HPインク（HPQ）2026年度第3四半期決算説明会：過去最高の売上高と業績予想の上方修正

HP Inc.（HPQ）は、パーソナルシステムズ部門の成長、高付加価値製品ミックスへのシフト、および価格改定措置に支えられ、2026年度第3四半期の売上高が過去最高を記録したと発表した。経営陣は通期のEPSおよびフリーキャッシュフローの見通しを引き上げた一方で、メモリやストレージのコスト上昇が短期的な利益率を圧迫し続けると警告した。

要点

• 第3四半期の売上高は前年同期比13%増（為替変動の影響を除いたベースで11%増）の157億ドルとなり、過去最高を記録した。HPの増収は9四半期連続となる。
• パーソナルシステムズ部門の売上高は前年同期比18%増の118億ドルとなり、第3四半期として過去最高を記録した。法人向け売上高は22%増、個人向け売上高は10%増となり、法人向けが同部門の売上高の70%以上を占めた。
• Non-GAAP希薄化後EPSは11%増の0.83ドルとなった。これには関税還付による0.11ドルの押し上げ効果が含まれている。経営陣によると、この還付効果を除いたEPSもHPの業績予想レンジの上限を上回った。
• HPは第3四半期に約16億ドルのフリーキャッシュフローを創出し、年初来では25億ドルを超えた。通期のフリーキャッシュフロー見通しは30億〜32億ドルに引き上げられた。
• 第3四半期におけるパーソナルシステムズ部門の出荷個数のうち、AI PCが46%を占めた。経営陣は、その構成比が2026年度末までに約50%、2027年には60%〜70%、2028年には70%を超えると予想している。
• 経営陣は、パーソナルシステムズ部門の営業利益率が第4四半期に底を打ち、その後、緩和策、製品の再設計、価格改定、プレミアム製品ミックスの効果が現れることで、2027年度に向けて四半期ごとに改善すると見込んでいる。

主要財務データ

事業および業績の動向

パーソナルシステムズ部門

パーソナルシステムズ部門は10四半期連続の増収を達成した。18%の増収は、高付加価値製品の投入、コモディティインフレに対応した価格改定、サービス事業の拡大、好調なプロダクトミックスによるものであり、出荷台数の減少を十分に補った。

法人向け売上高は22%増加し、個人向け売上高は10%増加した。HPはプレミアムカテゴリーで2.6ポイント、ワークステーションで1.8ポイントの市場シェアを獲得した。周辺機器、コラボレーション製品、およびWXPを含むサービスは、引き続きパーソナルシステムズ部門の売上総利益の約3分の1に貢献した。

同部門の出荷構成比においてAI PCが46%を占めた。経営陣は、高スペック端末への需要の背景として、ローカル環境でのAIワークロード、トークンコストの削減、レイテンシの短縮、データプライバシーおよびセキュリティ要件を挙げた。現在のユースケースには、従業員の生産性向上、エンジニアリングおよびデザイン、カスタマーサービス、予知保全、製造品質管理、小売、ヘルスケアなどが含まれる。

経営陣によると、Windows 11への移行は約70%完了しており、中小企業からの需要を引き続き下支えしている。HPは、AI PC、エッジAI、およびエージェント型ワークロードが今後の重要な需要牽引役になると見込んでいる。

プリント部門

プリント部門の売上高は、価格競争が激しい環境の中でサプライ品およびハードウェアの販売量が減少したため、2%減（為替変動の影響を除いたベースで4%減）となった。サプライ品の売上高は為替変動の影響を除いたベースで4%減少したが、これには中東市場での逆風が一部影響している。

個人向けプリント売上高は2%減少、法人向けプリント売上高は1%減少した。特に北米および中国のオフィス市場が軟調な中、HPは低利益率なシェア追及を避け、利益の出るハードウェアの設置に重点を置き続けた。

タンク式プリンターの出荷台数は42%増加し、HPはこのカテゴリーでさらに4ポイントの市場シェアを獲得した。産業用印刷事業は12四半期連続の増収を記録し、3Dプリンティング事業の売上高は2桁成長を示した。

HPはまた、AI、産業用自動化、印刷制作に焦点を当てた3年間で1億ドル規模の戦略的合意をRRDと締結した。同社によると、150カ国以上で利用可能な「Precise Print」機能により、紙の使用量を最大38%、インク消費量を最大47%削減できるという。

地域別業績

パーソナルシステムズ部門に牽引され、為替変動の影響を除いたベースで全地域において売上高が増加した。より高度なワークロードに対応するための端末の買い替えが進んだことで、アジア太平洋・日本（APJ）地域は22%増、欧州・中東・アフリカ（EMEA）地域は10%増、米州は5%増となった。

業績見通し（ガイダンス）

HPは2026年度のNon-GAAP希薄化後EPS予想を、従来の2.90〜3.10ドルから3.19〜3.29ドルへと引き上げた。修正後の予想レンジには、関税還付による推定0.19ドルのプラス影響が含まれている。

第4四半期について、経営陣はNon-GAAP希薄化後EPSを0.69〜0.79ドルと予想しており、これには推計0.08ドルの関税還付効果が含まれる。

通期のフリーキャッシュフローは、収益パフォーマンスと運転資本管理に支えられ、30億〜32億ドルに達する見込みである。

パーソナルシステムズ部門において、経営陣は第4四半期の売上高が前四半期比で減少して通常の季節性を下回るものの、前年同期比では依然として増加すると見込んでいる。価格改定、プレミアム製品および法人向けミックス、AI PC、ワークステーション、関連サービス等の提供により、出荷台数の減少を相殺する見通しである。HPは、暦年の下半期におけるPC出荷需要が前年同期比で10%台後半の減少を示すという業界の予測を引用した。

パーソナルシステムズ部門の営業利益率は第4四半期に第3四半期の水準を下回ると予想されるが、経営陣はこれをボトム（底）と引き続き捉えている。投入コストの上昇鈍化や改善策の浸透により、2027年度には四半期ごとに改善が進むと同社は見込んでいるが、2027年度の正式なガイダンスは公表しなかった。

プリント部門については、第4四半期の売上高は過去の季節的傾向に沿ったものになると予想される。関税還付の影響を除いた営業利益率は、HPの長期目標範囲である16%〜19%の下半分の水準になると見込まれる。経営陣は、一時的な関税還付効果を除けば、この範囲が2027年度についても引き続き適切であると述べた。

