- HP Inc. is a leading global provider of personal computing and other access devices, imaging and printing products.
- In 2022 HP acquired Poly, a leading global provider of workplace collaboration solutions.
- HP Inc operates in more than 170 countries.
HP Inc. (NYSE: HPQ, TSX: HPQ, LSE: 0J2E, TYO: 6597) is a leading global provider of personal computing and other access devices, imaging and printing products. Operating in more than 170 countries, HP delivers a wide range of devices, services and subscriptions for personal computing, printing, 3D printing, hybrid work, gaming, and more.
HP Inc. Acquired Poly
August 29, 2022; HP Inc. announced the completion of its acquisition of Poly, a leading global provider of workplace collaboration solutions.
Poly brings industry-leading video conferencing solutions, cameras, headsets, voice and software to HP, allowing customers to create meeting equity between those in the room and those who aren’t. The combined organization will deliver a complete ecosystem of devices, software, and digital services to create premium employee experiences, improve workforce productivity, and provide enterprise customers with better visibility, insights, security, and manageability across their hybrid IT environments.
HP completed the deal as an all-cash transaction of $40 per share, implying a total enterprise value of approximately $3.3 billion, inclusive of Poly’s net debt. The transaction was financed through a combination of balance sheet cash and new debt.
Fiscal 2023 First Quarter Results
HP Inc. announced fiscal 2023 first quarter net revenue of $13.8 billion, down 18.8% (down 14.7% in constant currency) from the prior-year period.
First quarter GAAP diluted net EPS was $0.49, down from $0.99 in the prior-year period and within the previously provided outlook of $0.47 to $0.57. First quarter non-GAAP diluted net EPS was $0.75, down from $1.10 in the prior-year period and within the previously provided outlook of $0.70 to $0.80. First quarter non-GAAP net earnings and non-GAAP diluted net EPS excludes after-tax adjustments of $262 million, or $0.26 per diluted share.
Personal Systems net revenue was $9.2 billion, down 24% year over year (down 20% in constant currency) with a 5.4% operating margin. Consumer PS net revenue decreased 36% and Commercial PS net revenue decreased 18%. Total units were down 28% with Consumer PS units down 33% and Commercial PS units down 24%.
Printing net revenue was $4.6 billion, down 5% year over year (down 2% in constant currency) with a 18.9% operating margin. Consumer Printing net revenue was down 3% and Commercial Printing net revenue was up 2%. Supplies net revenue was down 7% (down 6% in constant currency). Total hardware units were up 2% overall, with Consumer Printing units up 3% and Commercial Printing units down 8%.
Net revenue from the United States decreased 3.4% to $21.7 billion, and outside of the United States increased 0.6% to $41.3 billion. The decrease in net revenue was primarily driven by unfavorable foreign currency impacts, decline in Supplies, Notebooks and Consumer Printing, partially offset by an increase in Desktops, Workstations and Other Personal Systems.
Fiscal 2022 Full Year Results
HP Inc. announced fiscal 2022 ended October 31, 2022, net revenue of $63.0 billion, down 0.8% (up 0.7% in constant currency) from the prior-year period.
Fiscal 2022 GAAP diluted net EPS was $3.05, down from $5.33 in the prior-year period and below the previously provided outlook of $3.46 to $3.56. Fiscal 2022 non-GAAP diluted net EPS was $4.08, up from $3.79 in the prior-year period and within the previously provided outlook of $4.02 to $4.12.
HP generated $4.5 billion in net cash provided by operating activities and $3.9 billion of free cash flow in fiscal 2022. Free cash flow includes net cash provided by operating activities of $4.5 billion adjusted for net investments in leases of $155 million and net investments in property, plant and equipment of $765 million. HP utilized $4.3 billion of cash during fiscal 2022 to repurchase approximately 126 million shares of common stock in the open market. When combined with the $1.0 billion of cash used to pay dividends, HP returned 138% of its free cash flow to shareholders in fiscal 2022.
HP’s dividend payment of $0.25 per share in the fourth quarter resulted in cash usage of $0.2 billion. HP utilized $0.8 billion of cash during the quarter to repurchase approximately 26.6 million shares of common stock in the open market. As a result, HP returned 55% of its fourth quarter free cash flow to shareholders. HP exited the quarter with $3.2 billion in gross cash, which includes cash and cash equivalents and short-term investments of $17 million.
