Financial Data and Key Metrics Changes - The company reported a 5% increase in revenue in constant currency year over year, marking the fourth consecutive quarter of revenue growth [8][22] - Non-GAAP operating profit fell short of expectations due to additional tariff costs, impacting earnings per share by approximately $0.12 [9][22] - Gross margin decreased to 20.7% year over year, influenced by increased tariff and commodity costs [24] Business Line Data and Key Metrics Changes - Personal Systems revenue grew 8% in constant currency, driven by strong commercial performance, with commercial revenue increasing by 9% year over year [10][26] - Print revenue declined 3% in constant currency, with growth in Europe offsetting a slowdown in North America and weak demand in China [12][28] - The operating margin for Personal Systems was 4.5%, below the guidance range, primarily due to higher tariff costs [27] Market Data and Key Metrics Changes - Revenue growth was observed across all regions, with APJ growing 9%, Americas growing 5%, and EMEA growing 1% in constant currency [23] - The company expects the PC market to grow low single digits for the second half of the year, influenced by macroeconomic uncertainties [19][33] - The print market is anticipated to decline in low single digits for the calendar year, with expectations of a mid-single-digit decline in the second half [34] Company Strategy and Development Direction - The company is focusing on diversifying its manufacturing locations to mitigate geopolitical risks, with plans for nearly all products sold in North America to be built outside of China by June [9][10] - The Future Ready Accelerated Plan aims to deliver at least $2 billion in gross annual run rate structural savings by the end of fiscal year 2025 [19][30] - The company is committed to leveraging AI to enhance productivity and employee satisfaction, with a significant focus on AI PCs and related innovations [14][21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the dynamic external environment, including shifting trade policies and tariffs, which impacted operating profit [7][22] - The company remains confident in its ability to navigate market uncertainties and expects to fully mitigate tariff costs by Q4 [18][33] - Future growth is expected to be driven by strong demand in commercial PCs and the adoption of AI technologies [19][66] Other Important Information - The company returned approximately $400 million to shareholders through dividends and share repurchases [31] - Free cash flow was slightly negative due to timing of payments related to inventory actions taken for tariff mitigation [30][68] Q&A Session Summary Question: Expectations for the PC market in the second half of the year - Management noted strong demand in Q2, especially in commercial, but adopted a more prudent outlook for the second half due to economic conditions and price increases [42][43] Question: Size and growth of growth businesses - Growth businesses are performing well and are expected to represent more than 25% of the PC business by year-end, with solid growth in AIPCs and Workforce Solutions [49][50] Question: Personal Systems margins for the full year - Margins are expected to be in the 5% to 7% range for the full year, likely in the lower half due to Q2 impacts [55][56] Question: AI PCs and their impact on growth - The company is optimistic about AI PCs, which are expected to represent a significant portion of PC shipments in the coming years, driving higher average selling prices [66] Question: Mitigation actions for tariff impacts - The company has accelerated the shift of manufacturing out of China and implemented price increases across its portfolio to offset tariff costs [75][78]

