Hewlett Packard Enterprise Co. HPE shares are falling Friday after the company issued second-quarter guidance below analyst expectations.

What To Know: The company reported first-quarter earnings of 49 cents per share, meeting analyst estimates while came in at $7.85 billion, slightly beating the consensus estimate of $7.82 billion.

However, the company's non-GAAP gross margin dropped to 29.4%, down 680 basis points from the previous year and 150 basis points sequentially.

CEO Antonio Neri highlighted the company's fourth consecutive quarter of year-over-year revenue growth and expressed optimism about recent innovations. However, he acknowledged areas where execution could have been stronger.

Soft Outlook: For the second quarter, Hewlett Packard Enterprise expects revenue to range between $7.2 billion and $7.6 billion, falling short of the $7.93 billion analyst estimate. The company also guided for EPS between 28 cents and 34 cents, significantly below the 50 cents analyst forecast.

HPE Price Action: Hewlett Packard Enterprise shares were down 16.2% at $15.06 at the time of writing, according to Benzinga Pro.

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