Ever since Hewlett Packard split into two different companies, HP Inc. (NYSE: HPQ) and HP Enterprise (NYSE: HPE), things have been rather rocky for such an established brand name. HP Inc. handles printing and computers. HP Enterprise, what we want to focus on here, is everything else: network business, storage, software, servers, network equipment, services, infrastructure, products, and more.
Hiring and employee count is down everywhere, which is never a good sign. Maybe soon there will be an uptick in key positions / categories as HPE looks to tackle new projects and focus in on more of what they want to do, GreenLake (we'll get to that below), instead of being a jack of all trades.
The fall off in people not using a guest account could be a great sign, if they decide to sign up officially. Or it could mean way less people using HP overall. You can come to your own conclusion about that though, since there are a lot of contradictions between the stock market valuation of HPE and some of the alternative data we found.
HPE's third quarter earnings call brought a host of good news for the company. You can sense that a change in direction for the company is akin to steering a large ship around; it's going to take some time and patience amongst the crew. The plan (as every corporation seemingly wants to do nowadays) is: move from a one-time sales model to a software subscription service model, hoping people forget their pay a nominal fee every month and don't go through the steps to cancel. It worked for Microsoft. It worked for Adobe. It may as well work for HPE.
SaaS, or Software as a Service, is the bullseye on the target that HPE now wants to aim at. The switch to its service model, GreenLake, was only announced two months ago. Its a pay-per-use cloud platform that saw a 42% increase in sales over the last quarter, and 112% increase through partners.
So how are things going for HPE in the early stages of its new plan? Well, very good from what the CEO says:
We continue to see high double digits or triple digit (growth in channel sales of GreenLake) in some cases depending on the tier of the channel partner on the adoption of GreenLake. - CEO Antonio Neri
But we leave all the stock and revenue and gross margin analysis for others. We specialize in alternative data, and that tells us a much different story about HPE. Namely, its going to take some time to convert to a 100% SaaS model, and thats why shares have been down YoY the last few quarters for the company overall.
The evil twin brother meanwhile, HP Inc., can't stop itself from hiring more and more people. But that's the computers division, and now an entirely different business that spunoff HPE (although we can't help but point out the stark contrast in hirings between these two).
About the Data:
Thinknum tracks companies using information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.