Risks, uncertainties and assumptions that could affect our business and results of operations include factors relating to the impact of macroeconomic and geopolitical trends, changes and events, including the Russian invasion of Ukraine and tension across the Taiwan Strait and the regional and global ramifications of these events; recent volatility in global capital markets, increases in benchmark interest rates, the effects of inflation and instability of financial institutions; risks associated with HP’s international operations; the effects of the COVID-19 pandemic; the execution and performance of contracts by HP and its suppliers, customers, clients and partners, including logistical challenges with respect to such execution and performance; changes in estimates and assumptions HP makes in connection with the preparation of its financial statements; the need to manage (and reliance on) third-party suppliers, including with respect to component shortages, and the need to manage HP’s global, multi-tier distribution network, limit potential misuse of pricing programs by HP’s channel partners, adapt to new or changing marketplaces and effectively deliver HP’s services; HP’s ability to execute on its strategic plans, including the previously announced initiatives, business model changes and transformation; execution of planned structural cost reductions and productivity initiatives; HP’s ability to complete any contemplated share repurchases, other capital return programs or other strategic transactions; the competitive pressures faced by HP’s businesses; risks associated with executing HP’s strategy and business model changes and transformation; successfully innovating, developing and executing HP’s go-to-market strategy, including online, omnichannel and contractual sales, in an evolving distribution, reseller and customer landscape; the development and transition of new products and services and the enhancement of existing products and services to meet evolving customer needs and respond to emerging technological trends; successfully competing and maintaining the value proposition of HP’s products, including supplies; challenges to HP’s ability to accurately forecast inventories, demand and pricing, which may be due to HP’s multi-tiered channel, sales of HP’s products to unauthorized resellers or unauthorized resale of HP’s products or our uneven sales cycle; integration and other risks associated with business combination and investment transactions; the results of our restructuring plans (including the fiscal 2023 plan), including estimates and assumptions related to the cost (including any possible disruption of HP’s business) and the anticipated benefits of our restructuring plans; the protection of HP’s intellectual property assets, including intellectual property licensed from third parties; the hiring and retention of key employees; disruptions in operations from system security risks, data protection breaches, cyberattacks, extreme weather conditions or other effects of climate change, medical epidemics or pandemics such as the COVID-19 pandemic, and other natural or manmade disasters or catastrophic events; the impact of changes to federal, state, local and foreign laws and regulations, including environmental regulations and tax laws; our aspirations related to environmental, social and governance matters; potential impacts, liabilities and costs from pending or potential investigations, claims and disputes; the effectiveness of our internal control over financial reporting and other risks that are described in HP’s Annual Report on Form 10-K for the fiscal year ended October 31, 2022 and HP’s other filings with the Securities and Exchange Commission.
As in prior periods, the financial information set forth in this document, including any tax-related items, reflects estimates based on information available at this time. While HP believes these estimates to be reasonable, these amounts could differ materially from reported amounts in HP’s Quarterly Reports on Form 10-Q for the fiscal quarter ended July 31, 2023, Annual Report on Form 10-K for the fiscal year ending October 31, 2023, and HP’s other filings with the Securities and Exchange Commission. The forward-looking statements in this document are made as of the date of this document and HP assumes no obligation and does not intend to update these forward-looking statements.
HP’s Investor Relations website at investor.hp.com contains a significant amount of information about HP, including financial and other information for investors. HP encourages investors to visit its website from time to time, as information is updated, and new information is posted. The content of HP’s website is not incorporated by reference into this document or in any other report or document HP files with the SEC, and any references to HP’s website are intended to be inactive textual references only.
HP INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (Unaudited) (In millions, except per share amounts) | |||||||||||
Three months ended | |||||||||||
July 31, 2023 | April 30, 2023 | July 31, 2022 | |||||||||
Net revenue | $ | 13,196 | $ | 12,907 | $ | 14,648 | |||||
Costs and expenses: | |||||||||||
Cost of revenue | 10,374 | 9,993 | 11,764 | ||||||||
Research and development | 354 | 410 | 368 | ||||||||
Selling, general and administrative | 1,302 | 1,397 | 1,142 | ||||||||
Restructuring and other charges | 75 | 200 | 13 | ||||||||
Acquisition and divestiture charges | 48 | 74 | 32 | ||||||||
Amortization of intangible assets | 91 | 86 | 50 | ||||||||
Russia exit charges | — | — | 23 | ||||||||
Total costs and expenses | 12,244 | 12,160 | 13,392 | ||||||||
Earnings from operations | 952 | 747 | 1,256 | ||||||||
Interest and other, net | (16 | ) | (160 | ) | (70 | ) | |||||
Earnings before taxes | 936 | 587 | 1,186 | ||||||||
(Provision for) benefit from taxes | (170 | ) | 467 | (64 | ) | ||||||
Net earnings | $ | 766 | $ | 1,054 | $ | 1,122 | |||||
Net earnings per share: | |||||||||||
Basic | $ | 0.77 | $ | 1.06 | $ | 1.10 | |||||
Diluted | $ | 0.76 | $ | 1.06 | $ | 1.08 | |||||
Cash dividends declared per share | $ | 0.52 | $ | — | $ | 0.50 | |||||
Weighted-average shares used to compute net earnings per share: | |||||||||||
Basic | 993 | 991 | 1,024 | ||||||||
Diluted | 1,002 | 998 | 1,035 | ||||||||