Financial Data and Key Metrics Changes - The company reported a 5% increase in revenue in constant currency year over year, marking the fourth consecutive quarter of revenue growth [7][21] - Non-GAAP operating profit fell short of expectations due to additional tariff costs, impacting earnings per share by approximately $0.12 [8][21] - Operating margin was 7.3%, impacted by roughly 100 basis points due to unmitigated tariff costs [24][21] Business Line Data and Key Metrics Changes - Personal Systems revenue grew 8% in constant currency, driven by strong commercial performance, with commercial PC revenue increasing by 9% year over year [9][10] - Print revenue declined 3% in constant currency, with growth in Europe offsetting a slowdown in North America and weak demand in China [11][12] - Personal Systems operating margin was 4.5%, below guidance due to higher commodity and tariff costs [26] Market Data and Key Metrics Changes - Revenue growth was seen across all regions, with APJ growing 9%, Americas growing 5%, and EMEA growing 1% in constant currency [23] - The company expects the PC market to grow low single digits for the second half of the year, influenced by macroeconomic uncertainties [18][31] - The print market is expected to decline low single digits for the calendar year, with the second half declining closer to mid single digits [32] Company Strategy and Development Direction - The company is focusing on diversifying its manufacturing locations to mitigate geopolitical risks, with nearly all products sold in North America expected to be built outside of China by June [8][9] - The Future Ready Accelerated Plan aims to deliver at least $2 billion in gross annual run rate structural savings by the end of fiscal year 2025 [18][28] - The company is committed to leveraging AI to enhance productivity and employee satisfaction, with significant investments in AI PC portfolios and workforce solutions [13][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the dynamic geopolitical landscape and its impact on operating profit, emphasizing the need for cost management and strategic pricing actions [21][22] - The company remains confident in its ability to navigate market uncertainties and expects to fully mitigate tariff costs by Q4 [30][34] - Future growth is anticipated in both Personal Systems and Print segments, with expectations for sequential improvement in margins [31][32] Other Important Information - Cash flow from operations was approximately $38 million, with free cash flow slightly negative due to timing of payments related to inventory actions [29] - The company returned close to $400 million to shareholders through dividends and share repurchases [30] Q&A Session Summary Question: Expectations for the PC market in the second half of the year - Management noted strong demand in Q2 but adopted a more prudent outlook for the second half due to economic conditions and anticipated price increases [39][40] Question: Size and growth of growth businesses - Growth businesses are expected to grow faster than core businesses, with AIPCs projected to represent over 25% of the PC business by year-end [46][47] Question: Personal Systems margins for the full year - Margins are expected to be in the 5% to 7% range for the full year, likely in the lower half due to Q2 impacts [52][53] Question: AI PCs and their applications - The company is optimistic about AI PCs, with over 100 ISVs supporting applications that leverage their capabilities [59][60] Question: Mitigation actions for tariff impacts - The company has accelerated the shift of factories out of China and implemented price actions across its portfolio to mitigate tariff impacts [69][72]

Financial Performance - HP's net revenue was $1322 billion, up 3% year-over-year and 5% in constant currency[15] - Non-GAAP diluted net earnings per share were $071, below the outlook of $075 to $085[15] - GAAP diluted net earnings per share were $042, below the outlook of $062 to $072[15] - Free cash flow was $(95) million[15] - HP returned $04 billion to shareholders through dividends and share repurchases[15] Segment Performance - Printing net revenue was $4181 billion, down 43% year-over-year (down 26% in constant currency), with an operating profit of $814 million (195% OP margin)[21] - Personal Systems net revenue was $9024 billion, up 71% year-over-year (up 81% in constant currency), with an operating profit of $409 million (45% OP margin)[21] - Americas accounted for 44% of net revenue, with 36% from the US[18] - Non-US net revenue accounted for 64% of total net revenue[19] Personal Systems Details - Personal Systems revenue increased 7% year-over-year, driven by higher commercial volume and increased ASPs[30] - Commercial Personal Systems revenue grew 9%, reflecting refresh activity related to Windows 11[34] - Total Personal Systems units were up 6% year-over-year, with commercial units up 11% and consumer units down 2%[35] Printing Details - Printing revenue decreased 4% year-over-year (down 3% in constant currency)[36] - Printing supplies revenue was down 5% year-over-year (down 3% in constant currency)[43] - Total hardware units were up 1% year-over-year[43] Outlook - HP revised its FY25 GAAP diluted net EPS guidance to $232-$262 and non-GAAP diluted net EPS guidance to $300-$330[62] - HP revised its FY25 free cash flow guidance to $26-$30 billion[62]

