HP 2025 Q4 Earnings Revenue Up 4.2% Despite 12.3% Net Income Drop

HP reported Q4 2025 earnings with revenue up 4.2% to $14.64 billion, beating estimates. EPS was $0.93, a penny above expectations, but guidance fell below forecasts, indicating cautious outlook.

Revenue

Total revenue reached $14.64 billion, driven by robust performance in the Personal Systems segment, which accounted for $10.35 billion. Commercial PS revenue surged to $6.97 billion, while Consumer PS grew to $3.38 billion. The Printing segment contributed $4.27 billion, with Supplies leading at $2.76 billion. Commercial Printing added $1.21 billion, while Consumer Printing totaled $296 million. Corporate Investments and Other segments generated $19 million and $1 million, respectively.

Earnings/Net Income

HP’s EPS declined 9.6% to $0.85, and net income fell 12.3% to $795 million. Despite these declines, the company has maintained profitability for over two decades, showcasing operational resilience. Despite revenue growth, EPS and net income both declined year-over-year, signaling operational challenges.

Post-Earnings Price Action Review

The strategy of buying HP shares 30 days after earnings releases following three years of revenue growth delivered poor performance, with a -4.16% CAGR and -18.24% total return. This underperformed the benchmark’s 70.90% return, reflecting minimal risk but negative outcomes. The Sharpe ratio of -0.12 underscored the strategy’s inefficiency, while the maximum drawdown of 0.00% highlighted its lack of volatility.

CEO Commentary

CEO Enrique Lores emphasized six consecutive quarters of revenue growth, driven by Personal Systems and AI-powered devices. Strategic priorities include AI integration, Windows 11 adoption, and subscription expansion. Leadership remains confident in mitigating memory cost challenges through pricing adjustments and AI-driven savings.

Guidance

HP guided FY26 non-GAAP EPS to $2.90–$3.20, factoring in $0.30 reduction from memory costs. Personal Systems growth is expected to outpace the market, while Print revenue declines will be offset by industrial growth. Free cash flow targets $2.8B–$3B, with $250M in restructuring charges.

Additional News

HP announced a 10% workforce reduction (4,000–6,000 jobs) by 2028 as part of AI-driven restructuring, aiming for $1B in annual savings. The company also faces rising memory costs impacting EPS by $0.30 in FY26. Despite a 5.5% post-announcement stock drop, HP plans to invest in AI integration and operational efficiency.

Polished Article

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HP’s Q4 2025 earnings highlighted a 4.2% revenue increase to $14.64 billion, driven by Personal Systems growth and Printing segment performance. However, EPS and net income declines signaled ongoing challenges. CEO Enrique Lores emphasized AI-driven cost savings and strategic investments, while guidance reflected cautious expectations amid memory cost pressures.

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HP’s restructuring plan, including job cuts and AI integration, aims to streamline operations and enhance long-term competitiveness. Despite short-term headwinds, the company remains focused on innovation in AI-powered devices and subscription models to drive future growth.