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Vendor HP
Exam Number HP2-Z04
Exam Name Building HP ProCurve Campus LANs
Questions 100 Q & A
Recent Update October 17, 2018
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HP2-Z04 exam Dumps Source : Building HP ProCurve Campus LANs

Test Code : HP2-Z04
Test Name : Building HP ProCurve Campus LANs
Vendor Name : HP
Q&A : 100 Real Questions

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No influence discovered, try new keyword!a 200,000-rectangular-foot constructing occupied by way of Hewlett Packard spinoff DXC know-how Co., and the empty one hundred sixty,000-square-foot constructing at 630 Roseville Parkway. Strada additionally all started $10 million of campus impr...

Hewlett-Packard's administration items at know-how Briefing: software defined Networking convention (Transcript) | killexams.com Real Questions and Pass4sure dumps

Hewlett-Packard Co. (HPQ)

Bethany Mayer - Senior vice chairman and standard manager, Hewlett-Packard Networking

good day and welcome to this joint ISI and HP convention call and webcast. (Operator directions) i would now like to turn the call over to Brian Marshall, Senior Managing Director and Head of Tech-research at ISI.

Thanks all and sundry for becoming a member of us today. i am very excited to have Bethany Mayer, Senior vice chairman and regular manager of Hewlett-Packard Networking group. most likely, this group is one of the fastest transforming into company contraptions with inside HP, doing roughly about $2.5 billion of annual earnings, actually has grown 12 months-over-year for 13 consecutive quarters. So obviously that's relocating within the appropriate path.

and i'm really excited to discuss HP Networking nowadays in a bit bit extra aspect, especially with respect to probably the most new trends that we're seeing available. In selected, utility-defined networking, the adjustments it really is going to have in the business and how HP is going to be main that effort going ahead.

Bethany has spent over 25 years in the networking area, youngsters definitely wouldn't appear to be it. She spent lots of time at HP as well as Blue Coat, the place she became responsible for the Packeteer transaction, drove triple-digit boom there over a a few-year environment. She spent some time at Mirapoint and JDSU, at Cisco, Ericsson and Apple, so very chuffed to have her be part of us today.

So with that, I suppose she's going to have probably about 15 slides or so, then we are going to go at once into Q&A. We even have Nitesh Sharan from Hewlett-Packard's IR with us as smartly.

And so earlier than we hand it over to Bethany's presentation, i would similar to to point out that this presentation can also include some ahead-searching statements that involves risk and uncertainties and assumptions. For a detailed disclosure, please check with Slide 2 within the presentation deck.

With that, i would like to turn it over to Bethany.

thank you, Brian, I recognize the time and recognize all of your time out there. As Brian outlined, I head up the HP Networking company unit inside HP Networking. And additionally as he mentioned, we're a few $2.5 billion salary run fee at the moment.

i wanted to head over a few issues for you, just to delivery out, to give you a quick understanding average of HP Networking, so that in case you do not need that, you are going to. First, i'd like to birth with our consumer value proposition.

Our price proposition is in fact fairly exciting within the trade, but it surely's very, very compelling to CIOs, and that's in reality around simplification of their network. The community has been for many, a long time, a very complicated infrastructure, very fragile, very complex to control and change, and as a result, many CIOs have in fact struggled with making adjustments to reply to their company using the network.

And so our focal point within HP Networking and everything we do is concentrated round simplification of that networking, architecture, the infrastructure, and the working activities that go on with that community. So we have four key areas of focal point for us in terms of that price proposition and that i wanted to simply in short point out them.

the first is, open specifications. we are an open specifications-based corporation and business as you may additionally understand from HP. however that is very, very key to us. it be a key philosophy for our firm and it also enables our clients an excellent deal of choice because of that open requirements-primarily based focal point on our items.

We also have a very potent attention round convergence. And as you be aware of, HP's Converged Infrastructure method is a extremely key a part of our business overall within the enterprise neighborhood at HP. And it skill a lot to our valued clientele, as a result of in fact as these applied sciences converge collectively, they'll supply much more simplicity and automation for the customer base and that is the reason what we wish to do.

Virtualization is an additional factor of our offering, it is very crucial to simplify the community. We already do and have finished for a few years loads of virtualization options inside the community to permit our shoppers to really now not ought to category command strains into bins, to be able to make a change in that community. So now we have completed lots of work in virtualization already and of course with SDN we're doing more.

and finally, automation. every thing we do with reference to considering operating cost for the CIO focuses on ensuring they could automate as a lot as possible within the network. And this is frankly very different paradigm from what they have confronted in the past. They've needed to resolve that with human elements as an alternative of just automating the expertise itself, and we deliver loads of automation there.

And what it does for the customer in complicated terms is it promises a 66% lessen TCO and an eight month return on investment for them. So it's a very, very effective price proposition, very compelling from a dollars and cents standpoint as well.

I simply wanted to also in short point out one of the crucial innovations that we have had over the remaining a couple of years. As you may additionally comprehend, HP has been within the networking business for somewhat a long time, and began out in the 90s with a very wonderful innovation round redefining the campus economics. So what that supposed was they created a lifetime assurance for his or her items. That is not just a enterprise model activity. That requires innovation of the items themselves with a view to offer that. And we nevertheless present that today on a lot of our products.

So in case you brought a switch from us in 1996 and it is now completed, and it has had some variety of problem, that you would be able to come returned to us and we are able to provide you with a different one to substitute it. We might also now not provide the 1996 version of that product, but we will offer you one other one a good way to replace one definite characteristic.

additionally as you seem to be throughout the years, we now have developed a couple of other technologies that are very, very imaginative are: first, virtualized blade server connectivity, which we name virtual connect, is a extremely, very powerful piece of our networking portfolio and allows for shoppers to utilize the networking connectivity in blade server itself with tremendous expertise.

we now have also developed a virtualization expertise we name, clever Resilient Framework, or for short IRF, which permits you to virtualize a number of switches together, as if there's single swap, including the hop characteristic of that network. So it be no multi-hop, it's basically a single virtualized switch. and that's a very big talents, primarily in the data middle, in the event you're aggregating a great deal and loads of server racks.

We in the 2009 timeframe additionally came out with our single pane-of-glass administration, which is a very key aspect of our product offering these days of our intelligent administration center, which manages not simplest all of our products, but a couple of other peoples' products as smartly. and then in the 2011 timeframe, we developed our FlexNetwork architecture, which i will be able to describe to you, as well as we began to boost our OpenFlow enabled application-defined networking controller.

As you might also be aware of, we've had OpenFlow enabled in our items on account that 2007, and we're continuing that culture with now 29 OpenFlow enabled switching platforms going to the whole accomplished portfolio of OpenFlow enabled switches by using the end of 2013, so huge development. and then at last, what we are doing these days is, we're deploying SDN applications with purchasers while I communicate. So some surprising activities within the innovation house for HP Networking and HP as a company.

when it comes to who we're from a market momentum point of view, just a few things, and Brian mentioned one in every of them, which is 13 consecutive quarters of increase. we are additionally number one in wise managed switches. we are the #1 network vendor via a great deal, at a 41% market share in China, and number two community supplier globally. And in case you add it up, all of our different opponents, other than Cisco, they might not equal our profits. So we're number two by means of a great deal. and of course, we have a big competitor during this house as all of us know, however we now have a major market position today.

I simply desired to share with you a few of our consumers, to provide you with a bit sense of who we sell to. We sell to many Fortune 1,000 right down to small-medium agencies. we now have a extremely fine vast breadth of product providing and we cover many segments, earning new clients at roughly forty a quarter, so very exceptional momentum.

As i discussed, we developed some thing we name our FlexNetwork structure. here's very crucial and or not it's more than a diagram. it's how we design products and it has a really amazing cost propositions with the shoppers. So it's basically the primary unified structure that allows consistency throughout the records core, the campus and the department of an enterprise. And we have constant applied sciences throughout all of those areas of the community that allow a client to roll out a very, very primary networking structure that's open necessities based mostly, totally scalable, very secured, very agile, and as i discussed, extremely consistent.

And consistency is very important. if you happen to are making a transformation to a network round that automation dialogue we had, if all of your boxes have different working programs of them, are configured otherwise, must be provisioned otherwise, you have a really challenging time altering that community. And so consistency is in reality a key right here. after which it's all managed by way of a single administration platform, which once more is pleasing within the industry, no person else does that, and that's our IMC.

we have a very effective breadth of items as smartly that range from the data core throughout the campus and into branch. So in the facts middle, we do core switching and routing in addition to aggregation appropriate-of-rack. in the campus, we now have core switching and routing as neatly. We even have wired and instant and we really mix those into a unified wired wireless platform within the campus. And in the branch, we've routing, switching and additionally that wired instant for the branch in addition to flex management or intelligent management middle platform for management, so a broad breadth of items.

I need to center of attention on software-described networking for you, as a result of it is a really key a part of our method and our product offering, and i need to assist you have in mind it. So first I just wish to speak a bit bit in regards to the drivers. So if I had mentioned that community for many, decades has been definitely very difficult to trade and slow to alternate.

You could alternate a lot of issues for your infrastructure and also you might setup a digital computing device in precisely a few minutes if you wish, but to trade your network, it actually can take months, and a whole lot and a lot of planning and a lot of people. and that is the reason an issue, since the cloud isn't going to attend around for months. And if an IT organization cannot deliver a service to their end-user, the conclusion-user can regularly go to the cloud with out them.

So basically, the IT company should exchange its paradigm and needs to have the network be agile and aware of company, as all other points of the infrastructure are today in not use, what we call human middleware or a whole lot and loads of folks typing a great deal and loads of things into a whole lot and lots of boxes. That does not support them and it may not get them to the cloud.

also there are lots of, many contraptions that we all understand are being purchased into the business nowadays, and however an IT company decides, smartly, that we're simply not going to permit it. The truth is it happens anyways devoid of them. so they need to have a mechanism to enable their clients to are available in with devices and have them be secure and use them appropriately.

after which finally from a market boom perspective, the SDN market goes to be very huge. And the explanation why is because this paradigm, where you can control your network from a single mechanism is a profound exchange within the networking business. and that i'll discuss that.

So we're a founding member of the Open Networking foundation. And if you look on the explanation or definition of SDN, let me simply element just a few issues out for you, here is what the definition says. The handle and information planes are decoupled. k, it's key. it is distinct than what you do nowadays.

today, the control and records aircraft are in a single container, the change. and you have got to exchange the change, switch by using switch, in an effort to make a metamorphosis. So the control and information planes are decoupled. The network intelligence and state are logically centralized, in order that capability they're no longer in swap by means of change via swap, and the community infrastructure is abstracted from the functions, and the way you are looking to set up issues within the network. here is, as I referred to, a really giant and distinctive paradigm from what exists in networking these days and we're a huge part of this, which i am enthusiastic about.

