Insider Monkey favors HPE on a risk-adjusted basis, despite its higher forward P/E: about 14, versus below 10 for Supermicro. It cites HPE’s improving profitability and broader business, but flags Supermicro’s 10.8% full-year gross margin and an adverse audit opinion.
HPE’s fiscal third-quarter revenue rose 34% to a record $12.2 billion, while GAAP gross margin reached 40.1%. AI-systems orders rose more than 30% sequentially to $2.4 billion and its backlog reached $6.8 billion. After the quarter, HPE won a $3.5 billion hyperscaler inference-server deal; Oracle also chose HPE Juniper networking equipment for AI data centers.
Supermicro’s fiscal fourth-quarter sales rose to $11.1 billion from $5.8 billion a year earlier; full-year revenue was $39.1 billion, up 78%, and the company said it generated more than $60 billion in new orders. Fourth-quarter operating cash flow was positive $747 million. It ended June with $8.7 billion in bank debt and convertible notes, and its auditor issued an adverse opinion on internal control over financial reporting as of June 30. Insider Monkey says Supermicro’s upside could be greater if margins stabilize and control weaknesses are remedied; it also flags slower hardware growth and Juniper integration as risks for HPE.
