Hewlett Packard Enterprise rings the Opening Bell at the New York Stock Exchange on Oct. 15, 2025. NYSEShares of Hewlett Packard Enterprise surged 25% Tuesday, pacing for its biggest daily gain ever as the company posted its biggest earnings beat since 2018. The stock is looking to set a new intraday all-time high.Artificial intelligence-related demand in its server unit blew away analysts' expectations for second-quarter earnings. HPE reported adjusted earnings per share of 79 cents, versus 53 cents expected, and overall revenue soared to $10.68 billion versus an expected $9.79 billion. Server revenue alone, a sub-division of its cloud and AI unit, came in at $5.45 billion, topping the $4.66 billion analysts expected. In the wake of Dell's own AI-fueled earnings blowout, some analysts are getting cautious about how sustainable demand might be in the server space, as firms continue to buy and server prices climb.Bernstein increased their HPE estimates after better projections in the traditional server unit and took their price target to $62 from $35, writing that "a lot of the upside is already in the stock." The firm kept its rating at Market Perform. Morgan Stanley took their price target from $33 to $71. "Similar to DELL, HPE is seeing material upside to results from inelastic server demand and share capture, as servers become strategic, and those with supply take price," Morgan Stanley analysts wrote. "Durability of demand vs. peak earnings risk will be the key debate from here."Read more CNBC tech newsNvidia's new PC chips represent CEO Huang's bid to win at every layer of AI stackAmazon's four-day Prime Day event starts June 23, as shoppers battle inflationBlue Origin launchpad damaged in rocket explosion may not be restored until 2028, Isaacman saysMicrosoft and Google are late to AI coding, but 'absolutely critical' they compete for growthCNBC's Katie Tarasov, Kristina Partsinevelos and Chris Eudaily contributed to this report. watch nowStock Chart IconStock chart iconHPE year-to-date stock chart.