HP 2025 Q4 Earnings Beats Revenue Estimates Despite EPS and Net Income Declines

HP (HPQ) reported fiscal 2025 Q4 earnings on Nov 25, 2025, with revenue rising 4.2% year-over-year to $14.64 billion, surpassing Wall Street expectations. The company guided FY2026 non-GAAP EPS to $2.90–$3.20, below the $3.34 consensus, while Q1 2026 adjusted EPS is projected at $0.73–$0.81.

Revenue

HP’s revenue growth was driven by its Personal Systems segment, which generated $10.35 billion, with Commercial PS reaching $6.97 billion and Consumer PS hitting $3.38 billion. The Printing segment contributed $4.27 billion, though Supplies revenue declined to $2.76 billion. Commercial Printing and Consumer Printing reported $1.21 billion and $296 million, respectively. Corporate Investments and Other segments added $19 million and $1 million. The performance highlights resilience in commercial markets despite softer consumer printing demand.

Earnings/Net Income

HP’s EPS fell 9.6% to $0.85 in Q4 2025, with net income dropping 12.3% to $795 million. The decline reflects margin pressures, though the company has maintained profitability for over two decades, underscoring operational resilience.

Post-Earnings Price Action Review

The strategy of buying HP shares 30 days after earnings releases following three years of revenue growth delivered poor returns, with a CAGR of -7.71% and total return of -19.68%, significantly underperforming the benchmark. The approach exhibited high volatility (32.83%) and a Sharpe ratio of -0.23, indicating a high-risk, low-reward profile.

CEO Commentary

CEO Enrique Lores emphasized sustained revenue growth, noting the sixth consecutive quarter of year-over-year gains driven by Personal Systems. He highlighted strategic investments in AI-powered devices and the Workforce Experience platform, while acknowledging challenges like rising memory costs and supply chain disruptions. Leadership transitions and restructuring efforts were outlined as part of the company’s long-term strategy.

Guidance

HP projected FY2026 non-GAAP EPS of $2.90–$3.20, with Personal Systems growth outpacing market expectations and Printing growth slightly exceeding industry projections. Free cash flow is forecast at $2.8–$3 billion, while Q1 2026 adjusted EPS is expected to range between $0.73 and $0.81.

Additional News

1. Workforce Reduction: HP announced plans to cut 4,000–6,000 jobs by 2028 as part of an AI-driven restructuring, aiming to save $1 billion annually by 2028.

2. AI Investment: The company is accelerating AI integration into products, with AI computers accounting for 30% of Q4 shipments.

3. Stock Reaction: Shares fell 5.5% after hours following the earnings report, driven by weak guidance and restructuring plans.

HP’s Q4 results reflect a mixed performance, with revenue growth outpacing expectations but profitability metrics under pressure. The company’s focus on AI and operational efficiency will be critical in navigating sector headwinds.