01—Abstract
Summary
Summary of the 10-Q filed August 27, 2026. Cited figures are marked; the original filing is the authoritative source.
HP Inc. reported third-quarter fiscal 2026 results (three months ended July 31, 2026) with net revenue of $15.68 billiona, up from $13.93 billion a year earlier, driven mainly by products revenue from pricing actions to offset higher commodity costs in Personal Systems and favorable currency impacts.
Net earnings were $661 millionb, down from $763 million, and diluted EPS was $0.71 versus $0.80. For the nine months, net revenue was $44.52 billion and net earnings were $1.66 billion, or $1.79 diluted EPS. Gross margin declined to 18.8% in the quarter from 20.5%, reflecting higher commodity costs and unfavorable mix toward Personal Systems, partly offset by IEEPA tariff refunds.
Cash flow from operations improved to $3.04 billionc for the nine months from $2.07 billion, mainly from working capital changes. HP returned $1.5 billion to shareholders over the nine months through $0.8 billion of dividends and $0.7 billion of share repurchases, and $7.7 billion remained under its repurchase authorization. Total debt was $9.16 billion at July 31, 2026, against $9.67 billion at October 31, 2025, and stockholders' deficit narrowed to $(92) million.
The filing also details the Fiscal 2026 Plan, approved November 25, 2025, which targets a reduction of 4,000 to 6,000 employees and about $650 milliond in pre-tax charges, with $547 million recognized year to date. Two legal matters are notable: a U.K. High Court judgment of $1.24 billion in damages against the Lynch estate in the Autonomy matter, which is subject to a limited appeal and would be shared equally with Hewlett Packard Enterprise if recovered, and a June 29, 2026 Indian Customs Tribunal decision that overturned several duty and penalty findings in the DRI matter, with a damages ruling expected no earlier than September 2026.
02—Key points
Key Highlights
- Net revenue rose to $15.68 billion in the quarter from $13.93 billion, with Personal Systems net revenue up 18.5% on pricing actions, while Printing net revenue fell 2.2%.
- Net earnings declined to $661 million from $763 million, and diluted EPS was $0.71 versus $0.80 in the prior-year quarter.
- Gross margin fell to 18.8% from 20.5% as higher commodity costs and unfavorable mix toward Personal Systems outweighed pricing actions and IEEPA tariff refunds.
- Nine-month operating cash flow of $3.04 billion increased from $2.07 billion, primarily due to favorable working capital changes.
- HP returned $1.5 billion to shareholders in the nine months ($0.8 billion in dividends and $0.7 billion in buybacks), with about $7.7 billion remaining under the repurchase authorization.
- The Fiscal 2026 Plan targets 4,000 to 6,000 headcount reductions and about $650 million in pre-tax charges, with $547 million recognized in the nine months.
- A U.K. court awarded $1.24 billion in the Autonomy-related proceedings; the Lynch estate's appeal has been limited to a few damages issues, and HP and Hewlett Packard Enterprise would share any recovery equally.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2026, HP kept $0.04.
- Revenue$15.68B100.0%
- Cost of revenue−$12.73B81.2%
- Gross profit$2.94B18.8%
- Operating costs−$2.05B13.1%
- Operating income$892.0M5.7%
- Interest, other & tax−$231.0M1.5%
- Net income$661.0M4.2%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed August 27, 2026Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Revenue | $15.68B$13.93B | +12.5% |
| Cost of Revenue | $12.73B$11.08B | +14.9% |
| Gross Profit | $2.94B$2.85B | +3.3% |
| R&D Expenses | $389.00M$406.00M | −4.2% |
| SG&A Expenses | $1.54B$1.45B | +5.9% |
| Operating Expenses | $2.05B$2.13B | −3.8% |
| Operating Income | $892.00M$716.00M | +24.6% |
| Interest Expense | $96.00M$111.00M | −13.5% |
| Net Income | $661.00M$763.00M | −13.4% |
| EPS (Basic) | $0.72$0.81 | −11.1% |
| EPS (Diluted) | $0.71$0.80 | −11.3% |
| Shares Outstanding (Basic) | 919.00M947.00M | −3.0% |
| Shares Outstanding (Diluted) | 927.00M954.00M | −2.8% |
05—Questions
Frequently Asked Questions
How did HP's profitability trend in the third quarter of fiscal 2026?
Earnings from operations rose to $892 million from $716 million, but net earnings fell to $661 million from $763 million because of a $137 million tax provision compared with a $139 million tax benefit in the prior-year quarter. Gross margin declined 1.7 percentage points to 18.8%, driven by higher commodity costs and unfavorable mix toward Personal Systems.
What drove the increase in net revenue?
Products net revenue rose to $14.83 billion from $13.11 billion, mainly due to pricing actions to offset higher commodity costs in Personal Systems and favorable currency impacts. Personal Systems revenue grew 18.5%, while Printing declined 2.2%, with demand softness in Printing partly offsetting the gains.
How strong is HP's balance sheet and liquidity position?
Cash, cash equivalents and restricted cash were $4.17 billion at July 31, 2026, and total debt was $9.16 billion, down from $9.67 billion at October 31, 2025. HP also maintains a $5.0 billion revolving credit facility, and the stockholders' deficit improved to $(92) million from $(346) million.
What are the main legal developments investors should know about?
In the Autonomy matter, the U.K. High Court entered a judgment of $1.24 billion in damages, and the Court of Appeal denied most of the Lynch estate's appeal grounds on August 25, 2026; no recovery has been recorded. In India, the Customs Tribunal issued a June 29, 2026 decision overturning several duty and penalty findings, with a damages ruling expected no earlier than September 2026 and HP planning an appeal to the Supreme Court of India by August 28, 2026.
What is the status of the Fiscal 2026 restructuring plan?
HP expects to reduce global headcount by about 4,000 to 6,000 employees and estimates approximately $650 million in pre-tax charges, with about $500 million in labor costs. Through July 31, 2026, HP has incurred $0.5 billion under the plan, including a $220 million and $60 million special termination benefit tied to the voluntary early retirement program.
06—Continue