HP’s decline in PC shipments overshadows strong results; shares fall
Published Thu, Aug 27, 2026 · 08:00 AM — Updated Thu, Aug 27, 2026 · 08:03 AM
HP SAID on Wednesday (Aug 26) its personal computer unit shipments declined in the third quarter, overshadowing the company’s strong results and sending its shares down 10 per cent in extended trading.
That overshadowed strong revenue growth of 12.5 per cent, as HP said that rising commodity prices and waning benefits from lower-cost inventory are expected to further pressure margins for Personal Systems in the fourth quarter. A recovery is expected only in fiscal 2027.
“Given the impact of commodity-driven price increases, we expect below seasonal revenue performance in the fourth quarter,” CFO Karen Parkhill said on a post-earnings call.
“We do expect year-over-year revenue growth in the quarter, driven by pricing actions, share gains in premium categories, attach of higher margin offerings, and increased penetration of AI PCs as more AI workloads move to edge devices.”
HP, like peers Dell Technologies, Apple and China’s Lenovo Group, is grappling with a global memory chip squeeze, fueled by massive AI data centre buildouts that are sucking up capacity.
While PC unit revenue rose 18 per cent in the third quarter, unit shipments dropped 16 per cent, as it focused on selling more expensive, higher-margin products, including AI PCs. Printing revenue fell 2 per cent to US$3.9 billion in the three months ended Jul 31.
Operating margin for the PC segment shrank to 4.6 per cent from the prior quarter’s 5.2 per cent, as rising commodity and memory costs outpaced price increases.
HP expects fourth-quarter adjusted earnings per share between 69 cents and 79 cents, above analysts’ average estimate of 67 cents, according to data compiled by LSEG. The forecast includes an 8 cents boost from estimated tariff refunds.
Adjusted profit of 83 cents per share for the quarter included an 11 cents per share boost from tariff refunds. Analysts had expected adjusted EPS of 69 cents per share.
US President Donald Trump’s administration has refunded about US$100 billion from tariffs it collected before the US Supreme Court struck down those duties.
Third-quarter revenue of US$15.7 billion exceeded estimates of US$14.38 billion, helped by strong demand for AI-optimised PCs.
HP also raised its annual forecast for adjusted earnings per share to a range of US$3.19 to US$3.29, including a 19 cents favourable impact from estimated tariff refunds for the entire year. The laptop maker had earlier forecast annual adjusted EPS to be US$2.90 to US$3.10. REUTERS