So just to give you an illustration, for those who're constructing a cloud, here's what it takes these days to basically carry up 50 users. It takes a lot of individuals, loads of provisioning, a lot of instructions for 50,000 clients within the cloud. So in case you wish to set up a bunch of users within the cloud, it takes you over 3,000 man hours of effort and over 420 network admins. So I mean this is just now not scalable. It simply isn't and it's not suitable for the cloud, and that's the reason the aspect of SDN.

So if you appear at the approach the network is architected these days, it can not deliver agility and it can't give a couple of things, beginning with, the network does not know what functions are operating over it. In a way that is a gorgeous component, but in an additional manner it really is a nasty aspect, because purposes are often times sensitive to network changes and network efficiency. And if the community does not know that it be running an software that requires that, there is a problem with the software.

The network is awfully inflexible, bodily. So it's no longer intended for multi-tenant environments or diverse types of consumer forms or place, it lacks programmability. after which eventually, it is manually managed in many circumstances. You can't control it from yet another element in the network. So those are the concerns with the community as it exist.

And what SDN provides you is massive agility, and it permits you to have a community it's conscious of company wants. and looking out at it, if you beginning from the bottom, the infrastructure layer, what SDN first brings is an open specifications-primarily based programmatic entry to the infrastructure. So here is the place OpenFlow comes in, ok. that is the open specifications-primarily based programmatic access to the infrastructure.

It additionally provides a manage layer that abstracts the control from the machine, and it does that in a centralized manner. after which ultimately, it offers APIs which are programmable that construct orchestration or network services, or even different purposes on that network. So that is what an SDN structure should still look like.

And if you study it from a physical viewpoint, you are going to see the community gadgets on the infrastructure layer with the use of OpenFlow as a programmable interface, the SDN controller itself, which has the south-facing OpenFlow programmable capabilities and north-dealing with APIs that are open as well and programmable to loads of various things, together with cloud orchestration the use of OpenStack is a superb instance or SDN purposes, which i'll describe one for you or even company applications. So that's what it appears like.

So what HP is doing, is we're following that architecture that you would be able to see. And what which you can see from what we have now executed is, first, we've carried out OpenFlow in now 29 of our switching platforms. So it is 29 as compared to one with one different competitor that we find out about. a lot of OpenFlow enablement in those products and has been enabled on the grounds that 2007.

As smartly, we've our SDN controller. We exhibit it in a server, however it's software really, and may be put in a server, can be placed on a server anywhere in that network you desire, since it's the only element of manage. we have developed that, this is in statistics nowadays with a number of consumers, including the ones that I exhibit you during this slide for diverse SDN purposes.

and then, we built purposes, one is virtualization for our HP cloud, that allows you to virtualize the network the use of our SDN controller. We even have built a safety application, we name Sentinel, and we did that for our client HBO, who became having issues with people bringing devices into their community.

and that i'll explain that protection utility in some detail. What it potential is we've got taken our DDLab's cloud that promises signatures to our TippingPoint equipment perpetually and as a substitute of it supplying the signatures to the TippingPoint appliance; it provides the signatures to the SDN Controller, which then pushes those signatures out to all the switching ports within the material.

in order that in the event you deliver up gadget in that became established good, say, the day before today since it was clear via all the networking requisites using the IPS, you trot on domestic and your child performs with it and then you deliver it returned in again, the community can experience that there's malware on the device and block it. So it truly is the key there. And it may do that at each port in the network in its place of dragging all that traffic during the community to a single device. or not it's a extremely striking profound ability where you literally have dissolved IPS into the switching material itself.

And we additionally developed an utility with CERN, which, of route, moves terabytes of statistics standard, which load balances that statistics stream throughout the community using the network itself as an alternative of appliances. So here is, as I stated, very profound and the functions are captivating as a result of they can also be very diverse.

So just when it comes to what has variety of sprung out when it comes to SDN is, i believed i'll sort of offer you a way of myths which are out there and explain a bit bit about why they are not precise. So the primary fable is that the best community function in utility on a digital computing device or creating an overlay community is SDN. k, it really is now not proper.

it is a network software. Virtualization of the network is an utility of SDN. SDN as the definition mentions has programmable entry to the instruments that are the infrastructure. And if you simply use an overlay that doesn't take into account what devices are below it, that overlay, and the fine of service of that overlay is in jeopardy. in order that is not SDN.

also it isn't SDN to have an offering that uses a proprietary programming potential to software a tool. ok, it is well-nigh the opposite of SDN because you're going machine-by using-gadget to reprogram it and you have got all these contraptions that are actually inconsistent and you're doing that on a tool-by means of-equipment foundation. You aren't isolating the control airplane from that equipment. you are really simply controlling that machine much more granularly.

and then finally or not it's no longer the end of hardware innovation. There are lot of issues which you can do in silicon if you want to assist and boost community efficiency and that does not get supported in a white container. It gets supported by using real innovation in silicon itself. So those are the important thing issues that aren't SDN.

And what i might like to also share with you is we have now developed an ecosystem of utility-described networks as smartly. So now not handiest it is going to re-aid our personal items, however we can help different people's items as well, so third-birthday celebration virtual switches and infrastructure, all of us work with third-celebration controllers as neatly on account of our open-regular ability.

we will work with different corporations around the software layer. we are going to improve our own utility. And well-nigh have an software ecosystem with our companions and different corporations. The idea right here is to give back-to-back client alternative, their alternative and how they construct their SDN-enabled network.

and they can assemble it one piece at a time. here is now not a rip and change. And really, what i'll share with you is right here's our version of how the shoppers will undertake SDN. So first, they will lay the foundation with OpenFlow-enabled switches. Then they are going to create a lab to participate in an SDN Controller applications and information applications. they will stream from that to in fact deploying purposes on their community after which from there in all probability constructing their personal applications after which finally deploying that enterprise-vast.

So this is going to take time. and it'll be a migration. It should not a rip and change. And what's exciting is in case you think about it, you can also use your SDN Controller emigrate your network from the place it is nowadays to SDN as a result of practically using that controller you could virtualize materials of your network or you can automate parts of your community while nevertheless managing the network that you've it's there today. So in any case, that is the adoption and that's the reason what I even have these days to discuss with you about SDN. thanks.

question-and-answer Session

Brian Marshall - ISI neighborhood

incredible. Now, we will swap into the query-and-reply session of the discussion. however Bethany, I feel one of the enjoyable areas, if you go again to the most recent salary call that Meg and Cathy variety of singled-out is that HP is without doubt one of the areas that they believe in. HP Networking is likely one of the areas that they have confidence and most self assurance in going forward. are you able to talk a bit bit in regards to the sources of the self assurance internally, I mean, is it with appreciate to the pipeline, the channel, the products et cetera?

Bethany Mayer

well, I feel that first the momentum has been very wonderful. we've endured to grow in financial uncertainty and all forms of distinct areas, however the growth has been very good and superb. additionally, the innovation has been very strong. HP has very potent organic innovation and it is so pleasing to be a part of it. And that innovation is evidenced in many, many things we do together with the SDN capabilities that we've put in place for our purchasers.

So I suppose they are regarding the momentum we've had. we now have put in place an excellent go-to market group. we've leveraged our channels very closely. We're at 96% channel leverage. So it truly is very diverse than our rivals. And we've a extremely robust relationship with our channel companions. And all of those things collectively combined I believe provide them potent self assurance in our business unit.

Brian Marshall - ISI group

if you feel about HPs market share historically in networking, our perspective is that or not it's been tons more desirable within the campus and the department side of the publish to the facts middle. I guess if you may make clear some of that. and maybe focus on what probably the most ambitions are and the visions for constructing a higher presence on the facts middle switching facet.

Bethany Mayer

So HP begun in networking with the aid of constructing ProCurve, which a lot of you can also learn about, ProCurve, became a campus and department offering most effective and really very a success, very quick turning out to be enterprise for HP, very resourceful technologies, with its own ASICs. We still have our own ASICs within our business unit. And a robust player in the campus, in fact form of crept up there very instantly in market share in the campus environments.

We now as a result of having acquired 3Com in 2009 and then finalized that acquisition in 2010 have a really large breadth of product that runs from information center through campus and department. And now we have achieved loads of work inside HPN to build our facts core portfolio, which is now really very match with items that encompass the core change capabilities, our core routing functionality in addition to our right of racks and then utility capabilities round virtualization.

So we recognize today that according to Infonetics as a result of they do segmentation within the network, I feel we're at 10.5% share in information middle, however we're growing to be quick there historically from what I've considered in market share numbers. And so we have an extended way to go, no doubt, however I think very decent in regards to the innovation we need to offer to consumers and i do think good that obviously from our momentum greater americans are buying our products.

Brian Marshall - ISI neighborhood

in case you confer with the investment group, I feel there is a few already predetermined believes about the have an effect on that SDNs going to have on the profitability of infrastructure gadget going ahead. I suppose many issues by way of definition literally casting off some intelligence, some controls and intelligence from a change and placing it right into a low margin server you then would have some income migration from that change into the server.

Bethany Mayer

What do I suppose about that?

Brian Marshall - ISI neighborhood

yes, if you can touch upon that?

Bethany Mayer

So, both are entertaining to me. So couple of issues, one is back to the ASIC thing; it in fact concerns a lot for a network performance, just FYI. however despite the fact that you had been to claim the entire intelligence goes into the handle plane, neatly, basically we're k with that. as a result of, frankly that price we bring to the network is around the intelligence within the network within the automation and within the virtualization of the network. in order that intelligence is of value to the customer and to ordinary cost.

And so we accept as true with a good way to in reality be a really effective income pull for us. And interestingly satisfactory, in case you examine VMware, I suggest, they don't have any hardware, but their profit pull share is first rate. And it be that controlled mechanism that matters to people, that management capacity, the automation that you just bring to bear, that's your price. and i would say the other piece is, your ASIC can support you and can supply lots of capabilities as smartly.

Brian Marshall - ISI community

in case you take that line of thinking one step further, I suggest, certainly you guys are the number two participant during this space. you may have received a gorgeous big juggernaut with perhaps 70% of the market as incumbent, but are you able to speak in regards to the expense elasticity of the market, peculiarly with respect to a few of these new traits that are coming down the pipe. I suggest, is there an capacity to potentially pressure share beneficial properties with the aid of altering a little bit of where the gains lie in the equation?

Bethany Mayer

yes, completely. I imply, our converged infrastructure capabilities definitely add to that because frankly if there is a switching port that matches within the server or if it suits in a storage equipment, i am ok with that. I suggest, if the consumer desires to converge these technologies and have a fabric that goes throughout them that has a fewer packing containers, this is not a foul thing for us.

We agree with strongly that converged infrastructure is the way that the market will go. And we have seen that with our opponents because they've also really imitated us. and albeit that skill is entertaining to HP as a result of we personal the servers, the storage and the networking. And it's no longer a packaging exercise. there's the big change between partnering for packaging versus truly doing R&D organically for your own company around these three technologies. So HP is very at ease with these shifts within the industry and in the networking space. and that i suppose that had been competent to take very powerful talents of that.

