Slide 1: Earnings Announcement
Data courtesy of Print my Leg Earnings Announcement MAY 31, 2022 | Q2 FY22
Slide 2: Forward-looking Statements
Forward-looking Statements This presentation contains forward-looking statements based on current expectations and assumptions that involve risks and uncertainties. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of HP Inc. and its consolidated subsidia
Slide 3: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information HP has included non-GAAP financial measures in this presentation to supplement HP’s consolidated financial statements presented on a generally accepted accounting principles (“GAAP”) basis. Definitions of these non-GAAP financial measures and reconciliations of
Slide 4: Q2 FY22 Highlights
Q2 FY22 Highlights • Net revenue of $16.5 billion, up 3.9% from the prior-year period and up 4.9% in constant currency1 • Non-GAAP diluted net earnings per share2 of $1.08, at the high end of our previously provided outlook of $1.02 to $1.08 per share • GAAP diluted net earnings per share of $0.94,
Slide 5: Key Growth Areas
Key Growth Areas Collectively generated $5.6 billion in revenue in 1H FY22 PERIPHERALS 40%+ revenue growth across HyperX and HP branded peripherals Definitive agreement to acquire Poly expected to drive increased scale and accelerate growth in our peripherals business GAMING 40%+ revenue growth lead
Slide 6: Q2 FY22 Results Overview
Q2 FY22 Results Overview Growth CC1 Non-GAAP Non-GAAP Non-GAAP OP $ Non-GAAP OP % of $ in millions Net revenue Growth y/y% y/y% OP $3 OP % of rev3 y/y3 rev y/y3 Printing $4,963 (6.8)% (6.5)% $958 19.3% $7 1.4 pts Personal Systems $11,532 9.3% 10.6% $798 6.9% $88 0.2 pts Corporate Investments / $(5)
Slide 7: Q2 FY22 Mix by Segment and Region
Q2 FY22 Mix by Segment and Region Net revenue Non-GAAP operating profit2 Net revenue By key segment and business unit1 By key segment3 By region Workstations & Other Personal Systems 6% Printing Supplies $1.8 billion Desktops 19% AMERICAS EMEA APJ 17% Printing Commerical4 41% 37% 22% 6% Printing 19.
Slide 8: Revenue & Non-GAAP Diluted Net EPS Performance
Revenue & Non-GAAP Diluted Net EPS1 Performance Revenue (Billions) Non-GAAP diluted net EPS1 $18 $1.20 $16.7 $17.0 $16.5 $15.6 $15.9 $16 $15.3 $15.3 $0.93 $1.10 $1.00 $14.3 $1.08 $0.92 $14 $1.00 $12.5 $0.94 $12 $0.80 $10 $0.62 $0.60 $0.51 $8 $0.49 $6 $0.40 $4 $0.20 $2 $0 $0.00 2Q20 3Q20 4Q20 1Q21 2Q
Slide 9: Revenue Growth
Revenue Growth y/y growth (%) 30% 27.3% 25% 25.4% 20% 15% 9.3% 10% 7.0% 8.8% 7.0% 8.2% 4.9% 5% 6.6% 6.9% (0.2%) 4.1% 3.9% 0.1% 0% (1.0%) (5%) (2.1%) (10.1%) (10%) (11.2%) (15%) 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 1 Revenue growth in constant currency Revenue growth as reported 1 1. Adjusted
Slide 10: Regional Revenue Trends
Regional Revenue Trends 35% 35% $7 $6 Americas 30% United 30% (including U.S.) 25% States 25% 20% $6 $5 20% 15% 15% 10% 10% 5% $5 0% $4 5% (5%) 0% (10%) (5%) $4 (15%) $3 (10%) billions 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 % growth billions 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 % growt
Slide 11: Personal Systems Q2 FY22
Personal Systems Q2 FY22 Record Q2 revenue resulting in operating margin at the high end of the range reflecting the durability of PC demand Commercial was ~65% of revenue mix, with Revenue Operating profit revenue up 18% y/y driven by a strong mix of Windows-based notebooks, desktops, and $11.5 $79