リスクと注視すべき事項

• 製品コストに占めるメモリおよびストレージのコスト割合は、今後さらに上昇すると予想される。低コストで仕入れた在庫による利益上の恩恵はほぼ一巡しており、高コストな在庫が損益に反映されつつある。
• 値上げによりPCの出荷需要が圧迫される可能性がある。値上げが浸透するまでの期間は販売チャネルや契約形態によって異なり、即時適用から数カ月を要する場合まで様々である。
• HPは、暦年下半期のPC市場における出荷台数が前年同期比で10%台後半の減少となると予想しており、需要や製品ミックスに対する圧力となる可能性がある。
• プリント部門は、攻撃的な価格競争、ハードウェア販売量の減少、長期的サプライ品売上の低迷などのリスクに引き続き晒されている。経営陣は、為替変動の影響を除いたベースで、長期的なサプライ品売上高が1桁台前半から半ばのペースで減少し続けると引き続き見込んでいる。
• 関税の還付金は、第3四半期の業績およびプリント部門の利益率を大きく押し上げた。ただし、これらの恩恵は一時的なものであり、経営陣の長期的なプリント部門利益率の枠組みからは除外されている。
• コストインフレの環境下で、パーソナルシステムズ部門の流通在庫は通常より高い水準にあるものの、経営陣は在庫レベルが管理されており、需要見通しに沿った水準を維持していると述べた。プリント部門の流通在庫は通常の範囲内にとどまっている。
• HPは調達先、サプライチェーン上の施策、価格改定、製品構成の見直し、およびコスト削減を通じて、コモディティや地政学的な圧力への対応を継続している。経営陣は、現在のメモリおよびストレージの供給量は、当会計年度の顧客需要を満たすのに十分であると述べている。

アナリスト質疑応答の要点

経営陣は、低コストの部品在庫による恩恵がほぼ消失したと述べた。しかし、製品の再設計、プラットフォームの最適化、供給企業の適格性評価（サプライヤー認定）、および長期契約の改定により、コスト圧力を段階的に相殺できる見込みである。

価格引き上げは、需要喚起（デマンドシェイピング）、構成変更、コスト削減を実施した後に検討する最終手段という位置づけである。HPはオンラインチャネル、販売代理店、法人契約、および契約ベースのユーザー取引を通じて販売しているため、引き上げ後の価格がすべての顧客に行き渡るまでに最大で数カ月かかる場合がある。

AI PCの経済性について、経営陣は、トークン費用の削減、発生場所に近い場所での機密データの管理、応答時間の改善、ネットワーク依存度の低減を目的として、ローカル推論を評価する顧客が増えていると述べた。また、企業との対話では、AIエージェントを安全にガバナンスし、一元的なデバイス管理を維持することに議論が集中している。

経営陣は2027年度のPC出荷台数予測の開示を控えた。潜在的な需要要因として、AI PC、プレミアムPC、ワークステーションの普及拡大と、価格上昇により先送りされた端末更新需要が最終的に顕在化することの2点を挙げた。

決算説明会（トランスクリプト）全文

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決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Good day, everyone, and welcome to the Third Quarter 2026 HP Inc. Earnings Conference Call. My name is Lisa, and I'll be your conference moderator for today's call. [Operator Instructions]As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Mr. Alok Juyal, Global Treasurer and Head of Investor Relations. Please go ahead.

Alok Juyal

Good afternoon, everyone, and welcome to HP's Third Quarter 2026 Earnings Conference Call. With me today are Bruce Broussard, HP's Interim Chief Executive Officer; and Karen Parkhill, HP's Financial Officer. Before handing the call over to Bruce, let me remind you that this call is a webcast, and replay will be available on our website shortly after the call for approximately 1 year. .

We posted the earnings release and accompanying slide presentation on our Investor Relations web page at investor.hp.com. As always, elements of this presentation are forward-looking and are based on our best view of the world and our business as we see them today.

For more detailed information, please see disclaimers in the earnings materials relating to forward-looking statements that involve risks, uncertainties and assumptions. For a discussion of some of these risks, uncertainties and assumptions, please refer to HP's SEC reports, including our most recent Form 10-K.

HP assumes no obligation and does not intend to update any such forward-looking statements. We also note that the financial information discussed on this call reflects estimates based on information available now and could differ materially from the amounts ultimately reported in HP's SEC filings.

During this webcast, unless otherwise specifically noted, all comparisons are year-over-year comparisons with the corresponding year ago period. References to HP channel inventory, referred to the Tier 1 channel inventory and market share references are based on calendar quarter information.

In addition, unless otherwise specified, all financial measures discussed today are non-GAAP and EPS refers to non-GAAP diluted net earnings per share. Please refer to the tables in today's earnings release and the accompanying slide presentation on our website for reconciliations of these non-GAAP measures to the most directly comparable GAAP measures. With that, I will now turn the call over to Bruce.

Bruce Broussard

Thank you, Alok, and thanks, everyone, for joining us today. I'm pleased to share that we delivered record third quarter revenue and continue to exceed expectations on EPS. We're also laying a strong foundation for the AI era and are building momentum.

Our strategic execution, robust commodity mitigation plan and relies commitment to innovation are helping us advance our business and enable our customers to successfully navigate this most significant technology shift. Today, I'll share our third quarter highlights.

Discuss the innovations we are bringing to market and touch on how we are managing the current environment. Before I do, I know some of you are interested in an update on the CEO search. I'm sure you can appreciate that I am unable to share details or a time line, but the search is proceeding well, and we continue to make good progress on finding the right next leader for HP.

In the meantime, having spent the past several months leading the company day to day, a developed deeper perspective on HP for observations stand out. First, we need to continue advancing our operating infrastructure to become better connected, AI-enabled and data-driven, improving productivity while delivering better experiences for our customers, partners and employees.

Second, we will continue advancing our devices to be AI leading by bringing more computing to the edge or context of creating. This will enable more intelligent devices that anticipate needs and proactively solve problems. Third, we need to accelerate our evolution towards integrated solutions across our broad portfolio of devices, creating differentiated offerings that deliver greater value to our customers outstanding reoccurring revenue opportunities.

And lastly, we provide greater strategic clarity around where we choose to play and allocate capital, resources and capabilities against those priorities with focus and discipline. HP has tremendous assets, one of the most iconic brands and technology, a strong global footprint sophisticated supply chain, deep commercial relationships and a talented team, and there are meaningful opportunities to make HP stronger, more cohesive and more effective.

