HP Shares Jump as AI PC Demand Fuels Revenue Beat
Personal Systems segment grows 6% year-over-year, offsetting a decline in the company's legacy printing business.
HP Inc. (NYSE: HPQ) reported fiscal third-quarter revenue that surpassed analyst expectations, driven by resurgent demand for its personal computers as customers begin to embrace AI-powered devices. The company posted revenue of $13.9 billion, a 3.1% increase from the same period last year, sending its shares up more than 5% on the news.
The growth was anchored by the company's Personal Systems division, which saw its net revenue climb 6% year-over-year to $9.9 billion. This performance marks the fifth consecutive quarter of revenue growth for HP, a sign of stabilization and renewed momentum in the PC market following a post-pandemic slump. CEO Enrique Lores credited the results to "strength in Personal Systems and strong momentum in our key growth areas."
This strength in the PC market, which includes an 8% rise in consumer PC revenue and a 5% increase in commercial sales, helped to offset continued weakness in HP's Printing division. The printing unit reported a 4% decline in net revenue to $4.0 billion, with total hardware units down 9% as demand for home and office printers wanes.
The results highlight HP's strategic pivot toward the emerging market for AI-enabled hardware. The company has been integrating Neural Processing Units (NPUs) into its new EliteBook and Z Series workstations to handle advanced AI tasks more efficiently. This focus on AI was further solidified by its recent acquisition of assets from Humane, which are being used to develop HP's proprietary AI framework.
Looking ahead, HP expressed confidence in the durability of the PC market's recovery. CFO Karen Parkhill stated the company expects "continued momentum from Windows 11 refresh and AI PC adoption." For its fiscal fourth quarter, HP forecasts non-GAAP diluted earnings per share to be in the range of $0.87 to $0.97.