Slide 12: Printing Q2 FY22
Printing Q2 FY22 Operating margin above the high end of our target range for the second consecutive quarter HP+ and Big Tank printers now represent Revenue Operating profit 48% of our shipment mix, rebalancing our system profitability toward hardware $5.0 $958 7% y/y 19.3% Innovation: The new HP S
Slide 13: ESG Key Metrics
ESG Key Metrics Climate Action Human Rights Digital Equity As of year-end 2021 HP reduced single- 349,000 supply chain workers have now HP has enabled better learning use plastic packaging by 44% been reached through empowerment outcomes for over 74 million people compared to 2018—a 25% improvement
Slide 14: Select Cash & Debt Balances
Select Cash & Debt Balances Net cash (debt) 1 $ Billions $5.0 $ Billions 2Q21 3Q21 4Q21 1Q22 2Q22 $0.0 Gross cash2 3.4 3.4 4.3 3.4 4.5 Gross debt 6.2 7.2 7.6 7.1 9.1 ($5.0) Net cash (debt)1,3 (2.8) (3.7) (3.3) (3.7) (4.7) ($10.0) 2Q21 3Q21 4Q21 1Q22 2Q22 2 Gross cash Gross debt 1. Net cash (debt) is
Slide 15: Cash Flow & Shareholder Return
Cash Flow & Shareholder Return $ Millions Cash Flow $ Millions Shareholder Return $7,187 $4,000 $7,200 $7,000 Share repurchase $6,409 Dividend payment $6,000 $3,051 $3,000 $5,000 $4,167 6,249 $4,000 $2,000 $1,849 2,518 $3,000 $2,165 $1,272 $2,000 $1,755 1,610 $1,446 $1,346 $1,000 1,010 $1,000 938 $5
Slide 16: Outlook
Outlook Q3 FY22 net EPS guidance GAAP diluted net EPS $0.91 – $0.96 Non-GAAP diluted net EPS1 $1.03 – $1.08 FY22 net EPS guidance GAAP diluted net EPS $3.79 – $3.93 Non-GAAP diluted net EPS1 $4.24 – $4.38 FY22 Free Cash Flow Guidance Free Cash Flow2 At least $4.5 billion 1. Third quarter and fiscal
Slide 17: Non-GAAP Financial Information
Non-GAAP1 Financial Information $ in millions, except per share amounts Q2 FY22 Q1 FY22 Q2 FY21 Revenue $16,490 $17,028 $15,877 Cost of revenue 13,157 79.8% 13,643 80.1% 12,437 78.3% Total OpEx 1,889 11.4% 1,886 11.1% 1,997 12.6% Operating profit $1,444 8.8% $1,499 8.8% $1,443 9.1% Interest and othe
Slide 18: Q2 FY22 GAAP to Non-GAAP Bridge
Q2 FY22 GAAP to Non-GAAP Bridge $ in millions, except Restructuring Acquisition- Non-operating Amortization of Tax tax rate and per GAAP and other related retirement related Non-GAAP intangible assets adjustments share amounts charges charges (credits) / charges Revenue $16,490 $16,490 Cost of reven
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Slide 20: Supplemental Slides
Supplemental Slides @
Slide 21: Inventory & Accounts Receivable
Inventory & Accounts Receivable INVENTORY ACCOUNTS RECEIVABLE In Billions Percentage of Revenue1 In Billions Percentage of Revenue1 $10 18% $6 16% $9.0 $5.3 $5.5 $5.4 $8.9 $5.4 $5.3 $9 16% $5.2 $5.0 14% $8.2 $4.9 $7.9 $5 $8 $7.5 14% 12% $7 $6.7 13.9% 13.7% 13.2% 12% $4 $5.9 12.3% 12.5% 10% $6.0 $6 1
Slide 22: PP&E & Accounts Payable
PP&E & Accounts Payable PP&E ACCOUNTS PAYABLE In Billions Percentage of Revenue1 In Billions $3 16% $20 $18.1 $2.7 $2.6 $2.6 $2.6 $2.5 $2.5 $2.5 14% $17.0 $2.5 $15.9 $16.1 $16 $15.0 $15.2 $14.3 $14.7 12% $2 10% $12 8% $8 6% $1 4.7% 4% 4.6% 4.4% 4.2% 4.0% $4 4.0% 4.0% 4.0% 2% $0 0% $0 Jul20 Oct20 Jan
Slide 23: Working Capital Metrics
Working Capital Metrics 140 120 100 80 60 40 20 0 -20 -40 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Days receivables 33 32 30 28 29 30 27 29 Days inventory 45 43 49 54 62 53 59 61 Days payable 108 105 109 110 120 108 119 116 Cash conversion cycle 1 1 -30 -30 -30 -28 -29 -25 -33 -26 1. Cash con
