning in fiscal 2020. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

The FASB issued guidance in February 2016, with amendments in 2018 and 2019, which changes the accounting standards for leases. The amendments require lessees to record, at lease inception, a lease liability for the obligation to make lease payments and a right-of-use ("ROU") asset for the right to use the underlying asset for the lease term on their balance sheets. Lessees may elect to not recognize lease liabilities and ROU assets for most leases with terms of 12 months or less. The lease liability is measured at the present value of the lease payments over the lease term. The ROU asset will be based on the liability, adjusted for lease prepayments, lease incentives received, and the lessee's initial direct costs. For finance leases, lease expense will be the sum of interest on the lease obligation and amortization of the ROU asset, resulting in a front-loaded expense pattern. For operating leases, lease expense will generally be recognized on a straight-line basis over the lease term. The amended lessor accounting model is similar to the current model, updated to align with certain changes to the lessee model and the new revenue standard. The current sale-leaseback guidance, including guidance applicable to real estate, is also replaced with a new model for both lessees and lessors. The Company plans to adopt the guidance in the first quarter of fiscal 2020, beginning November 1, 2019, using the transition method whereby prior comparative periods will not be retrospectively presented in the Consolidated Financial Statements. The Company is currently evaluating the impact of these amendments and other available practical expedients on its Condensed Consolidated Financial Statements.

In April 2019, the FASB amended its standards on recognizing and measuring financial instruments to address the scope of the guidance, the requirement for remeasurement when using the measurement alternative and certain disclosure requirements. The Company is required to adopt the guidance in the first quarter of fiscal 2021. Early adoption is permitted. The Company is currently evaluating the timing and the impact of these amendments on its Condensed Consolidated Financial Statements.

There have been no other significant changes to the Company's accounting policies or recently adopted or enacted accounting pronouncements disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018.

Segment Policy

Segment Policy

There have been no significant changes to the Company's segment accounting policies disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2018, except as described in the 'Segment Realignment' section below.

Hewlett Packard Enterprise does not allocate to its segments certain operating expenses, which it manages at the corporate level. These unallocated costs include certain corporate costs and eliminations, stock-based compensation expense related to corporate and certain global functions, acquisition, disposition and other related charges, transformation costs, amortization of intangible assets, restructuring charges, disaster charges and separation costs.

Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.

Fair Value Hierarchy

The Company uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use.

Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement:

Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs.

Level 3—Unobservable inputs for the asset or liability.

The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs.

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Overview and Basis of Presentation (Tables)

9 Months Ended

Jul. 31, 2019

Accounting Policies [Abstract]

New Accounting Pronouncements and Changes in Accounting Principles

The following table summarizes the effects of adopting the new revenue standard at November 1, 2018 on the Condensed Consolidated Balance Sheets as an adjustment to the opening balance:

	Historical Accounting Method			Effect of Adoption			As Adjusted
	In millions
Assets
Accounts receivable	$	3,263		$	38		$	3,301
Inventory	2,447			(14)			2,433
Other current assets	3,280			50			3,330
Long-term financing receivables and other assets	11,359			44			11,403
Subtotal assets	$	20,349		$	118		$	20,467
Liabilities
Taxes on earnings	$	378		$	10		$	388
Deferred revenue	3,177			(36)			3,141
Other accrued liabilities(1)	3,840			52			3,892
Other non-current liabilities	6,885			(30)			6,855
Subtotal liabilities	$	14,280		$	(4	)	$	14,276
Stockholders' equity
Accumulated deficit(1)	$	(5,899	)	$	122		$	(5,777	)
Subtotal stockholders' equity	$	(5,899	)	$	122		$	(5,777	)
Subtotal liabilities and stockholders' equity	$	8,381		$	118		$	8,499

(1) Includes an adjustment related to the adoption of ASC 606 that was recorded during the third quarter of fiscal 2019.

The net periodic benefit (credit) cost transferred to Other (income) and expense during the three and nine months ended July 31, 2018 were as follows. Refer to Note 5, “Retirement and Post-Retirement Benefit Plans” for additional information.

	Three Months Ended July 31, 2018			Nine Months Ended July 31, 2018
	In millions
Cost of products and services	$	(14	)	$	(42	)
Research and development	(1		)	(3		)
Selling, general and administrative	(19		)	(53		)
Restructuring charges and transformation costs	8			8
	$	(26	)	$	(90	)

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Segment Information (Tables)

9 Months Ended

Jul. 31, 2019

Segment Reporting [Abstract]

Segment Operating Results from Continuing Operations

Segment Operating Results

	Hybrid IT		Intelligent Edge		Financial Services		Corporate Investments			Total
	In millions
Three months ended July 31, 2019
Net revenue	$	5,444	$	758	$	885	$	130		$	7,217
Intersegment net revenue and other	105		4		3		—			112
Total segment net revenue	$	5,549	$	762	$	888	$	130		$	7,329
Segment earnings (loss) from operations	$	704	$	37	$	77	$	(25	)	$	793
Three months ended July 31, 2018
Net revenue	$	5,925	$	783	$	922	$	134		$	7,764
Intersegment net revenue and other	184		2		6		—			192
Total segment net revenue	$	6,109	$	785	$	928	$	134		$	7,956
Segment earnings (loss) from operations	$	624	$	101	$	72	$	(25	)	$	772
Nine months ended July 31, 2019
Net revenue	$	16,745	$	2,107	$	2,695	$	373		$	21,920
Intersegment net revenue and other	410		7		8		—			425
Total segment net revenue	$	17,155	$	2,114	$	2,703	$	373		$	22,345
Segment earnings (loss) from operations	$	2,024	$	66	$	231	$	(82	)	$	2,239
Nine months ended July 31, 2018
Net revenue	$	17,649	$	2,132	$	2,721	$	404		$	22,906
Intersegment net revenue and other	511		15		11		—			537
Total segment net revenue	$	18,160	$	2,147	$	2,732	$	404		$	23,443
Segment earnings (loss) from operations	$	1,787	$	191	$	215	$	(79	)	$	2,114

Reconciliation of Segment Operating Results

The reconciliation of segment operating results to Hewlett Packard Enterprise condensed consolidated results was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Net Revenue:
Total segments	$	7,329		$	7,956		$	22,345		$	23,443
Eliminations of intersegment net revenue and other	(112		)	(192		)	(425		)	(537		)
Total Hewlett Packard Enterprise condensed consolidated net revenue	$	7,217		$	7,764		$	21,920		$	22,906
Earnings before taxes:
Total segment earnings from operations	$	793		$	772		$	2,239		$	2,114
Unallocated corporate costs and eliminations	(65		)	(49		)	(179		)	(169		)
Unallocated stock-based compensation expense	(13		)	(14		)	(42		)	(64		)
Amortization of intangible assets	(58		)	(72		)	(199		)	(222		)
Restructuring charges	—			1			—			(14		)
Transformation costs	(170		)	(126		)	(302		)	(491		)
Disaster charges	—			—			7			—
Acquisition, disposition and other related charges	(563		)	(24		)	(710		)	(70		)
Separation costs	—			2			—			—
Interest and other, net	(70		)	(64		)	(139		)	(163		)
Tax indemnification adjustments	(134		)	2			89			(1,342		)
Non-service net periodic benefit credit	12			26			45			90
Earnings from equity interests	3			11			21			23
Total Hewlett Packard Enterprise condensed consolidated (loss) earnings from continuing operations before taxes	$	(265	)	$	465		$	830		$	(308	)

Schedule of Net Revenue by Segment and Business Unit

Net revenue by segment and business unit was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
	2019			2018			2019			2018
	In millions
Hybrid IT
Hybrid IT Product
Compute	$	3,151		$	3,569		$	9,646		$	10,350
Storage	844			887			2,761			2,747
Total Hybrid IT Product	3,995			4,456			12,407			13,097
HPE Pointnext	1,554			1,653			4,748			5,063
Total Hybrid IT	5,549			6,109			17,155			18,160
Intelligent Edge
HPE Aruba Product	668			703			1,842			1,914
HPE Aruba Services	94			82			272			233
Total Intelligent Edge	762			785			2,114			2,147
Financial Services	888			928			2,703			2,732
Corporate Investments	130			134			373			404
Total segment net revenue	7,329			7,956			22,345			23,443
Eliminations of intersegment net revenue and other	(112		)	(192		)	(425		)	(537		)
Total Hewlett Packard Enterprise condensed consolidated net revenue(1)	$	7,217		$	7,764		$	21,920		$	22,906

(1)

Revenue from leasing arrangements within Financial Services and Eliminations of intersegment net revenue and other are not subject to the new revenue standard.

Net Revenue by Geographic Areas

The Company’s net revenue by geographic regions was as follows:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2019		2018		2019		2018
	In millions
Americas	$	2,910	$	3,153	$	8,582	$	9,053
Europe, Middle East and Africa	2,614		2,783		8,251		8,407
Asia Pacific and Japan	1,693		1,828		5,087		5,446
Total Hewlett Packard Enterprise condensed consolidated net revenue(1)	$	7,217	$	7,764	$	21,920	$	22,906

(1)

Revenue from leasing arrangements within Financial Services and Eliminations of intersegment net revenue and other are not subject to the new revenue standard.

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Restructuring (Tables)

9 Months Ended

Jul. 31, 2019

Restructuring and Related Activities [Abstract]

Schedule of Restructuring Activities

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, 2018	$	62		$	10		$	11		$	1	$	84
Cash payments	(25		)	(2		)	(5		)	—		(32		)
Liability as of July 31, 2019	$	37		$	8		$	6		$	1	$	52
Total costs incurred to date, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242
Total costs expected to be incurred, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242

	Employee Severance			Infrastructure and other
	In millions
Liability as of October 31, 2018	$	291		$	33
Charges	115			28
Cash payments	(209		)	(20		)
Non-cash items	(9		)	(9		)
Liability as of July 31, 2019	$	188		$	32
Total costs incurred to date, as of July 31, 2019	$	881		$	89
Total costs expected to be incurred, as of July 31, 2019	$	1,200		$	180

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HPE Next (Tables)

9 Months Ended

Jul. 31, 2019

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs

In association with the HPE Next initiative, during the three and nine months ended July 31, 2019, the Company incurred $172 million and $310 million of net charges, of which $170 million and $302 million were recorded within Transformation costs, and $2 million and $8 million were recorded within Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings, respectively. During the three and nine months ended July 31, 2018, the Company incurred $131 million and $499 million of net charges, of which $126 million and $491 million were recorded within Transformation costs, and $5 million and $8 million were recorded within Non-service net periodic benefit credit, in the Condensed Consolidated Statements of Earnings, respectively.

