HP Inc. (HPQ): Strong Q1 2026 Revenue Growth Driven by Personal Systems and AI PC Adoption

HP Inc. (NYSE:HPQ) is one of the most undervalued stocks under $30 to buy. On February 24, HP reported a 7% year-over-year increase in revenue for FQ1 2026, reaching $14.4 billion. This growth was primarily fueled by the Personal Systems segment. The segment saw an 11% revenue jump and 12% unit growth, driven by a Windows 11 refresh cycle and the rising adoption of AI PCs, now accounting for over 35% of shipments. While the company achieved a non-GAAP EPS of $0.81, hitting the top of its guidance range, it faced a 2% decline in its Print segment revenue due to lower supply volumes and hardware demand.

HP is navigating significant headwinds from rising input costs, particularly for DRAM and NAND memory. These costs have surged to ~35% of the PC bill of materials, up from historical levels of 15% to 18%. Consequently, management warned that Personal Systems’ operating margins will likely remain below long-term targets for the rest of the year. To mitigate these pressures, the company is implementing pricing actions and utilizing long-term supply agreements, though it expects a volatile environment to persist into FY2027.

HP Inc. (NYSE:HPQ) maintained its full-year guidance but expects to land at the lower end of its $2.90 to $3.20 non-GAAP EPS range and its $2.8 to $3.0 billion free cash flow target. While enterprise demand remains robust in Europe and Asia, the company anticipates a double-digit decline in the TAM for PC units in CY2026 as industry-wide pricing adjustments impact consumer demand.

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HP Inc. (NYSE:HPQ) provides personal computing, printing, 3D printing, hybrid work, gaming, and other related technologies in the US and internationally. The company operates through three segments: Personal Systems, Printing, and Corporate Investments.

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