Brian Marshall - ISI community

if you suppose about it I think one of the vital merits of that HP Networking has is early adoption, surely very early with appreciate to the trends of SDN, supporting it again in 2007, 2008. I feel over 15 million OpenFlow-enabled ports available in the market nowadays. but you talk plenty about the value of ASICs, absolutely Cisco, as well as Juniper and others, have relatively robust ASIC development companies, moreover what you guys present. are you able to talk a bit bit about might be one of the most differentiating traits of HP's SDN method relative to one of the most different guys, I imply, is it in reality being early-to-market, ASICs et cetera.

Bethany Mayer

well, early-to-market is important. but frankly, we think we will marry intelligence both within the device itself with giant capabilities and robust control capabilities in application. And we would not have a predilection between where we put that, appropriate. We're chuffed with it being intelligence in a single vicinity and not necessarily intelligence throughout all bins, correct.

So from my point of view, I feel our differentiation may be partly round convergence, as a result of that converged means that we are absolutely working on inside HP is an advantage that we've that none of our competitor in the networking house can suit today, that is very key.

And our SDN capability, in case you believe about it, can be extended significantly across loads of distinctive devices and technology in the structure of the infrastructure. It could also healthy into different orchestration capabilities that HP presents. So we have a very, really strong differentiation with the commercial enterprise neighborhood and our application group. And even if you believe about it, it could go the entire manner right down to our contraptions listing and conclusion-to-conclusion thought with our ElitePad as an example are the use of SDN for network security in a BYOD answer. there is lots of capabilities here that I suppose differentiate us very strongly.

Brian Marshall - ISI community

and you outlined earlier to your slide presentation that the deployment of SDN should still be commercial enterprise-vast through 2015, is that form of the timeframe by which you possibly can predict a lot of disconverged infrastructure tackle a ramp-up as smartly. I suggest, is this all going to ensue without delay or can you layer in different pieces to the puzzle? after which, as we're able to go along with SDN, we can just flip the switch and switch it on or will we future-proof, in case you will?

Bethany Mayer

I do feel it be a migration. I believe that people will make the most of SDN in distinctive ingredients of their network for diverse functions, for a duration of time. I think they are going to use SDN emigrate to SDN, consider it or now not, since it's a handle mechanism, correct. so you can control definite ingredients of your community with it and you can truly transition different materials of your community using it as a manage aircraft.

So I do suppose or not it's going to be a transition. The enterprise, rightfully so wants to ensure that anything answer they put in the infrastructure will work and may no longer cause them downtime, I completely recognize that. And so we will offer them different sorts of capabilities that they could take competencies of SDN without feeling like they're concerned about their usual infrastructure. it truly is our plan.

Brian Marshall - ISI group

I believe it sooner or later, I mean, what we see, being adopted with the aid of the market is, how will we keep prices? How can we reduce CapEx and OpEx?

Bethany Mayer

it'll.

Brian Marshall - ISI group

and i feel should you seem to be at the purposes; many individuals focus on SDN as really enabling the introduction of heaps of functions. however after I check with individuals within the trade, what I hear is that that doubtless 4 or five community virtualization, network tapping, security, 4 through 7 capabilities in management. Do you suppose that the lion share of the market; we estimate this generally is a $three billion market by 2016, I feel your slide observed $2 billion by using 2015. I consider will these four or five leading purposes represent the lion share of that market?

Bethany Mayer

maybe, however additionally I form of need to say I don't know, because purchasers will be capable of make the most of APIs to do what they need with it, if they opt for too. And so I believe we are going to be shocked via people who create diverse purposes for the community that we have not thought of nowadays. and that i believe there are lots of percentages. and i feel around the layer four via 7, there is a few exciting issues for you to do this we truly do not do even nowadays, right.

We do a lot with our business functions that are everyday, but there's a lot of new purposes that people are crating within the mobility space that may have an affect on that too. So I guess my position is I consider there might be some typical ones that absolutely everyone are looking to focus on and that i get it. but I consider there might be additionally others that we just do not know about yet these days.

Brian Marshall - ISI neighborhood

can you speak via a bit bit concerning the pieces of VAN, the digital application networks approach? Can VAN ultimately integrate with other cloud and virtualization platforms going forward?

Bethany Mayer

virtual software Networks is our management idea for functions within the community. So it really works along side SDN and the SDN controller to in fact supply. So the SDN controller makes a speciality of services in the infrastructure. The VAN utility specializes in administration of the infrastructure. and you can marry these two fantastically, and so we make the most of virtual utility network technologies inside our clever management core to do lots of the automation that we do nowadays even with out SDN.

so that you can use it to literally cable up a swap, play it into an Ethernet port and the clever administration center the usage of virtual application networks, will go in, will locate that equipment, will configure that gadget and truly have you ever be in a position to utilize it as a pool of elements to your community itself. So it be an automation tool even nowadays. And it be used very comfortably to manipulate the networking ambiance after which we'll couple it with our SDN capabilities, so as to manage the functions.

Brian Marshall - ISI neighborhood

Are there any questions from the dial-in queue? if you are pulling that might be i may just continue. if you feel about you mentioned how you're going to kind of combine the VAN and the SDN network software application alternatives going forward. can you talk a little bit more? I suggest, are you able to start to present more form four through 7 functions longer term? And if so how do you believe in regards to the use of home equipment in that variety of market? I suggest do you feel sooner or later that many of the four through 7 implementations going ahead will in reality be from the application perspective or do you think these home equipment might be required?

Bethany Mayer

well, I suppose once more lower back to the migration and it will take time. I believe that folks will migrate to diverse implementations of 4 via 7 features. So in some cases, they will make the most of the network and SDN and in one other cases they can also use contraptions themselves. because back to that there are certain styles of community performances that be greater, you can be in a position to use a device in certain instances. however as an example, which you could installation Microsoft Lync across a whole infrastructure using SDN.

that you can deploy diverse types of business functions that are very delicate to community performance moderate trade as an instance using SDN. and you may additionally utilize these layer 4 through 7 capabilities that you just definitely construct into the controller, in order that the community is aware of, ok, here is an trade packet this is going throughout, a MAPI packet that requires definite services of the community, for this reason the network will alternate to be in a position to guide MAPI, It is awfully chatty.

So I suppose that there might be lots of distinctive styles of concepts to aid diverse purposes on the community. And in some instances that will be really dissolved into the fabric itself the use of SDN and in some circumstances you may additionally opt for an equipment as neatly for that intention.

Brian Marshall - ISI community

Operator, are there any questions from the dial-in.

Operator

currently we have no questions.

Brian Marshall - ISI neighborhood

ok, i'll take one from the webcast category-in. Bethany, for the reason that you debunk the end of hardware improvements delusion in the presentation. What are your views on switching margins within the SDN paradigm?

Bethany Mayer

The margins are based on cost. They aren't in line with like how plenty a connector charges. And besides the fact that you look at home equipment these days and that i'll provide you with a pretty good example of Blue Coat was an appliance. We used truly an industry-based mostly motherboard. I imply, there wasn't as a lot of expertise within the motherboard, but we offered the appliance at incredible gross margin. So I believe margins are related to value.

And in case you construct potent value in the gadget itself that gives enhancement to the network efficiency, I think you'll nevertheless see respectable margin chance in contraptions. And additionally returned to that theory of imposing OpenFlow into a tool, there are lot of things which you can do in an ASIC to enhance OpenFlow and OpenFlow understandings. So this goes lower back to that clever equals' margin. And my opinion is that the intelligent can nevertheless advantage the instruments themselves as neatly because the handle aircraft software that you are making use of.

Brian Marshall - ISI group

I think we now have time for an additional query. We're developing on 45 minutes right here, but I think it comes returned to, are there any talents cannibalistic effects going forward? I imply, if you feel about the Sentinel safety utility, I believe you outlined it really TippingPoint, and there is going to be some other safety tie-ins, as that I believe HP obviously presents with respect to ArcSight and others, but on the conclusion of the, is this going to be additive to the HP Networking chance or will or not it's some kind of substitution for some thing else in the portfolio. are you able to speak a little bit variety of places and takes there?

Bethany Mayer

well, I believe that our protection firm is fitting more and more software oriented, I suggest, it's been there stance Arc do not need to focus on. And dissolving applied sciences into the switching material itself, even if its security or whether it be a different software in reality is very useful and you may nevertheless benefit returned to the value equals margin, you can nevertheless gain lots of salary from the software utility itself, appropriate. And the undeniable fact that it occurs to grow to be dwelling within the switching cloth, first, brings advantage to the client, however also makes the network tons extra standard.

So there can be capabilities to be able to emerge as being embedded within the switching material using application-defined networking. and that i feel that the aggregate of utility capabilities and intelligence in that SDN controller combined with the fabric and what that you may do to have an effect on the material using it, should be of price to purchasers.

So it's going to have an effect on to a few degree, some hardware within the community that are equipment-based, I suppose. however I suppose that is also to the benefit of the customer, and truly do not consider it's going to harm the vendor, as a result of once more if the supplier is bringing intelligence as their value, if it occurs to be in software, it truly is perfectly first-rate.

Brian Marshall - ISI group

maybe one remaining question from the webcast, it be a fascinating one. How does the applicability of SDN exchange according to the size of the client?

Bethany Mayer

So I wager the question is could or not it's applicable to smaller businesses, this is what I think the factor is there. I suppose that initially it has larger price for the greater commercial enterprise, since the business has much extra complexity. but you might also in reality, in case you idea about it you might possibly use SDN as a service issuer, presenting capabilities to a small-medium business in all probability, because you might help them control their network efficiency for distinctive functions like cloud functions they're deploying. it truly is very viable. however I do consider firstly and perhaps over an inexpensive amount of time, the higher enterprise, it's going to supply them greater capabilities than a small-medium company.

Brian Marshall - ISI neighborhood

With that i might like to thank you very a whole lot for taking the time today. It turned into wonderful chat with Bethany Mayer, the Senior vp and regular supervisor of HP Networking, and Nitesh Sharan from HP, IR. Thanks guys. And as always, it be again to work.

Bethany Mayer

thanks.

Operator

thanks. This concludes your convention. You may additionally now disconnect.

more From seeking Alpha


Work advances on state govt center in West Boise | killexams.com Real Questions and Pass4sure dumps

BOISE — Idaho state lawmakers decided two years in the past to buy the former Hewlett-Packard campus in West Boise and make it a middle for state offices, however up to now no state corporations have moved in.

development is underway, besides the fact that children, and the primary 150 state personnel, from the state Tax fee’s audit division and print center, will stream in Dec. 15.

“We introduced it to the group of workers last week,” referred to Ken Roberts, chairman of the state Tax commission, who joined lawmakers on the Joint Finance-Appropriations Committee for a tour of the HP campus on Monday.

At its height, the 200-acre HP campus on Chinden Boulevard was the core for the excessive-tech company’s Idaho operations, together with printer manufacturing, and greater than 7,000 excessive-tech employees were employed there in the back of closed gates. The campus was rumored to be a superb area to work, with grounds that featured jogging trails, soccer fields, picnic facilities and ponds; those are actually all state-owned, and for the primary time in years, open to neighbors who wish to jog or walk their canines.