	Three months ended July 31,					Nine months ended July 31,
	2019		2018			2019		2018
	In millions
Program management(1)	$	3	$	28		$	23	$	82
IT costs	41		38			94		107
Restructuring charges(2)	92		129			143		385
Loss (gain) on real estate sales	8		(77		)	1		(114		)
Impairment on real estate assets	19		—			19		—
Other(3)	9		13			30		39
Total	$	172	$	131		$	310	$	499

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

(2) For the three and nine months ended July 31, 2019 and 2018, a portion of these costs were recorded in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings as described above.

(3)

Primarily consists of site relocation costs in connection with the HPE Next initiative.

Schedule of Restructuring Reserve by Cost

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, 2018	$	62		$	10		$	11		$	1	$	84
Cash payments	(25		)	(2		)	(5		)	—		(32		)
Liability as of July 31, 2019	$	37		$	8		$	6		$	1	$	52
Total costs incurred to date, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242
Total costs expected to be incurred, as of July 31, 2019	$	751		$	78		$	1,268		$	145	$	2,242

	Employee Severance			Infrastructure and other
	In millions
Liability as of October 31, 2018	$	291		$	33
Charges	115			28
Cash payments	(209		)	(20		)
Non-cash items	(9		)	(9		)
Liability as of July 31, 2019	$	188		$	32
Total costs incurred to date, as of July 31, 2019	$	881		$	89
Total costs expected to be incurred, as of July 31, 2019	$	1,200		$	180

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Retirement and Post-Retirement Benefit Plans (Tables)

9 Months Ended

Jul. 31, 2019

Retirement Benefits [Abstract]

Summary of Net Benefit Cost

The Company's net pension benefit cost for defined benefit plans recognized in the Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018, was as follows:

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Service cost	$	21		$	26		$	63		$	79
Interest cost(1)	54			55			165			168
Expected return on plan assets(1)	(126		)	(139		)	(386		)	(423		)
Amortization and deferrals(1):
Actuarial loss	59			52			176			158
Prior service benefit	(4		)	(4		)	(12		)	(12		)
Net periodic benefit cost (credit)	4			(10		)	6			(30		)
Settlement loss(1)	4			9			10			11
Special termination benefits(1)	1			1			2			5
Net benefit cost (credit)	$	9		$	—		$	18		$	(14	)

(1)

These non-service components of net periodic benefit cost were included in Non-service net periodic benefit credit in the Condensed Consolidated Statements of Earnings.

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Taxes on Earnings (Tables)

9 Months Ended

Jul. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities included in the Condensed Consolidated Balance Sheets were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Deferred tax assets	$	1,657		$	2,403
Deferred tax liabilities	(278		)	(228		)
Deferred tax assets net of deferred tax liabilities	$	1,379		$	2,175

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Balance Sheet Details (Tables)

9 Months Ended

Jul. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Cash and Cash Equivalents

Cash and cash equivalents

	As of
	July 31, 2019		October 31, 2018
	In millions
Cash and cash equivalents	$	3,693	$	4,880
Restricted cash	318		204
Cash, cash equivalents and restricted cash	$	4,011	$	5,084

Schedule of Inventory

Inventory

	As of
	July 31, 2019		October 31, 2018
	In millions
Finished goods	$	1,225	$	1,274
Purchased parts and fabricated assemblies	991		1,173
Total	$	2,216	$	2,447

Schedule of Other Current Assets

Other Current Assets

	As of
	July 31, 2019		October 31, 2018
	In millions
Value-added tax receivables	$	630	$	811
Short-term tax receivables and prepaid taxes	225		535
Manufacturer and other receivables	619		937
Prepaid and other current assets	832		793
Restricted cash	318		204
Total	$	2,624	$	3,280

Schedule of Property, Plant and Equipment

Property, Plant and Equipment

	As of
	July 31, 2019			October 31, 2018
	In millions
Land	$	293		$	294
Buildings and leasehold improvements	2,157			2,103
Machinery and equipment, including equipment held for lease	9,460			9,419
	11,910			11,816
Accumulated depreciation	(5,910		)	(5,678		)
Total	$	6,000		$	6,138

Notes Payable and Short-Term Borrowings

Notes Payable and Short-Term Borrowings

	As of
	July 31, 2019		October 31, 2018
	In millions
Current portion of long-term debt	$	1,180	$	1,196
FS commercial paper	671		392
Notes payable to banks, lines of credit and other(1)	356		417
Total	$	2,207	$	2,005

(1)

As of July 31, 2019 and October 31, 2018, notes payable to banks, lines of credit and other includes $228 million and $361 million, respectively, of borrowing associated with FS and its subsidiaries.

Changes in Aggregate Product Warranty Liabilities

The Company's aggregate product warranty liability as of July 31, 2019, and changes during the nine months then ended were as follows:

	Nine Months Ended July 31, 2019
	In millions
Balance at beginning of period	$	430
Accruals for warranties issued	178
Adjustments related to pre-existing warranties	6
Settlements made	(212		)
Balance at end of period	$	402

Summary of Accounts Receivable, Net

A summary of accounts receivable, net, including unbilled receivables was as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Accounts receivable, net
Accounts receivable	$	2,786		$	3,117
Unbilled receivables	210			185
Allowance for doubtful accounts	(31		)	(39		)
Total	$	2,965		$	3,263

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Financing Receivables and Operating Leases (Tables)

9 Months Ended

Jul. 31, 2019

Leases [Abstract]

Components of Financing Receivables

The components of financing receivables were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Minimum lease payments receivable	$	9,009		$	8,691
Unguaranteed residual value	322			297
Unearned income	(765		)	(732		)
Financing receivables, gross	8,566			8,256
Allowance for doubtful accounts	(133		)	(120		)
Financing receivables, net	8,433			8,136
Less: current portion(1)	(3,567		)	(3,396		)
Amounts due after one year, net(1)	$	4,866		$	4,740

(1)

The Company includes the current portion in Financing receivables, and amounts due after one year, net in Long-term financing receivables and other assets, in the accompanying Condensed Consolidated Balance Sheets.

Credit Risk Profile of Gross Financing Receivables

The credit risk profile of gross financing receivables, based upon internal risk ratings, was as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Risk Rating:
Low	$	4,377	$	4,238
Moderate	3,913		3,805
High	276		213
Total	$	8,566	$	8,256

Allowance for Doubtful Accounts for Financing Receivables

The allowance for doubtful accounts for financing receivables as of July 31, 2019 and October 31, 2018 and the respective changes during the nine and twelve months then ended were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Balance at beginning of period	$	120		$	86
Provision for doubtful accounts	25			49
Write-offs	(12		)	(15		)
Balance at end of period	$	133		$	120

Gross Financing Receivables and Related Allowance Evaluated for Loss

The gross financing receivables and related allowance evaluated for loss were as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Gross financing receivables collectively evaluated for loss	$	8,120	$	7,917
Gross financing receivables individually evaluated for loss(1)	446		339
Total	$	8,566	$	8,256
Allowance for financing receivables collectively evaluated for loss	$	84	$	78
Allowance for financing receivables individually evaluated for loss	49		42
Total	$	133	$	120

(1)

Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Summary of the Aging and Non-accrual Status of Gross Financing Receivables

The following table summarizes the aging and non-accrual status of gross financing receivables:

	As of
	July 31, 2019		October 31, 2018
	In millions
Billed:(1)
Current 1-30 days	$	319	$	275
Past due 31-60 days	62		42
Past due 61-90 days	15		13
Past due > 90 days	86		74
Unbilled sales-type and direct-financing lease receivables	8,084		7,852
Total gross financing receivables	$	8,566	$	8,256
Gross financing receivables on non-accrual status(2)	$	297	$	226
Gross financing receivables 90 days past due and still accruing interest(2)	$	149	$	113

(1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables.

(2)

Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Operating Lease Assets Included in Machinery and Equipment

Operating lease assets included in Property, plant and equipment in the Condensed Consolidated Balance Sheets were as follows:

	As of
	July 31, 2019			October 31, 2018
	In millions
Equipment leased to customers	$	7,275		$	7,290
Accumulated depreciation	(3,225		)	(3,078		)
Total	$	4,050		$	4,212

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Goodwill (Tables)

9 Months Ended

Jul. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Allocation and Changes in the Carrying Amount of Goodwill

Goodwill allocated to the Company's reportable segments as of July 31, 2019 and the change in the respective carrying amounts during the nine months then ended were as follows:

	Hybrid IT		Intelligent Edge		Financial Services		Total
	In millions
Balance at October 31, 2018(1) (2)	$	15,479	$	1,914	$	144	$	17,537
Goodwill acquired during the period(3)	48		—		—		48
Goodwill adjustments	2		—		—		2
Balance at July 31, 2019(2)	$	15,529	$	1,914	$	144	$	17,587

(1) As a result of the organizational realignments effective during the first quarter of fiscal 2019, which are described in detail in Note 2, "Segment Information", goodwill was reclassified to the respective segments as of the beginning of the period using a relative fair value approach.

(2) Goodwill is net of an accumulated impairment loss of $88 million related to the Corporate Investments segment which was recorded during the fourth quarter of fiscal 2018. There is no remaining goodwill in the Corporate Investments segment.

(3)

Goodwill acquired in connection with the acquisition of BlueData.