Slide 24: Q1 FY22 GAAP to Non-GAAP Bridge
Q1 FY22 GAAP to Non-GAAP Bridge $ in millions, except Restructuring Non-operating tax rate and per Amortization of and other Acquisition- retirement related share amounts GAAP intangible assets charges related charges Tax adjustments (credits) / charges Non-GAAP Revenue $17,028 $17,028 Cost of reven
Slide 25: FY21 GAAP to Non-GAAP Bridge
FY21 GAAP to Non-GAAP Bridge Non-operating $ in millions, except Amortization Restructuring Acquisition- Debt Defined benefit Oracle retirement tax rate and per of intangible and other related Extinguishment plan settlement Tax litigation related (credits) / share amounts GAAP assets charges charges
Slide 26: Q4 FY21 GAAP to Non-GAAP Bridge
Q4 FY21 GAAP to Non-GAAP Bridge Defined Benefit Non-operating $ in millions, except Amortization Restructuring Acquisition- plan settlement Oracle retirement tax rate and per of intangible and other related (gains) / Tax litigation related (credits) share amounts GAAP assets charges charges charges
Slide 27: Q3 FY21 GAAP to Non-GAAP Bridge
Q3 FY21 GAAP to Non-GAAP Bridge Non-operating $ in millions, except Amortization Restructuring Acquisition- Debt retirement tax rate and per of intangible and other related extinguishment Tax related (credits) / share amounts GAAP assets charges charges costs adjustments charges Non-GAAP Revenue $15
Slide 28: Q2 FY21 GAAP to Non-GAAP Bridge
Q2 FY21 GAAP to Non-GAAP Bridge $ in millions, except Restructuring Non-operating tax rate and per Amortization of and other Acquisition- retirement related share amounts GAAP intangible assets charges related charges Tax adjustments (credits) / charges Non-GAAP Revenue $15,877 $15,877 Cost of reven
Slide 29: Q1 FY21 GAAP to Non-GAAP Bridge
Q1 FY21 GAAP to Non-GAAP Bridge $ in millions, except Restructuring Non-operating tax rate and per Amortization of and other Acquisition- retirement related share amounts GAAP intangible assets charges related charges Tax adjustments (credits) / charges Non-GAAP Revenue $15,646 $15,646 Cost of reven
Slide 30: FY20 GAAP to Non-GAAP Bridge
FY20 GAAP to Non-GAAP Bridge Defined Non-operating $ in millions, except Amortization Restructuring Acquisition- Debt Benefit plan retirement tax rate and per of intangible and other related extinguishme settlement Tax related (credits) share amounts GAAP assets charges charges nt costs charges adju
Slide 31: Q4 FY20 GAAP to Non-GAAP Bridge
Q4 FY20 GAAP to Non-GAAP Bridge Defined Benefit $ in millions, except Amortization Restructuring Acquisition- plan settlement Non-operating tax rate and per of intangible and other related (gains) / Tax retirement related share amounts GAAP assets charges charges charges adjustments (credits) / char
Slide 32: Q3 FY20 GAAP to Non-GAAP Bridge
Q3 FY20 GAAP to Non-GAAP Bridge Non-operating $ in millions, except Amortization Restructuring Acquisition- Debt retirement tax rate and per of intangible and other related extinguishment Tax related (credits) / share amounts GAAP assets charges charges costs adjustments charges Non-GAAP Revenue $14
Slide 33: Q2 FY20 GAAP to Non-GAAP Bridge
Q2 FY20 GAAP to Non-GAAP Bridge $ in millions, except Restructuring Non-operating tax rate and per Amortization of and other Acquisition- retirement related share amounts GAAP intangible assets charges related charges Tax adjustments (credits) / charges Non-GAAP Revenue $12,469 $12,469 Cost of reven