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  "path": "/article/4142928/hpes-server-and-storage-prices-can-change-after-you-place-an-order.html",
  "publishedAt": "2026-03-10T11:41:14.000Z",
  "site": "https://www.networkworld.com",
  "tags": [
    "Data Center, Enterprise Storage, Servers",
    "earnings call",
    "steep upward trajectory",
    "TrendForce projected in January 2026",
    "IDC has previously warned",
    "billion acquisition of Juniper Networks",
    "reported Q1 fiscal 2026 revenue"
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  "textContent": "HPE has told customers that the prices quoted for servers and storage hardware may not be the prices they ultimately pay, as surging memory and storage costs have led the company to reserve the right to reprice orders before shipment.\n\nHPE CEO Antonio Neri disclosed the change in its terms and conditions during the company’s Q1 fiscal 2026 earnings call on Monday. “We have amended our quoting terms with a right to reprice existing orders for commodity cost increases between quoting and shipment,” Neri said. The company expects elevated memory and storage prices to persist well into 2027, he added.\n\nThe practical implication for enterprise IT teams is significant. Organizations running fixed capital expenditure budgets or multi-year hardware refresh cycles may find that infrastructure costs approved at the quote stage no longer hold by the time equipment ships.\n\n“This is not a routine contractual adjustment,” said Sanchit Vir Gogia, chief analyst at Greyhound Research. “It signals a structural shift in how enterprise infrastructure procurement is going to operate in the coming years.”\n\nFor decades, enterprise hardware procurement followed a predictable model: procurement teams negotiated pricing based on configuration and volume, and once a quote was issued and internally approved, the price was effectively locked. That assumption is now breaking down, Gogia said, because the underlying cost structure of servers has fundamentally changed.\n\n“Historically, memory represented somewhere between roughly a quarter and about 40% of server material costs depending on the configuration,” Gogia said. “Crossing the 50% threshold changes the economics of infrastructure procurement because the most volatile component of the system now dominates the cost structure.”\n\nHPE CFO Marie Myers said on the call that the company had already begun implementing DRAM-related price increases in November 2025, ahead of the formal amendment to the quoting terms. HPE has also shortened its quote commitment cycle and is actively steering customers toward lower-memory configurations where possible. “We are dynamically passing through memory and component cost inflation while protecting our margins and preserving profitability,” Myers said on the call.\n\n## A market already under severe strain\n\nThe revision did not come without warning. Server memory prices have been on a steep upward trajectory since mid-2025, driven by AI data centre demand absorbing memory supply away from conventional enterprise hardware. TrendForce projected in January 2026 that average DRAM prices would rise 50% to 55% in Q1 2026 compared to Q4 2025. Samsung, SK Hynix, and Micron have all redirected production capacity toward high-bandwidth memory for AI accelerators, leaving conventional enterprise memory undersupplied.\n\nGogia said HPE’s move should be understood as an early signal of a broader industry shift rather than an isolated vendor decision. “The pattern is beginning to appear across the broader infrastructure vendor ecosystem. Component volatility is no longer an internal vendor risk. It is a shared market condition that must be reflected in contract structures,” he said.\n\n## The implications for enterprise procurement\n\nFor CIOs and IT procurement teams, the ripple effects are already visible. IDC has previously warned that enterprise buyers whose budgets were set before the full scope of the memory shortage became clear are likely to face sticker shock when refresh quotes arrive. HPE’s revised terms make that risk explicit rather than incidental.\n\nGogia said procurement governance must now evolve to treat infrastructure purchasing as a risk management exercise. Enterprises will need mechanisms such as indexed pricing tied to component markets, defined price adjustment corridors that cap increases within agreed ranges, and staged purchasing structures that reduce exposure to a single delivery event, he said. “Organisations that fail to adapt will find themselves facing budget overruns, delayed infrastructure deployments, and difficult internal approval cycles when final invoices diverge from approved purchase orders,” Gogia said.\n\n## Networking less exposed\n\nThe repricing risk, however, does not apply equally across HPE’s entire product portfolio. Neri said on the call that HPE’s networking business, now significantly expanded following the completion of its $14 billion acquisition of Juniper Networks in July 2025, is “more insulated, with memory comprising a significantly smaller portion of the bill of materials.” Networking now represents nearly 30% of HPE’s total revenues and more than half of its total operating profits, Neri said on the call.\n\nHPE reported Q1 fiscal 2026 revenue of $9.3 billion, up 18% year over year, and raised its full-year earnings outlook on the back of the results. HPE did not immediately respond to a request for comment.",
  "title": "HPE’s server and storage prices can change after you place an order"
}