HP (HPQ) Goldman Sachs Communacopia + Technology Conference 2024 summary

Strategic vision and priorities

• Focus on integrating AI across product portfolio to enable hybrid work and improve productivity.

• Aim to outpace market growth in both PC and print segments while driving operational efficiencies.

• Maintain capital allocation strategy of returning 100% of free cash flow to shareholders, unless higher ROI opportunities arise.

• Confident in leveraging hybrid work and AI trends for future growth.

Market and financial performance

• Returned to growth in the latest quarter, driven by commercial PC sales; print segment continues to decline but at a slower rate.

• PC market expected to see slight growth in 2024 and stronger growth in 2025, fueled by refresh cycles and Windows 11 upgrades.

• Print market, previously expected to be flat, is now forecasted to decline in 2024 but may grow in 2025.

• Regional performance strong in US, Europe, and India; China remains weak due to macroeconomic factors.

Industry trends and outlook

• Large, aging PC installed base and Windows 11 refresh are key drivers for upcoming replacement cycles.

• AI PCs projected to reach 50% of shipments in three years, increasing average selling prices by 5-10%.

• Commercial PC demand is robust and expected to remain strong, while consumer demand is softer but may recover with AI innovation.

• Federal, government, and defense sectors are leading verticals for growth.