“The state owns this property now,” Bob Geddes, state department of Administration director, informed JFAC on Monday. “It’s our intention to fill it up and utilize it.”

Idaho closed on its $110 million buy of the campus in December 2017, about six months later than originally deliberate, Geddes pointed out. “The negotiations took plenty longer than we predicted,” he observed.

The driving force was to locate a new domestic for the state Tax commission, whose current Park Boulevard vicinity, within the former Morrison-Knudsen office complex, became bought by using St. Luke’s. however the purchase of the HP complex opened up the probability for whatever thing much greater, Geddes mentioned, allowing state organizations now scattered across rented areas to be consolidated in a single location that’s additionally much more not pricey for the state than the pricey downtown core of Boise.

Idaho is presently paying $eight million a 12 months to lease inner most workplace space, he referred to.

“This buy could be a tremendous asset for the state of Idaho,” Geddes informed lawmakers. “This over time will become the solution to loads of the transforming into pains that Idaho is experiencing right now and should be sooner or later.”

Idaho bought the complicated for $110 million; it financed the buy through a $139 million bond issue permitted through the Legislature, with the additional $29 million covering building renovations, asbestos removal and related initiatives. The bonds might be paid off in a bit greater than 28 years; rent paid by using both the current tenants and state organizations will cowl the payments, which are just lower than $8 million a 12 months.

Hewlett-Packard nonetheless occupies about half the site, including four buildings; it now can pay employ to the state of Idaho. Two different tenants with current leases are also staying on with the state because the new landlord, but one of those, Sykes, a giant name-core enterprise, these days renegotiated its lease and vacated two floors early, which is what’s enabling the first batch of state Tax fee personnel to stream in.

The the rest of the Tax commission’s roughly 500 employees received’t movement in until subsequent summer time, when construction may be accomplished on their new web page within the complicated’s constructing 2. At that aspect, the audit and printing center laborers will flow next door from the present Sykes site, which they’ll occupy for about eight months, and be a part of the relaxation of the company.

“It’ll mean a double stream,” Roberts observed. but considering the now-vacant Sykes floors are move-in capable, finished with cubicles that the enterprise is leaving at the back of, he stated the divisions of the Tax fee can movement right in.

also scheduled to movement to the HP web site in the subsequent yr: The Idaho Public Utilities commission and the Idaho Industrial commission. a lot of different businesses also are weighing moving to the site when their existing leases expire.

“We’re enthusiastic about this — we want it,” talked about Eric Anderson, state PUC commissioner. “It’s going to be a very good stream.” He noted the agency is in talks with the city of Boise about buses or shuttles from downtown to the web page.

The PUC is scheduled to stream to the West Boise campus in September 2019. Its latest vicinity, simply blocks from the state Capitol, changed into bought at public sale via the state endowment, as a part of its move to get out of possessing industrial property. the brand new inner most proprietor submitted a bid, however the PUC liked the West Boise website greater.

Rep. Melissa Wintrow, D-Boise, talked about, “It’s sort of an intriguing prospect so far as ease and accessibility, to have organizations all in the identical place with all this parking.” The web page at the moment has 5,400 parking areas. “There’s a lot to be mentioned for centralizing the offices so that they’re purchasable to residents.”

Sen. Shawn Keough, R-Sandpoint, co-chairwoman of JFAC, observed, “We naturally have corporations that are paying hire to be in a downtown enviornment that’s turn into prohibitively costly. in the long run, here is probably a far better use of the taxpayer dollar.”

Geddes touted the stream as one which’s most economical for the state and no burden to taxpayers, as no tax enhance was required to finance the deal. however, the HP campus, as it was formerly privately owned, did come off the local property tax rolls when the state purchased it; it’s now exempt from property taxes. That means about $1 million a 12 months in property taxes in Ada County get shifted to different property taxpayers to make up, which Wintrow noted considerations her.

Geddes observed any property the state buys could be exempt. And with varied state companies taking a look at relocating to the web site, there’s even the possibility that the Idaho Transportation branch might, sooner or later, make a decision to promote its State highway property and circulation to the HP website. that would enable the ITD property to be bought and go onto the tax rolls, and it seemingly would be valuable and incredibly well known, given its proximity to the desirable Whitewater Park area.




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Hewlett Packard Enterprise (HPE) CEO Antonio Neri on Q2 2018 Results - Earnings Call Transcript | killexams.com real questions and Pass4sure dumps

No result found, try new keyword!Hewlett Packard Enterprise (NYSE ... Aruba Product grew 18%, with continued strong growth in campus switching and a rebound in wireless LAN, despite tough compares in the prior year. We’ve also starte...

Waterfalls and flywheels: General Motors’ new hyper-green data center | killexams.com real questions and Pass4sure dumps

A look down the completed "data hall" of GM's Warren Enterprise Data Center. With 2,500 virtual servers up and running, the center is at a tiny fraction of its full capacity.A look down the completed "data hall" of GM's Warren Enterprise Data Center. With 2,500 virtual servers up and running, the center is at a tiny fraction of its full capacity. General Motors reader comments Share this story
  • WARREN, Michigan—General Motors has gone through a major transformation since emerging from bankruptcy three years ago.  Now cashflow-positive, the company is in the midst of a different transformation—a three-year effort to reclaims its own IT after 20 years of outsourcing.

    The first physical manifestation of that transformation is here at Warren, where GM has built the first of two enterprise data centers. The $150 million Warren Enterprise Data Center will cut the company's energy consumption for its enterprise IT infrastructure by 70 percent, according to GM's CIO Randy Mott. If those numbers hold up, the center will pay for itself with that and other savings from construction within three years.

    Mott recently announced that GM's efforts to make the Warren data center's construction eco-friendly—including its energy-saving measures, solar-powered electric car charging stations in the parking lot, and recycling of 99 percent of construction waste—have earned the center a LEED "gold" certification from the US Green Building Council. Less than five percent of data centers have LEED certification.

    The data center is part of a much larger "digital transformation" at the company, Mott said. GM is consolidating its IT operations from 23 data centers scattered around the globe (most of them leased) and hiring its own system engineers and developers for the first time since 1996. Within the next three to five years, GM expects to hire 8,500 new IT employees with 1,600 of them in Warren. "We're already at about the 7,000 mark for internal IT from our start point of about 1,700," Mott said.

    On September 5, Jeff Liedel, GM's Executive Director and CIO for Infrastructure Engineering, gave Ars a personal tour of the Warren data center. While GM's needs are far different from that of big Internet companies such as Amazon, Facebook, or Google, it's clear that the automaker has cribbed from their notes on how to build data centers and how to create spaces that drive collaboration.

    While it will be years before GM reaches the capacity of the Warren data center, the company has already begun construction on another data center at the company's Milford proving grounds. Mott reiterated the expectation that the Warren site will pay for itself within three years. The savings won't just come from the 70 percent reduction in energy consumption, but there's a "holistic" effect of closing the 23 data centers around the world from GM's days of IT outsourcing.

    "In the IT business, you only get to build a data center once every 20 years or so," Liedel said.  "We needed to get this right."

    Building a cloud, under one roof GM's IT Operations and Command Center, where all of GM's IT infrastructure—including its partner network, OnStar systems, and design and engineering systems—is monitored and controlled. Enlarge / GM's IT Operations and Command Center, where all of GM's IT infrastructure—including its partner network, OnStar systems, and design and engineering systems—is monitored and controlled.

    The first step in that transformation, Liedel said, was converting everyone running its IT operations to GM employees. Next came centralizing control over the company's widely-scattered IT assets.

    So far, three of the company's 23 legacy data centers have been rolled into the new Warren data center. That's eliminated a significant chunk of the company's wide-area network costs. "We have 8,000 engineers at (Vehicle Engineering Center) here," Liedel said. And those engineers are pushing around big chunks of data—the "math" for computer-aided design, computer aided manufacturing, and a wide range of high-performance computing simulations

    "Now with the data center on the same campus, we're not paying for the WAN bandwidth we had before," Liedel explained. "We've got dark fiber here on the campus, and the other major concentration of engineers is at Milford at the Proving Ground." Milford and Warren are connected over fiber via dens wave division multiplexing, providing 10 channels of 10-gigabit-per-second bandwidth.

    GM has also centralized control of all of its data centers at Warren in a new 180,000 square foot IT Operations and Command Center adjacent to the data center. From the OCC, GM's IT operations team oversees the entire GM global network—including the growing cloud infrastructure within the Warren data center itself.

    "Cloud is an integral part of the data center," Liedel said. "We offer compute infrastructure as a service to the developers in the IT organization. I've been in IT for 25 years now, and I think 'We're waiting for a server' is a really lame excuse for being late with an IT rollout. The long pole should be the requirements, code or testing."

    For GM, cloud means automated provisioning of virtual servers within its existing computing hardware (which is largely made up of Hewlett-Packard blade servers in HP C7000 enclosures), using tools from HP, IBM, and VMware. The automated provisioning system GM has put in place allows Liedel's team to turn around requests for new servers in about two hours. That's not as fast as Amazon, but GM has some needs that require a bit more time to handle.

    "We build firewall rules, set which what protocol ports are open, and configure load balancers and do an active-active replication between data centers," Liedel explained. "And we perform security scans and signoffs. There are things you need to handle with applications, like 'do you need sticky bits on the load balancer, so it hits the same server every time you ask for something in a session' and  'do you need SSL setups?' Some of those things, the tools don't do that yet.  But a lot of what we do is automated."

    One of the hot-aisle containment pods in the Warren Enterprise Data Center—this one chock full of HP disk enclosures. Enlarge / One of the hot-aisle containment pods in the Warren Enterprise Data Center—this one chock full of HP disk enclosures.

    There are currently about 2,500 virtual servers running in the Enterprise Data Center, 88 percent of which run on GM's two standard provisioned operating systems: SUSE Linux and Microsoft Windows 2008 R2. Where the cloud provisioning system breaks, said Liedel, is in that other 12 percent "where they leave the cloud and we have to build custom infrastructure."

    GM isn't using software-defined networking as part of its cloud. "We use a lot of VPNs and a lot of LAN segments on the same hardware for traffic control as well as security," Leidy said. That's particularly true for a group of systems Liedel showed me racked up alongside each other in one of the data center's thermally isolated "pods"—GM's Enterprise Data Warehouse.

    GM's data warehouse consists of a cluster of IBM servers running a Hadoop cluster, a Teradata analytics "appliance," and another rack of HP compute servers running visualization and reporting tools on VMware virtual server instances. (That includes server software from Cognos.) Liedel said that GM uses Hadoop to normalize its masses of data and then uses the Teradata analytical engine to perform deep analysis on it.

