Earnings call transcript: HP Inc. Q2 2026 earnings beat estimates, stock rises

HP Inc. reported earnings for the second quarter of fiscal year 2026, surpassing analyst expectations with an earnings per share (EPS) of $0.86, compared to the forecast of $0.71. The company’s revenue also exceeded projections, coming in at 14.4 billion dollars against an anticipated 13.99 billion dollars. Following the announcement, HP’s stock rose by 4.34% in after-hours trading, reflecting strong investor confidence.

HP Inc. demonstrated strong overall performance in Q2 2026, marking the eighth consecutive quarter of revenue growth. The company achieved a year-over-year revenue increase of 9%, with notable growth in the Asia-Pacific Japan region. Despite flat performance in the Americas, the company maintained a strong operating margin of 7.5%, up 20 basis points from the previous year.

HP Inc. significantly outperformed expectations with an EPS of $0.86, compared to the forecast of $0.71, resulting in a 21.13% surprise. Revenue also exceeded expectations, coming in at 14.4 billion dollars against a forecast of 13.99 billion dollars.

Following the earnings release, HP’s stock price increased by 4.34%, closing at $24.45 in after-hours trading. The stock has surged 21% over the past week, significantly outpacing broader market indices. Trading at a P/E ratio of 9.47 with a market capitalization of $23.23 billion, the stock appears attractively valued. According to InvestingPro analysis, HP is currently trading below its Fair Value, suggesting potential upside for investors. The stock is trading near the middle of its 52-week range, and InvestingPro data shows it’s among the most undervalued stocks in the technology hardware sector.

HP Inc. raised its full-year EPS guidance to a range of $2.90 to $3.10, up from the previously indicated lower end. The company expressed confidence in achieving higher EPS for the fiscal year, driven by strong execution and strategic initiatives in growth areas like AI PCs.

CEO Enrique Lores stated, "Our strong performance this quarter demonstrates our ability to deliver on our strategic priorities and drive profitable growth." CFO Marie Myers added, "We are confident in our ability to navigate the current economic environment and deliver strong results for our shareholders."

During the earnings call, analysts focused on the company’s strategies for managing rising costs and its plans for expanding AI PC capabilities. Executives highlighted their commitment to innovation and cost management as key drivers of future growth.

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Amit Daryanani, Analyst, Evercore1: Good day everyone. Welcome to the second quarter 2026 HP Inc. earnings conference call. My name is Krista and I’ll be your conference moderator for today’s call. At this time, all participants will be in a listen-only mode. We will be facilitating a question and answer session towards the end of the conference. Should you need assistance during the call, please signal a conference specialist by pressing the star key followed by zero. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Alok Juyal, Global Treasurer and Head of Investor Relations. Please go ahead.

Alok Juyal, Global Treasurer and Head of Investor Relations, HP Inc.: Good afternoon, everyone, and welcome to HP’s second quarter 2026 earnings conference call. With me today are Bruce Broussard, HP’s Interim Chief Executive Officer, and Karen Parkhill, HP’s Chief Financial Officer. Before handing the call over to Bruce, let me remind you that this call is a webcast, and a replay will be available on our website shortly after the call for approximately one year. We posted the earnings release and accompanying slide presentation on our investor relations webpage at investor.hp.com. As always, elements of this presentation are forward-looking and are based on our best view of the world and our business as we see them today. For more detailed information, please see disclaimers in the earnings materials relating to forward-looking statements that involve risks, uncertainties and assumptions.

For a discussion of some of these risks, uncertainties, and assumptions, please refer to HP’s SEC reports, including our most recent Form 10-K. HP assumes no obligation and does not intend to update any such forward-looking statements. We also note that the financial information discussed on this call reflects estimates based on information available now and could differ materially from the amounts ultimately reported in HP’s SEC filings. During this webcast, unless otherwise specifically noted, all comparisons are year-over-year comparisons with the corresponding year-ago period. In addition, unless otherwise noted, references to HP channel inventory refer to Tier 1 channel inventory and market share references are based on calendar quarter information. Unless otherwise specified, all financial measures discussed today are non-GAAP, and EPS refers to non-GAAP diluted net earnings per share.

Please refer to the tables in today’s earnings release and the accompanying slide presentation on our website for reconciliations of these non-GAAP measures to the most directly comparable GAAP measures. With that, I will now turn the call over to Bruce.

Bruce Broussard, Interim Chief Executive Officer, HP Inc.: Thank you, Alok, and thanks everyone for joining us today. I want to start by saying how much I appreciate the opportunity to lead HP during this important time for the company. Through the efforts of our team around the world, we continue to advance our future of work strategy and help our customers navigate one of the most significant technology shifts ever due to AI. I want to recognize and thank the entire HP team for the focus, discipline, and agility they demonstrate every day. As interim CEO, I have spent significant time with customers, partners, and employees. What I’ve seen is an organization that’s moving with speed, focus, and urgency to strengthen our market position and accelerate innovation that benefits our customers. This is translating into strong results in a complex operating environment.

Our second quarter performance underscores both the resilience of the business today and the opportunities we see ahead. Today, I’ll share the innovations we’re bringing to market across our portfolio, the results we delivered this quarter, as well as how we’re planning for the environment ahead. First, let me address one topic I know is top of mind, the CEO search. As a reminder, the board established a search committee and engaged an external search firm. We’re looking for a leader with the following attributes. First, a proven track record of creating long-term value for customers and shareholders. Second, the ability to operate effectively in a complex and rapidly changing environment, like many companies are navigating today. Lastly, global and multi-segment business experience. We are engaged in a comprehensive process to select the best leader for HP.

While we’re not in a position to provide a timeline, the board is actively evaluating candidates who align with HP’s needs. Turning to innovation, let me share how we’re bringing our strategy to life across the company. As work evolves, organizations face critical decisions about their IT infrastructure, and employees are adapting to new ways of working, especially in the age of AI. AI innovation is accelerating, adoption growing rapidly across enterprises. Customers are becoming more thoughtful about where AI workloads run. AI is transforming computing from passive devices to context-aware intelligent systems. Companies like HP that own the trusted edge, the workflow context, and the orchestration layer between local and cloud intelligence will be positioned to thrive in this environment. Rising cloud costs associated with agentic AI, along with latency, privacy, and security considerations, are driving demand for AI workloads at the edge.

As a result, customers are building AI at the edge using smaller open source and proprietary models with more capable hardware and secure software layers. HP is enabling the future of work by providing the essential tools and technology necessary for this transformation. Our devices and software stack support this shift with strong architectural capabilities for edge inferencing and new AI workload. We are becoming the trusted intelligent edge provider, connecting devices, workflows, contexts, and physical environment. We continue to believe the future of AI is hybrid, with edge playing an increasingly important role over time. Building on this opportunity, we recently unveiled a wave of innovation at our HP Imagine event, our annual global technology showcase of new products and solutions. In Personal Systems, we introduced the next generation AI PC and expanded local AI capabilities with an ecosystem of more than 150 software companies of all sizes.

Previously, we highlighted our collaboration with partners like Zoom and CrowdStrike. Today, I want to showcase other software partners. GoodNotes, for example, is leveraging the NPU for local audio transcription and summarization, while AI Producer is transforming our AI PCs into professional production studios. These are just a few examples of how we are enhancing productivity, output, and workflow experience for our customers. To bring data center capabilities directly to the desktop in order to support the most demanding AI and compute workloads, we introduced new Z Workstatio