Published - May 31st, 2023 @ 10:42 AM (GMT+2 )
HP Inc's Q2 Results Suffer Due to Inflation
Under the pressure of inflation, customers have scaled back their spending on HP Inc's personal computers, causing the company to miss Wall Street's second-quarter revenue targets, leading to a nearly 3% drop in its shares in after-hours trading.
Post-Pandemic Dip in Tech Demand
The dip mirrors a similar trend among other companies like Lenovo and Dell Technologies, whose demand had eased following the pandemic-induced peaks when work-from-home trends catalyzed increased sales of laptops and other electronics.
Global PC Shipments Plummet
The downturn is not just limited to these brands, with global PC shipments taking a substantial hit too, plunging nearly 30% during Q1 to pre-pandemic levels, as reported by research firm IDC.
Drop in Sales for HP's Key Segments
HP's Personal Systems segment, encompassing desktop and notebook PCs, saw a 29% dip in the quarter under review. Furthermore, the company's printing segment also experienced a 5% decrease.
Anticipating a Stronger Second Half
Despite these figures, HP remains optimistic about the latter half of the year. CEO Enrique Lores asserts that the second half is poised to be stronger, particularly on the consumer side, despite a year-on-year comparison that might need to look more favorable.
HP Adjusts Annual Profit Expectations
HP's annual adjusted profit expectations have been updated to a range between $3.30 per share and $3.50 per share, a slight adjustment from the earlier forecast of $3.20 to $3.60.
Embracing AI for Future PC Development
Lores unveiled that AI-driven opportunities were discussed at a recent partner event. The company is actively collaborating with leading software and silicon partners to develop innovative PC architectures that will fuel a refresh in the PC industry in the upcoming years.
Q2 Revenue Falls Short of Analysts' Predictions
HP's revenue for the second quarter stood at $12.91 billion, falling short of the analysts' prediction of $13.07 billion, according to Refinitiv data. On an adjusted basis, HP outperformed expectations, earning 80 cents per share versus the anticipated 76 cents.
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