(a) Represents amounts in connection with the HPE Next initiative and includes costs related to labor and non-labor restructuring, program management and IT charges, partially offset by the gain on sale of real estate.

(b) Represents amounts in connection with damages sustained by the Company as a result of Hurricane Harvey.

(c) Represents adjustment to net periodic pension cost resulting from remeasurements of the Hewlett Packard Enterprise pension plans in connection with the spin-off of the software business, Seattle SpinCo, Inc., and the merger of Seattle SpinCo, Inc. with Micro Focus International plc and the spin-off of the enterprise services business, Everett SpinCo, Inc., and the merger of Everett SpinCo, Inc. with Computer Sciences Corporation.

(d) Represents the settlement of certain pre-separation Hewlett-Packard Company income tax liabilities indemnified through the Tax Matters Agreement with HP Inc.

(e) Represents the amortization of basis difference adjustments related to the H3C divestiture.

(f) Includes tax amounts in connection with the spin-off of the enterprise services business, Everett SpinCo, Inc. and the software business, Seattle SpinCo, Inc., tax amounts related to the recently enacted U.S. tax reform, tax amounts related to the settlement of certain pre-separation Hewlett-Packard Company income tax liabilities indemnified through the Tax Matters Agreement with HP Inc. and excess tax benefits associated with stock-based compensation.

For the three months ended January 31, 2018, this amount includes a $920 million benefit following the resolution of certain pre-separation Hewlett-Packard Company income tax liabilities and a $244 million benefit primarily from foreign tax credits and from the release of non U.S. valuation allowances on deferred taxes established in connection with the Everett Transaction, following changes in foreign tax laws.

Further, as a result of the recently enacted U.S. tax reform, for the three months ended January 31, 2018, this amount includes an estimated tax benefit of $1.8 billion from the provisional application of the new tax rules including a lower federal tax rate to deferred tax assets and liabilities, partially offset by a provisional estimate of $1.0 billion of transition tax expense on accumulated non U.S. earnings, and a $203 million benefit as a result of the liquidation of an insolvent non U.S. subsidiary.

During the first quarter of fiscal 2018, the Company adopted ASU 2016-09 on a prospective basis, except for the statement of cash flows for which it was retrospectively adopted for the prior comparative periods, which requires the excess tax benefits or tax deficiencies associated with stock-based compensation to be recognized as a component of the provision for income taxes in the Statement of Earnings rather than additional paid-in capital in the Balance Sheet. For the three months ended January 31, 2018, this amount includes $14 million, which represents the net excess tax benefits from stock-based compensation.

For the three months ended October 31, 2017, this amount primarily includes $619 million of income tax benefit related to U.S. foreign tax credits generated.

HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In millions, except par value)
	As of
	January 31, 2018				October 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	7,673			$	9,579
Accounts receivable	3,098				3,073
Financing receivables	3,515				3,378
Inventory	2,431				2,315
Assets held for sale(a)	34				14
Other current assets	3,748				3,085
Total current assets	20,499				21,444
Property, plant and equipment	6,338				6,269
Long-term financing receivables and other assets	13,740				12,600
Investments in equity interests	2,561				2,535
Goodwill and intangible assets	18,481				18,558
Total assets	$	61,619			$	61,406
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Notes payable and short-term borrowings	$	3,915			$	3,850
Accounts payable	5,948				6,072
Employee compensation and benefits	1,034				1,156
Taxes on earnings	410				429
Deferred revenue	3,135				3,128
Accrued restructuring	412				445
Other accrued liabilities	4,489				3,844
Total current liabilities	19,343				18,924
Long-term debt	10,040				10,182
Other non-current liabilities	8,247				8,795
Stockholders’ equity
HPE stockholders’ equity:
Preferred stock, $0.01 par value (300 shares authorized; none issued and outstanding at January 31, 2018)	—				—
Common stock, $0.01 par value (9,600 shares authorized; 1,567 and 1,666 shares issued and outstanding at January 31, 2018 and October 31, 2017, respectively)	16				16
Additional paid-in capital	32,947				33,583
Retained earnings	(6,057		)		(7,238		)
Accumulated other comprehensive loss	(2,955		)		(2,895		)
Total HPE stockholders’ equity	23,951				23,466
Non-controlling interests	38				39
Total stockholders’ equity	23,989				23,505
Total liabilities and stockholders’ equity	$	61,619			$	61,406

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