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Fair Value (Tables)

9 Months Ended

Jul. 31, 2019

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis:

	As of July 31, 2019								As of October 31, 2018
	Fair Value Measured Using								Fair Value Measured Using
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	In millions
Assets
Cash Equivalents and Investments:
Time deposits	$	—	$	908	$	—	$	908	$	—	$	781	$	—	$	781
Money market funds	609		—		—		609		2,340		—		—		2,340
Foreign bonds	7		125		—		132		7		124		—		131
Other debt securities	—		1		32		33		—		—		25		25
Derivative Instruments:
Interest rate contracts	—		20		—		20		—		—		—		—
Foreign exchange contracts	—		467		—		467		—		496		—		496
Total assets	$	616	$	1,521	$	32	$	2,169	$	2,347	$	1,401	$	25	$	3,773
Liabilities
Derivative Instruments:
Interest rate contracts	$	—	$	32	$	—	$	32	$	—	$	353	$	—	$	353
Foreign exchange contracts	—		116		—		116		—		117		—		117
Other derivatives	—		1		—		1		—		6		—		6
Total liabilities	$	—	$	149	$	—	$	149	$	—	$	476	$	—	$	476

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Financial Instruments (Tables)

9 Months Ended

Jul. 31, 2019

Investments, All Other Investments [Abstract]

Cash Equivalents and Available-for-Sale Investments

Cash equivalents and available-for-sale investments were as follows:

	As of July 31, 2019								As of October 31, 2018
	Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value		Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
	In millions
Cash Equivalents:
Time deposits	$	908	$	—	$	—	$	908	$	781	$	—	$	—		$	781
Money market funds	609		—		—		609		2,340		—		—			2,340
Total cash equivalents	1,517		—		—		1,517		3,121		—		—			3,121
Available-for-Sale Investments:
Foreign bonds	110		22		—		132		113		18		—			131
Other debt securities	33		—		—		33		26		—		(1		)	25
Total available-for-sale investments	143		22		—		165		139		18		(1		)	156
Total cash equivalents and available-for-sale debt investments	$	1,660	$	22	$	—	$	1,682	$	3,260	$	18	$	(1	)	$	3,277

Contractual Maturities of Investments in Available-for-Sale Debt Securities

Contractual maturities of available-for-sale debt investments were as follows:

	July 31, 2019
	Amortized Cost		Fair Value
	In millions
Due in one to five years	$	10	$	10
Due in more than five years	133		155
	$	143	$	165

Gross Notional and Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets

The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows:

	As of July 31, 2019										As of October 31, 2018
			Fair Value										Fair Value
	Outstanding Gross Notional		Other Current Assets		Long-Term Financing Receivables and Other Assets		Other Accrued Liabilities		Long-Term Other Liabilities		Outstanding Gross Notional		Other Current Assets		Long-Term Financing Receivables and Other Assets		Other Accrued Liabilities		Long-Term Other Liabilities
	In millions
Derivatives designated as hedging instruments
Fair value hedges:
Interest rate contracts	$	6,850	$	—	$	20	$	—	$	32	$	6,850	$	—	$	—	$	—	$	353
Cash flow hedges:
Foreign currency contracts	8,539		218		157		24		23		8,423		270		107		11		15
Net investment hedges:
Foreign currency contracts	1,745		25		30		18		18		1,737		32		41		13		11
Total derivatives designated as hedging instruments	17,134		243		207		42		73		17,010		302		148		24		379
Derivatives not designated as hedging instruments
Foreign currency contracts	5,206		36		1		26		7		6,780		41		5		55		12
Other derivatives	103		—		—		1		—		104		—		—		6		—
Total derivatives not designated as hedging instruments	5,309		36		1		27		7		6,884		41		5		61		12
Total derivatives	$	22,443	$	279	$	208	$	69	$	80	$	23,894	$	343	$	153	$	85	$	391

Offsetting Assets

As of July 31, 2019 and October 31, 2018, information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows:

	As of July 31, 2019
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	487	$	—	$	487	$	125	$	316	(1)	$	46
Derivative liabilities	$	149	$	—	$	149	$	125	$	5	(2)	$	19

	As of October 31, 2018
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	496	$	—	$	496	$	179	$	205	(1)	$	112
Derivative liabilities	$	476	$	—	$	476	$	179	$	302	(2)	$	(5	)

(1) Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date.

(2) Represents the collateral posted by the Company in cash or through the re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of July 31, 2019, of the $5 million of collateral posted, $4 million was in cash and $1 million was through re-use of counterparty collateral. As of October 31, 2018, $302 million of collateral posted was entirely in cash.

Offsetting Liabilities

As of July 31, 2019 and October 31, 2018, information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows:

	As of July 31, 2019
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	487	$	—	$	487	$	125	$	316	(1)	$	46
Derivative liabilities	$	149	$	—	$	149	$	125	$	5	(2)	$	19

	As of October 31, 2018
	In the Condensed Consolidated Balance Sheets
	(i)		(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
							Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset		Net Amount Presented		Derivatives		Financial Collateral			Net Amount
	In millions
Derivative assets	$	496	$	—	$	496	$	179	$	205	(1)	$	112
Derivative liabilities	$	476	$	—	$	476	$	179	$	302	(2)	$	(5	)

(1) Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date.

(2) Represents the collateral posted by the Company in cash or through the re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of July 31, 2019, of the $5 million of collateral posted, $4 million was in cash and $1 million was through re-use of counterparty collateral. As of October 31, 2018, $302 million of collateral posted was entirely in cash.

Pre-tax Effect of Derivative Instruments and Related Hedged Items in a Fair Value Hedging Relationship

The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship for the three and nine months ended July 31, 2019 and 2018 were as follows:

	Gains (Losses) Recognized in Earnings on Derivative and Related Hedged Item
Derivative Instrument	Location	Three months ended July 31, 2019		Nine months ended July 31, 2019		Hedged Item	Location	Three months ended July 31, 2019			Nine months ended July 31, 2019
		In millions						In millions
Interest rate contracts	Interest and other, net	$	123	$	341	Fixed-rate debt	Interest and other, net	$	(123	)	$	(341	)

	Gains (Losses) Recognized in Earnings on Derivative and Related Hedged Item
Derivative Instrument	Location	Three months ended July 31, 2018		Nine months ended July 31, 2018			Hedged Item	Location	Three months ended July 31, 2018			Nine months ended July 31, 2018
		In millions							In millions
Interest rate contracts	Interest and other, net	$	16	$	(194	)	Fixed-rate debt	Interest and other, net	$	(16	)	$	194

Pre-tax Effect of Derivative Instruments in Cash Flow and Net Investment Hedging Relationships

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the three and nine months ended July 31, 2019 were as follows:

	Gains (Losses) Recognized in Other Comprehensive Income ("OCI") on Derivatives (Effective Portion)						Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion)
	Three months ended July 31, 2019			Nine months ended July 31, 2019			Location	Three months ended July 31, 2019		Nine months ended July 31, 2019
	In millions							In millions
Cash flow hedges:
Foreign currency contracts	$	43		$	102		Net revenue	$	42	$	168
Foreign currency contracts	20			123			Interest and other, net	16		91
Total cash flow hedges	$	63		$	225		Net earnings from continuing operations	$	58	$	259
Net investment hedges:
Foreign currency contracts	$	(18	)	$	(23	)	Interest and other, net	$	—	$	—

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships for the three and nine months ended July 31, 2018 was as follows:

	Gains (Losses) Recognized in Other Comprehensive Income ("OCI") on Derivatives (Effective Portion)					Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion)
	Three months ended July 31, 2018		Nine months ended July 31, 2018			Location	Three months ended July 31, 2018		Nine months ended July 31, 2018
	In millions						In millions
Cash flow hedges:
Foreign currency contracts	$	121	$	59		Net revenue	$	29	$	(82	)
Foreign currency contracts	28		(9		)	Interest and other, net	14		4
Total cash flow hedges	$	149	$	50		Net earnings from continuing operations	$	43	$	(78	)
Net investment hedges:
Foreign currency contracts	$	57	$	31		Interest and other, net	$	—	$	—

Pre-tax Effect of Derivative Instruments Not Designated as Hedging Instruments on the Condensed Consolidated and Combined Statements of Earnings

The pre-tax effect of derivative instruments not designated as hedging instruments on the Condensed Consolidated Statements of Earnings for the three and nine months ended July 31, 2019 and 2018 was as follows:

		Gains (Losses) Recognized in Earnings on Derivatives
	Location	Three months ended July 31, 2019			Three months ended July 31, 2018		Nine months ended July 31, 2019			Nine months ended July 31, 2018
		In millions
Foreign currency contracts	Interest and other, net	$	55		$	233	$	(68	)	$	104
Other derivatives	Interest and other, net	(2		)	—		5			—
Total		$	53		$	233	$	(63	)	$	104

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Stockholders' Equity (Tables)

9 Months Ended

Jul. 31, 2019

Equity [Abstract]

Taxes Related to Other Comprehensive Income (Loss)

Taxes related to Other Comprehensive Income

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Taxes on change in net unrealized gains (losses) on cash flow hedges:
Tax (provision) on net unrealized gains arising during the period	$	(6	)	$	(20	)	$	(24	)	$	(6	)
Tax provision (benefit) on net (gains) losses reclassified into earnings	7			5			31			(11		)
	1			(15		)	7			(17		)
Taxes on change in unrealized components of defined benefit plans:
Tax benefit on net unrealized losses arising during the period	5			3			13			2
Tax provision on amortization of net actuarial loss and prior service benefit	(3		)	(4		)	(9		)	(10		)
Tax provision on curtailments, settlements and other	—			(5		)	(7		)	(12		)
	2			(6		)	(3		)	(20		)
Tax (provision) benefit on change in cumulative translation adjustment	(1		)	2			—			3
Tax benefit (provision) on other comprehensive income	$	2		$	(19	)	$	4		$	(34	)

Changes and Reclassifications Related to Other Comprehensive Income (Loss), Net of Taxes

Changes and reclassifications related to Other Comprehensive Income, net of taxes

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019			2018
	In millions
Other comprehensive income, net of taxes:
Change in net unrealized gains (losses) on available-for-sale securities:
Net unrealized gains (losses) arising during the period	$	3		$	(2	)	$	8		$	(1	)
Gains reclassified into earnings	—			—			(3		)	(9		)
	3			(2		)	5			(10		)
Change in net unrealized gains (losses) on cash flow hedges:
Net unrealized gains arising during the period	57			129			201			44
Net (gains) losses reclassified into earnings(1)	(51		)	(38		)	(228		)	67
	6			91			(27		)	111
Change in unrealized components of defined benefit plans:
Net unrealized losses arising during the period	(26		)	(22		)	(65		)	(21		)
Amortization of net actuarial loss and prior service benefit(2)	51			43			152			133
Curtailments, settlements and other	5			4			5			(1		)
	30			25			92			111
Change in cumulative translation adjustment	(9		)	(38		)	(2		)	(37		)
Other comprehensive income, net of taxes	$	30		$	76		$	68		$	175

(1) For more details on the reclassification of pre-tax net (gains) losses on cash flow hedges into the Condensed Consolidated Statements of Earnings, see Note 11, "Financial Instruments".

(2)

These components are included in the computation of net pension and post-retirement benefit cost in Note 5, "Retirement and Post-Retirement Benefit Plans".