Financial Performance - Fiscal 2025 Q2 net revenue was $13.2 billion, an increase of 3.3% year-over-year[4] - GAAP diluted net EPS for Q2 was $0.42, down 31% from $0.61 in the prior year[3] - Non-GAAP diluted net EPS for Q2 was $0.71, down 13% from $0.82 in the prior year[3] - Total net revenue for the three months ended April 30, 2025, was $13,220 million, a decrease of 2.1% from $13,504 million in the previous quarter and an increase of 3.3% from $12,800 million in the same quarter last year[22] - Gross profit for the three months ended April 30, 2025, was $2,739 million, down 10.4% from $2,840 million in the previous quarter and down 9.4% from $3,023 million in the same quarter last year[22] - Net earnings for the three months ended April 30, 2025, were $406 million, a decrease of 28.1% from $565 million in the previous quarter and a decrease of 33.1% from $607 million in the same quarter last year[22] - Basic net earnings per share for the three months ended April 30, 2025, was $0.43, down from $0.60 in the previous quarter and $0.62 in the same quarter last year[22] - Total net revenue for the six months ended April 30, 2025, was $26,724 million, an increase of 2.8% from $25,985 million in the same period last year[24] - Net earnings for the six months ended April 30, 2025, were $971 million, a decrease of 21.0% from $1,229 million in the same period last year[24] Cash Flow and Dividends - Free cash flow for Q2 was $(95) million, a decrease of 120% compared to $0.5 billion in the prior year[7] - HP returned $0.4 billion to shareholders through dividends and share repurchases in Q2[3] - For FY25, HP anticipates generating free cash flow in the range of $2.6 to $3.0 billion[11] - Cash dividends declared per share for the six months ended April 30, 2025, was $0.58, compared to $0.55 in the same period last year[24] - Cash dividends paid in the six months ended April 30, 2025, totaled $546 million, slightly up from $544 million in the same period of 2024[35] Segment Performance - Personal Systems segment net revenue was $9.0 billion, up 7% year-over-year, with a 4.5% operating margin[9] - Printing segment net revenue was $4.2 billion, down 4% year-over-year, with a 19.5% operating margin[9] - The Personal Systems segment reported net revenue of $9,024 million for the three months ended April 30, 2025, a 7% increase from $8,426 million year-over-year[37] - The Printing segment's operating margin for the three months ended April 30, 2025, was 19.5%, an increase of 0.5 percentage points compared to the previous quarter[43] - The Consumer Printing segment's net revenue for the three months ended April 30, 2025, was $289 million, unchanged from the previous year[37] Assets and Liabilities - HP's accounts receivable at the end of Q2 was $4.3 billion, with inventory at $8.2 billion[6] - Total current assets as of April 30, 2025, were $19,458 million, a decrease of 6.3% from $20,760 million as of October 31, 2024[31] - Total liabilities and stockholders' deficit as of April 30, 2025, was $38,799 million, a decrease of 2.8% from $39,909 million as of October 31, 2024[31] Research and Development - Research and development expenses for the three months ended April 30, 2025, were $401 million, slightly up from $397 million in the previous quarter but down from $436 million in the same quarter last year[22] Future Outlook - For Q3 FY25, HP estimates GAAP diluted net EPS to be in the range of $0.57 to $0.69[10] - Key growth areas identified by the company include Hybrid Systems and Advanced Compute Solutions, which are expected to grow faster than HP's core business[55] - The company emphasizes the importance of non-GAAP financial measures for evaluating its financial performance and making operational decisions[60]

HP reported second-quarter results that beat analysts' estimates for revenue but missed on earnings and guidance, in part due to President Donald Trump's sweeping tariffs. Shares sank 15% after the report.Here's how the company did versus analysts' estimates compiled by LSEG:Earnings per share: 71 cents, adjusted vs. 80 cents expected.Revenue: $13.22 billion vs. $13.14 billion expected.Revenue for the quarter increased 3.3% from $12.8 billion in the same period last year. HP reported net income of $406 mill ...