    Keeping it cool The Warren Enterprise Data Center has a 47-inch raised floor, with redundant cooling, electrical, and network distribution run to each rack. There are two high-speed backbone rooms, separated from the data center by dual physical firewalls. The rooms support all of the data center's inbound and outbound connections including the corporate VoIP phone network, telepresence, and connections to GM's partners. Enlarge / The Warren Enterprise Data Center has a 47-inch raised floor, with redundant cooling, electrical, and network distribution run to each rack. There are two high-speed backbone rooms, separated from the data center by dual physical firewalls. The rooms support all of the data center's inbound and outbound connections including the corporate VoIP phone network, telepresence, and connections to GM's partners.

    Aside from shedding the leases and leased lines, one of the biggest sources of savings at Warren is expected to be its energy efficiency. Part of that comes from the design of the data center itself, and part of it comes from being in Michigan.

    "We take advantage of the cold weather we have eight to nine months a year," Liedel explained. The data center's cooling system includes three "waterfall" evaporation chillers, with three monster-sized refrigerating chillers as backup that sometimes heat the water up.  "Sometimes when it's colder, we have to heat the water to 53 degrees," Liedel said—because at lower temperatures, the water would cause moisture in the data center's air to form condensation.

    Two chillers are enough to handle the current capacity of the data center, but there are three for redundancy. There's also infrastructure in place to add more chillers as the capacity of the data center expands. Alongside the evaporative waterfalls, there are huge "thermal storage" tanks. The tanks hold a reserve of 30 minutes worth of cooling water in the event the cooling system loses power—it can take up to 30 minutes to get cooling water back to the right temperature if the system goes offline, Liedel said.

    Another part of the data center's cooling efficiency comes from the "in-row" coolers. Six of these coolers—essentially chill-water cooled air conditioning units—are installed in each of the data center's thermal containment pods. These pods are groups of racks arranged in a rectangular block with a common "hot aisle" behind them. Each pod has a heat containment "roof," a retractable plastic sheet that covers the hot aisle.

    "Servers will adjust their current draw and their cooling fans based on their load," said Liedel. In data centers with central HVAC, that can play havoc with cooling, since some areas will be hotter than others. But with individual in-row coolers only three racks at most away from a set of servers, it's easier to deliver cooling just to the areas where it's needed and run the HVAC for the whole facility much more efficiently. If cooling fails in one of the data center's pods, its roof automatically retracts to allow the general HVAC to pick up the load.

    Almost no batteries required One of the Warren Enterprise Data Center's two diesel generators.One of the Warren Enterprise Data Center's two diesel generators.

    Aside from its energy efficiency, GM's Warren Data Center picks up green cred in the way it handles its emergency power. Instead of using an array of lead-acid batteries to provide current in the event of an interruption of power, the data center is equipped with uninterruptible power supplies from Piller that use 15,000 pound flywheels spinning at 3,300 revolutions per minute.

    The stored momentum in the flywheels can turn an emergency generator in order to provide power for up to 15 seconds while the data center's two giant 5,800 horsepower diesel generators come online. There are also two 6,400-gallon diesel fuel tanks—enough for the generators to produce three megawatts of power for up to 48 hours. These tanks can be continuously refueled to keep the data center up and running indefinitely.

    All of the energy coming into the data center, both from the utility lines and from the backup generators, is used to power "motor generators." Rather than being passed directly into the power grid of the data center, the outside power is used to run these internal generators, mostly to prevent outside spikes or variations from being passed on to the power distribution system.


    Hewlett Packard Enterprise Company (HPE) Q2 2018 Earnings Conference Call Transcript | killexams.com real questions and Pass4sure dumps

    Image source: The Motley Fool.

    Hewlett-Packard Enterprise Company (NYSE: HPE)Q2 2018 Earnings Conference CallMay 22, 2018, 5:00 p.m. ET

    Good afternoon, everyone, and welcome to the second quarter Fiscal Year 2018 Hewlett-Packard Enterprise earnings conference call. My name is William and I will be your conference moderator for today's call. At this time, all participants will be in a listen only mode. We will be facilitating a question and answer session toward the end of the conference. Should you need assistance during the call, please signal a conference specialist by pressing the * key followed by 0. As a reminder, this conference is being recorded for replay purposes.

    I would now like to turn the presentation over to your host for today's call, Mr. Andrew Simanek, Head of Investor Relations. Please proceed.

    Good afternoon. I'm Andy Simanek, Head of Investor Relations for Hewlett-Packard Enterprise. I'd like to welcome you to our Fiscal 2018 second quarter earnings conference call with Antonio Neri, HPE's President and Chief Executive Officer, and Tim Stonesifer, HPE's Executive Vice President and Chief Financial Officer.

    Before handing the call over to Antonio, let me remind you that this call is being webcast. A replay of the webcast will be made available shortly after the call for approximately one year. We posted the press release and the slide presentation accompanying today's earnings release on our HPE investor relations webpage at investors.hpe.com.

    As always, elements of this presentation are forward-looking and are based on our best view of the world and our businesses as we see them today. For more detailed information, please say the disclaimers on the earnings materials relating to forward-looking statements that involve risks, uncertainties, and assumptions. For a discussion of some of these risks, uncertainties, and assumptions, please refer to HPE's filings with the SEC, including its most recent form 10-K.

    HPE assumes no obligation and does not intend to update any such forward-looking statements. We also note that the financial information discussed on this call reflects estimates based on information available at this time and could differ materially from the amounts ultimately reported on HPE's quarterly report on form 10-Q for the fiscal quarter ended April 30th, 2018.

    Finally, for financial information that has been expressed on a non-GAAP basis, we have provided reconciliations to the comparable GAAP information on our website. Please refer to the tables and slide presentation accompanying today's earnings release on our website for details.

    With that, let me turn the call over to Antonio.

    Thanks, Andy and good afternoon, everyone. Thanks for joining us today. Let me begin by saying that I'm very pleased with our strong performance in Q2. We continue to execute well across all business segments while delivering on a number of strategic initiatives. Revenue of $7.5 billion was up 10% from the prior year period. We experienced solid revenue growth across each business segment with particular strength in intelligent edge, high performance compute, storage, hyper converged, and composable infrastructure.

    From a micro perspective, the IT market remains robust. We saw growth in all regions with particular strength in both EMEA and APJ. Currency was a larger year over year benefit, providing a three-point tailwind this quarter. Given our strong execution held by a $0.01, we delivered a non-GAAP EPS of $0.34 above our average range of $0.29 to $$0.33.

    Looking at cashflow, our free cashflow was -$269 million in Q2. We remain confident in our full year outlook or approximately $1 billion in free cashflow and we'll provide more color on this in a moment.

    Finally, in Q2, we begin executing against our $7 billion capital return plan we announced last quarter. We returned $1 billion to shareholders in the form of share repurchases and dividends and we announced that we are raising our dividend by approximately 50% starting in the current third quarter.

    Looking forward, as a result of our performance in Q2 as well as the continued benefit from a lower tax rate, we are raising our Fiscal Year 18 non-GAAP EPS outlook to $1.40 to $1.50 from our previously provided outlook of $1.35 to $1.45. Tim will provide more details in a minute.

    Before I turn to the business segment performance, I want to give you an update on our progress with HP Next. As a reminder, HP Next is our companywide initiative to rearchitect HPE to deliver on our strategy and drive a new wave of shareholder value. It's all about simplification, execution and innovation. Through this initiative, we are simplifying our operating model and the way we work. We are streamlining our offerings and business processes and modernizing our IT systems to improve our execution. We are shifting our investments in innovation toward high growth and higher margin opportunities.

    Over the first half of this year, we have achieved some significant milestones across each of these areas. For example, we have reduced spans and layers between the CEO and the customer. We have significant streamline of our structure, empowering the front line to make key additions. And we have dramatically reduced SKUs and platforms across our volume and value segments, which simplifies our operation and makes us easier to work with. Moving into the second half of the year, we'll be concentrating our efforts on the next phase of the initiative, including building out our no touch sales model and accelerating our IT transformation to better service customers and partners.

    The changes we are making through HP Next will not only improve our cost structure, they will also give us a significant long-term competitive advantage. I am very proud of the work we are doing here. While the decisions we are making are for the long-term, you already are already beginning to see the benefits in our financial results. In Q2, we delivered an operating margin of 8.6%, up 270 basis points from last year, due in part to the effective execution of HP Next.

    Turning to our business segments, we saw solid performance across the board while continuing to deliver innovation in key areas of our platform. In Intelligent Edge segment, revenue grew 17% year over year, with strengths in both products and services. Wireless LAN revenue rebounded as expected after a softer Q1 and wire switching remains strong. While, still, a small portion of our overall product sales, we saw strong customer traction IoT systems, including a significant win with a global financial services company. These results bode well for our future.

    Our customers tell us they want to take advantage of exploring the amount of usable data being created at the edge. We heard that. We continued to make investments to build out our Intelligent Edge platform. For example, in Q2, we strengthened our platform with the acquisition of Cape Networks. The Cape acquisition is the latest steps toward our vision of autonomous infrastructure enabled by artificial intelligence.

    Cape expands Aruba AI power networking capabilities with a sense of base network insurance solutions that improves network performance, reduces disruption and significantly provides IT management for our customers. We also introduce Net Insight, another complementary AI-based analytics, reduces disruption insurance solution for optimizing network performance. Net Insights uses machine learning to continuously monitor the network and deliver insights in the event of anomalies. It also recommends how best to optimize the network for today's mobile first and replace critical IoT devices.

    Looking forward, we see significant potential in Intelligent Edge. This will continue to be a key area of investment for us. Turning to Hybrid IT, revenue was $6 billion, up 7% year over year with solid performance across all segment. Compute grew 6% year over year and 9% if you exclude tier one. We saw very strong growth in high-performance computer, composable infrastructure, and hyper convert, offset by the continued decline in our customized commodity server sells to tier one vendors, a business we are moving away from.

    Our focus continues to be on providing solutions that deliver high value differentiation to our customers and to our profitable share for HPE. We continue to prioritize investment in those higher margin, higher growth segments of the market. For example, just last week, we announced the acquisition of Plexxi. Plexxi provides innovative software-defined networking technology, which we plan to integrate into both SimpliVity, our hyper converge offering, and Synergy, our composable infrastructure offering. With Plexxi, we will enable customers to move and manage their data more quickly and effectively and also significantly reduce CapEx and OpEx by up to 50% in some cases.

    Storage performed very well, up 24% year over year with a nimble acquisition and up 14% organically. All-flash continued to perform well, growing 20% year over year as the market continues to transition and we benefit from our strong position with both 3PAR and Nimble. And earlier this month, we introduced the next generation in storage platform, which is guaranteed to deliver the best storage efficiency of any all-flash array on the market.

    Data center's working revenue was up 2% year over year with good execution within our existing install base. Finally, turning to services, HP Pointnext revenue grew 1% year over year in Q2. We saw it pick up in orders in deals that flip from Q1 and strong customer traction from our newest offering called HP GreenLake. HP GreenLake is a suite of paper use solutions available for top customers or loads like big data, SAP HANA and Edge Computing. The offering simplifies the IT experience and gives customers choice of where workloads should live and how to flexibly consume them. This is an offering we will continue to expand. Look for updates soon.

