HP Inc. reported third-quarter results that exceeded analyst expectations, with adjusted earnings per share of $0.83, surpassing the consensus estimate of $0.66. The beat included a $0.11 benefit from tariff refunds. Revenue climbed 12.5% year-over-year to $15.7 billion, outpacing the $14.34 billion forecast.
Free cash flow totaled $1.6 billion for the quarter, while gross cash ended at $4.2 billion. The company returned $574 million to shareholders through $300 million in share buybacks and $274 million in dividends.
Personal Systems revenue, which includes PCs and workstations, rose 18% to $11.8 billion, driven by a 22% increase in commercial sales. Consumer revenue grew 10%. Unit shipments declined 16% as HP shifted toward higher-priced, higher-margin products such as AI PCs. Operating margin in the segment narrowed to 4.6% from 5.2% in the prior quarter due to rising commodity and memory costs that outpaced pricing adjustments.
Printing revenue fell 2% to $3.9 billion, with supplies revenue down 3%.
For the full fiscal year 2026, HP raised its adjusted EPS guidance to a range of $3.19 to $3.29, above the prior midpoint of $3.04. Free cash flow guidance was increased to $3.0 billion to $3.2 billion. Fourth-quarter adjusted EPS is expected between $0.69 and $0.79, including an estimated $0.08 benefit from tariff refunds.
Interim CEO Bruce Broussard highlighted growth in premium products and innovations in AI PCs, while Bank of America analysts maintained an Underperform rating, citing margin pressure and slower PC unit growth. Shares fell more than 7% in early U.S. trading following the results.