We are taking action now to strengthen the validation, sharpen our priorities and improved execution. So that when our next CEO steps in, it can build on that momentum, and lead HP into its next chapter of growth and value creation. Let me get to our results. This quarter, we delivered $15.7 billion in revenue. A record Q3 for HP.

This represents an increase of 13% and our ninth consecutive quarter of top line growth, driven by another strong quarter in Personal Systems, while print results were in line with our expectations. We executed on our commitments and accelerating our key growth areas, which collectively grew 46% year-over-year and faster than our core.

We continue to take share in high-value segments while managing commodity headwinds with our mitigation playbook, enabling us to deliver EPS above our expectations. Even when excluding a tariff-free fund benefit while also delivering strong free cash flow. In short, we did what we said we would do.

In Personal Systems, we achieved our tenth consecutive quarter of revenue growth, up 18% year-over-year, driven by solid growth across both commercial and consumer segments. We are particularly pleased with the continued strength of our AI PC portfolio continued to grow and is still expected to be 50% of our shipment mix by the end of this fiscal year.

At the same time, consistent with our strategy, we delivered double-digit revenue expansion in our key growth areas, including advanced compute solutions and workforce solutions. We also continue to capture share in high-value categories, including premium PC, returning us to share leadership in the Americas.

Overall, these results show customers continue to invest in the hardware and solutions they need to run AI or work habits. Turning to Print. Revenue was down 2% year-over-year and what continues to be a competitive market. We remain focused on pricing discipline and the placement of profitable units. We said we would double down on bigger tank market, and we did, gaining another 4 points of share this quarter.

Industrial Printing delivered its 12th straight quarter of revenue growth as customers continue to leverage our award-winning hardware portfolio to drive their digital workflows and grow their businesses.

Across both segments, we are balancing near-term execution with long-term investment and shifting our portfolio towards high-value and more profitable categories. Turning to innovation. This quarter, we unveiled advancements designed to help our customers thrive in the AI era.

We believe the future of AI is hybrid. That means AI will operate both in the cloud and increasingly at the edge. Our customers already seeing the cost of cloud-based AI [indiscernible] economics alone makes edge AI compelling. It can also improve security, latency and strengthen data governance.

To make Edge AI a reality, we are working with customers and ecosystem partners to build platforms to extend data center class AI capabilities to the edge by enabling GPU sharing through HP Z Boost and integrating it with our WXP software layer security and device features, we are making traditional cloud AI capabilities available locally.

Building advanced AI locally has to of specialized infrastructure, large budgets and complex setups. We are changing that. With our HP CGX Fury, we bring data center class AI to the debt side, so teams can build and run front tier scale models and always on agents locally.

The response since we first showed this direction at Computex has been clear customers want local AI, they can own. Over the next month, we will extend this momentum into more of the form factors people already carry with the memory empower those on device models actually need.

A leading automotive company is using HP solutions to bring visual AI and inferencing directly to its manufacturing line, helping improve quality inspections, performance and economics. We see the same potential in many other sectors that require on-site compute performance, strong security and the most cost-effective ways to manage increasingly complex AI models.

This creates significant opportunities in areas like retail, public sector and health care. We are also advancing what PCs can do as edge devices. In the Agentic era, PCs are becoming partners that understand their needs and help meet them. So we are reimagining what a personal computer can do with our new Omni book Ultra team powered by NVIDIA RTX Spark.

It brings the compute needed to build and run sophisticated AI models and personal agents to a thin mainstream mobile PC and our Omni desk mini desktop combines full-sized performance for the contact design and built-in AI capabilities.

In Print, we're already delivering tangible customer value with AI. In June, we expanded our flagship AI-powered print experience Precise Print to more than 150 countries. By intelligently removing unnecessary web content before printing.

Precise Print helps customers reduce paper usage by up to 38% and ink consumption up to 47%. Our HP neo AI companion brings a Agentic AI to industrial print operations and is gaining momentum. Neo was awarded a 2026 European Digital Press Association Award for Best Software agent in the print industry AI category.

This underscores our commitment to intelligent, data-driven production systems but built in remote remediation capabilities, and importantly, solving uptime problems for our printer service customers.

In Q3, we also signed a 3-year $100 million strategic agreement with RRD one of the world's leading print service providers. This reflects our shared vision to accelerate AI and industrial automation and print production. Succeeding at the edge also requires intelligent ways to manage the technology portfolio.

Work moves across PCs, meeting rooms, collaboration tools, printers and other end points. Our WXP platform helps CIOs track and manage fleets of connected devices and applications. This quarter, we integrated HP Poly lens and collaboration capabilities into WXP, getting IT teams greater visibility across PCs, printers and collaboration devices.

By bringing together insights that were previously isolated across different environments, organizations and channel partners can turn data into actionable intelligence, improved workforce experiences, lower costs and establish a governance layer. WXP was named a leader in the 2026 [ Gartner ] Magic Quadrant for digital employee experience management tools.

We believe the future of computing will be increasingly intelligent and integrated with devices anticipating user needs, executing tasks seamlessly and connecting traditionally separate cloud and desktop environments. By bringing AI capabilities closer to users, these devices can provide the context required for more effective reasoning and inference.

AI at the edge offers meaningful benefits for our customers while creating significant incremental growth opportunities for HP and the broader industry. We believe HP is uniquely positioned to lead this evolution through our broad portfolio of products and services, trusted brand presence in more than 180 countries and robust innovation pipeline.

Together, these strengths create substantial opportunities for growth. At HP, we consider ourselves customer, using our own business as a proving ground for the products and solutions we develop. Like our customers, HP is benefiting today from localized AI capabilities using edge inferencing across our business.

For example, in our Singapore production facility, teams are using our ZBook workstations running an OPUS model to enhance quality insurance and detection capabilities on the manufacturing line. This past quarter, we scaled our work with OpenAI. OpenAI frontier, we are integrating AI across the customer and partner experiences, the HC store, digital support, [ WXPtelenterin, ] employee productivity and software development.

Early deployments are already helping teams accelerate engineering workflows, enhanced security analysis and automate routine tasks while maintaining HP's high standards for data governance and security. We are just getting started with an AI and expect to share more as we turn our pilots into scale capabilities that create business value.

