HP expects a slower rate of memory cost increases as it moves into the fourth quarter of its fiscal year, CFO Karen Parkhill said during a Wednesday analyst call.
Memory Cost Outlook
Parkhill acknowledged that chip pricing will stay high but indicated the pace of rise is easing. “Looking ahead to the remainder of our fiscal year, we continue to expect input costs to rise, putting near‑term pressure on our operating margins, particularly in personal systems,” she said.
She added that HP still sees RAM and storage expenses climbing as a share of the bill of materials, yet the acceleration should be milder than in fiscal ’26. “On input costs, we said we still expect them to rise in FY ‘27 and in Q4, but at a slower rate than we’ve seen to date,” Parkhill repeated.
Personal Systems Performance
The personal systems segment posted an 18 percent year‑over‑year revenue gain, reaching $11.76 billion. The boost came despite a 16 percent drop in total unit shipments, a sign that higher‑margin products are offsetting lower volume.
Growth in AI‑enabled PCs helped lift the segment, a trend HP highlighted as a bright spot amid broader market softness. Analysts have noted that such “creative” offsets may temper the impact of component price pressure.
Overall revenue rose 12.5 percent to $15.67 billion, comfortably beating Wall Street’s forecast of $14.39 billion. Non‑GAAP diluted earnings were reported at 83 cents per share, above the expected 69 cents.
Leadership Search
The board continues to look for a permanent chief executive, seven months after Enrique Lores left for PayPal. Interim chief, Bruce Broussard, said the search is progressing but offered no timeline.
The search continues.
One solution‑provider executive, who asked to stay anonymous, expressed frustration over the prolonged interim period, saying, “My view is, it’s hard to run an organization of this size with an interim leader, unless [Broussard] is planning to become the permanent leader.”
While the CEO hunt remains open, HP’s quarterly results suggest that the operating strategy is holding up despite the cost headwinds.
Given the current trajectory, the slower cost rise could give HP a modest breathing room in its margins, especially if the AI PC segment continues to command premium pricing. However, any further spikes in chip pricing could quickly erode that cushion, leaving the firm to lean on its broader portfolio to stay competitive.
The CFO’s remarks also hinted that the upcoming fiscal year may see a steadier cost environment, but she stopped short of promising a return to pre‑crunch pricing levels. Investors will likely watch the next earnings release for signs of whether the slower pace materializes.
