Table 3		HP Enterprise Servers & Storage								Nov-06
				(Fiscal year end: Oct 31)
			2006e	% of	Change	2005	% of	Change	2004	% of
			($ Mill)	Rev	06/05	($ Mill)	Rev	05/04	($ Mill)	Rev
Revenue			19%			19%			19%
Business Segments (est)
	Industry Standard Servers		$10,050	59.0%	2.7%	$9,790	58.6%	20.6%	$8,118	55.0%
	Bus Critical Serv		$3,580	21.0%	-5.8%	$3,800	22.8%	1.1%	$3,759	21.0%
	Network Storage		$3,400	20.0%	9.3%	$3,110	18.6%	-2.7%	$3,197	21.2%
Total Revenue			$17,030	100.0%	2.0%	$16,700	100.0%	10.8%	$15,074	97.2%
	4Q06 Actual		$4,670		4.3%	$4,476
Costs
Cost of Revenue			$10,560	62.0%	5.1%	$10,050	60.2%	2.6%	$9,800	65.0%
One-time Charges
Total Costs			$10,560	62.0%	5.1%	$10,050	60.2%	2.6%	$9,800	65.0%
Gross Profit/Margin			$6,470	38.0%	-2.7%	$6,650	39.8%	26.1%	$5,274	35.0%
Expenses
Sales, General & Marketing			$3,922	23.0%	2.0%	$3,846	23.0%	7.6%	$3,573	23.7%
Restr. Charges (apportioned)			$315			$324			$30
Research & Development			$1,703	10.0%	2.0%	$1,670	10.0%	10.6%	$1,510	10.0%
Total Expenses			$5,940	34.9%	1.7%	$5,840	35.0%	14.2%	$5,113	33.9%
Operating Profit (Loss)			$530	3.1%	-34.6%	$810	4.8%	402.9%	$161	1.1%
as reported								-100.0%	$161	1.1%
	4Q06 Actual		$322	6.9%	78.9%	$180	4.0%
Other Income (Loss)			($5)	-0.0%	0.0%	($5)	-0.0%	-14.5%	($6)	-0.0%
Income (Loss) Before Tax			$525	3.1%	-34.8%	$805	4.8%	418.6%	$155	1.0%
Income Tax (Benefit)			$107	20.3%	-34.8%	$164	20.3%	532.8%	$26	16.7%
Net Income (Loss)			$418	2.5%	-34.8%	$641	3.8%	395.8%	$129	0.9%
Earnings per share (basic)		2.74	0.15			0.23			0.05
				Pro Forma Valuation
		P/E Ratio	Rev Ratio	Market Cap (est.)			Spin-off	Actual
				P/E	Rev	Combined	Benefit	(5/15/06)
Industry Segment Avg		20.00	2.70	$8.36	$45.98	$27.17
HP Corp Act Prorated		27.72	0.95	$11.59	$16.18	$16.74		$89.46
HP ESS		10.00	1.60	$4.18	$27.25	$15.71	($1.03)
	Source: Annex Research