    And in Q2, we also continued to strengthen our advisory capabilities, building on our acquisition of cloud technical partners with the acquisition of RedPixie. RedPixie is a UK-based cloud consulting company with deep Microsoft Azure expertise, which perfectly complements CTP's strong AWS relationship. We are excited about the capabilities this acquisition brings to HPE and already seeing them open doors to new and bigger deals.

    HP Financial Services also performed well in the quarter, with revenue up 5% year over year, leading with strong growth in our asset management business. Customers are responding well to the actions we are taking, both from an operational and innovation perspective. They believe in our strategy, in the powerful portfolio of products and services we are building. That confidence can be seen in some recent wins.

    For example, in Q2, we won a major high-performance compute deal with the US Department of Energy. This is just the latest example of the strength of HPE's HPC portfolio and the value it brings to the US government in the nation, in international competition over computing power. We also won a new project with Time Warner, where Aruba was selected for the state of the art Hudson Yard Digital Workplace Project in New York City.

    And we announced a new supercomputer installation at KU Leuven, a Flemish research university, consistently ranked as one of the top five most innovative universities in the world. We have collaborated with the university to develop a deploy a new supercomputer specifically built to develop AI workloads. It will be used to build applications that drive scientific breakthroughs, economic growth and innovation in Belgium.

    Next month, we will host our annual HPE Discover conference in Las Vegas, bringing together thousands of customers and partners from around the world. We'll be making some exciting announcements at events and I look forward to seeing many of you there.

    So, as is said earlier, I'm very pleased with our performance in the first half of Fiscal Year 18. All of our business segments perform well. We made solid progress on HP Next and continue to invest in innovation that will further strengthen and differentiate our company into the future.

    Looking ahead to the rest of the year, as we indicated last quarter, we expect the growth rate to moderate given tougher competitors, lacking acquisitions, and a smaller currency tailwind. While we see a more challenging second half, we have got great momentum and I'm confident that we will deliver on our annual Fiscal Year 18 outlook.

    With that, I will turn it over to Tim.

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    Thanks, Antonio. Our Q2 financial results were strong, with robust revenue growth, significantly improved operating margins and better than expected earnings. Total revenue for the quarter was $7.5 billion, up 10% year over year and 6% in constant currency. Topline performance was driven by good market dynamics, solid execution, and both favorable year over year compares and exchange rates.

    From a portfolio mix perspective, we're seeing solid growth in our value offerings and our core volume business is growing better than expected. From a macro perspective, IT spending continues to be quite healthy with solid customer demand across all businesses and geographies. The pricing environment remains competitive but has continued to be more rationale and passing through elevated commodities cost.

    DRAM cost increases have also started to flatten. Currency drove a 330-basis point tailwind to revenue year over year. With that said, rates have moved somewhat unfavorably in the last month, so currency will not be as large of a benefit in the second half if these rates hold. We now expect closer to a 2-point benefit to revenue in Fiscal Year 18.

    Regionally HPE's performance in the Americas continue to be solid, growing 3% in constant currency. Most of the growth came from the US, Canada, and Brazil with strength in storage and the intelligent edge. Revenue growth in Europe continue to be strong, up 9% in constant currency, with double-digit growth in UK, France, and Italy.

    Performance in EMEA was strong across all business units with double-digit growth in compute, storage, in Aruba products and services. Asia Pacific grew 9% in constant currency with strong in China, Australia, and Singapore.

    Turning to margins, the gross margin of 30.4% was up 90 basis points year over year and 200 basis points sequentially. Non-GAAP operating profit of 8.6% was up 270 basis points year over year and 90 basis points sequentially. We continue to execute well this quarter with HPE Next savings driving most of the improvement. DRAM was also less of a pressure point as compared to prior quarters and we continued to gain traction on the pricing front.

    Going forward, margin improvement will be driven primarily by delivering the cost savings from HPE Next and delivering our value portfolio offerings, which have higher margins. Non-GAAP diluted net earnings per share of $0.34 is just above the high-end of our previous outlook of $0.29 to $0.33 due to strong operational performance and a tax rate benefit of approximately a penny.

    The Q2 non-GAAP tax rate was 9.6%, which is just below our previously provided tax range of 11% to 15% due to various one-time reductions in non-US tax expense. For the full year, we now expect our tax rate to be at the lower end of the 11% to 15% range, but we are still working through many variables associated with tax reform. GAAP diluted net earnings per share was $0.49 above our previously provided outlook range of $0.10 to $0.14, primarily due to releasing reserves we've been holding associated with HPQ tax risks that were part of our separation agreement, which has now been settled.

    Now, turning to the business units -- in hybrid IT, revenue was up 7% year over year and 4% in constant currency. Revenue performance was strong and balanced across all businesses in all regions. Operating margins were 10.3%, up 220 basis points year over year and 70 basis points sequentially and in line with our expectations.

    Compute revenue was up 6% year over year and 9% excluding tier one. We continue to see higher AUPs driven by passing through more DRAM costs, increasing our Gen10 mix and delivering richer tax configurations.

    We saw continued momentum in our value bass with high-performance compute growing over 20%, hyper converge up triple digits, and Synergy gaining increasing customer traction. As mentioned earlier, revenue growth in our volume business was higher than planned, driven by strong growth in core rack.

    Storage revenue was up 24% year over year with continued momentum in the organic business, up 14% year over year. We saw strong double digit growth and coverage storage driven by nimble and big data storage that has become a meaningful part of the portfolio. All-flash arrays grew 20% year over year. While the overall storage market remains competitive, we like our current position and expect to take 50 basis points of share this quarter, which will be the tenth time in the last 12 quarters where we've gained and maintained share.

    Data center networking revenue was up 2% with good execution primarily from our installed base in the Americas. HPE Pointnext revenue was up 1% year over year with operational growth for the seventh consecutive quarter. Overall orders grew 1% with even better growth and operational services, which was driven by our new HPE GreenLake flexible capacity offerings. Service intensity remains strong, but attached orders continue to be under pressure from lower hardware growth and richer hardware configurations.

    In the intelligent edge, revenue was up 17% year over year and 14% in constant currency. Operating margins of 6.5% were up 360 basis points sequentially due to the operating leverage from higher revenue but were down 110 basis points year over year due to significant investments in sales and R&D. Aligned to our strategy of pivoting to the intelligent edge, we've been making significant go to market and R&D investments that have given us the leadership position in this high-growth market opportunity.

    Aruba product grew 18% with continued strong growth and campus switching and a rebound in wireless LAN, despite tough compares in the prior year. We've also started to see good traction in our edge compute business. Aruba Services was up 10% on installed base growth due to strong attach of our software platform like ClearPass and Airwave.

    HPE Financial Services revenue grew 5% year over year and 1% in constant currency, driven by strong residual sales and growth in our direct business that was somewhat offset by lower operating release mix. Volume was flat as growth in our direct business was offset by the pressure in our indirect business. Operating profit declined 90 basis points year over year to 7.9% due to one-time items.

    Now, turning to cashflow. Free cashflow was -$269 million in Q2. The cash conversion cycle was in line with expectations and decreased sequentially by one day to -22 days. Both inventory and payables were elevated in the quarter due to strategic positioning of key commodities and somewhat higher pricing. We also entered the quarter with an operating company net cash balance of 3.5%. Looking forward, we're still on track to achieve our free cashflow outlook of approximately $1 billion in Fiscal Year 18as the second half benefits from a few items.

    First, we expect cash earnings to ramp, aligned with normal seasonality and the cost savings from HPE Next. Second, working capital will be a source of cash versus the use of cash in the first half with the cash conversion cycle improving to the negative-high 20-day range, similar to our Q4 exit range. Last, we have fewer one-time payments and expect incremental real estate sales toward the end of the year.

    Moving to capital allocation, as part of our $7 billion capital return plan through Fiscal Year 19, which we announced in Q1, we returned $1 billion to shareholders during the quarter. This includes $907 million of share repurchases and $116 million of dividend payments. As previously communicated, we raised our quarterly dividend by 50%, which will be payable in July.

    We also announced today that we'll be redeeming $1.6 billion of our bounds maturing in October at the end of June. The bond redemption is consistent with our capital allocation approach, which includes maintaining an investment grade credit rating. Going forward, we intend to run the operating company with net cash neutral to positive and we'll maintain financial flexibility through barring capacity as needed.

    Now turning to our outlook, consistent with our approach in Q1, we are increasing our non-GAAP earnings outlook for Fiscal Year 18 by $0.05, due to our operational performance in Q2 and a favorable tax rate that we now expect to be at the low end of our 11% to 15% guidance for the year. As a result, we expect Fiscal Year 18 non-GAAP diluted net earnings per share of $1.40 to $1.50. We expect our Fiscal Year 18 GAAP diluted net earnings per share to be $1.70 to $1.80.

    For Q3 18, we expect non-GAAP diluted net earnings per share of $0.35 to $0.39 and we expect GAAP diluted net earnings per share to be $0.19 to $0.23. So, overall, I'm pleased with the performance in the quarter and I'm looking forward to focusing on delivering our full-year commitments.

    Before we open up the call for questions, as Antonio mentioned, I just wanted to remind everyone that we have our IR Summit coming up in June at our Discover customer event in Las Vegas and I hope many of you will be able to join us.

    Now, let's open it up for questions.

    Questions and Answers:

    Operator

    Thank you. And we will now begin the question and answer session. To ask a question, you may press * and then 1 on your touchstone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press * then 2. We do also request that you limit yourself to one question and a single follow-up question.

    And our first questioner today will be Sherri Scriber with Deutshce Bank. Please go ahead.

    Sherri Scribner -- Deutsche Bank -- Analyst

    Thank you. I think Antonio and Tim, you both mentioned that DRAM cost increases have started to flatten. Can you remind us how you're feeling about DRAM and NAN as we move into the second half of the year I think when we talked about it last quarter, that's going to be somewhat of a pressure on revenue. How are you thinking about that as we move into the second half?

    Antonio Neri -- President and Chief Executive Officer

    Sure. Thanks, Sherri. We've still seen a flattening of the DRAM costs. We still see what I call nominal, low single-digit cost increases. We are able to pass those along for two reasons. One is stronger execution in our go to market, more disciplined approach and second, our competitors are becoming more rational about pricing in general. It's going to be a very low-cost increase and we feel confident to pass those along.

    The AUPs, obviously, continue to be elevated for two reasons. One is the DRAM, as we talked before. Two is the richer configurations -- particularly on the compute side, the compute side are driving a rich configuration of memory, obviously flash, NAN in terms of storage. That's why we see the increased AUPs. Those are not going to change anytime soon, also because customers try to reach more efficiencies in their data centers, particularly to deploy the private cloud. The other one is some of these workloads demand that level of configuration, particularly as you move to AI and data analytics.

    Sherri Scribner -- Deutsche Bank -- Analyst

    Okay. Great. Then just looking at the storage business, it seems like you guys have definitely recovered in that business versus some issues you had last year. How are you feeling about the storage business as we move into the second half? Do you think these revenue growth levels are sustainable or do you expect them to come back in a bit? Thank you.

