HP Inc reported Q1 revenue of $14.44 billion, a 6.9% increase year over year, and non-GAAP EPS of $0.81, surpassing estimates. Despite this, shares have dropped 31% over the past year. AI PCs now make up over 35% of shipments, but memory costs are impacting margins. Management anticipates a decline in PC unit shipments for 2026 and noted a 2% drop in printing revenue. Reddit sentiment remains bearish, with concerns about translating unit growth into margin recovery amidst high memory prices.
"HP's finance chief warned that memory cost volatility is expected to persist even into next year, with no near-term relief for a cost that now dominates the bill of materials."
"Printing revenue fell 2% year over year in Q1, with consumer printing down 8%, removing a historically stable margin contributor."
"Management guided PC unit shipments to a double-digit percentage decline for 2026, meaning AI PC mix gains must offset the overall downturn."
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