HP Inc. Sees Catalysts in AI PC and Windows Refresh Cycle

HP Inc. is gearing up for a potential boost in earnings with the introduction of AI PCs and the upcoming Windows refresh cycle. The computer giant reported a stabilization in its fiscal second quarter, with sales increasing in the personal systems segment as commercial clients upgrade their computers ahead of Microsoft’s end of support for Windows 10 in 2025.

HP CEO Enrique Lores highlighted the stronger than expected PC demand driven by the upgrade cycle, as businesses realize the need to replace aging units, especially those still in use from the pandemic. However, printer sales continued to face challenges, with consumer and commercial sales declining.

The introduction of AI PCs such as the HP OmniBook X AI and the HP EliteBook Ultra AI could potentially brighten the earnings outlook for HP and rival Dell. Lores predicts that AI PCs will account for about 10% of PC sales in 2024, ramping up to 60% in three years.

In its latest earnings report, HP reported net sales of $12.8 billion, a slight decrease year over year, with personal systems sales showing growth and printer sales facing a decline. The company’s diluted EPS also saw a slight increase compared to estimates.

As HP enters a new era of AI, it joins other tech giants in embracing artificial intelligence. Amazon AWS CEO Adam Selipsky shared insights on the company’s AI plans in a recent podcast. Stay tuned for more updates on the latest technology news that could impact the stock market.