Hewlett Packard Enterprise CoHPE
Hewlett Packard Enterprise Co Fair Value Disclosure
Fair Value
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.
Fair Value Hierarchy
The Company uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement:
Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs.
Level 3—Unobservable inputs for assets or liabilities.
The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs. For the fiscal years ended October 31, 2025 and 2024, there were no transfers between levels within the fair value hierarchy.
The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis:
| As of October 31, 2025 | As of October 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||
| Fair Value Measured Using | Fair Value Measured Using | ||||||||||||||||||||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||||||||||||||||||
| In millions | |||||||||||||||||||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||||||||||||||
| Cash Equivalents: | |||||||||||||||||||||||||||||||||||||||||||||||
| Time deposits | $ | — | $ | 997 | $ | — | $ | 997 | $ | — | $ | 601 | $ | — | $ | 601 | |||||||||||||||||||||||||||||||
| Money market funds | 2,741 | — | — | 2,741 | 12,639 | — | — | 12,639 | |||||||||||||||||||||||||||||||||||||||
| Total cash equivalents | 2,741 | 997 | — | 3,738 | 12,639 | 601 | — | 13,240 | |||||||||||||||||||||||||||||||||||||||
| Available-for-sale Debt Investments: | |||||||||||||||||||||||||||||||||||||||||||||||
| Foreign bonds | — | 111 | — | 111 | — | 102 | 1 | 103 | |||||||||||||||||||||||||||||||||||||||
Other debt securities(1) | — | — | 46 | 46 | — | — | 14 | 14 | |||||||||||||||||||||||||||||||||||||||
| Total available-for-sale debt investments | — | 111 | 46 | 157 | — | 102 | 15 | 117 | |||||||||||||||||||||||||||||||||||||||
| Equity Investments: | |||||||||||||||||||||||||||||||||||||||||||||||
| Mutual funds | — | 59 | — | 59 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Equity securities in public companies | 6 | — | — | 6 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Equity securities | — | — | — | — | — | — | 88 | 88 | |||||||||||||||||||||||||||||||||||||||
| Total equity investments | 6 | 59 | — | 65 | — | — | 88 | 88 | |||||||||||||||||||||||||||||||||||||||
| Derivatives Instruments: | |||||||||||||||||||||||||||||||||||||||||||||||
| Foreign currency contracts | — | 193 | — | 193 | — | 299 | — | 299 | |||||||||||||||||||||||||||||||||||||||
| Other derivatives | — | 2 | — | 2 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
| Total assets | 2,747 | 1,362 | 46 | 4,155 | 12,639 | 1,002 | 103 | 13,744 | |||||||||||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||
| Derivatives Instruments: | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest rate contracts | — | 51 | — | 51 | — | 58 | — | 58 | |||||||||||||||||||||||||||||||||||||||
| Foreign currency contracts | — | 238 | — | 238 | — | 103 | — | 103 | |||||||||||||||||||||||||||||||||||||||
| Other derivatives | — | — | — | — | — | 2 | — | 2 | |||||||||||||||||||||||||||||||||||||||
| Total liabilities | $ | — | $ | 289 | $ | — | $ | 289 | $ | — | $ | 163 | $ | — | $ | 163 | |||||||||||||||||||||||||||||||
(1)Available-for-sale debt securities with carrying values that approximate fair value.
Valuation Techniques
Cash Equivalents and Investments: The Company holds time deposits, money market funds, debt securities primarily consisting of corporate and foreign government notes and bonds. The Company values cash equivalents using quoted market prices, alternative pricing sources, including net asset value, or models utilizing market observable inputs. The fair value of debt and equity investments was based on quoted market prices or model-driven valuations using inputs primarily derived from or corroborated by observable market data, and, in certain instances, valuation models that utilize assumptions which cannot be corroborated with observable market data. Equity and other securities include investments in marketable and non-marketable securities. In evaluating non-marketable securities for impairment or observable price changes, the Company uses valuation techniques using the best information available, and may include quoted market prices, market comparables and discounted cash flow projections.