Let me now focus on the external supply and cost environment, which remains complex. We continue to effectively execute our mitigation plan. We remain confident in our memory and storage supply availability for this fiscal year and our focus on our needs into next year and beyond.

Enhanced operating model we are building is designed to compound over time, creating a more connected, process-led enterprise that can serve customers with greater consistency, speed and predictability. What we are building is not a short-term efficiency program or a situational response but a fundamental stronger operating model that better connects planning, decision-making and execution across the enterprise.

We already see early signs of this working in areas such as order delivery predictability, improved accuracy rates leading to better conversion on incoming orders. The solid mitigation efforts already in place and additional steps planned, we remain confident about HP's upside potential, both in near term and long term and the constraints the industry face begins to lift.

Looking ahead, we remain focused on being the trusted resource for customers in navigating a dynamic environment. In Personal Systems, we see opportunity for increasing commercial workloads [ AITCs, ] advanced compute to the broader shift towards hybrid AI and growing need for contact are use cases at the edge.

In Print, we will continue to place profitable hardware units, grow big tank and subscription businesses and invest in industrial applications. Our teams will continue to manage memory storage and geopolitical pressures through pricing, sourcing, supply chain actions, productivity and portfolio choices.

Opportunity ahead is significant. AI is moving from isolated experimentation into day-to-day workflows, devices and environments. HP is well positioned to be the customer's trusted edge AI platform, helping them make the most of that transition.

In closing, I'm proud of how the HP team performed this quarter. We delivered strong Personal Systems growth, managed through a challenging end market and continue to drive innovation that will shape how work is done. Thank you to our employees for their commitment and to our customers, partners and investors for the trust you continue to place in HP.

With that, I'll turn it over to Karen.

Karen Parkhill

Thank you, Bruce, and good afternoon, everyone. We are pleased with our third quarter results, which reflect solid execution and continued progress against the priorities we outlined at the start of the year.

For the third consecutive quarter, we delivered better-than-expected top line growth and EPS at the top or above our guidance range, underscoring the discipline of our teams in a dynamic operating environment. We drove yet another quarter of robust revenue growth with continued momentum in Personal Systems and key growth areas.

Double-digit sequential growth in Personal Systems also supported strong free cash flow in the quarter. And at the same time, as Bruce mentioned, we are continuing to drive our 4-pillar plan to mitigate rising input costs.

These ongoing efforts to secure supply, shape demand, implement targeted cost reductions and take disciplined pricing action, all continue to ramp and have enabled us to deliver OP rates in line with our, growth after excluding the favorable impact of tariff refunds received in the quarter.

Now let me walk you through more details on our third quarter performance. We delivered 13% revenue growth or 11% in constant currency, with growth across all regions. By geography, strong Personal Systems performance drove constant currency revenue up 22% in APJ, 10% in EMEA and 5% in the Americas.

As customers continue to upgrade their devices to manage more demanding workloads. Our gross margin at 18.8% was down year-over-year as expected driven by higher commodity costs and increased mix from Personal Systems. Pricing, strong growth from our key growth areas and tariff refunds partially offset these headwinds.

Strong revenue growth, along with our focus on disciplined cost management, helped to drive operating expenses down as a percent of revenue. while still enabling important investments in innovation, product promotion and our people. All in, our operating margin was 6.5%.

And when excluding the benefit of tariff refunds, this was in line with our expectations. Below operating profit, higher cash balances contributed to lower financing costs in the quarter. and led to better-than-expected other income and expense. Our net earnings per share at $0.83 grew 11% and includes $0.11 related to tariff refunds.

Importantly, without the tariff benefit, we still delivered EPS above the top end of our guidance range. Now let's turn to segment performance. In Personal Systems, we delivered record third quarter revenue of $11.8 billion, up 18% and a stronger-than-expected market.

While volume was down as expected, our continued prioritization of higher-value unit placements, repricing for higher commodity costs and services expansion more than offset the volume headwind. And consistent with our strategy, we gained share in the premium PC categories and delivered strong performance from our key growth areas.

With double-digit revenue growth in AI PC, advanced compute solutions, hybrid systems and workforce solutions. From a segment perspective, we also delivered double-digit revenue growth in both commercial, up 22% and Consumer, up 10%, driven by disciplined pricing actions and favorable mix.

Aligned with our focus on higher value segments, commercial represented over 70% of our Personal Systems revenue in the quarter. PS operating margin of 4.6% and was below our long-term range as expected and down year-over-year from higher commodity costs and variable compensation, which we worked to partially offset with repricing actions and other cost reductions.

Turning to Print. As expected, revenue was down 2% or 4% in constant currency on lower supplies and hardware volumes and what remained the competitive pricing environment. These headwinds were offset in part by key growth area contributions, including continued momentum in industrial print, fueled by increased usage, double-digit growth in 3D and and a continued ramp of subscribers to our all-in plan.

By customer segment, Consumer revenue declined 2% with lower traditional printer volume, offset in part by higher ASPs. Aligned with our strategy, we continue to increase our penetration of the tank printer market, delivering 42% unit growth in this important profit upfront category and gaining share both year-over-year and sequentially.

In commercial, revenue was down 1%, driven by lower volume and unfavorable mix. We saw particular softness in the office market in North America and China, and our results reflect our focus on placing profitable units in an aggressive pricing environment. And in line with expectations, supplies revenue was down 4% in constant currency, impacted in part by headwinds in the Middle East.

All in, print operating margin was 18.1%. The up roughly 1 point year-over-year, reflecting the favorable impact of tariff refunds and pricing actions. Excluding the benefit of tariff refunds, print operating margin was in line with our guidance at the low end of our long-term range.

Now let me move to cash flow and capital allocation. We generated over $1.7 billion in cash from operations and roughly $1.6 billion in free cash flow in Q3 on the strength of Personal Systems performance. And as planned, we paid down slightly more than $500 million in debt maturities due in the quarter.

Through disciplined working capital management and robust Personal Systems growth, we have driven year-to-date free cash flow of more than $2.5 billion, well ahead of our typical seasonality. Through both dividends and share repurchase, we returned nearly $600 million to shareholders in the quarter and over $1.5 billion year-to-date, and we ended the quarter within our target leverage range.

As always, we remain committed to returning approximately 100% of our free cash flow to shareholders over time as long as our gross leverage remains under 2x, and there aren't better return opportunities. 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.