Components of Accumulated Other Comprehensive Loss, Net of Taxes

The components of Accumulated other comprehensive loss, net of taxes as of July 31, 2019, and changes during the nine months ended July 31, 2019 were as follows:

	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gains (losses) on cash flow hedges			Unrealized components of defined benefit plans			Cumulative translation adjustment			Accumulated other comprehensive loss
	In millions
Balance at beginning of period	$	17		$	106		$	(2,922	)	$	(419	)	$	(3,218	)
Other comprehensive income (loss) before reclassifications	8			201			(65		)	(2		)	142
Reclassifications of (gains) losses into earnings	(3		)	(228		)	157			—			(74		)
Balance at end of period	$	22		$	79		$	(2,830	)	$	(421	)	$	(3,150	)

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Net Earnings Per Share (Tables)

9 Months Ended

Jul. 31, 2019

Earnings Per Share [Abstract]

Reconciliations of the Numerators and Denominators of the Basic and Diluted Net EPS Calculations

The reconciliations of the numerators and denominators of each of the basic and diluted net EPS calculations were as follows:

	Three months ended July 31,						Nine months ended July 31,
	2019			2018			2019		2018
	In millions, except per share amounts
Numerator:
Net (loss) earnings from continuing operations	$	(27	)	$	452		$	569	$	2,784
Net loss from discontinued operations	—			(1		)	—		(119		)
Net (loss) earnings	$	(27	)	$	451		$	569	$	2,665
Denominator:
Weighted-average shares used to compute basic net EPS	1,334			1,513			1,367		1,552
Dilutive effect of employee stock plans	—			18			13		26
Weighted-average shares used to compute diluted net EPS	1,334			1,531			1,380		1,578
Basic net (loss) earnings per share:
Continuing operations	$	(0.02	)	$	0.30		$	0.42	$	1.79
Discontinued operations(1)	—			—			—		(0.07		)
Basic net (loss) earnings per share	$	(0.02	)	$	0.30		$	0.42	$	1.72
Diluted net (loss) earnings per share:
Continuing operations	$	(0.02	)	$	0.29		$	0.41	$	1.76
Discontinued operations(1)(2)	—			—			—		(0.07		)
Diluted net (loss) earnings per share	$	(0.02	)	$	0.29		$	0.41	$	1.69
Anti-dilutive weighted-average stock awards(3)	44			2			4		3

(1) EPS for discontinued operations was calculated by deducting the EPS from continuing operations from the total EPS.

(2) U.S. GAAP requires the denominator used in the diluted net EPS calculation for discontinued operations to be the same as that of continuing operations, regardless of net earnings (loss) from continuing operations.

(3)

The Company excludes shares potentially issuable under employee stock plans that could dilute basic net EPS in the future from the calculation of diluted net earnings (loss) per share, as their effect, if included, would have been anti-dilutive for the periods presented.

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Indemnifications (Tables)

9 Months Ended

Jul. 31, 2019

Guarantees and Product Warranties [Abstract]

Schedule of Indemnified Litigation Matters and Other Contingencies

As of July 31, 2019 and October 31, 2018, the Company’s receivable and payable balances related to indemnified litigation matters and other contingencies, and income tax-related indemnification covered by these agreements were as follows:

	As of
	July 31, 2019		October 31, 2018
	In millions
Litigation matters and other contingencies
Receivable	$	88	$	104
Payable	$	57	$	83
Income tax-related indemnification(1)
Net indemnification receivable - long-term(2)	$	266	$	16
Net indemnification receivable - short-term	$	13	$	17
Net indemnification payable - long-term	$	9	$	9
Net indemnification payable - short-term(3)	$	102	$	26

(1) The actual amount that the Company may receive or pay could vary depending upon the outcome of certain unresolved tax matters, which may not be resolved for several years.

(2) For the nine months ended July 31, 2019, the increase in Net indemnification receivable - long-term was due primarily to the effects of U.S. tax reform on tax attributes related to fiscal periods prior to the Separation.

(3)

For the nine months ended July 31, 2019, the increase in Net indemnification payable - short-term was due primarily to the effective settlement of the U.S. federal income tax audit of fiscal years 2013 through 2015 for HP Inc. for which the Company was joint and severally liable and for which the Company was partially indemnified by HP Inc. under the Tax Matters Agreement.

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Overview and Basis of Presentation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions			3 Months Ended		9 Months Ended
	Aug. 15, 2019	May 16, 2019	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Segment Reporting Information [Line Items]
Net loss from discontinued operations			$ 0	$ 1	$ 0	$ 119
Change in restricted cash						43
Total net revenue			7,217	$ 7,764	21,920	$ 22,906
Subsequent Event | Cross-Indemnifications | Everett SpinCo, Inc. | Settled Litigation
Segment Reporting Information [Line Items]
Amount awarded to other party	$ 666
Post-award interest rate	3.00%
Accounting Standards Update 2016-16
Segment Reporting Information [Line Items]
Effects of adoption of accounting standard updates			$ 2,300		$ 2,300
Minimum
Segment Reporting Information [Line Items]
Capitalized contract cost amortization period			3 years		3 years
Maximum
Segment Reporting Information [Line Items]
Capitalized contract cost amortization period			6 years		6 years
Cray Inc.
Segment Reporting Information [Line Items]
Share price paid (in usd per share)		$ 35
Consideration transferred		$ 1,300
Effect of Adoption
Segment Reporting Information [Line Items]
Total net revenue			$ 23		$ 41

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Overview and Basis of Presentation - Changes to Net Periodic Benefit Cost (Details) - Accounting Standards Update 2017-07 - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Jul. 31, 2018	Jul. 31, 2018
Other (Income) and Expense
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net benefit cost (credit)	$ (26)	$ (90)
Cost of products and services
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net benefit cost (credit)	(14)	(42)
Research and development
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net benefit cost (credit)	(1)	(3)
Selling, general and administrative
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net benefit cost (credit)	(19)	(53)
Restructuring charges and transformation costs
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net benefit cost (credit)	$ 8	$ 8

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Overview and Basis of Presentation - Effects of New Accounting Standards (Details) - USD ($) $ in Millions	Jul. 31, 2019	Nov. 01, 2018	Oct. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable	$ 2,965		$ 3,263
Inventory	2,216		2,447
Other current assets	2,624		3,280
Long-term financing receivables and other assets	9,092		11,359
Total assets	50,760		55,493
Taxes on earnings	160		378
Deferred revenue	3,225		3,177
Other accrued liabilities	4,686		3,840
Other non-current liabilities	5,569		6,885
Accumulated deficit	(7,959)		(5,899)
Total HPE stockholders' equity	17,533		21,239
Total liabilities and stockholders' equity	$ 50,760		55,493
Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable		$ 3,301
Inventory		2,433
Other current assets		3,330
Long-term financing receivables and other assets		11,403
Total assets		20,467
Taxes on earnings		388
Deferred revenue		3,141
Other accrued liabilities		3,892
Other non-current liabilities		6,855
Subtotal liabilities		14,276
Accumulated deficit		(5,777)
Total HPE stockholders' equity		(5,777)
Total liabilities and stockholders' equity		8,499
Accounting Standards Update 2014-09 | Historical Accounting Method
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable			3,263
Inventory			2,447
Other current assets			3,280
Long-term financing receivables and other assets			11,359
Total assets			20,349
Taxes on earnings			378
Deferred revenue			3,177
Other accrued liabilities			3,840
Other non-current liabilities			6,885
Subtotal liabilities			14,280
Accumulated deficit			(5,899)
Total HPE stockholders' equity			(5,899)
Total liabilities and stockholders' equity			$ 8,381
Accounting Standards Update 2014-09 | Effect of Adoption
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable		38
Inventory		(14)
Other current assets		50
Long-term financing receivables and other assets		44
Total assets		118
Taxes on earnings		10
Deferred revenue		(36)
Other accrued liabilities		52
Other non-current liabilities		(30)
Subtotal liabilities		(4)
Accumulated deficit		122
Total HPE stockholders' equity		122
Total liabilities and stockholders' equity		$ 118

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Segment Information - Narrative (Details)	9 Months Ended
	Jul. 31, 2019 segment
Segment Reporting [Abstract]
Number of segments	4

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Segment Information - Segment Operating Results from Continuing Operations (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Segment Reporting Information [Line Items]
Net revenue	$ 7,217	$ 7,764	$ 21,920	$ 22,906
Segment earnings (loss) from operations	(76)	490	814	1,084
Intersegment net revenue and other
Segment Reporting Information [Line Items]
Net revenue	(112)	(192)	(425)	(537)
Operating Segment
Segment Reporting Information [Line Items]
Net revenue	7,329	7,956	22,345	23,443
Segment earnings (loss) from operations	793	772	2,239	2,114
Hybrid IT
Segment Reporting Information [Line Items]
Net revenue	5,444	5,925	16,745	17,649
Hybrid IT | Intersegment net revenue and other
Segment Reporting Information [Line Items]
Net revenue	(105)	(184)	(410)	(511)
Hybrid IT | Operating Segment
Segment Reporting Information [Line Items]
Net revenue	5,549	6,109	17,155	18,160
Segment earnings (loss) from operations	704	624	2,024	1,787
Intelligent Edge
Segment Reporting Information [Line Items]
Net revenue	758	783	2,107	2,132
Intelligent Edge | Intersegment net revenue and other
Segment Reporting Information [Line Items]
Net revenue	(4)	(2)	(7)	(15)
Intelligent Edge | Operating Segment
Segment Reporting Information [Line Items]
Net revenue	762	785	2,114	2,147
Segment earnings (loss) from operations	37	101	66	191
Financial Services
Segment Reporting Information [Line Items]
Net revenue	885	922	2,695	2,721
Financial Services | Intersegment net revenue and other
Segment Reporting Information [Line Items]
Net revenue	(3)	(6)	(8)	(11)
Financial Services | Operating Segment
Segment Reporting Information [Line Items]
Net revenue	888	928	2,703	2,732
Segment earnings (loss) from operations	77	72	231	215
Corporate Investments
Segment Reporting Information [Line Items]
Net revenue	130	134	373	404
Corporate Investments | Intersegment net revenue and other
Segment Reporting Information [Line Items]
Net revenue	0	0	0	0
Corporate Investments | Operating Segment
Segment Reporting Information [Line Items]
Net revenue	130	134	373	404
Segment earnings (loss) from operations	$ (25)	$ (25)	$ (82)	$ (79)