Core Insights - HP Inc. reported a net revenue of $13.2 billion for Q2 FY25, reflecting a year-over-year increase of 3.3% (4.5% in constant currency) compared to Q2 FY24 [2][3] - The company's GAAP diluted net earnings per share (EPS) decreased to $0.42, down 31% from $0.61 in the prior-year period, and below the previous outlook of $0.62 to $0.72 [3][6] - Non-GAAP diluted EPS also fell to $0.71, down 13% from $0.82 in the prior-year period, and below the previous outlook of $0.75 to $0.85 [3][6] Financial Performance - GAAP net earnings for Q2 FY25 were $0.4 billion, a decline of 33% from $0.6 billion in Q2 FY24 [1][6] - Non-GAAP net earnings were $0.7 billion, down 17% from $0.8 billion in the prior-year period [1][6] - The GAAP operating margin decreased to 4.9%, down from 7.4% in the prior-year period, while the non-GAAP operating margin fell to 7.3% from 8.8% [1][3] Cash Flow and Shareholder Returns - HP generated $0.0 billion in net cash from operating activities, a significant decrease of 94% from $0.6 billion in Q2 FY24 [1][5] - The company reported a free cash flow of $(0.1) billion, down 120% from $0.5 billion in the prior-year period [1][5] - HP returned $0.4 billion to shareholders through dividends and share repurchases during the quarter [6] Segment Performance - Personal Systems segment net revenue was $9.0 billion, up 7% year-over-year, with a 4.5% operating margin [14] - Printing segment net revenue was $4.2 billion, down 4% year-over-year, with a 19.5% operating margin [14] Outlook - For Q3 FY25, HP estimates GAAP diluted EPS to be in the range of $0.57 to $0.69 and non-GAAP diluted EPS to be in the range of $0.68 to $0.80 [9] - For the full fiscal year 2025, HP anticipates GAAP diluted EPS in the range of $2.32 to $2.62 and non-GAAP diluted EPS in the range of $3.00 to $3.30 [10]

Core Insights - The white paper highlights significant transformations in the global memory market driven by advancements in AI technology, increasing server storage demands, and upgrades in consumer storage products [19] Group 1: Global Memory Market Changes and Technological Developments - High-density 3D NAND Flash storage is continuously improving, with advancements in read/write performance, power consumption, durability, and cost [2][36] - The complexity of etching and deposition processes increases with the number of layers in NAND Flash, leading to challenges that manufacturers are overcoming through various techniques [2][41] - Major manufacturers like Samsung and SK Hynix are focusing on mass production plans for NAND Flash with over 300 layers, utilizing Wafer-to-Wafer bonding technology [2][41] Group 2: Server NAND and DRAM Application Growth - The expansion of global data center infrastructure and increased investment in AI infrastructure are driving the growth of server storage demand [3][9] - In 2024, the application shares of NAND in servers, mobile devices, and PCs are projected to be 30%, 31%, and 14% respectively, with server NAND application share expected to rise to 30% by 2025 [4][43] - For DRAM applications, the shares in servers, mobile devices, and PCs are expected to be 34%, 32%, and 14% in 2024, with server DRAM application share anticipated to grow to 36% by 2025 [5][47] Group 3: Storage Technology and Application Outlook - QLC NAND is improving in performance and reliability, making it suitable for read-intensive applications, particularly in computing centers [6][51] - The rise of AI PCs is driving the growth of PCIe 4.0/5.0 SSD applications in the consumer market, with an expected penetration rate of 35% by 2025 [7][58] - Manufacturers are actively expanding into overseas markets, particularly in Southeast Asia, Latin America, and Africa, where the SSD market holds significant potential [8][71] Group 4: AI Server Storage Demand - There is a surge in capital expenditure for AI infrastructure, significantly increasing the demand for AI servers [9][72] - The global HBM market is projected to reach $16 billion in 2024 and grow to $30 billion by 2025, accounting for 28% of the global DRAM market [11] - The demand for enterprise-grade PCIe 5.0 SSDs is rapidly increasing, with an expected shipment share of 30% by 2025 [12][50] Group 5: Consumer Storage Product Applications and Developments - Global PC shipments are expected to see a slight increase of 3% in 2025, with AI PC penetration reaching 35% [13][58] - The global smartphone shipment volume is projected to reach approximately 1.184 billion units in 2024, with NAND capacity expected to exceed 220GB by 2025 [15][16] - AI glasses are emerging as a significant consumer electronics product, with shipments expected to rise from 2 million units in 2024 to 10 million units in 2025 [17][18]

