HP Inc. (HPQ) Business Profile

What it does

HP is a global technology company that sells devices, services and subscriptions for personal computing, printing, 3D printing, hybrid work, gaming and related technologies. It operates in more than 170 countries and has three segments: Personal Systems, Printing and Corporate Investments.

Personal Systems sells desktop and notebook PCs, workstations, thin clients, point-of-sale systems, displays, hybrid systems, software, endpoint-security products and lifecycle services. Its commercial customers include enterprises, public-sector organizations, schools and small and medium-sized businesses; its consumer business serves people using PCs for gaming, learning, remote work, entertainment and personal tasks. Its platforms primarily use Microsoft Windows and Google Chrome, with processors from Intel and AMD and NVIDIA graphics processors for advanced workloads.

Printing sells hardware, supplies, services and solutions to homes, home businesses, small businesses, large enterprises, print-service providers and packaging converters. The business includes office and home printers, industrial and graphics presses, and additive-manufacturing and personalization systems. Supplies include ink and laser cartridges, media, industrial graphics supplies and 3D-printing supplies intended for repeated use.

The company is adding AI-oriented capabilities across these businesses. Its AI PCs and workstations are designed for local AI processing, while its printers and security offerings use AI features. Management said the company is extending data-center-class AI capabilities to edge devices through systems including HP ZGX Fury and HP Z Boost.

How it makes money

HP earns most of its revenue from selling physical products, with additional revenue from supplies, services, software, subscriptions and support. Products generated $52.0 billion in FY2025, or 94.0% of revenue, while services generated $3.3 billion, or 5.96%. Products revenue grew 3.07% and services revenue grew 6.02% in FY2025.

Personal Systems is the larger segment. It makes money from commercial and consumer PCs and related hardware, as well as endpoint security, support, deployment, configuration, extended warranties and lifecycle services. The company is pursuing Device-as-a-Service as customers adopt subscription-based solutions. In Q3 2026, management said Personal Systems revenue was $11.8 billion, up 18% year over year; commercial represented over 70% of segment revenue in the quarter. Management also said attached businesses—peripherals, collaboration products, services and Workforce Experience Platform offerings—accounted for one-third of Personal Systems gross profit.

Printing earns revenue at the initial hardware sale and from supplies and services over the installed life of a printer. Its recurring offerings include Instant Ink Services, HP All-In Plan and Managed Print Services. Commercial Printing includes office, graphics, 3D-printing and personalization activities, excluding supplies; Consumer Printing covers home printing, excluding supplies; Supplies covers consumables used repeatedly with hardware.

For FY2025, Personal Systems revenue was $38.5 billion and Printing revenue was $16.7 billion. Corporate Investments, which contains incubation projects and digital-enablement investments, reported $62.0 million. Management said Q3 2026 company revenue was $15.7 billion, with Print revenue down 2% year over year.

Customers and how it sells

HP organizes customers into consumer and commercial groups. Commercial Personal Systems serves enterprise, public-sector, education, small- and medium-sized business customers, while consumer products are aimed at home use, gaming, learning, remote work and entertainment. Printing serves home, home-business and micro-business users, as well as small businesses, public-sector bodies, large enterprises, print-service providers and packaging converters.

The majority of overall revenue comes through channel resellers. HP also sells directly, including online, and works with retailers, resellers, distribution partners, system integrators and other intermediaries. Retailers mainly target consumers and small businesses, while commercial resellers mainly serve small businesses, mid-market accounts, public-sector organizations and large enterprises. Large enterprise accounts typically have an HP account manager supported by product and service specialists.

One customer represented 12.0% of FY2025 revenue. Other countries generated $36.1 billion of FY2025 revenue, while the Americas generated $23.5 billion. Within the Americas, United States revenue was $19.2 billion; Europe, Middle East and Africa generated $18.6 billion, and Asia-Pacific and Japan generated $13.2 billion. HP states that approximately 65% of FY2025 net revenue came from outside the United States.

Management said Q3 2026 constant-currency revenue rose in APJ, EMEA and the Americas, driven by Personal Systems performance.

Suppliers and costs

HP uses outsourced manufacturers around the world for HP-designed products and also assembles finished products from components and sub-assemblies bought from a wide range of vendors. It uses build-to-order production for high-volume basic configurations and configure-to-order production for customer-specific hardware and software requirements.

Its platforms primarily use Microsoft Windows and Google Chrome operating systems, processors from Intel and AMD, and NVIDIA GPUs for advanced graphics and computing workloads. Most products have existing or readily available alternative sources of supply, but certain components come from a single or limited number of suppliers when this is considered advantageous for technology, availability, price or quality. Printing obtains many components from sole-source suppliers for similar reasons.