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Segment Information - Reconciliation of Segment Operating Results (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Net revenue:
Net revenue	$ 7,217	$ 7,764	$ 21,920	$ 22,906
Earnings before taxes:
Total segment earnings from operations	(76)	490	814	1,084
Amortization of intangible assets	(58)	(72)	(199)	(222)
Restructuring charges	0	1	0	(14)
Transformation costs	(170)	(126)	(302)	(491)
Disaster charges	0	0	7	0
Acquisition and other related charges	(563)	(24)	(710)	(70)
Separation costs	0	2	0	0
Interest and other, net	(70)	(64)	(139)	(163)
Tax indemnification adjustments	(134)	2	89	(1,342)
Non-service net periodic benefit credit	12	26	45	90
Earnings from equity interests	3	11	21	23
(Loss) earnings from continuing operations before taxes	(265)	465	830	(308)
Operating Segment
Net revenue:
Net revenue	7,329	7,956	22,345	23,443
Earnings before taxes:
Total segment earnings from operations	793	772	2,239	2,114
Elimination of intersegment net revenue and other
Net revenue:
Net revenue	(112)	(192)	(425)	(537)
Segment Reconciling Items
Earnings before taxes:
Unallocated corporate costs and eliminations	(65)	(49)	(179)	(169)
Unallocated stock-based compensation expense	(13)	(14)	(42)	(64)
Amortization of intangible assets	(58)	(72)	(199)	(222)
Restructuring charges	0	1	0	(14)
Transformation costs	(170)	(126)	(302)	(491)
Disaster charges	0	0	7	0
Acquisition and other related charges	(563)	(24)	(710)	(70)
Separation costs	0	2	0	0
Interest and other, net	(70)	(64)	(139)	(163)
Tax indemnification adjustments	(134)	2	89	(1,342)
Non-service net periodic benefit credit	12	26	45	90
Earnings from equity interests	$ 3	$ 11	$ 21	$ 23

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Segment Information - Schedule of Net Revenue by Segment and Business Unit (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Segment Reporting Information [Line Items]
Net revenue	$ 7,217	$ 7,764	$ 21,920	$ 22,906
Products
Segment Reporting Information [Line Items]
Net revenue	4,508	4,944	13,709	14,414
Services
Segment Reporting Information [Line Items]
Net revenue	2,595	2,711	7,869	8,160
Hybrid IT
Segment Reporting Information [Line Items]
Net revenue	5,444	5,925	16,745	17,649
Intelligent Edge
Segment Reporting Information [Line Items]
Net revenue	758	783	2,107	2,132
Financial Services
Segment Reporting Information [Line Items]
Net revenue	885	922	2,695	2,721
Corporate Investments
Segment Reporting Information [Line Items]
Net revenue	130	134	373	404
Operating Segment
Segment Reporting Information [Line Items]
Net revenue	7,329	7,956	22,345	23,443
Operating Segment | Hybrid IT
Segment Reporting Information [Line Items]
Net revenue	5,549	6,109	17,155	18,160
Operating Segment | Hybrid IT | Hybrid IT Product
Segment Reporting Information [Line Items]
Net revenue	3,995	4,456	12,407	13,097
Operating Segment | Hybrid IT | Hybrid IT Product | Compute
Segment Reporting Information [Line Items]
Net revenue	3,151	3,569	9,646	10,350
Operating Segment | Hybrid IT | Hybrid IT Product | Storage
Segment Reporting Information [Line Items]
Net revenue	844	887	2,761	2,747
Operating Segment | Hybrid IT | HPE Pointnext
Segment Reporting Information [Line Items]
Net revenue	1,554	1,653	4,748	5,063
Operating Segment | Intelligent Edge
Segment Reporting Information [Line Items]
Net revenue	762	785	2,114	2,147
Operating Segment | Intelligent Edge | Products
Segment Reporting Information [Line Items]
Net revenue	668	703	1,842	1,914
Operating Segment | Intelligent Edge | Services
Segment Reporting Information [Line Items]
Net revenue	94	82	272	233
Operating Segment | Financial Services
Segment Reporting Information [Line Items]
Net revenue	888	928	2,703	2,732
Operating Segment | Corporate Investments
Segment Reporting Information [Line Items]
Net revenue	130	134	373	404
Elimination of intersegment net revenue and other
Segment Reporting Information [Line Items]
Net revenue	(112)	(192)	(425)	(537)
Elimination of intersegment net revenue and other | Hybrid IT
Segment Reporting Information [Line Items]
Net revenue	(105)	(184)	(410)	(511)
Elimination of intersegment net revenue and other | Intelligent Edge
Segment Reporting Information [Line Items]
Net revenue	(4)	(2)	(7)	(15)
Elimination of intersegment net revenue and other | Financial Services
Segment Reporting Information [Line Items]
Net revenue	(3)	(6)	(8)	(11)
Elimination of intersegment net revenue and other | Corporate Investments
Segment Reporting Information [Line Items]
Net revenue	$ 0	$ 0	$ 0	$ 0

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Segment Information - Revenue by Geographic Region (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Segment Reporting Information [Line Items]
Total net revenue	$ 7,217	$ 7,764	$ 21,920	$ 22,906
Americas
Segment Reporting Information [Line Items]
Total net revenue	2,910	3,153	8,582	9,053
Europe, Middle East and Africa
Segment Reporting Information [Line Items]
Total net revenue	2,614	2,783	8,251	8,407
Asia Pacific and Japan
Segment Reporting Information [Line Items]
Total net revenue	$ 1,693	$ 1,828	$ 5,087	$ 5,446

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Restructuring - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018	Oct. 31, 2018
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 0	$ 1	$ 0	$ (14)
Current restructuring liability reported in Accrued restructuring	223		223		$ 294
Non-current restructuring liability reported in Other liabilities	19		19		31
Restructuring Plan All
Restructuring Cost and Reserve [Line Items]
Current restructuring liability reported in Accrued restructuring	$ 33		$ 33		$ 53

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Restructuring - Schedule of Restructuring Activities (Details) $ in Millions	9 Months Ended
	Jul. 31, 2019 USD ($)
Restructuring Reserve
Balance at the beginning of the period	$ 84
Cash payments	(32)
Balance at the end of the period	52
Total costs incurred to date, as of July 31, 2019	2,242
Total costs expected to be incurred, as of July 31, 2019	2,242
Employee Severance | 2015 Plan
Restructuring Reserve
Balance at the beginning of the period	62
Cash payments	(25)
Balance at the end of the period	37
Total costs incurred to date, as of July 31, 2019	751
Total costs expected to be incurred, as of July 31, 2019	751
Infrastructure and other | 2015 Plan
Restructuring Reserve
Balance at the beginning of the period	10
Cash payments	(2)
Balance at the end of the period	8
Total costs incurred to date, as of July 31, 2019	78
Total costs expected to be incurred, as of July 31, 2019	78
Infrastructure and other | 2012 Plan
Restructuring Reserve
Balance at the beginning of the period	1
Cash payments	0
Balance at the end of the period	1
Total costs incurred to date, as of July 31, 2019	145
Total costs expected to be incurred, as of July 31, 2019	145
Employee Severance and EER | 2012 Plan
Restructuring Reserve
Balance at the beginning of the period	11
Cash payments	(5)
Balance at the end of the period	6
Total costs incurred to date, as of July 31, 2019	1,268
Total costs expected to be incurred, as of July 31, 2019	$ 1,268

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HPE Next - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018	Oct. 31, 2018
Restructuring Cost and Reserve [Line Items]
Transformation costs	$ 170	$ 126	$ 302	$ 491
Current restructuring liability reported in Accrued restructuring	223		223		$ 294
Long-term portion of restructuring reserve, recorded in Other liabilities	19		19		31
HPE Next
Restructuring Cost and Reserve [Line Items]
Transformation costs	172	131	310	499
Current restructuring liability reported in Accrued restructuring	190		190		241
Long-term portion of restructuring reserve, recorded in Other liabilities	30		30		$ 83
Transformation Costs | HPE Next
Restructuring Cost and Reserve [Line Items]
Transformation costs	170	126	302	491
Non-Service Net Periodic Benefit Credit | HPE Next
Restructuring Cost and Reserve [Line Items]
Transformation costs	$ 2	$ 5	$ 8	$ 8

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HPE Next - Transformation Costs (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 0	$ (1)	$ 0	$ 14
Total	170	126	302	491
HPE Next
Restructuring Cost and Reserve [Line Items]
Program management	3	28	23	82
IT costs	41	38	94	107
Restructuring charges	92	129	143	385
Loss (gain) on real estate sales	8	(77)	1	(114)
Impairment on real estate assets	19	0	19	0
Other	9	13	30	39
Total	$ 172	$ 131	$ 310	$ 499

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HPE Next - Schedule of Restructuring Activity (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Restructuring Reserve
Balance at the beginning of the period			$ 84
Charges	$ 0	$ (1)	0	$ 14
Cash payments			(32)
Balance at the end of the period	52		52
Total costs incurred to date, as of July 31, 2019	2,242		2,242
HPE Next
Restructuring Reserve
Charges	92	$ 129	143	$ 385
HPE Next | Employee Severance
Restructuring Reserve
Balance at the beginning of the period			291
Charges			115
Cash payments			(209)
Non-cash items			(9)
Balance at the end of the period	188		188
Total costs incurred to date, as of July 31, 2019	881		881
Total costs expected to be incurred, as of July 31, 2019	1,200		1,200
HPE Next | Infrastructure and other
Restructuring Reserve
Balance at the beginning of the period			33
Charges			28
Cash payments			(20)
Non-cash items			(9)
Balance at the end of the period	32		32
Total costs incurred to date, as of July 31, 2019	89		89
Total costs expected to be incurred, as of July 31, 2019	$ 180		$ 180

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Retirement and Post-Retirement Benefit Plans (Details) - Benefit Plans - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Service cost	$ 21	$ 26	$ 63	$ 79
Interest cost	54	55	165	168
Expected return on plan assets	(126)	(139)	(386)	(423)
Amortization and deferrals:
Actuarial loss	59	52	176	158
Prior service benefit	(4)	(4)	(12)	(12)
Net periodic benefit cost (credit)	4	(10)	6	(30)
Settlement loss	4	9	10	11
Special termination benefits	1	1	2	5
Net benefit cost (credit)	$ 9	$ 0	$ 18	$ (14)

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Taxes on Earnings - Narrative (Details) - USD ($) $ in Millions	3 Months Ended			9 Months Ended
	Jul. 31, 2019	Jan. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018	Oct. 31, 2018
Income Tax Examination [Line Items]
Effective tax rate (as a percent)	89.80%		2.80%	31.40%	1003.90%
Net income tax charges (benefits)	$ (303)		$ (68)	$ 80	$ (3,300)
Pre-Separation tax matters	308			264	2,000
Transformation costs, acquisition of business, disposition and other related charges	18			75
Increase in unrecognized tax benefits from separation activities	19			19
Release of non-U.S. valuation allowances on deferred tax assets			38
Income tax benefit from U.S. tax reform			33		713
Net excess tax benefits related to stock compensation			26		68
Tax indemnification amount			$ 7
Foreign tax credit					38
Benefit from liquidation of business					203
Income tax benefit on restructuring charges, separation costs, transformation costs and acquisition and other related charges					74
Additional tax charge		$ 426
Transition tax		7
Withholding tax charges		37		40
Unrecognized tax benefits	2,600			2,600		$ 8,800
Unrecognized tax benefits that would affect effective tax rate if realized	800			800		1,100
Decrease in unrecognized tax benefits resulting from settlements with taxing authorities				6,200
Accrued income tax for interest and penalties	130			$ 130		$ 142
Likelihood of no resolution period				12 months
Reasonably possible reduction in existing unrecognized tax benefits within the next 12 months	40			$ 40
Likelihood of conclusion period for certain federal, foreign and state tax issues				12 months
Significant change in unrecognized tax benefits that would impact effective tax rate	7			$ 7
Domestic and State and Local Jurisdictions [Member]
Income Tax Examination [Line Items]
Income tax charges related to change in valuation allowances				$ 365
Domestic Tax Authority [Member]
Income Tax Examination [Line Items]
Valuation allowance of deferred tax assets		438
State and Local Jurisdiction [Member]
Income Tax Examination [Line Items]
Income tax charges related to change in valuation allowances	$ 14
Valuation allowance of deferred tax assets		$ 56
Everett SpinCo
Income Tax Examination [Line Items]
Foreign tax credit					$ 228

