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What's in the Offing for HP Inc. (HPQ) This Earnings Season?
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HP Inc. (HPQ - Free Report) is slated to report first-quarter fiscal 2023 results on Feb 28.
The company expects fiscal first-quarter non-GAAP earnings per share between 70 cents and 80 cents. The Zacks Consensus Estimate for earnings is pegged at 74 cents, indicating a decline of 32.7% from the year-ago quarter.
The Zacks Consensus Estimate for revenues stands at $14.15 billion, suggesting a decline of 16.9% from the prior-year quarter.
HP’s earnings surpassed the consensus mark in three of the trailing four quarters while matching the same on one occasion, the average surprise being 2.2%.
Let’s see how things have shaped up before the announcement.
HP’s first-quarter performance is likely to have witnessed a negative impact of the slowdown in consumer demand for PCs and high inventory levels. HP witnessed the robust demand for its PCs during the pandemic-led work-and-learn-from-home wave. However, the reopening of economies and offices, inflationary pressure and recession concerns have been waning the demand for PCs.
Furthermore, enterprises are postponing their large IT spending plans due to the weakening global economy amid ongoing macroeconomic and geopolitical issues. This might have hurt HP’s commercial PC sales in the to-be-reported quarter. The Zacks Consensus Estimate for HP’s Personal Systems revenues is pegged at $9.74 billion, suggesting a year-over-year decline of 20.1%.
Per the preliminary data released by Gartner in January 2023, PC shipments in the October-December 2022 quarter plunged 28.5% year over year to 65.3 million units. The independent research firm claims the decline to be the largest since it has been tracking the PC market since the mid-1990s. (Read more: PC Shipments Crashes in Q4 on Weak Demand, Macroeconomic Woes)
In its report, Gartner pointed out that though supply-chain challenges have eased, a higher inventory level has become a major issue due to the softened demand for consumers and commercial PCs.
HP’s Printing division’s sales are likely to have been hampered by softened consumer demand. The consensus mark for the segment’s first-quarter revenues is pegged at $4.52 billion, indicating a year-over-year decline of 6.4%.
Furthermore, HP’s first-quarter bottom line is likely to have witnessed the benefits of favorable pricing, disciplined cost management and a better product mix. However, lower revenues, higher commodity costs, unfavorable currency exchange rates, increased investments in innovation and the go-to-market strategy are expected to have more than offset the benefits.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for HPQ this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
HP currently carries a Zacks Rank of #3 and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Per our model, Splunk , CrowdStrike (CRWD - Free Report) and Zscaler (ZS - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.
Splunk carries a Zacks Rank #2 and has an Earnings ESP of +0.39%. The company is slated to report fourth-quarter fiscal 2023 results on Mar 1. Its earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 222%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Splunk’s fourth-quarter earnings stands at $1.11 per share, implying a year-over-year increase of 68.2%. It is estimated to report revenues of $1.07 billion, which suggests an increase of 19% from the year-ago quarter.
CrowdStrike carries a Zacks Rank #3 and has an Earnings ESP of +2.33%. The company is scheduled to report fourth-quarter fiscal 2023 results on Mar 7. Its earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 34.6%.
The Zacks Consensus Estimate for CRWD’s fiscal fourth-quarter earnings is pegged at 43 cents per share, indicating a year-over-year increase of 43.3%. The consensus mark for revenues stands at $624.7 million, suggesting a year-over-year increase of 44.9%.
Zscaler is slated to report second-quarter fiscal 2023 results on Mar 2. The company has a Zacks Rank #3 and an Earnings ESP of +2.17% at present. ZS’ earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 27.3%.
The Zacks Consensus Estimate for second-quarter earnings is pegged at 29 cents per share, suggesting an increase of 123.1% from the year-ago quarter’s earnings of 13 cents. Zscaler’s quarterly revenues are estimated to increase 42.4% year over year to $363.8 million.
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What's in the Offing for HP Inc. (HPQ) This Earnings Season?
