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How Does HP View the Global Demand Environment?

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Revenue growth in major business segments

US-based (SPY) consumer technology (QQQ) company HP (HPQ) says that demand for its PC (personal computer) and Printer segments has improved in fiscal 2017.

In fiscal 3Q17, revenue from its Personal Systems rose 12.0% YoY (year-over-year), while shipments rose 7.0% YoY driven by increasing component prices. There has also been a product mix shift to higher-end devices. According to HP, this mix has been at the forefront of this shift and has attributed product innovation to revenue growth.

Market research firm IDC (International Data Corporation) has estimated PC unit shipments to fall YoY and revenue to remain flat YoY in 2017. While the commodity cost environment is expected to remain high over the next few months, HP is focusing on execution and market strategy to gain traction.

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Print segment

HP has estimated the total available market in its Print segment to be around $200.0 billion. Its Managed Print Services and Digital Graphics verticals are growing at a faster pace than the overall Print segment. During Deutsche Bank’s (DB) technology conference, HP’s CFO (chief financial officer) Cathie Lesjak mentioned what a competitive market it is but that it’s better than the previous year. She said the segment is growing in the mid-single to low-single digits.

Competition in this market makes it essential for companies to introduce the right product at the right time at the right price.

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