(b) Represents the settlement of certain pre-separation Hewlett-Packard Company income tax liabilities indemnified through the Tax Matters Agreement with HP Inc.
(c) Represents the amortization of basis difference adjustments related to the H3C divestiture.
(d) Includes tax amounts in connection with the Everett and Seattle Transactions, tax amounts related to U.S. tax reform, tax amounts related to the settlement of certain pre-separation Hewlett-Packard Company income tax liabilities indemnified through the Tax Matters Agreement with HP Inc., and excess tax benefits associated with stock-based compensation. For the three months ended October 31, 2018, this amount primarily includes $1.3 billion expense as a result of U.S. tax reform.
For the three months ended October 31, 2017, this amount primarily includes the income tax benefit related to U.S. foreign tax credits generated in connection with the Everett and Seattle Transactions.
(e) For the three months ended October 31, 2017, this amount primarily includes the income tax benefit related to U.S. foreign tax credits generated as a result of the Everett and Seattle Transactions included in discontinued operations.
|
HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES
ADJUSTMENTS TO GAAP NET EARNINGS, EARNINGS FROM OPERATIONS, OPERATING MARGIN AND DILUTED NET EARNINGS PER SHARE (Unaudited) (In millions, except percentages and per share amounts) | |||||||||||||||
|
Twelve months
ended October 31, 2018 |
Diluted net
earnings per share |
Twelve months
ended October 31, 2017 |
Diluted net
earnings per share | ||||||||||||
| GAAP net earnings from continuing operations | $ | 2,012 | $ | 1.30 | $ | 436 | $ | 0.26 | |||||||
| Non-GAAP adjustments: | |||||||||||||||
| Amortization of intangible assets | 294 | 0.19 | 321 | 0.19 | |||||||||||
| Impairment of goodwill | 88 | 0.06 | — | — | |||||||||||
| Restructuring charges | 19 | 0.01 | 417 | 0.25 | |||||||||||
| Transformation costs(a) | 445 | 0.29 | 359 | 0.21 | |||||||||||
| Disaster Charges | — | — | 93 | 0.06 | |||||||||||
| Acquisition and other related charges | 82 | 0.05 | 203 | 0.12 | |||||||||||
| Separation costs | 12 | 0.01 | 248 | 0.15 | |||||||||||
| Defined benefit plan settlement charges and remeasurement (benefit) | — | — | (64 | ) | (0.04 | ) | |||||||||
| Tax indemnification adjustments(b) | 1,354 | 0.87 | 3 | — | |||||||||||
| Loss from equity interests(c) | 151 | 0.10 | 155 | 0.09 | |||||||||||
| Adjustments for taxes(d) | (2,039 | ) | (1.32 | ) | (563 | ) | (0.33 | ) | |||||||
| Non-GAAP net earnings from continuing operations | $ | 2,418 | $ | 1.56 | $ | 1,608 | $ | 0.96 | |||||||
| GAAP earnings from continuing operations | $ | 1,858 | $ | 625 | |||||||||||
| Non-GAAP adjustments related to continuing operations: | |||||||||||||||
| Amortization of intangible assets | 294 | 321 | |||||||||||||
| Impairment of goodwill | 88 | — | |||||||||||||
| Restructuring charges | 19 | 417 | |||||||||||||
| Transformation costs | 425 | 359 | |||||||||||||
| Disaster Charges | — | 93 | |||||||||||||
| Acquisition and other related charges | 82 | 203 | |||||||||||||
| Separation costs | 12 | 248 | |||||||||||||
| Defined benefit plan settlement charges and remeasurement (benefit) | — | (64 | ) | ||||||||||||
| Non-GAAP earnings from continuing operations | $ | 2,778 | $ | 2,202 | |||||||||||
| GAAP operating margin from continuing operations | 6 | % | 2 | % | |||||||||||
| Non-GAAP adjustments from continuing operations | 3 | % | 6 | % | |||||||||||
| Non-GAAP operating margin from continuing operations | 9 | % | 8 | % | |||||||||||
| GAAP net loss from discontinued operations | $ | (104 | ) | $ | (0.07 | ) | $ | (92 | ) | $ | (0.05 | ) | |||
| Non-GAAP adjustments related to discontinued operations: | |||||||||||||||
| Amortization of intangible assets | — | — | 116 | 0.07 | |||||||||||
| Restructuring charges | — | — | 251 | 0.15 | |||||||||||
| Acquisition and other related charges | — | — | 1 | — | |||||||||||
| Separation costs | 51 | 0.03 | 1,037 | 0.62 | |||||||||||
| Defined benefit plan settlement charges and remeasurement (benefit) | — | — | (9 | ) | (0.01 | ) | |||||||||
| Interest expense on Seattle debt | — | — | 19 | 0.01 | |||||||||||
| Tax indemnification adjustments | 58 | 0.04 | 15 | 0.01 | |||||||||||
| Adjustments for taxes (e) | (5 | ) | — | (587 | ) | (0.35 | ) | ||||||||
| Non-GAAP net earnings from discontinued operations | $ | — | $ | — | $ | 751 | $ | 0.45 | |||||||
| Total GAAP net earnings | $ | 1,908 | $ | 1.23 | $ | 344 | $ | 0.21 | |||||||
| Total Non-GAAP net earnings | $ | 2,418 | $ | 1.56 | $ | 2,359 | $ | 1.41 | |||||||
