HPQ · HP Inc.

HP's fiscal Q2 2026 results exceeded expectations on both revenue and earnings, driven by strong Personal Systems growth. Revenue of $14.4 billion rose 9% YoY (6.3% in constant currency), above the prior quarter's trajectory. Personal Systems revenue surged 13% to $10.2 billion, with commercial up 14% and consumer up 10%, reflecting robust demand for AI-enabled devices and workstations. Printing revenue was flat at $4.2 billion as supplies growth (+1%) offset hardware declines. Non-GAAP operating margin expanded 20 basis points to 7.5%, aided by favorable mix and cost discipline despite restructuring charges of $365 million. Non-GAAP EPS of $0.86 beat the guided range of $0.70-$0.76 and rose 21% YoY, while GAAP EPS of $0.49 missed guidance due to higher restructuring costs. Free cash flow of $0.8 billion was strong, enabling $374 million in shareholder returns (dividends of $0.30/share and $100 million buybacks). Management's commentary highlighted strategic progress in AI and edge computing. Guidance for Q3 FY2026 implies non-GAAP EPS of $0.61-$0.71, below Q2's level but expected seasonally; for the full year, HP raised its non-GAAP EPS range to $2.90-$3.10 (from $2.81-$3.01 previously) and FCF guidance to $2.8-$3.0 billion. The raised outlook reflects confidence in sustained demand and operational execution, though rising commodity costs remain a headwind. Overall, the print signals solid momentum in HP's transformation toward higher-value devices and services.