The HP board of directors has declared a quarterly cash dividend of $0.2625 per share on the company’s common stock, payable on January 4, 2023. This is an increase of 5% from the prior dividend.
Beginning third quarter of fiscal 2022, the company observed an accelerated decline in consumer demand, particularly with respect to Consumer PCs. This decline in demand is in line with industry-wide declines and the company expect this to continue for fiscal 2023. For the fiscal year 2022, the company continued to see strong demand in Windows-based Commercial PCs, and mix shifts from low end to premium products. However, the company anticipate the overall macroeconomic environment to continue to adversely impact the demand for Commercial PCs in the short-term. In Printing, the company continued to see gradual and uneven recovery in Commercial Print, driven by the slow return of workers to the office, and softening of demand in Consumer Print, which accelerated during the fourth quarter of fiscal 2022. Also, the company experienced an increasingly competitive pricing environment in the second half of fiscal 2022, which the company expect to continue in the short-term, due to the macroeconomic environment across Personal Systems and Printing. Further, its operating margins were negatively impacted by the higher cost due to inflationary pressures. In fiscal 2023, the company expect decline in both Personal Systems and Printing market compared to fiscal 2022.
Supply chain dynamics have impacted and the company expect will continue to impact logistics and component costs at least in the short term, with logistics costs remaining elevated for the fiscal year as a result of both expedited shipments of components and overall rate costs in the freight network, while capacity improved in the second half of fiscal 2022.
HP is a leading global provider of personal computing and other access devices, imaging and printing products, and related technologies, solutions and services. The company sell to individual consumers, small- and medium-sized businesses and large enterprises, including customers in the government, health and education sectors.
HP has three reportable segments: Personal Systems, Printing and Corporate Investment
Personal Systems offers commercial and consumer desktop and notebook PCs, workstations, thin clients, commercial mobility devices, retail POS systems, displays and peripherals, software, support and services. The company group commercial notebooks, commercial desktops, commercial services, commercial mobility devices, commercial detachables and convertibles, workstations, retail POS systems and thin clients into commercial PCs and consumer notebooks, consumer desktops, consumer services and consumer detachables into consumer PCs when describing performance in these markets.
Printing provides consumer and commercial printer hardware, supplies, services and solutions. Printing is also focused on Graphics and 3D imaging solutions in the commercial and industrial markets.
Corporate Investments includes HP Labs and certain business incubation and investment projects.
At October 31, 2022, its worldwide patent portfolio included over 28,000 patents, including patents acquired as a result of its acquisition of Plantronics, Inc. in August 2022.
Hewlett-Packard Company (HP) was founded in 1939 by William Hewlett and David Packard in a garage in Palo Alto.
|1934||Bill Hewlett and Dave Packard become friends when they bond over a two-week camping trip.|
|1938||The Walt Disney Company buys 8 HP oscillators to prepare movie theaters to screen Fantasia.|
|1939||HP was founded by William Hewlett and David Packard in a garage in Palo Alto, California. They started with a budget of $538.|
|1951||HP invents the 524A high-speed frequency counter. These kinds of signal measuring products will earn billions for HP.|
|1957||HP went public with an initial public offering (IPO) of 200,000 shares at $16.50 per share|
|1959||HP goes global and establishes facilities in Switzerland and Germany.|
|1963||HP invents a frequency synthesizer that’s used aboard vehicles headed for deep space.|
|1964||The company invents the atomic clock. Capable of coordinating international time to within a millionth of a second, it’s the most accurate clock ever invented.|
|1966||HP Laboratories opens. HP Labs conducts research into new technology. The same year it opens, HP Labs invents light-emitting diodes (LEDs).|
|1968||HP develops its first “personal computer,” a scientific calculator called the HP 9100A. Ads for the calculator coin the term, “personal computer.”|
|1974||HP introduces the world’s first programmable pocket calculator.|
|1990||HP produces its first PC, the HP-85. It has intuitive peripherals and can even communicate with other computers|
|1983||The HP-150 Touchscreen PC is introduced, which allows users to navigate the interface by touching the screen.|
|1991||HP creates an affordable color printer with the HP DeskJet 500C.|
|2015||HP split into two separate companies, HP Inc. and Hewlett Packard Enterprise.|
|2016||The HP Jet Fusion debuts, HP’s first 3D printer.|
|2016||HP Inc. acquired Samsung's printer business for $1.05 billion, becoming the world's largest printer manufacturer.|
|2022||HP acquired Poly, a leading global provider of workplace collaboration solutions.|