XML

Taxes on Earnings - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Income Tax Disclosure [Abstract]
Deferred tax assets	$ 1,657	$ 2,403
Deferred tax liabilities	(278)	(228)
Deferred tax assets net of deferred tax liabilities	$ 1,379	$ 2,175

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Balance Sheet Details - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018	Jul. 31, 2018	Oct. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 3,693	$ 4,880
Restricted cash	318	204
Cash, cash equivalents and restricted cash	$ 4,011	$ 5,084	$ 5,249	$ 9,592

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Balance Sheet Details - Schedule of Inventory (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Finished goods	$ 1,225	$ 1,274
Purchased parts and fabricated assemblies	991	1,173
Total	$ 2,216	$ 2,447

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Balance Sheet Details - Schedule of Other Current Assets (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Value-added tax receivables	$ 630	$ 811
Short-term tax receivables and prepaid taxes	225	535
Manufacturer and other receivables	619	937
Prepaid and other current assets	832	793
Restricted cash	318	204
Total	$ 2,624	$ 3,280

XML

Balance Sheet Details - Schedule of Property, Plant and Equipment and Narrative (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Property, Plant and Equipment, Net
Property, plant and equipment, gross	$ 11,910	$ 11,816
Accumulated depreciation	(5,910)	(5,678)
Total	6,000	6,138
Land
Property, Plant and Equipment, Net
Property, plant and equipment, gross	293	294
Buildings and leasehold improvements
Property, Plant and Equipment, Net
Property, plant and equipment, gross	2,157	2,103
Machinery and equipment, including equipment held for lease
Property, Plant and Equipment, Net
Property, plant and equipment, gross	$ 9,460	$ 9,419

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Balance Sheet Details - Notes Payable and Short-Term Borrowings (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Long-term debt
Current portion of long-term debt	$ 1,180	$ 1,196
FS commercial paper	671	392
Notes payable to banks, lines of credit and other	356	417
Total	2,207	2,005
Financial Services
Long-term debt
Notes payable to banks, lines of credit and other	$ 228	$ 361

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Balance Sheet Details - Changes in Aggregate Product Warranty Liabilities (Details) $ in Millions	9 Months Ended
	Jul. 31, 2019 USD ($)
Changes in aggregated product warranty liabilities
Balance at beginning of period	$ 430
Accruals for warranties issued	178
Adjustments related to pre-existing warranties	6
Settlements made	(212)
Balance at end of period	$ 402

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Balance Sheet Details - Summary of Accounts Receivable, Net (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounts receivable	$ 2,786	$ 3,117
Unbilled receivables	210	185
Allowance for doubtful accounts	(31)	(39)
Total	$ 2,965	$ 3,263

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Balance Sheet Details - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Jul. 31, 2019	Jul. 31, 2019	Oct. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Contract liabilities	$ 5,900	$ 5,900	$ 5,800
Deferred revenue for financing activities	96	96	$ 82
Unearned revenue recognized		5,100
Unsatisfied performance obligations	5,900	5,900
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Current portion of capitalized costs	46	46
Non-current portion of capitalized costs	69	69
Amortization of capitalized costs to obtain a contract	$ 12	$ 34
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-08-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Unsatisfied performance obligation expected to be recognized over the remainder of the year	22.00%	22.00%

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Financing Receivables and Operating Leases - Narrative (Details) - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018
Leases [Abstract]
Financing receivable term, low end of range	2 years
Financing receivable term, high end of range	5 years
Financing receivable sold	$ 153	$ 127

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Financing Receivables and Operating Leases - Components of Financing Receivables (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018	Oct. 31, 2017
Leases [Abstract]
Minimum lease payments receivable	$ 9,009	$ 8,691
Unguaranteed residual value	322	297
Unearned income	(765)	(732)
Financing receivables, gross	8,566	8,256
Allowance for doubtful accounts	(133)	(120)	$ (86)
Financing receivables, net	8,433	8,136
Less: current portion	(3,567)	(3,396)
Amounts due after one year, net	$ 4,866	$ 4,740

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Financing Receivables and Operating Leases - Credit Risk Profile of Gross Financing Receivables (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Gross financing receivables
Gross financing receivables	$ 8,566	$ 8,256
Low
Gross financing receivables
Gross financing receivables	4,377	4,238
Moderate
Gross financing receivables
Gross financing receivables	3,913	3,805
High
Gross financing receivables
Gross financing receivables	$ 276	$ 213

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Financing Receivables and Operating Leases - Allowance for Doubtful Accounts for Financing Receivables (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Jul. 31, 2019	Oct. 31, 2018
Allowance for doubtful accounts
Balance at beginning of period	$ 120	$ 86
Provision for doubtful accounts	25	49
Write-offs	(12)	(15)
Balance at end of period	$ 133	$ 120

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Financing Receivables and Operating Leases - Gross Financing Receivables and Related Allowance Evaluated for Loss (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018	Oct. 31, 2017
Leases [Abstract]
Gross financing receivables collectively evaluated for loss	$ 8,120	$ 7,917
Gross financing receivables individually evaluated for loss(1)	446	339
Financing receivables, gross	8,566	8,256
Allowance for financing receivables collectively evaluated for loss	84	78
Allowance for financing receivables individually evaluated for loss	49	42
Total	$ 133	$ 120	$ 86

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Financing Receivables and Operating Leases - Summary of the Aging and Non-accrual Status of Gross Financing Receivables (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Billed:
Current 1-30 days	$ 319	$ 275
Past due 31-60 days	62	42
Past due 61-90 days	15	13
Past due 90 days	86	74
Unbilled sales-type and direct-financing lease receivables	8,084	7,852
Financing receivables, gross	8,566	8,256
Gross financing receivables on non-accrual status	297	226
Gross financing receivables 90 days past due and still accruing interest	$ 149	$ 113

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Financing Receivables and Operating Leases - Operating Lease Assets Included in Machinery and Equipment (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Leases [Abstract]
Equipment leased to customers	$ 7,275	$ 7,290
Accumulated depreciation	(3,225)	(3,078)
Total	$ 4,050	$ 4,212

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Goodwill (Details)	9 Months Ended
	Jul. 31, 2019 USD ($)
Goodwill [Roll Forward]
Goodwill beginning balance	$ 17,537,000,000
Goodwill acquired during the period	48,000,000
Goodwill adjustments	2,000,000
Goodwill ending balance	17,587,000,000
Hybrid IT
Goodwill [Roll Forward]
Goodwill beginning balance	15,479,000,000
Goodwill acquired during the period	48,000,000
Goodwill adjustments	2,000,000
Goodwill ending balance	15,529,000,000
Intelligent Edge
Goodwill [Roll Forward]
Goodwill beginning balance	1,914,000,000
Goodwill acquired during the period	0
Goodwill adjustments	0
Goodwill ending balance	1,914,000,000
Financial Services
Goodwill [Roll Forward]
Goodwill beginning balance	144,000,000
Goodwill acquired during the period	0
Goodwill adjustments	0
Goodwill ending balance	144,000,000
Corporate Investments
Goodwill [Roll Forward]
Goodwill beginning balance	88,000,000
Goodwill ending balance	$ 0

XML

Fair Value - Schedule of Assets and Liabilities on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Assets
Total assets	$ 2,169	$ 3,773
Liabilities
Total liabilities	149	476
Time deposits
Assets
Total assets	908	781
Money market funds
Assets
Total assets	609	2,340
Foreign bonds
Assets
Total assets	132	131
Other debt securities
Assets
Total assets	33	25
Interest rate contracts
Assets
Total assets	20	0
Liabilities
Total liabilities	32	353
Foreign exchange contracts
Assets
Total assets	467	496
Liabilities
Total liabilities	116	117
Other derivatives
Liabilities
Total liabilities	1	6
Level 1
Assets
Total assets	616	2,347
Liabilities
Total liabilities	0	0
Level 1 | Time deposits
Assets
Total assets	0	0
Level 1 | Money market funds
Assets
Total assets	609	2,340
Level 1 | Foreign bonds
Assets
Total assets	7	7
Level 1 | Other debt securities
Assets
Total assets	0	0
Level 1 | Interest rate contracts
Assets
Total assets	0	0
Liabilities
Total liabilities	0	0
Level 1 | Foreign exchange contracts
Assets
Total assets	0	0
Liabilities
Total liabilities	0	0
Level 1 | Other derivatives
Liabilities
Total liabilities	0	0
Level 2
Assets
Total assets	1,521	1,401
Liabilities
Total liabilities	149	476
Level 2 | Time deposits
Assets
Total assets	908	781
Level 2 | Money market funds
Assets
Total assets	0	0
Level 2 | Foreign bonds
Assets
Total assets	125	124
Level 2 | Other debt securities
Assets
Total assets	1	0
Level 2 | Interest rate contracts
Assets
Total assets	20	0
Liabilities
Total liabilities	32	353
Level 2 | Foreign exchange contracts
Assets
Total assets	467	496
Liabilities
Total liabilities	116	117
Level 2 | Other derivatives
Liabilities
Total liabilities	1	6
Level 3
Assets
Total assets	32	25
Liabilities
Total liabilities	0	0
Level 3 | Time deposits
Assets
Total assets	0	0
Level 3 | Money market funds
Assets
Total assets	0	0
Level 3 | Foreign bonds
Assets
Total assets	0	0
Level 3 | Other debt securities
Assets
Total assets	32	25
Level 3 | Interest rate contracts
Assets
Total assets	0	0
Liabilities
Total liabilities	0	0
Level 3 | Foreign exchange contracts
Assets
Total assets	0	0
Liabilities
Total liabilities	0	0
Level 3 | Other derivatives
Liabilities
Total liabilities	$ 0	$ 0