We are factoring that into our Q4 outlook, along with the traction we are making on our cost mitigation plans. By segment, in Personal Systems, we remain aligned with industry experts projecting the PC unit TAM to decline high teens year-over-year for the second half of the calendar year.

Given the impact of commodity-driven price increases, we expect below seasonal revenue performance in Q4. That said, 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.

We continue to expect memory and storage costs to increase further as a percentage of the bill of materials. And as we signaled last quarter, we expect our Q4 margin to be below Q3 levels, and then to sequentially improve as we look ahead into FY '27. In print, our outlook is aligned with industry expectations for a mid-single-digit decline in the hardware market in the second half of the calendar year.

We will continue building on our share gain progress in tank printers through portfolio extensions and targeted promotions, while completing the rollout of our latest AI-enabled laser portfolio and office by the end of the fiscal year. For Q4, we expect print revenue to be in line with historical seasonality.

And excluding the impact of any tariff refunds in the quarter, we expect operating margins in the lower half of our long-term range, reflecting our focus on incremental hardware unit placement and near-term input cost pressures, which we are actively working to mitigate.

Beyond the segments, we expect Q4 OI&E and corporate to be similar to Q3 levels. All in, based on our strong performance in the quarter, we are increasing our outlook for the fiscal year. We now expect diluted net earnings per share to be in the range of $319 to $329. Up from our previous range of $290 to $310 and including a $0.19 favorable impact from estimated tariff refunds.

For Q4 specifically, we expect diluted net earnings per share to be in the range of $0.69 to $0.79, including an $0.08 favorable impact from estimated tariff refunds. And given our improved earnings performance and strong free cash flow in Q3, we are also increasing our outlook for free cash flow to be in the range of $3 billion to $3.2 billion for the fiscal year.

Looking beyond this fiscal year, as Bruce said, we see meaningful opportunity as workloads continue shifting to the edge, and we are well positioned to lead this transition through our trusted devices software and services.

In Personal Systems, we plan to continue to invest in innovation across AI PC, workstations and high-value solutions with a disciplined focus on gaining share in premium categories.

We expect input costs to continue to rise but at a slower rate than we have experienced in fiscal '26. And of course, we remain focused on mitigating the impact of this dynamic commodities environment and expect to bring our PSOP rate back into our long-term range as quickly as possible in FY '27.

In Print, we will remain focused on protecting operating profit through share gains and profit upfront tank printers expansion in consumer subscriptions, strengthening our position in office through AI-enabled innovation, sustaining momentum in industrial graphics and maintaining cost discipline. I will share more on our fiscal 2017 outlook in our Q4 earnings call.

In closing, we are pleased with the performance in the quarter and the progress we are making against our strategic and financial priorities. We have a strong track record of execution and remain confident in our ability to drive continued growth and value ahead.

Turning to Q&A. Given the continued dynamic PC environment, we have invited [ Ketan Patel, ] Head of Personal Systems to join us. So with that, I would like to hand it back to the operator and open the call for your questions.

Operator

[Operator Instructions] And our first questioner today will be Amit Daryanani from Evercore ISI.

質疑応答

Amit Daryanani

I guess I have a question and a follow-up, but maybe just to start with Karen, could you just spend a little bit of time on the Personal Systems assumptions for Q4? I think you sort of implying PS revenues will be sub seasonal, but you should still see year-over-year growth in the model.

I think it's a fair way to think about it, but I'd love to understand, do you see that fiscal Q4 trend line of units being down high tees, but revenue is still growing by a few points, persisting through fiscal '27? Or is that more in Q4?

Karen Parkhill

Yes. Thanks for the question, Amit. On Q4, our outlook reflects the industry's view that PC units will decline high teens in the second half as pricing actions pressure demand as we said, though, we do still expect to drive year-over-year revenue growth.

We expect it to be down quarter-over-quarter but growing year-over-year with a richer mix of higher-value categories including premium and commercial and consumer PCs, AI PC, workstations and attach offerings along with pricing and all of that to more than offset the lower units.

I would also note that we're maintaining our discipline to prioritizing profitable growth and edge AI driven demand rather than chasing a low margin share. Our comments on revenue growth relate to Q4. It's too early for us to be giving FY '27 guidance. We'll be doing that on our Q4 call.

Amit Daryanani

Fair enough. I figure I can try nonetheless. On memory, in your prepared in the press release, you folks talked about meaningful improvements in memory supply, higher fulfillment rate. Can you just talk about. Is that just you getting better allocations or there's more spot availability?

Just what do those things mean for HP Inc. And from your perspective, where do you think PS margins would trough as you go forward?

Karen Parkhill

Yes. Thanks for the question. On supply, we are getting the supply that we need to fill our customer demand. So that has not been an issue. And as we look ahead in Q4 at our margins, I would say that -- we said that we expected Q4 margins to be a low point last quarterly call. .

We continue to believe that. But we have high confidence that it will improve from there. As we work through this volatile environment, I would say we've not only been transparent, but we've also shown that we can deliver what we say we will do.

And we signaled at the beginning of the year, that margins would be increasingly impacted as we move through the fiscal year. Costs have continued to rise, and we are working through the benefit of the lower cost of inventory on our balance sheet that we had more in the first half and now you're seeing inventory that is carrying higher cost working through our P&L in the back half.

But at the same time, we've been successfully implementing our mitigation plan. We've secured supply. We've qualified new suppliers. We've reshaped demand and configuration, and we've taken targeted cost actions and reprice with discipline.

And as we said before, some of those actions move quickly, while others like product redesign and platform optimization on the cost reduction side and long-term contract revisions on the pricing side takes some lead time.

We also expect margin benefit from the areas where we're prioritizing growth in the premium categories and AI PCs and higher value attach and edge AI workloads and all of that contributes to improved overall margins. So on input costs, we said we still expect them to rise in FY '27 and in but at a slower rate than we've seen to date.

So our focus, as I said, is just going to be to recover PS margins back to the long-term range as quickly as possible while also continuing to drive profitable growth.

Operator

The next question comes from Mark Newman, Bernstein.

Mark Newman

Following up on the margin. On the timing of memory cost increases, is the inventory, the low cost may lower cost memory inventory benefit done? Or in the Q3 that you just printed, is there still some cost benefit? .

I'm just trying to figure out on the cost line, are there more headwinds for you to normalize to the market price of memory? Or is the upcoming cost increase just based on the market increases of memory? And related to that on pricing for PCs, Obviously, these results are implying quite considerable price increases, which is leading to the strong revenue growth.

