HP Inc (HPQ.N) surpassed Wall Street’s expectations for second-quarter revenue on Wednesday, indicating a resurgence in the personal computer (PC) market as consumers upgrade their systems.
Similar to other PC manufacturers, HP witnessed a surge in sales during the pandemic as individuals, businesses, and educational institutions stocked up on tech products. However, this was followed by a two-year sales decline, which is now beginning to ease.
HP is aiming to capitalize on this trend, particularly after Microsoft (MSFT.O) unveiled a range of new AI features designed for the next generation of PCs last week.
In an interview with Reuters, Chief Executive Enrique Lores stated that he anticipates about 10% of HP’s PC sales to stem from “AI PCs” in the second half of the company’s fiscal 2024. Lores noted that the significance of AI PCs is expected to grow further in 2025.
Education customers were a driving force behind sales growth in the second quarter, with schools upgrading their systems after a prolonged demand slump following the COVID-19 pandemic.
HP reported second-quarter revenue of $12.8 billion, surpassing analysts’ average estimate of $12.6 billion, according to LSEG data.
Sales in HP’s personal systems segment, which includes desktop and notebook PCs, increased by 3% compared to the previous year, while its printing segment saw an 8% decline.
The company has revised its fiscal 2024 adjusted profit outlook to be in the range of $3.30 to $3.60 per share, compared to its previous forecast of $3.25 to $3.65 per share. The midpoint of the updated full-year range is $3.45, exceeding analyst estimates of $3.43.
