Hewlett Packard Enterprise earnings and revenue both hit records in the latest quarter as demand for the information technology company's hardware booms.

HPE reported fiscal third-quarter adjusted earnings of $1.11 per share, which was a major jump from the earnings of 44 cents per share in the prior year period and ahead of analyst estimates of 93 cents per share, according to FactSet. Revenue for the quarter of $12.2 billion rose 34% from the year period and also beat Wall Street estimates of $12 billion.

Expectations were high coming into the report, and shares were down 5.2% in after-hours trading.

"We are turning what I call exceptional demand into durable, profitable growth for a company and shareholders," CEO Antonio Neri told Barron's on Wednesday.

HPE also raised its revenue outlook for the year. It now expects fiscal 2026 revenue to grow between 34% to 37%, which is above prior estimates for growth between 29% to 33%.

HPE stock had jumped 116% this year, heading into the earnings report. Investors are betting big on companies that are seeing earnings and revenue growth due to the increased need for hardware used to power artificial intelligence. For HPE, that's servers and networking solutions.

HPE, seeking to grow the networking business, closed the acquisition of Juniper Networks in July 2025.

Cloud & AI revenue for the quarter was $9 billion, up 25% from last year. Networking revenue of $2.9 billion also rose 75% from the prior year.

HPE is working hard to meet demand, but component shortages have hit supply and sent costs soaring.

"Ssupply availability will continue to be very constrained, and we don't expect to have a solution to this problem, anytime soon," Neri says. He believes the supply headwinds will continue through 2028.

"But at the same time, we see enterprise customers accelerating the usage of AI because nobody wants to be left behind," says Neri.