XML

Fair Value - Narrative (Details) - USD ($) $ in Billions	Jul. 31, 2019	Oct. 31, 2018
Fair Value Disclosures [Abstract]
Fair value, short-term and long-term debt	$ 13.5	$ 12.2

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Financial Instruments - Narrative (Details) - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2019	Oct. 31, 2018
Investment Holdings
Investments in equity interests	$ 2,346	$ 2,398
Equity securities in privately held companies | Long-Term Financing Receivables and Other Assets
Investment Holdings
Investment amount	184	$ 162
Cash flow hedges
Investment Holdings
Gain expected to be reclassified from Accumulated OCI into earnings in next 12 months	$ 80

XML

Financial Instruments - Cash Equivalents and Available-for-Sale Investments (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Cash and Cash Equivalents [Line Items]
Debt securities, Amortized Cost	$ 143
Debt securities, Fair Value	165
Total cash and equivalents and available-for-sale investments, Cost basis	1,660	$ 3,260
Gross Unrealized Gain	22	18
Gross Unrealized Loss	0	(1)
Total cash equivalents and available-for-sale debt investments	1,682	3,277
Cost
Cash and Cash Equivalents [Line Items]
Total cash equivalents	1,517	3,121
Cost | Time deposits
Cash and Cash Equivalents [Line Items]
Total cash equivalents	908	781
Cost | Money market funds
Cash and Cash Equivalents [Line Items]
Total cash equivalents	609	2,340
Fair Value
Cash and Cash Equivalents [Line Items]
Total cash equivalents	1,517	3,121
Fair Value | Time deposits
Cash and Cash Equivalents [Line Items]
Total cash equivalents	908	781
Fair Value | Money market funds
Cash and Cash Equivalents [Line Items]
Total cash equivalents	609	2,340
Debt securities
Cash and Cash Equivalents [Line Items]
Debt securities, Amortized Cost	143	139
Debt securities, Gross Unrealized Gain	22	18
Debt securities, Gross Unrealized Loss	0	(1)
Debt securities, Fair Value	165	156
Foreign bonds
Cash and Cash Equivalents [Line Items]
Debt securities, Amortized Cost	110	113
Debt securities, Gross Unrealized Gain	22	18
Debt securities, Gross Unrealized Loss	0	0
Debt securities, Fair Value	132	131
Other debt securities
Cash and Cash Equivalents [Line Items]
Debt securities, Amortized Cost	33	26
Debt securities, Gross Unrealized Gain	0	0
Debt securities, Gross Unrealized Loss	0	(1)
Debt securities, Fair Value	$ 33	$ 25

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Financial Instruments - Contractual Maturities of Investments in Available-for-Sale Debt Securities (Details) $ in Millions	Jul. 31, 2019 USD ($)
Amortized Cost
Due in one to five years	$ 10
Due in more than five years	133
Debt securities, Amortized Cost	143
Fair Value
Due in one to five years	10
Due in more than five years	155
Debt securities, Fair Value	$ 165

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Financial Instruments - Gross Notional and Fair Value of Instruments in the Balance Sheets (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Derivatives, Fair Value
Outstanding Gross Notional	$ 22,443	$ 23,894
Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	279	343
Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	208	153
Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	69	85
Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	80	391
Derivatives designated as hedging instruments
Derivatives, Fair Value
Outstanding Gross Notional	17,134	17,010
Derivatives designated as hedging instruments | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	243	302
Derivatives designated as hedging instruments | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	207	148
Derivatives designated as hedging instruments | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	42	24
Derivatives designated as hedging instruments | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	73	379
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts
Derivatives, Fair Value
Outstanding Gross Notional	6,850	6,850
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	0	0
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	20	0
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	0	0
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	32	353
Derivatives designated as hedging instruments | Cash flow hedges | Foreign exchange contracts
Derivatives, Fair Value
Outstanding Gross Notional	8,539	8,423
Derivatives designated as hedging instruments | Cash flow hedges | Foreign exchange contracts | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	218	270
Derivatives designated as hedging instruments | Cash flow hedges | Foreign exchange contracts | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	157	107
Derivatives designated as hedging instruments | Cash flow hedges | Foreign exchange contracts | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	24	11
Derivatives designated as hedging instruments | Cash flow hedges | Foreign exchange contracts | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	23	15
Derivatives designated as hedging instruments | Net investment hedges | Foreign exchange contracts
Derivatives, Fair Value
Outstanding Gross Notional	1,745	1,737
Derivatives designated as hedging instruments | Net investment hedges | Foreign exchange contracts | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	25	32
Derivatives designated as hedging instruments | Net investment hedges | Foreign exchange contracts | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	30	41
Derivatives designated as hedging instruments | Net investment hedges | Foreign exchange contracts | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	18	13
Derivatives designated as hedging instruments | Net investment hedges | Foreign exchange contracts | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	18	11
Derivatives not designated as hedging instruments
Derivatives, Fair Value
Outstanding Gross Notional	5,309	6,884
Derivatives not designated as hedging instruments | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	36	41
Derivatives not designated as hedging instruments | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	1	5
Derivatives not designated as hedging instruments | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	27	61
Derivatives not designated as hedging instruments | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	7	12
Derivatives not designated as hedging instruments | Foreign exchange contracts
Derivatives, Fair Value
Outstanding Gross Notional	5,206	6,780
Derivatives not designated as hedging instruments | Foreign exchange contracts | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	36	41
Derivatives not designated as hedging instruments | Foreign exchange contracts | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	1	5
Derivatives not designated as hedging instruments | Foreign exchange contracts | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	26	55
Derivatives not designated as hedging instruments | Foreign exchange contracts | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	7	12
Derivatives not designated as hedging instruments | Other derivatives
Derivatives, Fair Value
Outstanding Gross Notional	103	104
Derivatives not designated as hedging instruments | Other derivatives | Other Current Assets
Derivatives, Fair Value
Derivative asset, fair value	0	0
Derivatives not designated as hedging instruments | Other derivatives | Long-Term Financing Receivables and Other Assets
Derivatives, Fair Value
Derivative asset, fair value	0	0
Derivatives not designated as hedging instruments | Other derivatives | Other Accrued Liabilities
Derivatives, Fair Value
Derivative liability, fair value	1	6
Derivatives not designated as hedging instruments | Other derivatives | Long-Term Other Liabilities
Derivatives, Fair Value
Derivative liability, fair value	$ 0	$ 0

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Financial Instruments - Offsetting Assets and Liabilities (Details) - USD ($) $ in Millions	9 Months Ended
	Jul. 31, 2019	Oct. 31, 2018
Derivative assets
Gross Amount Recognized	$ 487	$ 496
Gross Amount Offset	0	0
Net Amount Presented	487	496
Gross Amounts Not Offset
Derivatives	125	179
Financial Collateral	316	205
Net Amount	46	112
Derivative liabilities
Gross Amount Recognized	149	476
Gross Amount Offset	0	0
Net Amount Presented	149	476
Gross Amounts Not Offset
Derivatives	125	179
Financial Collateral	5	302
Net Amount	$ 19	(5)
Business days prior to reporting date	2 days
Cash collateral	$ 4	$ 302
Counterparty collateral	$ 1

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Financial Instruments - Pre-tax Effect of Derivative Instruments and Items in a Fair Value Hedging Relationship (Details) - Interest rate contracts - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Earnings on Derivative	$ 123	$ 16	$ 341	$ (194)
Gains (Losses) Recognized in Earnings on Related Hedged Item	$ (123)	$ (16)	$ (341)	$ 194

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Financial Instruments - Pre-tax Effect of Derivative Instruments in Hedging Relationships (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Other Comprehensive Income (OCI) on Derivatives (Effective Portion)	$ 63	$ 149	$ 225	$ 50
Net revenue	7,217	7,764	21,920	22,906
Interest and other, net	(70)	(64)	(139)	(163)
Net (loss) earnings from continuing operations	(27)	452	569	2,784
Foreign currency contracts | Cash flow hedges
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Other Comprehensive Income (OCI) on Derivatives (Effective Portion)	63	149	225	50
Foreign currency contracts | Cash flow hedges | Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion) | Reclassifications of gains (losses) into earnings
Derivative Instruments, Gain (Loss) [Line Items]
Net revenue	42	29	168	(82)
Interest and other, net	16	14	91	4
Net (loss) earnings from continuing operations	58	43	259	(78)
Foreign currency contracts | Cash flow hedges | Net revenue
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Other Comprehensive Income (OCI) on Derivatives (Effective Portion)	43	121	102	59
Foreign currency contracts | Cash flow hedges | Interest and other, net
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Other Comprehensive Income (OCI) on Derivatives (Effective Portion)	20	28	123	(9)
Foreign currency contracts | Net investment hedges | Gains (Losses) Reclassified from Accumulated OCI Into Earnings (Effective Portion) | Reclassifications of gains (losses) into earnings
Derivative Instruments, Gain (Loss) [Line Items]
Interest and other, net	0	0	0	0
Foreign currency contracts | Net investment hedges | Interest and other, net
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Other Comprehensive Income (OCI) on Derivatives (Effective Portion)	$ (18)	$ 57	$ (23)	$ 31

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Financial Instruments - Pre-tax Effect of Derivative Instruments Not Designated as Hedging Instruments (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Earnings on Derivatives	$ 53	$ 233	$ (63)	$ 104
Foreign currency contracts | Interest and other, net
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Earnings on Derivatives	55	233	(68)	104
Other derivatives | Interest and other, net
Derivative Instruments, Gain (Loss) [Line Items]
Gains (Losses) Recognized in Earnings on Derivatives	$ (2)	$ 0	$ 5	$ 0

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Borrowings (Details)	Aug. 16, 2019 USD ($) extension_term	Jul. 31, 2019 USD ($) commercial_paper_program	Mar. 31, 2019 USD ($)	Oct. 31, 2018 USD ($)
Line of Credit Facility [Line Items]
Number of commercial paper programs | commercial_paper_program		2
Line of Credit | Revolving Credit Facility | Subsequent Event
Line of Credit Facility [Line Items]
Maximum borrowing capacity under commercial paper program	$ 4,750,000,000
Debt term	5 years
Number of extension terms | extension_term	2
Debt renewal term	1 year
Euro Program
Line of Credit Facility [Line Items]
Maximum borrowing capacity under commercial paper program		$ 3,000,000,000.0
Commercial Paper
Line of Credit Facility [Line Items]
Maximum approved		$ 4,000,000,000.0
Number of commercial paper programs | commercial_paper_program		2
Amount outstanding		$ 0		$ 0
Commercial Paper | Hewlett Packard Enterprise
Line of Credit Facility [Line Items]
Additional authorization		1,000,000,000.0
Commercial Paper | U.S. Program
Line of Credit Facility [Line Items]
Maximum borrowing capacity under commercial paper program		4,000,000,000.0
Commercial Paper | Euro Commercial Paper Certificate of Deposit Programme
Line of Credit Facility [Line Items]
Maximum borrowing capacity under commercial paper program		1,000,000,000.0	$ 500,000,000
Amount outstanding		$ 671,000,000		$ 392,000,000