Component, memory, storage, tariff and foreign-exchange costs affect the cost base. The company experienced higher commodity and tariff costs in FY2025 that were not fully offset by pricing and other actions. Management said it had secured supply, qualified new suppliers, changed configurations, reduced costs and repriced products with discipline. Management expects input costs to continue rising in FY2027, though more slowly than in FY2026.

Competitive position

Personal Systems operates in markets characterized by price competition and frequent product introductions. HP identifies Acer, Apple, ASUSTeK Computer, Dell, Huawei, Lenovo, Logitech, Microsoft, Samsung and Toshiba as primary competitors. It also competes with local companies and white-box manufacturers in certain geographies. Management said it returned to share leadership in the Americas during Q3 2026 and gained share in premium PCs and workstations.

Printing competes in printer hardware and supplies with Brother, Canon, Pantum, Seiko Epson, Ricoh and Xerox. It also faces independent sellers of imitation, refill and remanufactured supplies, which can be lower priced and are sold beside HP products through online and omnichannel resellers, retailers and distributors. Management described Print as a competitive market and said it was focused on pricing discipline and profitable hardware placements.

HP competes across both segments on technology, innovation, performance, price, quality, reliability, brand, distribution, product range, ease of use, customer relationships, support, security, availability of applications, subscriptions, financing and sustainability. Its stated competitive assets include its product range, research and development, security features, design, procurement leverage, cross-selling, service and support, brand and routes to market.

Our reading: HP’s distribution reach, commercial relationships and ability to sell PCs, print hardware, supplies and services together are meaningful moat sources, but they operate in product categories where price pressure and short product cycles constrain their durability. [item1]

Our reading: Supplies, subscriptions and managed services provide recurring-revenue mechanisms, yet lower-cost non-original supplies remain a direct competitive constraint in Printing. [item1, item7]

Growth opportunities

HP’s growth plan centers on expanding AI-capable personal systems, higher-value commercial and premium PCs, workstations, advanced compute, hybrid systems, security, services and peripherals. It is also investing in endpoint services and solutions, including Device-as-a-Service, as customers move toward subscription-based offerings. Management said Q3 2026 key growth areas collectively grew 46% year over year, faster than the core business.

AI PCs are a stated product focus because they can process some AI workloads locally. Management said AI PCs represented 46% of Q3 2026 Personal Systems mix and the company expects them to represent 50% of shipment mix by the end of FY2026. Management also said it expects AI PCs to represent 60% to 70% of mix in 2027 and more than 70% in 2028. The company is developing edge-AI systems, including workstations and desk-side systems, for applications involving local processing, security, latency and data governance.

In Printing, the company is pursuing subscriptions, profitable tank-printer placements, office products with AI-enabled features, industrial graphics, 3D printing and personalization. Management said Industrial Printing recorded its 12th consecutive quarter of revenue growth, while tank-printer unit growth was 42% in Q3 2026. The company expanded Precise Print, an AI-powered print experience, to more than 150 countries and signed a three-year $100 million strategic agreement with RRD to accelerate AI and industrial automation in print production.

Management said it integrated Poly Lens and collaboration capabilities into Workforce Experience Platform, extending fleet management across PCs, printers and collaboration devices.

Structural risks

• Competition and product cycles. HP operates in markets with established corporations, new and rapidly growing firms, short product life cycles and competitive pricing. It may need to adjust prices to remain competitive.

• Components and input costs. The business faces component shortages, rising memory and storage costs, tariff costs and potential supply constraints. Personal Systems margins can be affected when higher-cost inventory moves through the business.

• Supplier concentration. Some components are obtained from a single or limited number of sources, and Printing obtains many components from single-source suppliers because of technology, availability, price, quality or other considerations.

• International exposure. Approximately 65% of FY2025 net revenue came from outside the United States. Trade restrictions, tariffs, sanctions, localization requirements, political or economic instability, exchange-rate movements and foreign legal changes can affect production, shipping, pricing, demand and operating costs.

• Printing demand and supplies. Printing faces changing customer behavior, aggressive pricing, lower hardware and supplies volumes, and competition from lower-priced imitation, refill and remanufactured supplies.

• Execution and transactions. The company’s results depend on developing, manufacturing and marketing products, services and solutions. Acquisitions, divestitures, alliances, joint ventures and investments may not deliver anticipated benefits, may take longer than expected or may be less profitable than anticipated.

Bottom line

Our reading

Our reading: HP is a global hardware-led business whose largest activity is Personal Systems, complemented by a Printing business that includes recurring supplies, subscriptions and managed services. [item1, item7]

Our reading: The company is directing its portfolio toward AI PCs, edge computing, higher-value devices, software and services, while its results remain exposed to commodity costs, pricing competition, supply concentration and international trade conditions. [call_prepared, call_qa, item1a]

Our reading: Printing’s supplies and service relationships and HP’s broad commercial and channel coverage add continuity, but the business still competes in markets with short cycles and lower-cost alternatives. [item1, item7]