Derivative Instruments: The Company uses forward contracts, interest rate and total return swaps to hedge certain foreign currency and interest rate exposures. The Company uses industry standard valuation models to measure fair value. Where applicable, these models project future cash flows and discount the future amounts to present value using market-based observable inputs, including interest rate curves, the Company and counterparties' credit risk, foreign currency exchange rates, and forward and spot prices for currencies and interest rates. See Note 13, “Financial Instruments,” for a further discussion of the Company's use of derivative instruments.
Other Fair Value Disclosures
Short-Term and Long-Term Debt: The Company estimates the fair value of its debt primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities, and considering its own credit risk. The portion of the Company's debt that is hedged is reflected in the Consolidated Balance Sheets as an amount equal to the debt's carrying amount and a fair value adjustment representing changes in the fair value of the hedged debt obligations arising from movements in benchmark interest rates. As of October 31, 2025, the estimated fair value of the Company's short-term and long-term debt was $22.5 billion and the carrying value was $22.4 billion. As of October 31, 2024, the estimated fair value of the Company's short-term and long-term debt was $18.3 billion and the carrying value was $18.2 billion. If measured at fair value in the Consolidated Balance Sheets, short-term and long-term debt would be classified in Level 2 of the fair value hierarchy.
Other Financial Instruments: For the balance of the Company's financial instruments, primarily accounts receivable, accounts payable and financial liabilities included in other accrued liabilities, the carrying amounts approximate fair value due to their short-term nature. If measured at fair value in the Consolidated Balance Sheets, these other financial instruments would be classified in Level 2 or Level 3 of the fair value hierarchy.
Non-Recurring Fair Value Measurements
Equity Investments without Readily Determinable Fair Value: Equity investments are recorded at cost and measured at fair value, when they are deemed to be impaired or when there is an adjustment from observable price changes. For fiscal 2025, the Company recorded a realized net loss of $105 million on the sale of these investments. For fiscal 2024, the Company recorded net unrealized gain of $34 million. For fiscal 2023, the Company recorded net unrealized loss of $45 million, which included impairments of $50 million. These amounts are reflected in Interest and other, net in the Consolidated Statements of Earnings. If measured at fair value in the Consolidated Balance Sheets, these would generally be classified in Level 3 of the fair value hierarchy. These adjustments are based on observable price changes for certain equity investments without readily determinable fair value. For investments still held as of October 31, 2025, there was no cumulative upward adjustments for observable price changes while the for observable price changes and impairments was immaterial. Refer to Note 13 “Financial Instruments,” for further information about equity investments.
Non-Financial Assets: The Company's non-financial assets, such as intangible assets, goodwill and property, plant and equipment, are recorded at cost. The Company records ROU assets based on the lease liability, adjusted for lease prepayments, lease incentives received and the lessee's initial direct costs. Fair value adjustments are made to these non-financial assets in the period an impairment charge is recognized.
In fiscal 2025, the Company recorded $1.6 billion of impairment charges for the goodwill associated with the Hybrid Cloud reporting unit and the impairment of certain fixed assets. For impairment testing purposes, the fair values of both the reporting unit and the fixed assets were estimated using company‑specific unobservable inputs and would generally be classified within Level 3 of the fair value hierarchy. For more information on the goodwill impairment, see Note 11 “Goodwill and Intangible Assets.”
In fiscal 2023, the Company recorded a net ROU asset impairment charge of $18 million in Transformation costs in the Consolidated Statements of Earnings as the carrying value of certain ROU assets exceeded its fair value. If measured at fair value in the Consolidated Balance Sheets, these would generally be classified in Level 3 of the fair value hierarchy.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Dec 18, 2025 | Showing above |
| 2024 | Dec 19, 2024 | |
| 2023 | Dec 22, 2023 | |
| 2022 | Dec 8, 2022 | |
| 2021 | Dec 10, 2021 | |
| 2020 | Dec 10, 2020 | |
| 2019 | Dec 13, 2019 | |
| 2018 | Dec 12, 2018 | |
| 2017 | Dec 15, 2017 | |
| 2016 | Dec 15, 2016 | |
| 2015 | Dec 17, 2015 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.