HP Inc. (HPQ - Free Report) is slated to report first-quarter fiscal 2023 results on Feb 28.
The company expects fiscal first-quarter non-GAAP earnings per share between 70 cents and 80 cents. The Zacks Consensus Estimate for earnings is pegged at 74 cents, indicating a decline of 32.7% from the year-ago quarter.
The Zacks Consensus Estimate for revenues stands at $14.15 billion, suggesting a decline of 16.9% from the prior-year quarter.
HP’s earnings surpassed the consensus mark in three of the trailing four quarters while matching the same on one occasion, the average surprise being 2.2%.
Let’s see how things have shaped up before the announcement.
HP Inc. Price and EPS Surprise
HP Inc. price-eps-surprise | HP Inc. Quote
Factors to Consider
HP’s first-quarter performance is likely to have witnessed a negative impact of the slowdown in consumer demand for PCs and high inventory levels. HP witnessed the robust demand for its PCs during the pandemic-led work-and-learn-from-home wave. However, the reopening of economies and offices, inflationary pressure and recession concerns have been waning the demand for PCs.
Furthermore, enterprises are postponing their large IT spending plans due to the weakening global economy amid ongoing macroeconomic and geopolitical issues. This might have hurt HP’s commercial PC sales in the to-be-reported quarter. The Zacks Consensus Estimate for HP’s Personal Systems revenues is pegged at $9.74 billion, suggesting a year-over-year decline of 20.1%.
Per the preliminary data released by Gartner in January 2023, PC shipments in the October-December 2022 quarter plunged 28.5% year over year to 65.3 million units. The independent research firm claims the decline to be the largest since it has been tracking the PC market since the mid-1990s. (Read more: PC Shipments Crashes in Q4 on Weak Demand, Macroeconomic Woes)
In its report, Gartner pointed out that though supply-chain challenges have eased, a higher inventory level has become a major issue due to the softened demand for consumers and commercial PCs.
HP’s Printing division’s sales are likely to have been hampered by softened consumer demand. The consensus mark for the segment’s first-quarter revenues is pegged at $4.52 billion, indicating a year-over-year decline of 6.4%.
Furthermore, HP’s first-quarter bottom line is likely to have witnessed the benefits of favorable pricing, disciplined cost management and a better product mix. However, lower revenues, higher commodity costs, unfavorable currency exchange rates, increased investments in innovation and the go-to-market strategy are expected to have more than offset the benefits.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for HPQ this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
HP currently carries a Zacks Rank of #3 and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Per our model, Splunk , CrowdStrike (CRWD - Free Report) and Zscaler (ZS - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.
Splunk carries a Zacks Rank #2 and has an Earnings ESP of +0.39%. The company is slated to report fourth-quarter fiscal 2023 results on Mar 1. Its earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 222%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Splunk’s fourth-quarter earnings stands at $1.11 per share, implying a year-over-year increase of 68.2%. It is estimated to report revenues of $1.07 billion, which suggests an increase of 19% from the year-ago quarter.
CrowdStrike carries a Zacks Rank #3 and has an Earnings ESP of +2.33%. The company is scheduled to report fourth-quarter fiscal 2023 results on Mar 7. Its earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 34.6%.
The Zacks Consensus Estimate for CRWD’s fiscal fourth-quarter earnings is pegged at 43 cents per share, indicating a year-over-year increase of 43.3%. The consensus mark for revenues stands at $624.7 million, suggesting a year-over-year increase of 44.9%.
Zscaler is slated to report second-quarter fiscal 2023 results on Mar 2. The company has a Zacks Rank #3 and an Earnings ESP of +2.17% at present. ZS’ earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 27.3%.
The Zacks Consensus Estimate for second-quarter earnings is pegged at 29 cents per share, suggesting an increase of 123.1% from the year-ago quarter’s earnings of 13 cents. Zscaler’s quarterly revenues are estimated to increase 42.4% year over year to $363.8 million.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.