HPE boss: "If the channel doesn't grow we can't grow"

HPE's CEO has made it clear that the channel play a pivotal role in its fortunes as the firm delivered its Q1 earnings for the three months ended 31 January.

The vendor saw revenues improve by just a single percent to $7.6bn and operating profits increased by 19% year-on-year giving the firm the confidence to raise its outlook for the earnings per share.

HPE is looking to establish itself as a leading light in the intelligent edge and hybrid IT world and in revenue terms they improved by 5% and declined by 3% respectively. One of the factors explaining the year-on-year decrease on the hybrid side was the decision to exit some customer segments.

Antonio Neri, president and CEO of HPE, was bullish about the firm's performance and responded to an analyst question about the importance of the channel confirming that partners remained a crucial part of its plans.

"If the channel doesn't grow we can't grow. So 70% of our business in the core Hybrid IT and up to 90% in Aruba are all driven by the channel," said Neri "Our sellout in the channel has grown double digits and that's why we are confident."

There have been signs from other vendors that Q1 has been more of a challenge given Brexit and the ongoing China and US trade issues, but Neri remained upbeat about market conditions.

"We continue to monitor the economic uncertainties around the globe, but the overall IT spending environment remains healthy. Our customers tell us the IT investment they are making are critical to driving business outcomes as they look to harness the explosion of data that continues to grow," he said.

"While the demand environment is helpful, our performance largely reflects our sound strategy, focused execution and software-defined portfolio that is resonating with our customers around the world," he added.

"When you ask me about Brexit, our business in UK grew double-digits," he said in response to a specific question about the impact of the political uncertainty.