HP (HPQ) investor relations material

Executive summary

• Net revenue for Q3 2026 reached $15.7 billion, up 12.5% year-over-year, driven by strong Personal Systems performance, premium products, and AI PCs, while Printing was in line with expectations.

• Non-GAAP diluted net EPS was $0.83, up 10.7% year-over-year and above guidance, including a $0.11 benefit from tariff refunds; GAAP diluted net EPS was $0.71, down year-over-year due to prior-year one-time benefits.

• Free cash flow for the quarter was $1.6 billion, with $0.6 billion returned to shareholders via dividends and share repurchases.

• Strategic focus on AI innovation, edge computing, and integrated solutions accelerated growth in key areas.

• Continued disciplined execution on cost mitigation, supply chain management, and capital allocation, including workforce reductions and a voluntary early retirement program.

Financial highlights

• Revenue grew 12.5% year-over-year to $15.7B, with Personal Systems up 18% and Printing down 2%; gross margin was 18.8%, down year-over-year due to higher commodity costs and mix shifts.

• Operating margin was 6.5% (non-GAAP) and 5.7% (GAAP); net earnings (non-GAAP) were $772M, GAAP net earnings were $661M.

• Net cash from operating activities was $1.7B; free cash flow was $1.6B in Q3.

• Cash conversion cycle was negative 37 days.

• Gross cash at quarter end was $4.2B; total debt was $9.2B.

Outlook and guidance

• FY26 GAAP diluted net EPS outlook raised to $2.52–$2.62; non-GAAP diluted net EPS to $3.19–$3.29, both including $0.19 from tariff refunds.

• Q4 diluted net EPS expected at $0.69–$0.79 (non-GAAP) and $0.74–$0.84 (GAAP), both including $0.08 from tariff refunds.

• Free cash flow outlook increased to $3.0–$3.2 billion for FY26.

• Expect continued input cost pressures, especially in Personal Systems, with Q4 margins below Q3 but improving into FY 2027.

• Printing revenue expected to follow historical seasonality, with operating margins in the lower half of the long-term range.