HP reports Third Quarter Results Fiscal Year 2025

Net revenue and EPS results

HP Inc. and its subsidiaries (“HP”) announced fiscal 2025 third quarter net revenue of $13.9 billion, up 3.1% (up 3.3% in constant currency) from the prior-year period.

“In Q3 we delivered a fifth consecutive quarter of revenue growth, driven by strength in Personal Systems and strong momentum in our key growth areas,” said Enrique Lores, President and CEO of HP Inc. “These results demonstrate our agility and focused execution in the quarter, reinforce the strength of our strategy, and our commitment to be a leader in the future of work.”

“Looking forward, we remain confident in the strength of the PC market opportunity, and expect continued momentum from Windows 11 refresh and AI PC adoption,” said Karen Parkhill, CFO, HP Inc. “We believe that the actions we are taking are the right ones to enable us to respond swiftly to near term market dynamics, while continuing to invest for long-term profitable growth.”

Third quarter GAAP diluted net EPS was $0.80, up from $0.65 in the prior-year period and above the previously provided outlook of $0.57 to $0.69. Third quarter non-GAAP diluted net EPS was $0.75, down from $0.84 in the prior-year period and within the previously provided outlook of $0.68 to $0.80. Third quarter non-GAAP net earnings and non-GAAP diluted net EPS excludes after-tax adjustments of $(50) million, or $(0.05) per diluted share, related to restructuring and other charges, acquisition and divestiture charges, amortization of intangible assets, certain litigation (benefits) charges, net, non-operating retirement-related credits, tax adjustments, and the related tax impact on these items.

Notes to table Information about HP Inc.'s use of non-GAAP financial information is provided under "Use of non-GAAP financial information" below.

Asset management

HP's net cash provided by operating activities in the third quarter of fiscal 2025 was $1.7 billion. Accounts receivable ended the quarter at $5.1 billion, up 3 days quarter over quarter to 33 days. Inventory ended the quarter at $8.4 billion, down 2 days quarter over quarter to 68 days. Accounts payable ended the quarter at $17.0 billion, up 8 days quarter over quarter to 138 days.

HP generated $1.5 billion of free cash flow in the third quarter. Free cash flow includes net cash provided by operating activities of $1.7 billion adjusted for net investments in leases from integrated financing of $23 million and net investments in property, plant, equipment and purchased intangible of $215 million.

HP’s dividend payment of $0.2894 per share in the third quarter resulted in cash usage of $272 million. HP also utilized $150 million of cash during the quarter to repurchase approximately 5.5 million shares of common stock in the open market. HP exited the quarter with $2.9 billion in gross cash, which includes cash and cash equivalents of

$2.9 billion, restricted cash of $3 million and short-term investments of $3 million included in other current assets. Restricted cash is related to amounts collected and held on behalf of a third party for trade receivables previously sold.

Fiscal 2025 third quarter segment results

• Personal Systems net revenue was $9.9 billion, up 6% year over year (up 6% in constant currency) with a 5.4% operating margin. Consumer PS net revenue was up 8% and Commercial PS net revenue was up 5%. Total units were up 5% with Consumer PS units up 8% and Commercial PS units up 3%.

• Printing net revenue was $4.0 billion, down 4% year over year (down 3% in constant currency) with a 17.3% operating margin. Consumer Printing net revenue was down 8% and Commercial Printing net revenue was down 3%. Supplies net revenue was down 4% (down 3% in constant currency). Total hardware units were down 9%, with Consumer Printing units down 8% and Commercial Printing units down 12%.