PALO ALTO, Calif., May 29, 2018 (GLOBE NEWSWIRE) -- HP (NYSE:HPQ)
| ● | Second quarter GAAP diluted net earnings per share of $0.64, above the previously provided outlook of $0.42 to $0.46 per share |
| ● | Second quarter non-GAAP diluted net earnings per share of $0.48, within the previously provided outlook of $0.45 to $0.49 per share |
| ● | Second quarter net revenue of $14.0 billion, up 13% (up 10% in constant currency) from the prior-year period |
| ● | Second quarter net cash provided by operating activities of $1,050 million |
| ● | Second quarter free cash flow of $937 million |
| ● | Second quarter returned $1,028 million to shareholders in the form of share repurchases and dividends |
| HP Inc.'s Fiscal 2018 second quarter financial performance | ||||||||||||||
| Q2 FY18 | Q2 FY17 | Y/Y | ||||||||||||
| GAAP net revenue ($B) | $ | 14.0 | $ | 12.4 | 13 | % | ||||||||
| GAAP operating margin | 6.9% | 6.6% | 0.3pts | |||||||||||
| GAAP net earnings ($B) | $ | 1.1 | $ | 0.6 | 89 | % | ||||||||
| GAAP diluted net earnings per share | $ | 0.64 | $ | 0.33 | 94 | % | ||||||||
| Non-GAAP operating margin | 7.4% | 7.6% | (0.2)pts | |||||||||||
| Non-GAAP net earnings ($B) | $ | 0.8 | $ | 0.7 | 16 | % | ||||||||
| Non-GAAP diluted net earnings per share | $ | 0.48 | $ | 0.40 | 20 | % | ||||||||
| Net cash provided by operating activities ($B) | $ | 1.1 | $ | 0.5 | 131 | % | ||||||||
| Free cash flow ($B) | $ | 0.9 | $ | 0.4 | 147 | % | ||||||||
Notes to table
Information about HP Inc.'s use of non-GAAP financial information is provided under "Use of non-GAAP financial information" below.
Net revenue and EPS results
HP Inc. (“HP”) announced Fiscal 2018 second quarter net revenue of $14.0 billion, up 13% (up 10% in constant currency) from the prior-year period.
Second quarter GAAP diluted net EPS was $0.64, up from $0.33 in the prior-year period and above the previously provided outlook of $0.42 to $0.46. Second quarter non-GAAP diluted net EPS was $0.48, up from $0.40 in the prior-year period and within the previously provided outlook of $0.45 to $0.49. Second quarter non-GAAP net earnings and non-GAAP diluted net EPS exclude after-tax adjustments of $0.3 billion, or $0.16 per share, related to restructuring and other charges, acquisition-related charges, defined benefit plan settlement charges, amortization of intangible assets, non-operating retirement-related credits/(charges), debt extinguishment costs and tax adjustments.
“We delivered another quarter of double digit year over year revenue and profit growth, strong EPS and impressive free cash flow and performed well across segments and regions,” said Dion Weisler, President and CEO, HP Inc. “Our sharp focus on innovation, combined with operational excellence and driving profitable growth is paying off.”
Asset management
HP’s net cash provided by operating activities in the second quarter was $1.1 billion. Accounts receivable ended the quarter at $4.6 billion, up 3 days quarter over quarter to 30 days. Inventory ended the quarter at $5.6 billion, up 1 day quarter over quarter to 44 days. Accounts payable ended the quarter at $13.1 billion, up 7 days quarter over quarter to 104 days.
HP generated $937 million of free cash flow in the second quarter of Fiscal 2018. Free cash flow includes net cash provided by operating activities and net investments in property, plant and equipment of $113 million.
HP’s dividend payment of $0.1393 per share in the second quarter resulted in cash usage of $0.2 billion. HP also utilized $0.8 billion of cash during the quarter to repurchase approximately 35.4 million shares of common stock in the open market. As a result, HP returned 110% of its free cash flow to shareholders in the second quarter of Fiscal 2018. HP exited the quarter with $5.3 billion in gross cash, which includes cash and cash equivalents and short-term investments of $1.1 billion included in other current assets.
Fiscal 2018 second quarter segment results
- Personal Systems net revenue was up 14% year over year (up 11% in constant currency) with a 3.8% operating margin. Commercial net revenue increased 16% and Consumer net revenue increased 10%. Total units were up 7% with Notebooks units up 7% and Desktops units up 7%.
- Printing net revenue was up 11% year over year (up 9% in constant currency) with a 16.0% operating margin. Total hardware units were up 13% with Commercial hardware units up 88% and Consumer hardware units up 4%. Supplies net revenue was up 8% (up 6% in constant currency).
