HP Inc. Discuss A3 Copier Growth, Financial Results, 3D Printing, More
On October 29th, HP Inc. executives held a conference call for analysts, discussing HP strategy and results for its fourth-quarter and fiscal-year 2018 (see “HP Reports Stellar Fourth-Quarter, Fiscal 2018 Results” for more).
HP Inc. President and CEO Dion Weisler commented on HP’s A3 copier/MFP strategy, and noted that November 29th marked the first anniversary of HP’s acquisition of Samsung’s Printing Solution Group (now called S-Print). Weisler also noted that earlier this month, HP also completed its acquisition of Apogee, a U.K.-based office equipment dealer and Europe’s largest independent provider of print, outsourced services, and document-processing technology for approximately $500 million.
Weisler also touched on the growth of HP’s 3D-printer business, noting that auto-maker BMW is now manufacturing production parts for its cars with HP’s Multi Jet Fusion 3D printers, and Forecast 3D now has two dozen Multi Jet Fusion deployed, “operating around-the-clock to produce millions of final parts as their business grows.”
A3 Market and Competitors
As for the A3 copier/MFP market, the HP CEO noted that “There’s upwards of over a dozen players in the printing market. And in an overall market that’s relatively flat, generally what happens in that environment is where you don’t have the scale, it becomes more difficult to compete. Some of our competitors are a little distracted, others are focused, we look at all of our competitors, but ultimately we are playing our game.”
Weisler also commented on HP’s message of its secure printers and copiers – exemplified by its series of “Wolf” ads – noting “Our security message is really resonating with our customers. It’s on every C-level executives’ mind, and we’ve the most secure printers on the planet.
According to Weisler, HP’s managed print services (MPS) business continues to be an area of focus, and noted: “The integration of Samsung’s business has just gone through its first year anniversary and I’m really pleased with how we’ve integrated that company and how we are making progress against our goals in the A3 contractual space.”
In its third-quarter 2018, HP grew its A3 share year-over-year by 0.8 percent, with Weisler noting that HP remains on track to achieve 12 percent A3 copier market share by the end of 2020.
Full-Year Profit for both PC and Printing Group
HP Inc. CFO Steve Fieler noted that for the complete fiscal-year 2018, HP grew revenue and operating profit in both its Printing and Personal Systems group.
Fieler noted that total hardware units were up 11 percent, with consumer units up 3 percent and commercial units up 85 percent, including contributions from S-Print. In the third-quarter, HP’s overall print unit share – which includes A4 and A3 – was 42 percent.
For the full year, the Printing group’s operating profit grew $46 million versus 2017,and operating margin was 16.1 percent, down 0.5 points year-over-year, but up 0.1 point sequentially. Fieler said that the primary drivers of the year-over-year margin decline were the addition of S-Print and strong unit placements, as well as investments in growth and future initiatives including A3 and 3D printing.
Fieler also discussed HP’s strategy for coping with existing and potential U.S. tariffs on parts and products imported from China: “Our plans to mitigate previously announced and implemented China U.S tariffs are on track…. we expect the headwind to be larger in the short-term and reduce throughout the year. We have not considered any impact from unannounced tariffs or any significant demand changes that may result from an increase in geopolitical uncertainties.”
- November 2018: HP Reports Stellar Fourth-Quarter, Fiscal-Year Results
- November 2018: HP Completes Acquisition of Office-Equipment Dealer Apogee
- November 2018: HP Outlines Progress, Key Strategies at ‘Power of Print’ Day
- October 2018: HP Inc. Updates on Financial Outlook
- August 2018: Revenue, Earnings Up for HP Inc.’s Third Quarter
- May 2018: HP Continues to Report Strong Revenue Growth, Raises Forecast
- February 2018: HP ‘Strong out of the Gate’ for First Quarter
- November 2017: HP Reports Third Consecutive Quarter of Revenue Growth, Raises Forecast
- November 2017: Industrial/Professional 3D-Printer Shipments Set for Growth as HP Inc., GE Move Into Global Top Five
- November 2017: Printer Sales Down in Western Europe, But HP Makes Gains
- November 2017: It’s Official: HP Completes Acquisition of Samsung’s Printing Business