But I'm trying to understand, is there -- because some of your revenue is coming from channel relationships and those gene relationships may be a bit of a lag in sort of how quickly you can increase prices.

So are you caught up to where you want to be for pricing or some of those relationships with some of your thermal partners still need catching up due to whatever terms. So in other words, I'm trying to figure out -- is there more upside to pricing? Or should we expect you to be quite in line with the market going forward?

Karen Parkhill

Sure, Mark. I'll start answering that long question, and I'll ask Katen to chime in if he's got anything to add. I would say, first, on the PS margin, yes, we were benefiting earlier in the year from that lower cost of inventory that was on our balance sheet and flowing through to the P&L.

While we still have a mix of lower cost of inventory, I would say that benefit is largely behind us. And we now have higher cost of inventory that's working through our P&L, as I said. But on the cost side, we have other things that we are doing to help drive costs down.

Things like product redesign and platform optimization, those things take some time, and we'll begin to start seeing the benefit of some of those things going forward. And that is one of the levers that will be helping us improve our margin as we move forward.

On pricing, we have been increasing pricing -- we expect to continue to increase pricing as input costs rise. We use that as a last lever after we have focused on demand shaping and product reconfiguration and and taking cost out everywhere that we can. We use pricing as the last lever.

So I'll let Ketan add anything.

Ketan Patel

Karen. You covered it very well on a few of the pricing questions. I'll just add one thing that we have several go-to-market options including we do business with online channels. We do business with our regular channel partners, enterprise customers, and we also have contractual end user deals.

And all of them have different durations for reflecting updated pricing. So the lag can range from immediately to a few months before price changes will be fully reflected for all the customers. And this is all post mitigations, which Karen already spoke about.

So definitely, we'll continue to work on some of those actions. On top of it, I would say that while pricing is one of the levers, some of the actions which we have taken, let me quote a couple of examples which are helping us navigate the situation.

This robust supply informed demand planning and demand shaping muscle which we are leveraging through our WSP workforce Experience Platform Insights to identify key configurations for specific customer workloads is helping customers with the best value with the right cost.

And the second example I would quote is we have aggressive design for cost initiative, which has led to highly optimized costs for specific products for specific countries, which gives us structural capability to serve customer needs again at the right value and cost.

Operator

The next question is from Krish Sankar, TD Cowen.

Unknown Analyst

This is Stephen on on behalf of Krish. The first one that I had was for Bruce, previously in the prepared remarks, you talked about a 50% AI PC mix target by year-end. I'm just kind of curious, like in terms of the configurations of those AI PC, does that include a lot of AI workstations and what's sort of the attach rate of discrete AI accelerators in -- within that IPC mix?

Bruce Broussard

Well, thank you for the question. And really is oriented to the AI PCs in totality at the workstation. So just to provide that context relative to the attach rate. The tax rate on the AI PCs are very similar to the attach rate that we see and other parts of the PC business.

And that's traditionally around 1/3 have a 30% margin kind of opportunity for us. On top of that, we also see opportunity to continue to add solutions to our IPCs that is oriented to really things like the HP IQ, which will be coming out later this year, device security, there's another area where we look at.

And even in our areas of primer we have AI-enabled print, which complements our AI and so I would say, as you look at the IPC there as Pete and Karen have talked about that they are at premium pricing and our significant value to our customers that are complemented by the attach rate that we firmly and then on top of that, we have a number of solutions that we're able to add to the ITCs that offer it to be more valuable to the customer and, frankly, more value to us.

Ketan Patel

I'll just add on top of what Bruce mentioned, AIP sees a strong performance also for us this quarter. It contributed 46% of our mix, in line with our 40% to 50% forecast for FY '26. And we are expecting it to get up to 60% to 70% in 2027 and more than 70% in 2028.

Also the work which we have accelerated with ISV partners with software companies with more than 150 of them to leverage the capabilities of the species. And as Bruce mentioned in his comments, with a growing AI workload being pushed to the edge, driven by cost, latency and privacy considerations. The lower of these pieces in customer fleets will continue to expand.

So this will be margin accretive to us, and that's what we'll continue to focus in terms of AI PC mix as well as workstations, which are critical categories for growth.

Unknown Analyst

Got you. Maybe for the color, [indiscernible] and for a follow-up, I had a question on the strong double-digit growth that you guys are seeing in both the EMEA and APJ markets. If I recall correctly, the Windows 10 refresh was a big driver of that in the near term.

Kind of curious like in the current quarter and maybe like the quarter after as well, is when does the refresh still a big driver there? Or is that going to play out in the near term? And any other thoughts on demand pricing to be helpful.

Karen Parkhill

Yes. Thanks for the question, Stephen. We now see roughly 70% of the Win 11 refresh complete. That's been a good catalyst for the last couple of years, and we are seeing it still drive small and medium business demand.

I would say, that said, the Win 11 catalyst is really being increasingly augmented by a rising demand for AI PCs, Edge AI and genic workloads requiring more capable PCs. So we honestly see these tailwinds to shape the market in the coming years.

And we're proud to have an increased penetration of AI PCs today as part of our shipments, as Katen just mentioned and a growing part as we look ahead.

Operator

Your next question today comes from Wamsi Mohan, Bank of America.

Wamsi Mohan

I was wondering if you could talk about channel inventory levels in both PC and print and how they're shaking out maybe relative to where you would ideally like them and I have a follow-up.

Karen Parkhill

Thanks, Wamsi. I would say that we are definitely disciplined in how we manage inventory across our channels. And in an inflationary cost environment, we would expect inventory to be higher than normal, and that's exactly what we see in PS right now.

But that said, the inventory levels in the channel remain well controlled. They're within our demand outlook, and they continue to support the supply continuity that we really want in a constrained memory environment.

And in print, our channel inventory remains at healthy levels and within the range that we would consider normal.

Wamsi Mohan

Okay. As a follow-up, we heard a lot about AI and IPC as positive mix. I'm just wondering, are you seeing these customers already quantifying ROI from local inference deployments and what kind of use cases are driving that?

Or is it more so that customers are selecting AI PCs because that's becoming the default specification in refresh cycles. Just how much utilities being provided today towards ROI from IPCs versus future proof debt?