    Antonio Neri -- President and Chief Executive Officer

    Sure. Storage performed very well, up 24% year over year with inclusion of Nimble and 14% organically, which is to your point, we actually executed way better than last year. Last year, we had some execution challenges, particularly in North America. We think we have addressed those issues and when I think about the opportunity in the market, obviously all flash continue to be a significant opportunity. This quarter we grew 20%. We are really excited about our portfolio.

    The combination of Nimble and 3Par with the simplicity of our value proposition, with cloud capabilities built into it and most importantly with our AI technologies built into it, both in Nimble and 3Par because now we scaled that solution to 3Par actually is something that's resonated with customers. So, as I look forward, we expect to see solid organic growth in storage, but let's remind ourselves next quarter we are going to have the lapping of the Nimble acquisition to the portfolio. I think the growth rate will be a little bit more moderated, but we're very confident about our ability to execute with this portfolio because we have true value differentiation.

    Sherri Scribner -- Deutsche Bank -- Analyst

    Thank you.

    Andrew Simanek -- Head of Investor Relations 

    Thank you, Sherri. Can you have the next question, please.

    Operator

    And our next question will be Katie Huberty with Morgan Stanley. Please go ahead.

    Katie Huberty -- Morgan Stanley -- Managing Director

    Thank you. Good afternoon. You've beat revenue and EPS two quarters in a row. The majority of the $0.05 full-year guidance is tax related. Can you just comment on why you're not assuming strong operational trends continue for the remainder of the year? Just as a related follow-up to that, when you talk about tough compares in the back half of the fiscal year and lapping acquisition, does that end in a company that's not growing topline or do you think the topline can continue to grow in the back half just at lower rates?

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    Yeah. So, as far as the $0.05 goes, I'd say $0.02 of the $0.05 was operational. Again, we continue to perform very well, particularly in the volume piece of the portfolio. That's growing faster than we had expected. As far as why we aren't passing more through. Again, we have a quite a bit of execution left in the second half. We still have six months to go and we feel it's just prudent to pass along the operational performance we're seeing and then we're trying to be as transparent as we can on the tax front as we're still working through all those changes.

    As far as the growth goes, yeah, I think we can continue to grow. If you look at the 10% growth that we had in Q2, I'd say about 3.5 points of that was tailwind from FX. We had a couple of points of tailwind from the compares with Nimble and SimpliVity and then we had 4.5 points of execution. I think it's really a combination because I do think our go to market motion is working better. I do think our geo-model we pivoted to this year is working very well, but we also have better markets. We have strong customer demand. We have a better pricing environment. So, that plays into it as well.

    As I look forward into the second half, rates have moved a little bit unfavorably for us. If those rates hold, we would get less of a tailwind. We obviously lose the favorable compares. The other point I would make out is we're doing about half of the tier one business in the second half of the year that we did versus the first half. That's about 2.5 points of headwind, no margin impact, and then we have tougher compares overall. I think moving forward, we can certainly grow, but it's obviously not going to be at that 10% rate given the reason they just laid out.

    Antonio Neri -- President and Chief Executive Officer

    Antonio, I want to add a couple of things here -- one is if you go back to where we guided, we said zero to 1% growth. It's obvious we're going to grow faster than that for the year. I think that's one area. The second is we are very, very confident in our portfolio. I think as we continue to contribute from volume to value, we will see also an improvement there because the growth areas we see are hyper-converged in areas like private cloud, high-performance compute and so forth. We believe this company absolutely can grow and definitely this year will be above the guidance we give you for the full year.

    Katie Huberty -- Morgan Stanley -- Managing Director

    Thank you.

    Andrew Simanek -- Head of Investor Relations 

    Thank you, Katie. Can we go to the next question, please?

    Operator

    Our next questioner today will be Tony Sacconaghi with Bernstein. Please go ahead.

    Toni Sacconaghi -- Bernstein -- Analyst

    Thank you. You provided an update on HPE Next and some of the accomplishments so far. I think the target was to try and deliver $250 million in net savings this year and $800 million over the next three years. Could you provide an update on where you think you are in terms of the savings capture rate so far this year and whether we should still be thinking about a $250 million savings for the year? I have a follow up, please.

    Antonio Neri -- President and Chief Executive Officer

    Sure, Toni, thanks for the question. We are confident we are on track to deliver $250 million for the years. Now, just as a reminder, HP Next is the initiative I launched to rearchitect the company to deliver on our vision or strategy. Our goal with this was all about simplification, innovation, and execution. We have made good progress on many fronts.

    One is the operating model simplification in the go to market is paying off in terms of not just the savings but actually improve the execution. Second we have reduced already quite significantly a number of platforms and options which translates in lower amounts of skills to our customers and partners, which allows us to better plan and execute in our supply chain.

    Then third is the culture of the company as well. So, from my standpoint, we are on track with what we said we're going to do. To me, this is going to be the competitive advantage that Hewlett-Packard Enterprise will have going forward. For me, this is not just a way to return shareholder value, but really to improve the way we execute our business every single day. The reality is the market is moving really fast. They need to react to those opportunities quickly. Have a lean, mean, end to end value chain is absolutely essential.

    So, now, we're going to enter the second phase of this, which is the transformation in the processes in IT modernization, which actually will give us the incremental step forward on executing even better and more simply in front of the market opportunity. Tim, do you want to add anything?

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    No, I think you nailed it.

    Toni Sacconaghi -- Bernstein -- Analyst

    So, the follow-up -- it still looks like if we believe Pointnext has about 30% operating margins, which is historically where it's been, it still looks like operating margins on servers, storage, and the data center networking is in the 1% to 2% range right now. That probably suggests that server margins are negative still.

    How should investors just think about what a normalized margin for these businesses are or has the whole server market moved to a market where we shouldn't be thinking about it that way and that we're really looking at a blended margin between support and servers are really becoming the vehicle to selling high margin support and we shouldn't be thinking about discreet profitability for each of those.

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    Thanks for the question, Toni. I would say this -- I think your math is correct. You're in the low single-digit range for the hardware businesses. I'm not really going to comment about where those are going, but I'll give you color. If you look at our overall margin of 8.6%, as we've talked about all year, we do think that continues to improve over the course of the year and that's really a combination of the increased cost savings from HPE Next. That's a combination of the acquisitions as they become more and more accretive as continue to grow those businesses and right size those cost envelopes.

    Then to Antonio's point, as we continue to pivot toward the value portion of our portfolio, where we have higher margins and higher attached, that obviously gives us some rate lift as well. We'd expect those to continue through the course of a year on a normalized, if you will, basis, two or three years down the road, I think a couple calls ago, there's a couple hundred points of improvement and I still think that's true because even as we exit '18, we're still going to have HPE Next savings and we'll continue to pivot toward the value portion of the portfolio.

    Antonio Neri -- President and Chief Executive Officer

    The other thing I would add, Toni, if you look at our Q2 performance, we improved our Hybrid IT margins by 20 basis points in that business. And obviously, like I said before, the Russianization of platforms and options give us improved profitability on the hardware side.

    It is obviously that obviously a big chunk of our profitability comes from services, but let's remind ourselves that profitability and service business is not just attached. It's what we call services led opportunities and we pivot that portfolio quite significant in the last two to three years and we see now the momentum and the way customers want to consume a more subscription-based model.

    That's why things like HP GreenLake as well. But to Tim's point, we will continue to drive that rigor and discipline and our cost structure and ultimately the simpler we innovate in our portfolio, the easier it is to go sell it to improve the pull through for services and as well for the rest of the HP portfolio.

    Andrew Simanek -- Head of Investor Relations 

    Thank you, Toni. Can we go to the next question, please?

    Operator

    The next question will be Simon Leopold with Raymond James. Please go ahead.

    Victor Chu -- Raymond James -- Analyst

    Hey, guys. This is Victor Chu in for Simon Leopold. I wanted to ask about free cashflow. It seems like FCS seems like it will have quite a sharp step up in the back half of the year to get to your $1 billion target. I was hoping you would give us more color around that, what parts of working capital are you expecting to drive the cash conversion in the second half of the year.

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    Sure. We're still confident with $1 billion for Fiscal Year 18. Q2 came in at -$269 million, which to be honest with you, was lighter than we expected. I think on the last call, I said Q2 would be flattish. We had a higher mix of one-time payments and unfavorable movements that was rated to the VAT taxes. So, those are more timing than anything else.

    As you know in this business, free cashflow is very seasonal. If you look at the last couple of years, we typically have negative free cashflow in the first half of the year and then we generate a significant amount in the second half of the year and I don't think 2018 is going to be any different.

    It's really driven by four things. First of all, you can look at the earnings ramp. That's reflected in our EPS guide. That's a combination of HPE Next savings as well as typically seasonality so that will obviously generate more free cash flow. From working capital perspective, we actually had a cash usage in the first half of the year, we're going to generate cash in the second half of the year I think the indicator to look at there is our cash conversion cycle. As we said in the prepared remarks, we'd expect that to end in the negative high-20 day range. We expected that to be very consistent with where we exited Q4 of 17 and that generates a significant amount of cash.

    Other assets and liabilities -- we had some unfavourability in the first half, I would expect that to come back in the second half. Nothing has structurally changed when you think about the balance sheet. I'll go back to the VAT examples we should be collecting on those receivables in the second half of the year.

    Then lastly, we're going to have fewer one time payments. If you look at the SAM presentation that we laid out, we had about $1.1 billion of one-time cash payments, roughly $800 million of that has been taken care of in the first half of the year, so that provides us a tailwind in the back half of the year and then we will have, to your point, we will have some real estate gains in the second half of the year. There's a lot of moving parts and free cashflow. That's why it's very difficult to forecast on a quarter basis, but given those comments, we feel really good about the dollars for Fiscal Year 18.

    Victor Chu -- Raymond James -- Analyst

    Thank you. That's very helpful.

    Andrew Simanek -- Head of Investor Relations 

    Thank you, Simon. Can we go to the next question, please?

    Operator

    Our next questioner today will be Shannon Cross with Cross Research.

    Shannon Cross -- Cross Research -- Analyst

    My question is with regard to AI -- I'm just curious how you see some of the new offerings you've launched and some of the new acquisitions fitting into this, particularly I'm curious as to how you're going to monetize them because everybody talk about AI and what it's going to do to the industry, but I'm wondering how it helps you from a competitive standpoint over time. And I have a follow up.

    Antonio Neri -- President and Chief Executive Officer

    Sure. Thank you for the question. I'm actually very excited about AI. We see this every day. I spend 50% talking to customers. It's kind of interesting because what they're looking for is to monetize that data faster and trying to understand they should be doing with that data from the business perspective. So, AI gives you that vehicle to accelerate outcomes from the data standpoint. We already have very strong offerings both in memory solutions -- think about our Superdome X and as well at HP Apollo 6500, which is an AI-designed platform.

