Hewlett Packard Enterprise has secured a $1.2 billion artificial-intelligence infrastructure order from cloud provider Vultr, giving the company a major new customer win as demand for AI computing expands beyond the largest hyperscale cloud operators.
The agreement calls for HPE to provide Vultr with AMD-based server racks designed for artificial-intelligence workloads. HPE announced the contract Wednesday during its networking investor day.
The size of the order is significant because Vultr operates in a cloud market dominated by much larger companies including Amazon Web Services, Microsoft Azure and Google Cloud.
Independent cloud providers are increasing investment in accelerated computing as businesses seek additional sources of AI capacity.
HPE is positioning itself to capture more of that spending across both computing and networking infrastructure.
The company also raised its long-term growth outlook for its networking business. HPE now expects networking revenue to increase at a compound annual rate of approximately 7% to 9% through fiscal 2029, compared with its previous expectation of 5% to 7%.
The Vultr transaction also highlights AMD’s expanding role in AI infrastructure.
Nvidia remains the dominant supplier of AI accelerators, but cloud companies are increasingly evaluating alternative hardware as demand for computing capacity grows and customers seek greater choice in price and performance.
For HPE, that creates an opportunity extending beyond the individual server sale.
AI clusters require high-speed networking, storage, power management and systems integration alongside the processors themselves. Vendors capable of supplying multiple layers of that infrastructure can potentially capture a larger share of each deployment.
HPE shares rose nearly 6% in premarket trading following the announcement.
The company’s latest outlook adds another data point suggesting that the AI capital-spending cycle is broadening beyond GPUs and the largest data-center operators.
The next question is whether orders such as Vultr’s develop into sustained growth as more cloud providers build competing AI infrastructure.
