HP Inc. reported third-quarter fiscal 2026 revenue of $15.7 billion, up 12.5% year-on-year and well above analyst estimates of roughly $14.38 to $14.58 billion, according to Reuters. Adjusted earnings per share came in at 83 cents, beating the consensus estimate of 69 cents. Investors still pushed the stock down approximately 9 to 10% in after-hours trading on 26 August 2026.
The source of the unease was a 16% fall in total personal computer unit shipments during the quarter. Consumer units dropped 19% and commercial units fell 14%, SiliconAngle reported. Higher average selling prices cushioned the revenue impact: HP's Personal Systems segment, which covers PCs and related products, saw revenue rise 18% to $11.8 billion despite shipping far fewer units.
The gap between rising revenue and falling volumes is a critical distinction for investors. It means HP is selling more expensive machines to fewer buyers, a dynamic that raises questions about the durability of demand. Whether the unit decline reflects deliberate inventory management, softening end-market demand, or a combination of the two is not yet clear from the results.
Printing, HP's other main business, offered little support. Printing revenue fell 2% to $3.9 billion in the quarter, down 4% in constant currency terms, Reuters noted.
Tariff refunds played a meaningful role in the headline numbers. Of the 83-cent adjusted earnings per share figure, 11 cents came from tariff refunds, SiliconAngle reported. That makes direct comparisons with prior quarters more complicated, since the refunds may not recur at the same level.
On an unadjusted basis, the picture was weaker. Diluted earnings per share fell to 71 cents from 80 cents a year earlier, and net earnings dropped to $661 million from $763 million, according to SiliconAngle.
HP generated $1.7 billion in operating cash flow and $1.6 billion in free cash flow during the quarter. The company returned $600 million to shareholders through $274 million in dividends and $300 million in share repurchases covering approximately 12.2 million shares. Gross cash stood at $4.2 billion at the end of the period.
For the fourth quarter, HP guided adjusted earnings per share of 69 to 79 cents, above the analyst estimate of 67 cents, with 8 cents of that range attributed to estimated tariff refunds, Bloomberg reported. HP also raised its full-year adjusted earnings per share outlook to $3.19 to $3.29, up from a prior forecast of $2.90 to $3.10. That full-year figure includes a $0.19 tailwind from estimated tariff refunds, according to Reuters.
The quarterly results arrive against a difficult backdrop. HP has struggled with PC demand for several years since the pandemic-era surge in home computing purchases normalised. Reuters reported in early 2024 that HP missed revenue estimates for a seventh consecutive quarter, citing weak consumer PC demand. Later that year, HP guided first-quarter fiscal 2025 profit below estimates on continued sluggishness in the PC market. In May 2025, HP cut its annual profit forecast as tariffs weighed on demand, with shares falling 14% after chief executive Enrique Lores said tariff impacts had exceeded the company's expectations.
The pattern of volumes under pressure while revenue is held up by higher average prices has now become a structural feature of HP's results. Investors watching the 16% unit shipment fall in the third quarter of fiscal 2026 are weighing whether the company can sustain revenue growth if average selling prices plateau or if demand for higher-end machines softens further.
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