    How we monetize is very simple. We provide services upfront, which is basically the advisory capability, how to implement AI in their environment and number two, how we design and implement the right solution for them and we already have many, many platforms with AI embedded in terms of it in terms of solution development kits their data scientist using whatever tools they want, whether it's cloud data or whatever it is.

    So, this is a good opportunity for us and also, we are using AI inside our portfolio. So, we talk about the future of hybrid IT being adaptive. We are delivering AI technologies inside our own software defined infrastructure. An example that, obviously, is Info site, but you're going to see more and more of that embedded at the edge as well as our cloud orchestration capabilities.

    Shannon Cross -- Cross Research -- Analyst

    Tim, can you talk a bit about how we should think about the model changing as you move to flexible capacity or flexible consumption models over time. We sat in software obviously to SaaS and now we're seeing these two devices that service over time. Thanks.

    Antonio Neri -- President and Chief Executive Officer

    I think you're asking the question from the business model perspective or the financial perspective? If it's financial, I will ask Tim here to comment. What we see is customers like the ability to consume on prem in a utility-based model. What that means is they want a full integrated solution with the hardware or infrastructure they need, with the software or services to run it the most efficient way. In many ways, we talk about how we bring that public cloud experience and economics on prem and that experience includes the consumption-based model. Depending on the scale, we can provide the customers a very competitive solution on premises. It's not just infrastructure as a service but also outcome as a service. Think about back half recovery as a service, SAP HANA as a service and so on. We already have those available and we see a significant interest and significant uptick in service.

    From the financial side, we have crafted what I think is a very strong and simple solutions for our customers leveraging our financial portfolio which provide that embedded financing but is a services-led organization and the way we've finally treated them is no different than any subscription-based model. Tim, maybe you want to comment on that.

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    Over time, it will improve our recurring revenue and will also improve our profitability.

    Andrew Simanek -- Head of Investor Relations 

    Thank you, Shannon. Can we move on to the next question?

    Operator

    The next questioner will be Jim Suva with Citigroup. Please go ahead.

    Jim Suva -- Citigroup -- Analyst

    Thank you very much and good job on the results and execution. I have a question on the Hybrid IT reporting segment, specifically the Pointnext or the service revenues. If I do the math correctly, that is up about 1% year over year with currency down 1% year over year. Why would revenues for Pointnext be down year over year when overall your company results are so strong or how do we bridge the gap between those differences?

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    I think that's a factor of the contracts rolling off and given the fact that a lot of these are three-year contracts, you have some timing from a translation and effects perspective.

    Jim Suva -- Citigroup -- Analyst

    Okay. So, should we expect Pointnext to be challenged with the timing of context rolling of?

    Antonio Neri -- President and Chief Executive Officer

    No. When we book the orders, we book it as whatever the currency was at the time, but at the same time, we are booking our orders with what I call more favorable currency. The mix of this is going to dictate what the outcome is but we're still confident that we will continue to drive the growth in this portfolio driven by these new offerings. That's why we are very keen to continue to drive that consumption-based model that Shannon asked the question for because that has grown significantly faster than what we are poting here as w hole segment.

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    I would say another thing to look at is services intensity. So, service intensity was up 35% in Q2 so we continue to have more attached dollars per units.

    Jim Suva -- Citigroup -- Analyst

    Thank you so much for the clarification and detail.

    Andrew Simanek -- Head of Investor Relations 

    Can we move on to the next question please?

    Operator

    The next question will be Steve Milunovich with UBS. Please go ahead.

    Steve Milunovich -- UBS -- Managing Director

    Thank you. First of all, on the tax rate for Fiscal 19 I think you said the tax rate would go up this year. We were thinking maybe 18% but does that come down a couple points now?

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    We'll give you guys more color at SAM because we're still working through the impact in Fiscal Year 18. To your point, the last year we guided, we said 16% to 20%, so you're right in the middle there. I'm not going to give you the guidance here for 19 but we'll give you full transparency in October at SAM.

    Steve Milunovich -- UBS -- Managing Director

    I wonder if you can elaborate more on your on the trends you're seeing? Is Azure stack out there and some volume? How's your Microsoft relationship? I think you actually need new servers if an account were to use Azure with yoyr products and talk with your software offerings. I think you have some fairly good orchestration software.

    Antonio Neri -- President and Chief Executive Officer

    Sure. Thanks for the question. We see good traction in the private cloud segment. We offer a multi-cloud type of solution. Obviously, we have the VMware. We have now a very strong integration between the VMware stack and our HP Synergy. We see significant traction of Synergy with VMware in particular segments like the financial sector, where they need large deployments of large VM farms that ultimately they can manage a significant amount of workload.

    The other one is Azure Stack. It's still a little bit early, but we see good promise. We have done slightly different implementation on that because we have better engineering integration and we already provide different types of solution, whether it's HP reliant or what is now with availability of HP SimpliVity as well with a hyper-based solution.

    And by the way, with our offering of HP OneSphere, we also provide OpenStack and Coupa environment for all those customers who want to absolutely raid deployment of containers. In the end, we have platform called HP OneView that manages any type of infrastructure, whether it is a traditional tier three approach, converge, hyper converge and composable and now with the inclusion of Plexxi, which we announced that last week, we're actually now virtualizing the network fully integrated natively.

    And then with HP OneSphere, we provide it through cloud in a hybrid IT environment where you deployed a container or even an open source type of solution. We see the traction across them and we wrap all of that with our consumption based model. We talk about HP GreenLake and that's where the customers are very interested to work with us.

    Andrew Simanek -- Head of Investor Relations 

    Thanks, Steve. Can we go to the next question, please?

    Operator

    Our next question with be Amanda Bruja with Loop Capital. Please go ahead.

    Ananda Bruja -- Loop Capital -- Analyst

    Thanks for taking the question. Two if I could and I'll ask them at the same time -- the first is with regards to long-term competitive advantages, it makes sense how it improves your processes and your get to market, could you speak specifically to what you see as some of the competitive advantages relative to the marketplace and your competition. The second question, I believe there was a comment, the second half will be more challenging. I was wondering if you could tease out what some of the challenges you see in the second half. Thanks.

    Antonio Neri -- President and Chief Executive Officer

    Sure. As I said before, we truly believe. I believe that HP Next will be a competitive differentiator for us because one of the drivers we see in this industry is the ability to provide an integrative experience. With the hard work we have done over the last six and a half years and position of Hewlett-Packard Enterprise clearly in this space where we can compete and win, we have the opportunity to deliver a whole integrated new experience.

    It is the opportunity of a lifetime. I've been at the company for 23 years. Unfortunately, I know every system, every process for good or bad and I know we have tremendous upside, not only to improve our cost structure, but really improve our growth through better execution once we have this integrated experience.

    Let me give an example of that. Now we're going to have a simple, much better integrated experience with configurations. We're going to have a low touch model for more of the transactional side, particularly as you think about the midmarket and SMB. We're going to have a streamline platform for the supply chain, which actually improves not just quote to cash, but the finance side of the execution, but all of this translates into value for our customers and for our shareholders because obviously, we're allowed to make everything we can in that execution.

    From the growth standpoint, again, like I said before, we are confident we will beat our guidance we give as them, which was zero to 1%, but obviously we're going to have tougher compares. The currency is not going to be as strong as its tailwind. We have the acquisition now in the full run rate. I'm very confident in our organic growth because our portfolio is very, very strong. It's going to come down to how well we are going to execute and we are executing better and where we see the opportunity in terms of balancing growth with the profitability which we just increased again on EPS.

    Ananda Bruja -- Loop Capital -- Analyst

    Both of those are very helpful. Thanks so much.

    Andrew Simanek -- Head of Investor Relations 

    I think we have time for one more question.

    Operator

    That question will be from Aaron Rakers with Wells Fargo. Please go ahead.

    Aaron Rakers -- Wells Fargo -- Analyst

    Thank you. I do have a follow-up as well. I want to go back to Tony's earlier progression with regard to your savings you expect to generate from HP Next. I'm curious how much have you realized of the $250 million thus far in the first half of the year and if you look at some of the progress of things you're going to execute on, going to one ERP system versus ten, 400 sales comp plans down to 25, etc., I'm just curious can you help us understand what has been done and what you're planning to execute on in the second half. Then I have a follow-up.

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    I'll answer the financial component then flip it to Fabio. If you look at the $250 million, I would say that a third of that is in the first half and two-thirds will be coming in the back-half of the year. As Antonio mentioned, we are on track to deliver that.

    Antonio Neri -- President and Chief Executive Officer

    In terms of what has been done, we already initiated the platform simplification. We said 26 platforms down to seven on the Volume side and 27 down to 9, so we are well on on our way. We are not completely done on that but well on our way. In terms of the manufacturing side, we have not yet initiated the full transition.

    So, in the back half of this year, particularly in the latter part of the year, we're going to implement the new SAP instance and with that foundation with a common data master, we're going to move to the simplification of our supply chain in number of notes, which the vast majority is going to happen in 2019.

    In terms of our core plans, we executed much of that, we executed 2019 in terms of sales plans, which also is one of the reason we are executing better because you're telling the sellers exactly where to focus and how they're going to get paid and that's a motivator in many ways and that's why we have better execution.

    Very confident where we are today, but there's still a significant amount of work to be done. It is a journey to be laid out for the next three years and much of this will be dependent on the IT transformation driving, particularly on the low touch, no touch, which is going to come in the latter part of 2018 and that will improve our execution or go to market in the latter part as we continue to pivot from volume to volume growth.

    Aaron Rakers -- Wells Fargo -- Analyst

    That's very helpful and maybe this is somewhat tied to the follow up -- as I look at the cash conversion cycle, one thing that stands out is you had 40% year over year in your inventory carried on the balance sheet on this last quarter. Is there strategic purchases being made in the inventory are you holding more than given these initiatives or what's really driving that increase on the inventory side?

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    It's a little bit of both. We were carrying some excess buffer stock to make sure we had enough inventory to meet customer demand and then you have to remember we have elevated ERAM costs as well. So, that has significant impact.

    Aaron Rakers -- Wells Fargo -- Analyst

    Thank you very much.

    Andrew Simanek -- Head of Investor Relations 

    Thank you, Aaron. Thanks everyone for joining us today. With that, we can close out the call.

    Operator

    Ladies and gentlemen, this will conclude our call for today. Thank you for attending.

    Duration: 56 minutes

    Call participants:

    Andrew Simanek -- Head of Investor Relations 

    Antonio Neri -- President and Chief Executive Officer

    Tim Stonesifer -- Executive Vice President and Chief Financial Officer

    Sherri Scribner -- Deutsche Bank -- Analyst

    Katie Huberty -- Morgan Stanley -- Managing Director

    Toni Sacconaghi -- Bernstein -- Analyst

    Victor Chu -- Raymond James -- Analyst

    Shannon Cross -- Cross Research -- Analyst

    Jim Suva -- Citigroup -- Analyst

    Steve Milunovich -- UBS -- Managing Director

    Ananda Bruja -- Loop Capital -- Analyst

    Aaron Rakers -- Wells Fargo -- Analyst

    More HPE analysis

    This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

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