As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at hardware & infrastructure stocks, starting with Dell (NYSE: DELL).
The Hardware & Infrastructure sector will be buoyed by demand related to AI adoption, cloud computing expansion, and the need for more efficient data storage and processing solutions. Companies with tech offerings such as servers, switches, and storage solutions are well-positioned in our new hybrid working and IT world. On the other hand, headwinds include ongoing supply chain disruptions, rising component costs, and intensifying competition from cloud-native and hyperscale providers reducing reliance on traditional hardware. Additionally, regulatory scrutiny over data sovereignty, cybersecurity standards, and environmental sustainability in hardware manufacturing could increase compliance costs.
The 9 hardware & infrastructure stocks we track reported a slower Q1. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 0.7% above.
Luckily, hardware & infrastructure stocks have performed well with share prices up 10.7% on average since the latest earnings results.
Dell (NYSE: DELL)
Founded by Michael Dell in his University of Texas dorm room in 1984 with just $1,000, Dell Technologies (NYSE: DELL) provides hardware, software, and services that help organizations build their IT infrastructure, manage cloud environments, and enable digital transformation.
Dell reported revenues of $23.38 billion, up 5.1% year on year. This print exceeded analysts’ expectations by 1.1%. Despite the top-line beat, it was still a softer quarter for the company with a significant miss of analysts’ operating income estimates.
Interestingly, the stock is up 1.6% since reporting and currently trades at $115.43.
Read our full report on Dell here, it’s free.
Best Q1: Hewlett Packard Enterprise (NYSE: HPE)
Born from the 2015 split of the iconic Silicon Valley pioneer Hewlett-Packard, Hewlett Packard Enterprise (NYSE: HPE) provides edge-to-cloud technology solutions that help businesses capture, analyze, and act upon their data across hybrid IT environments.
Hewlett Packard Enterprise reported revenues of $7.63 billion, up 5.9% year on year, outperforming analysts’ expectations by 2.3%. The business had a strong quarter with a solid beat of analysts’ ARR and EPS estimates.
Hewlett Packard Enterprise delivered the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 1.5% since reporting. It currently trades at $17.94.
Is now the time to buy Hewlett Packard Enterprise? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: HP (NYSE: HPQ)
Born from the legendary Silicon Valley garage startup founded by Bill Hewlett and Dave Packard in 1939, HP (NYSE: HPQ) designs and sells personal computers, printers, and related technology products and services to consumers, businesses, and enterprises worldwide.
HP reported revenues of $13.22 billion, up 3.3% year on year, exceeding analysts’ expectations by 0.9%. Still, it was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates.
As expected, the stock is down 10.7% since the results and currently trades at $24.37.
Read our full analysis of HP’s results here.
Pure Storage (NYSE: PSTG)
Founded in 2009 as a pioneer in enterprise all-flash storage technology, Pure Storage (NYSE: PSTG) provides all-flash data storage hardware and software that helps organizations manage their data more efficiently across on-premises and cloud environments.
Pure Storage reported revenues of $778.5 million, up 12.3% year on year. This print surpassed analysts’ expectations by 1.1%. It was a strong quarter as it also recorded a solid beat of analysts’ EPS estimates and full-year revenue guidance meeting analysts’ expectations.
The stock is down 5.1% since reporting and currently trades at $52.26.
Read our full, actionable report on Pure Storage here, it’s free.
Super Micro (NASDAQ: SMCI)
Founded in Silicon Valley in 1993 and known for its modular "building block" approach to server design, Super Micro Computer (NASDAQ: SMCI) designs and manufactures high-performance, energy-efficient server and storage systems for data centers, cloud computing, AI, and edge computing applications.
Super Micro reported revenues of $4.6 billion, up 19.5% year on year. This number came in 2.7% below analysts' expectations. Overall, it was a slower quarter as it also logged a significant miss of analysts’ operating income estimates.
Super Micro achieved the fastest revenue growth but had the weakest performance against analyst estimates among its peers. The stock is up 30.6% since reporting and currently trades at $42.95.
Read our full, actionable report on Super Micro here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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