Core Viewpoint - HPQ Silicon Inc. has received an early request for material samples from a leading global fumed silica manufacturer, indicating strong interest in its proprietary Fumed Silica Reactor technology [1][2]. Company Developments - HPQ Silicon confirmed the independent validation of its fumed silica production through its Fumed Silica Reactor Pilot Plant during a four-batch Phase One test [2]. - The request for samples was made prior to the completion of planned optimizations by HSPI's technology supplier, PyroGenesis Inc., highlighting the technology's unique potential [2]. - The collaboration with the leading fumed silica manufacturer aims to validate the FSR's ability to produce material that meets specific industry standards, leveraging over 80 years of manufacturing expertise [5]. Production Goals - The pilot plant program focuses on two main objectives: enhancing product-grade purity and reaching a targeted production capacity of 50 tonnes per year (TPY) [5]. - Enhancements will involve improving process control, achieving higher product surface areas, and increasing silica conversion efficiency [5]. Market Positioning - The collaboration is seen as a critical step toward commercial validation, positioning HPQ and HSPI to accelerate market entry with a scalable, high-purity fumed silica solution [5]. - The company is confident that its proprietary technology can disrupt traditional fumed silica production methods and meet the growing market demand [5].

Group 1: Company History and Founding - HP was founded in a garage in Palo Alto, California, in 1939 by Bill Hewlett and David Packard, marking the beginning of Silicon Valley's tech boom [1][7] - The company started with an initial investment of $538, which included a loan from their professor, Frederick Terman [7] - HP's first product was the 200A audio oscillator, sold for $54.5, with a significant order from Walt Disney Studios for the film "Fantasia" [10][12] Group 2: Philanthropy and Family Foundations - The Hewlett family established the William and Flora Hewlett Foundation, which plans to allocate $631 million in 2024, with assets around $13.9 billion as of December 31, 2024 [2][19] - Bill Hewlett was known for his charitable contributions, particularly to Stanford University, where he and Packard donated nearly $400 million [31] - The foundation's investment strategy includes a diversified portfolio across various financial instruments, with approximately 30% in publicly traded stocks as of December 31, 2023 [26][30] Group 3: Legacy and Impact - Hewlett and Packard are recognized as symbols of Stanford University's rise as a leading institution, significantly influencing the entrepreneurial spirit in Silicon Valley [31] - Bill Hewlett's mentorship and support for young innovators, such as Steve Jobs, exemplified his commitment to fostering talent in the tech industry [15][16] - The Hewlett Foundation has evolved to include non-family members on its board, ensuring a diverse leadership structure while maintaining a focus on philanthropy [24][22]

Core Viewpoint - HP is expected to report quarterly earnings of $0.80 per share, reflecting a 2.4% decline year-over-year, while revenues are forecasted to increase by 4.9% to $13.43 billion [1] Earnings Estimates - Over the last 30 days, the consensus EPS estimate has been revised upward by 8.7%, indicating analysts' reassessment of their initial forecasts [2] - Revisions to earnings estimates are significant indicators for predicting investor actions regarding the stock [3] Revenue Projections - Analysts project 'Net revenue- Personal Systems- Commercial PS' to reach $6.99 billion, a year-over-year increase of 12% [5] - 'Net revenue- Personal Systems- Consumer PS' is estimated at $2.20 billion, reflecting a 0.6% increase year-over-year [5] - The total 'Net revenue- Personal Systems' is expected to be $9.19 billion, indicating a 9% increase from the prior-year quarter [5] - 'Net revenue- Printing- Supplies' is projected at $2.76 billion, showing a year-over-year decline of 3.8% [6] - 'Net revenue- Printing- Commercial Printing' is expected to be $1.19 billion, a decrease of 1% from the previous year [6] - 'Net revenue- Printing- Consumer Printing' is forecasted at $286.82 million, indicating a 4.1% decline year-over-year [7] - The total 'Net revenue- Printing' is estimated at $4.24 billion, reflecting a 3% decrease from the prior year [7] Operational Metrics - 'Days in accounts payable' is expected to reach 134 days, compared to 132 days in the previous year [7] - 'Days of sales outstanding in accounts receivable' is projected at 30 days, down from 31 days year-over-year [8] - 'Days of supply in inventory' is estimated at 73.5 days, compared to 70 days in the previous year [8] - 'Earnings from operations- Printing' is forecasted at $796.32 million, down from $829 million in the same quarter last year [8] - 'Earnings from operations- Personal Systems' is expected to reach $528.27 million, compared to $508 million reported in the same quarter last year [9] Stock Performance - HP shares have increased by 12.5% over the past month, outperforming the Zacks S&P 500 composite's 10.7% increase [9]