Ketan Patel

I'll take that. So one, thank you for the question. Clearly, this is -- the PCs are now providing more value than what it was last year. Clearly, as the workloads are coming from cloud to the device, it's adding to significant value for our customers, especially on token economics, which is a big topic right now as you start deploying workloads in a customer environment.

So that's significant value which customers are seeing. On top of it, they also see advantage of keeping sensitive data closure to where it is generated, reduced dependency on network connectivity improve response times and manage AI cost, as I said earlier, more effectively.

So this we see as adoption developing in stages it right now is helping us on higher-value use cases where the return on investment of the customer is clear, such as employee productivity, engineering and design workflows or customer service, predictive maintenance kind of use cases.

As customers gain confidence in some of those use cases, these capabilities will expand across a fleet of devices and also to broader enterprise workflows. So that's how we see the current trend.

Operator

Next, you'll have a question from Asiya Merchant from Citi.

Michael Cadiz

Mike Cadiz on for Asiya with Citi. Let me just go ahead and ask both my questions at once. So the first would be, could you give more color on the upside of the free cash flow guide -- could it be more than just tariff refund related or levels in that? So that's question one.

And the second one would be on additional color, please, on the proportion of enterprise customers deploy AITC in various pilot versus at-scale kind of deployments.

Karen Parkhill

Thanks, Mike, for the question. I'll answer the free cash flow, and then I'll ask Ketan to take the second one. In terms of free cash flow, we are pleased with our performance year-to-date. It is above seasonal performance and enabled us to increase our guide for the full year.

That performance is really driven by strong Personal Systems growth along with continued focus on working capital. Our cash conversion cycle is negative 37 days, and we continue to have a strong focus on that. So it was driven by -- yes, more than the tariffs. Tariffs helped a little bit, but clearly driven by underlying performance.

Ketan, do you want to take the second question? .

Ketan Patel

Yes. On top of the comments, which I had on the IPC and the workloads, I would say that -- there are clearly unique needs, which we are addressing right now through our PC printer pay for our services and meeting room solutions for modern work.

Simultaneously, our solutions like WXP are allowing great control for IT and admins to monitor support end user, which is becoming a big need in the world where you will have humans and agents operating together.

And currently, our AI PCs are most capable for running AI models locally. And as Bruce mentioned, we have debited all of this in our first local first AI model through HPI and also Wolf security solution, which HP is implementing is unique and in protecting at a bias level inclusions.

So some of these are coming together as customers are deploying, as I said earlier, on high-value use cases and expanding this at a broader level. But one thing which we are seeing as a trend for HP, which is a great advantage for our positioning is our ability uniquely to connect the endpoint, the user experiences, enterprise manageability, security and the broader IT environment is something which is becoming a good value equation, which we are able to deliver.

Bruce Broussard

Maybe I'll just add a little bit there. I would say that we are seeing better ROI and in a number of different areas. And I think that a large one we're seeing, as Ketan mentioned, was developer customer service, but we're also seeing it in manufacturing, where our workstations are able to be incorporated in the manufacturing line or our quality control that can use it for quality control and other NII-related manufacturing.

And so we do see it there. We also see it in the retail area. And in addition, we're beginning to start to see it in the health care area. We're seeing a significant amount about interest and demand as a result of some very powerful use cases, both in the subsectors that we're focused on. in addition in the broader areas like what Ketan has talked about.

Operator

Your next question comes from Erik Woodring from Morgan Stanley.

Erik Woodring

I apologize I hopped on late, but Ketan, you sound very optimistic about fiscal '27 Personal Systems operating margins and you've in the October quarter being the trough. But if we think about unit declines accelerating component inflation is continuing, you're working through higher cost inventory.

And it's fair to probably imagine demand elasticity likely increases to these factors. It's not totally clear to me what the factors are that allow Personal Systems operating margins to improve, even NVIDIA tonight is guiding to margin pressure next year from memory cost. So can you maybe just help me please better understand the offsets to some of these pressures that we're thinking about? And then I have a quick follow-up.

Karen Parkhill

Yes. Sure, Eric. Happy to help. So obviously, we talked about the fact that we expect cost to continue to increase, but at a slower rate. So I'll start there. And at the same time, the mitigation actions that we've been taking are really starting to kick in.

So things like long-term contract revisions on the pricing side, which takes some lead time. and other cost actions that we've been working through, like product redesign and platform optimization that can also take some time starting to kick in.

And I would say, importantly, we're also going to continue to focus on what we've been driving so far, which is an increased mix of premium products with AI PCs and workstations and also a greater mix of attached offerings where we've got plenty of opportunity to drive even more.

And that's inclusive of peripherals and services. things like our WXP platform, et cetera. So it's all of these things combined that give us high confidence that we can drive improvement from here.

Erik Woodring

Okay. All right. I appreciate that. And as a quick follow-up, I know obviously, myself included there a focus on PS margins on this call. What about Print operating margins just as you think about them into next year, how do you expect them to trend? And what are some of the puts and takes to consider.

Karen Parkhill

Yes. I would say on the print margins in FY '27, I'll start by just confirming that we remain comfortable with our long-term operating profit range of 16% to 19% for print, and that still holds for our fiscal '27.

Where we land in that range can really vary quarter-to-quarter and is influenced by seasonality along with the magnitude of long-term profitable units that we're able to place in the competitive environment. But as we look more broadly to FY '27, we will remain focused on protecting operating profit through share gains and profit upfront tank printers through expansion in consumer subscriptions.

And by strengthening our position in office through some AI-enabled innovation that we've been bringing to market, along with sustaining momentum in industrial graphics and, of course, always maintaining cost discipline. So hopefully, that helps.

Operator

Our next question today comes from Katherine Murphy, Goldman Sachs.

Katherine Murphy

It was impressive to see the 18% revenue growth in the Personal Systems segment, though units were down 16%. And I was wondering if you could help quantify or otherwise rank how like-for-like price increases portfolio mix shift benefits and then the increased attach of related services benefited that implied ASP increase in the quarter?

And if 1/3 of gross profit in this segment coming from those attached businesses is still the right way to think about the mix? And then I have a quick follow-up.

Karen Parkhill

Thanks, Katherine. I'll take that question and Ketan, feel free to add, if you want. I would say all of the things that we are doing really drove our revenue growth, and we're not going to quantify how much was related to each.

But clearly, mix played a role as we drive more premium share, more AI PCs more hybrid, more workforce experience platform, all of those things played a role, along with pricing. We've been continuing to increase pricing given our higher input costs and that also played a role too. Ketan, anything you would add?

