More and more companies are doubling Down in future of AI and huid Packard Enterpris is no exception at HP discover Barcelona the company announced several Ai and cloud computing offerings Including an expanded collaboration with Nvidia helip Packer Enterprise Co Antonio ner joins me now from Barcelona Antonio busy week for your company Thanks for making a few uh taking a few Moments for us here so let's start on This partnership with Nvidia what Exactly did you announce well good Morning Brian thanks for having me we're Just wrapping up another amazing HP Discovery event here in beautiful Barcelona I can tell you it was an Incredible week for us uh we engaged More than 3,000 customers and obviously The biggest news was the expanded Partnership with Nvidia uh two weeks ago Almost three weeks ago now uh we Actually announced a trun key Solutions With Nvidia at the time for what we call The mobel developers and this is all About helping accelerate mobile training Without super Computing Technologies Including a networking Fabric and our Software and the Nvidia Grace opener H200 and their software now here in Barcelona we expanded that partnership To now address the needs of Enterprise And think about this way in the context Of the AI life cycle we have model
Developers that training models but Enterprises are going to fine tune those Models with their data and they want to Do it in a secure private and safe way And what we did with Nvidia is announced A specific Enterprise term case solution That actually leverage our portfolio Including HP Green Lake in order to Deploy an AI native architecture on Prem So they can Leverage The Cloud native World where all the data is with an AI N Word on Prem so they can speed time to Value very exciting for the for the lay Person out there Antonio what is this Deal with an Nvidia what is that or how Does it change your financial Outlook Over for the next two Years I mean it's an acceleration of What we're doing if you recall Brian Over the last 5 years you know have been Talking about the Transformations Enterprises are going through and I said That Enterprise in the future will be Edge Centric Cloud enable and data Driven you saw results at the end of uh T 2023 last early this week we had a Massive acceleration of the edge now Represent 20% of the company Revenue Almost 50% company profit we enacted HP Green Lake which is uh a hybrid Cloud Platform to accelerate deployment of Cloud everywhere across the Enterprise And now we are in that data driven Journey and together with Nvidia we
Bring enormous expertise we have a Partnership for decades where basically We have been addressing supercomputing Requirements now we're going to Democratize that with their technology And our Solutions including our services Expertise which is an incremental Critical component what customer needs To democratize Ai and this amazing Technology to accelerate business Transformation so you know think about Our results in 23 at the beginning of The year we had less than $100 million In AI orders at the end of 23 we Actually book $3.6 billion so 10 months Huge growth yeah and just playing off That number Antonio and maybe it's it's Hard to explain at least I find it hard To explain things just feel like they're Moving very fast in AI compared to where They were a week ago two weeks ago 3 Months ago and and I bring that up Because Jensen this week said you know We're almost arriving at that point Where five years from now a lot of um AI Solutions or Computing process will Processes will be on par with the human Mind I mean do you share that sentiment I agree with Jensen and Jenson and I Meet regularly almost on several weeks Not anym months um and the reason why is Because we believe on the opportunity We Believe on the use this technology in an Ethical and responsible away but at the
Same time the pace of the Innovation we Are seeing have never seen before think About when mobile came along think about When we 1.0 came along it took several Years maybe decade a decade or so this Is happening now weekly and monthly to a Pace we haven't seen so I believe we're Going to achieve major breakthroughs Over the next several months think about J chpt3 as an example was in the Hundreds of billions of parameters now Is over a trilon parameters But Ultimately as the model becomes more Intelligent context aware we're going to Achieve new breakthroughs in ways we Haven't imagined before what does a a Breakthrough and AI look like for next Year well I think we see several Trends Right so as we think about the Convergence of uh what I call Cloud Native Andi native worlds in AI Specifically see the convergence of Generative AI with simulation Modeling historically know we have used Simulation and modeling to address some Specific requirements uh where you know Was you know kind of simulate where a Testing will look like or a Manufacturing process will look like it Was more about creating digital twins For the physical world but now with Genera we give a lot of intelligence to That and therefore we can accelerate the Outcome of these models and provide
Automation and decision making Capabilities the question is how far you Want to go with that decision making and This is why there is a step between Training and tuning which we call Prompt Engineering which you know some cases Like you do with your chat GPT if you Want you just enter a prompt and it Gives you an answer but in the future You can actually automate The Prompt Engineering based on requirements and You can actually automate that execution If you will right through the Inferencing side so we think about this Not just in the context of large Language model we think about this in The context of molecular docking Foundation model climate research uh Simulation and modeling diffusion things Are actually probably for the society Easy to understand than just you know a Large language model but this Convergence is happening right now and We as the market leader in superc Computing we see that convergence which Actually creates a massive opportunity For us because this is an inflection Point where HP is uniquely position with Intellectual Pro and expertise to Capture that moment each time we have Talked this year Antonio I have come Away thinking increasingly that HP is a Really strong play on AI and where AI is Going and I think this conversation just
Further uh furthers that thought along As the CEO of HP do you look at your Portfolio and think maybe there's Certain areas we no longer need to play In and these parts of the business are Not where we're going into the future And maybe we shouldn't have them in our Portfolio we always is my feary duty and The F duty of our board to always look How we can accelerate value for Shareholders it is a context where we Invest money where we divest where it Makes no sense and ultimately where We're going to grow as I think about Three five 10 years out and as youit This go multiple time all comes down to Relevancy is not just Financial Engineering and that's why a strategy That's Innovation driven is the core so As I think about our business we have Five business right the computer Business the traditional server business Is very commoditized but give us SC And honestly give us a lot of free cash Flow that we directly contribute back to Shareholders or we use to invest in Growth engine and I see three distinct Growth engine for us one is the Intelligent Edge and you see the results Uh which actually created an increment Of $2 billion in just 18 months and Actually had a massive operating profit So that to me is the core fabric of the Company is the networking layer the
Second is the hybrid cloud and you know As you saw in our 23 results we went From very little to $13 billion in total Contra value in less than 6 years and That's the foundation for which we Create the data manage the data then now We can accelerate with the third growth Engine which is AI and we have the Expertise to do so but also we need to Allocate Capital correctly and if think About the results of 2023 we actually Deliver record break and performance non Gap theen share and free cash flow in The history of the company so we are on The right path but it's always about the Dis discipline of Lo or return invested Capital