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Stockholders' Equity - Taxes Related to Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Accumulated Other Comprehensive Income
Components of accumulated other comprehensive income, net of taxes
Tax benefit (provision)	$ 2	$ (19)	$ 4	$ (34)
Change in Net Unrealized Gains (Losses) on Cash Flow Hedges
Components of accumulated other comprehensive income, net of taxes
Tax (provision) on net unrealized gains (losses) arising during the period	(6)	(20)	(24)	(6)
Tax provision (benefit) on net (gains) losses reclassified into earnings	7	5	31	(11)
Tax benefit (provision)	1	(15)	7	(17)
Unrealized components of defined benefit plans
Components of accumulated other comprehensive income, net of taxes
Tax benefit (provision)	2	(6)	(3)	(20)
Unrealized Losses Arising During the Period
Components of accumulated other comprehensive income, net of taxes
Tax (provision) on net unrealized gains (losses) arising during the period	5	3	13	2
Actuarial Loss and Net Prior Service Benefit
Components of accumulated other comprehensive income, net of taxes
Tax provision (benefit) on net (gains) losses reclassified into earnings	(3)	(4)	(9)	(10)
Curtailments, settlements and other
Components of accumulated other comprehensive income, net of taxes
Tax provision (benefit) on net (gains) losses reclassified into earnings	0	(5)	(7)	(12)
Change in cumulative translation adjustment
Components of accumulated other comprehensive income, net of taxes
Tax benefit (provision)	$ (1)	$ 2	$ 0	$ 3

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Stockholders' Equity - Changes and Reclassifications Of OCI (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other comprehensive income, net of taxes	$ 30	$ 76	$ 68	$ 175
Net unrealized gains (losses) on available-for-sale securities
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other comprehensive income (loss) before reclassifications	3	(2)	8	(1)
Gains reclassified into earnings	0	0	(3)	(9)
Other comprehensive income, net of taxes	3	(2)	5	(10)
Change in net unrealized gains (losses) on cash flow hedges
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other comprehensive income (loss) before reclassifications	57	129	201	44
Gains reclassified into earnings	(51)	(38)	(228)	67
Other comprehensive income, net of taxes	6	91	(27)	111
Change in unrealized components of defined benefit plans
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other comprehensive income (loss) before reclassifications			(65)
Gains reclassified into earnings			157
Other comprehensive income, net of taxes	30	25	92	111
Net unrealized losses arising during the period
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Gains reclassified into earnings	(26)	(22)	(65)	(21)
Amortization of actuarial loss and prior service benefit
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Gains reclassified into earnings	51	43	152	133
Curtailments, settlements and other
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other comprehensive income, net of taxes	5	4	5	(1)
Change in cumulative translation adjustment
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other comprehensive income (loss) before reclassifications			(2)
Gains reclassified into earnings			0
Other comprehensive income, net of taxes	$ (9)	$ (38)	$ (2)	$ (37)

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Stockholders' Equity - Components of AOCI (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Components of accumulated other comprehensive loss, net of taxes
Balance at beginning of period			$ 21,274
Balance at end of period	$ 17,580		17,580
Net unrealized gains (losses) on available-for-sale securities
Components of accumulated other comprehensive loss, net of taxes
Balance at beginning of period			17
Other comprehensive income (loss) before reclassifications	3	$ (2)	8	$ (1)
Reclassifications of (gains) losses into earnings	0	0	(3)	(9)
Balance at end of period	22		22
Net unrealized gains (losses) on cash flow hedges
Components of accumulated other comprehensive loss, net of taxes
Balance at beginning of period			106
Other comprehensive income (loss) before reclassifications	57	129	201	44
Reclassifications of (gains) losses into earnings	(51)	(38)	(228)	67
Balance at end of period	79		79
Unrealized components of defined benefit plans
Components of accumulated other comprehensive loss, net of taxes
Balance at beginning of period			(2,922)
Other comprehensive income (loss) before reclassifications			(65)
Reclassifications of (gains) losses into earnings			157
Balance at end of period	(2,830)		(2,830)
Cumulative translation adjustment
Components of accumulated other comprehensive loss, net of taxes
Balance at beginning of period			(419)
Other comprehensive income (loss) before reclassifications			(2)
Reclassifications of (gains) losses into earnings			0
Balance at end of period	(421)		(421)
Accumulated other comprehensive loss
Components of accumulated other comprehensive loss, net of taxes
Balance at beginning of period	(3,180)	(2,982)	(3,218)	(2,895)
Other comprehensive income (loss) before reclassifications			142
Reclassifications of (gains) losses into earnings			(74)
Balance at end of period	$ (3,150)	$ (2,906)	$ (3,150)	$ (2,906)

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Stockholders' Equity - Narrative (Details) - Share Repurchase program - USD ($) shares in Millions, $ in Billions	9 Months Ended	12 Months Ended
	Jul. 31, 2019	Oct. 31, 2018
Equity, Class of Treasury Stock [Line Items]
Common stock retired (in shares)	130.0	2.4
Open share repurchases during period (in shares)	1.2
Repurchases of common stock recorded as a reduction to stockholders' equity	$ 1.9
Remaining authorized repurchase amount	$ 2.7

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Net Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2019	Jul. 31, 2018	Jul. 31, 2019	Jul. 31, 2018
Numerator:
Net (loss) earnings from continuing operations	$ (27)	$ 452	$ 569	$ 2,784
Net loss from discontinued operations	0	(1)	0	(119)
Net (loss) earnings	$ (27)	$ 451	$ 569	$ 2,665
Denominator:
Weighted-average shares used to compute basic net EPS (in shares)	1,334	1,513	1,367	1,552
Dilutive effect of employee stock plans (in shares)	0	18	13	26
Weighted-average shares used to compute diluted net EPS (in shares)	1,334	1,531	1,380	1,578
Basic net (loss) earnings per share:
Continuing operations (in dollars per share)	$ (0.02)	$ 0.30	$ 0.42	$ 1.79
Discontinued operations (in dollars per share)	0	0	0	(0.07)
Total basic net earnings (loss) per share (in dollars per share)	(0.02)	0.30	0.42	1.72
Diluted net (loss) earnings per share:
Continuing operations (in dollars per share)	(0.02)	0.29	0.41	1.76
Discontinued operations (in dollars per share)	0	0	0	(0.07)
Total diluted net earnings (loss) per share (in dollars per share)	$ (0.02)	$ 0.29	$ 0.41	$ 1.69
Anti-dilutive weighted-average stock awards (in shares)	44	2	4	3

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Litigation and Contingencies (Details) $ in Thousands														1 Months Ended	9 Months Ended	24 Months Ended
	Aug. 15, 2019 USD ($)	May 16, 2019 USD ($)	Feb. 06, 2018 plaintiff	Dec. 01, 2017 plaintiff	Nov. 30, 2017 plaintiff	Nov. 08, 2017 USD ($)	Dec. 19, 2016	Jun. 30, 2016 USD ($)	Jan. 24, 2013 USD ($)	Dec. 11, 2012 USD ($)	Apr. 21, 2012 USD ($)	May 10, 2010 USD ($) employee	Apr. 29, 2010 USD ($)	Jul. 31, 2011	Jul. 31, 2019	Oct. 31, 2008 contract	Apr. 20, 2012 USD ($)	Apr. 11, 2012 USD ($)	Jun. 15, 2011 phase
Litigation and Contingencies
Damages sought												$ 370,000
Forsyth, et al. vs HP Inc. and Hewlett Packard Enterprise
Litigation and Contingencies
Number of plantiffs | plaintiff			16	13	3
Judicial ruling | Oracle
Litigation and Contingencies
Amount awarded								$ 3,000,000
Number of phases | phase																			2
Judicial ruling | Oracle - past lost profits
Litigation and Contingencies
Amount awarded								1,700,000
Judicial ruling | Oracle - future lost profits
Litigation and Contingencies
Amount awarded								$ 1,300,000
Renewed judgement | Oracle
Litigation and Contingencies
Amount awarded		$ 3,800,000
Daily interest accrual on renewed judgement		$ 1,037
Minimum | Forsyth, et al. vs HP Inc. and Hewlett Packard Enterprise
Litigation and Contingencies
Age of terminated employees							40 years
India Directorate of Revenue Intelligence Proceedings
Litigation and Contingencies
Number of HP India employees alleging underpaid customs | employee												7
Number of former HP India employees alleging underpaid customs | employee												1
Loss contingency deposit to prevent interruption of business													$ 16,000
Bangalore Commissioner of Customs
Litigation and Contingencies
Duties and penalties under show cause notices																	$ 17,000	$ 386,000
Amount deposited under show cause notice prior to order																	$ 7,000	$ 9,000
Additional amount deposited against products-related show cause notice										$ 10,000
Additional amount deposited against parts-related show cause notice											$ 3,000
Additional amount deposited against product order									$ 24,000
ECT proceedings
Litigation and Contingencies
Number of ECT contracts related to alleged improprieties | contract																3
Bid and contract term														5 years
ECT proceedings | Maximum
Litigation and Contingencies
Length of sanctions															5 years
ECT proceedings | Minimum
Litigation and Contingencies
Length of sanctions															2 years
Everett SpinCo | Cross-Indemnifications
Litigation and Contingencies
Damages sought						$ 1,000,000
Everett SpinCo | Discontinued Operations, Disposed of by Means Other than Sale, Spinoff
Litigation and Contingencies
Indemnification threshold amount						$ 250,000
Subsequent Event | Everett SpinCo | Cross-Indemnifications
Litigation and Contingencies
Amount award against entity	$ 632,000
Pre-judgment interest	$ 34,000

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Indemnifications (Details) - USD ($) $ in Millions	Jul. 31, 2019	Oct. 31, 2018
Tax Indemnification
Other Commitments [Line Items]
Net indemnification receivable - long-term	$ 266	$ 16
Net indemnification receivable - short-term	13	17
Net indemnification payable - long-term	9	9
Net indemnification payable - short-term	102	26
Cross-Indemnifications
Other Commitments [Line Items]
Receivable	88	104
Payable	$ 57	$ 83