HPE raises networking forecast, announces $1.2 billion Vultr AI order

Hewlett Packard Enterprise raised its long-term Networking growth forecast and announced a $1.2 billion order from cloud infrastructure provider Vultr for AMD Helios AI Rack systems at U.S. data centers. The order puts a disclosed customer commitment alongside HPE’s forecast that AI infrastructure spending will lift its networking business.

In its updated Networking forecast, HPE said it expects the segment’s revenue to grow in the high-teens-to-low-20s percentage range in fiscal 2027. It also projected a high-teens compound annual growth rate from fiscal 2026 through fiscal 2029. Both figures are company forecasts, not reported results.

HPE described the Vultr transaction as its first order for AMD Helios AI Rack by HPE systems. The companies did not disclose the number of racks, delivery milestones, payment terms, cancellation rights or when HPE expects to recognize revenue from the order.

According to HPE, each rack combines 72 AMD Instinct MI455X graphics processors with AMD EPYC Venice processors, Pensando Vulcano AI network interface cards and ROCm software. Six HPE Juniper Networking QFX5252 Ethernet switch trays connect components within the rack. AMD is supplying several layers of the system, while AMD’s broader AI expansion provides company-level context for its role.

HPE and Vultr executives attributed the transaction to demand for AI training and inference infrastructure. Their releases did not provide independent market data quantifying that demand.

HPE also said it expects Networking operating margin in the mid-to-high-20s percentage range from fiscal 2027 through fiscal 2029. It raised its target for annual run-rate cost savings tied to Juniper to $800 million by the end of fiscal 2028, up from at least $600 million.