Ketan Patel

Yes, just to give some color to the mix thing that how mix is helping us in the overall margin performance is our sequential gains on premium categories has been pretty strong. We grew 2.6 points of share on premium and 1.8 points of share on workstations.

Those are categories which are growing and something which we are pleased that we continue to take share. And to your other comment around non-hardware business contribution, yes, the attach businesses, which is a combination of peripherals, collaboration solutions, services such as WXP and others have contributed 1/3 of the overall PS gross profit.

And that's in line with what we have been forecasting that those are the businesses which will continue to focus.

Katherine Murphy

Great. And then I'll attempt to ask if there's any preliminary thoughts on industry PC volumes as we think about fiscal 2027.

Karen Parkhill

Yes. I would say on FY '27, obviously, we're still in our planning period. It's premature to give you specifics on our outlook for the fiscal year. And on unit volumes, that continues to move around. So premature for us to talk about that at this point.

Ketan Patel

I would just only add that there are 2 demand vectors as you look at 2027. As Karen mentioned previously, a growth catalyst being the shift towards AI workloads and hence, some of those categories are on AI PCs and premium PCs and workstations.

So that's going to be a tailwind. At the same time, there has been demand delay or as some of the customers deferred product refresh, given the price increases this year. And as costs start stabilizing over the next period, you will start seeing some of those refreshes coming over a period of time. So that's how we look at 2 different demand signals coming through.

Operator

Your next question comes from David Vogt from UBS.

David Vogt

So Karen, I just want to maybe just a clarifying question about '27 profitability and margins. Can you help us walk through your comment in greater detail about protecting print margins.

Does that exclude the benefit of the tariff contract count in '26 is that how we should be thinking about your comment in '27? Or is that inclusive of the benefit that you're seeing this year from the tariff refunds? And if you could help us understand, jump on late, and I apologize was the tariff refund largely in print?

I would imagine there's a big chunk in PC also, but I didn't quite hear that in the prepared remarks.

Karen Parkhill

Yes. So just on your question on print margins for next year when we talk about our long-term 16% to 19% range, that is without or excluding any onetime benefit that we might get from tariff refunds. We did have some benefit from tariff refunds this quarter and have signaled more next quarter.

It does largely benefit print. There is a smaller portion that benefited PS, but it is largely benefiting print. And -- so you saw our print margins in Q3 be higher than expectations, driven by that benefit. But once you exclude those benefits, they were largely in line with expectations.

David Vogt

Perfect. That's what we thought. And then maybe just as a quick follow-up. In terms of mix, I think we were -- we were worried about mix to hardware in the quarter, obviously, supplies are sub season, well, hardware is seasonally stronger relative to supplies.

How do we think about the input cost on the hardware side relative to the business? Because I know we've talked about in the past the impact of currencies, the impact of commodities like oil, how are you thinking about that in context of when we're thinking about fiscal '27? I know you don't want to give a guide. But like when I think about those moving parts that are a little bit out of your control, how should we think about those contributions to the outlook?

Karen Parkhill

Yes. I would just say, in general, in Print, we are going to continue to focus on momentum in our key growth areas and introducing new products in our more traditional print business. That includes expanding our tank portfolio and driving further traction from our recent rollout of our AI-enabled laser portfolio in office.

And then in terms of just supplies, we have said for a long term that we expect supplies revenue to decline low to mid-single digits in constant currency. This year, in particular, in FY '26, we see it declining low single digit in constant currency, but our long-term view of supplies hasn't changed.

Operator

And the next question is Ananda Baruah with Capital.

Ananda Baruah

Appreciate you taking the question here. I guess going back to what sort of the revenue texture can look like as we go through '27. Do you think if the situation where corporate is refreshing to higher-spec PCs now as a trend such that it's not -- you got a -- you guys are seeing higher ASPs not only because of memory prices, but because it's actually what customers are increasingly watching.

And I guess what I'm trying to get like an echo sense of, is there increasingly a much more -- is there more appetite natural appetite for higher pricing as the thing for memory pricing increases as we go through '27 to '28

Ketan Patel

Yes, I'll take that question. Thank you for that. Yes, we definitely see the effect of how customers are choosing those higher configuration products, largely because of the need to conduct AI at the edge to support increasing AI workloads.

Our customers in their environment are now as they're implementing AI in their workflows, they are seeing this becoming more prevalent than before. Also increasing use of agents increasing concern about token costs, cybersecurity, privacy and a lot of applications, which requires a different kind of latency needs leading to a PC refresh with more capable PCs having these capabilities.

And that's why, to your point, yes, we see demand shifting to those higher-end devices too as part of the natural mix.

Ananda Baruah

And this is a tricky one here. Just a quick follow-up. But are you guys -- do you guys yet have visibility to enterprise users adopting AI PCs or talking about AI PC. You sort of quick touched on it as a way to get just to get off basically just to model off the Internet, right?

So they don't have to observe token costs so they can actually run the native and just avoid the token costs. Is that a meaningful part of conversations yet?

Ketan Patel

Yes, there are 2 meaningful conversations which are going on right now as customers bring these workloads. One, this increasing cost of token and how bringing models locally on the edge can help them optimize cost as well as take care of customer -- take care of employee needs of requirements to use different AI models for their work.

So that's definitely one of the conversation. And the second big one is, as they deploy agents more in that environment, how to govern those agents more securely and drive the right level of enterprise manageability. I think those are the top 2 use cases, which we believe are happening as we speak, apart from the industry vertical workflows, which Bruce talked about earlier.

Operator

And everyone, that does conclude our question-and-answer session. I would like to hand the conference back to Mr. Bruce Broussard for any additional or closing remarks.

Bruce Broussard

Thank you, and thank you all for the thoughtful questions and joining us today. As we -- you can tell from our voices, we are excited about the future and AI [ FDAs ] creates some incredible opportunities and HP is well positioned in this area. As we talked about with our strong portfolio, our network reach, trusted brand, we are all equipped to help our customers thrive in the AI era.

And thank you, as always, to our customers, partners and investors for the continued confidence she'd place in HP, and we look forward to keeping you updated on our progress, and have a good afternoon. Thank you.

Operator

Once again, ladies and gentlemen, this does conclude today's conference. We would like to thank you all for your participation today. You may now disconnect.