HP Inc. (NYSE:HPQ)

The analysis of intangible assets and goodwill over the given periods reveals several noteworthy trends and fluctuations. The values reflect the company's investments and amortization activities related to intangible resources, as well as changes in goodwill.

Customer contracts, customer lists, and distribution agreements

This category remained relatively stable from 2013 to 2015, fluctuating slightly around the 4,400 US$ million mark. There is a significant drop by 2017, with values declining sharply to 85 million, followed by a slight increase to 112 million in 2018.

Technology and patents

The recorded value was high in 2013 at 3,193 million but decreased considerably in 2014 to 2,128 million. From 2015 onward, values drop steeply, reaching 98 million in 2017, then increasing to 601 million in 2018. This shows a contraction followed by a moderate recovery.

Trade name and trademarks

The values declined significantly from 394 million in 2013 to 122 million in 2015. After 2015, the values are not reported, indicating possible reclassification, disposal, or impairment of these assets during or after that period.

In-process research and development

This item shows irregular values, with a small value recorded in 2013 (3 million), a rise to 159 million in 2015, and no entries afterward, suggesting fluctuating investment or accounting treatment changes related to ongoing research projects.

Intangible assets, gross

The gross intangible assets experienced a decline from 8,055 million in 2013 to 6,918 million in 2014 and remained stable in 2015. From 2017 onwards, values are substantially lower, at 183 million and 713 million for 2017 and 2018 respectively, indicating a possible reclassification or significant write-down.

Accumulated amortization

This shows a steady accumulated amortization around -4,800 to -4,900 million from 2013 through 2015. In 2017 and 2018, the values are much smaller (-180 million and -260 million), consistent with the lower gross intangible assets recorded during those years.

Intangible assets, net

The net intangible assets, after amortization, decreased substantially from 3,169 million in 2013 to 2,014 million in 2015. By 2017 and 2018, the net values are minimal (3 million in 2017 and 453 million in 2018), reflecting changes in asset composition and possible impairments.

Goodwill

Goodwill remained fairly stable from 2013 to 2015, around 31,100 to 32,900 million. However, there is a substantial drop in 2016 and 2017, to approximately 5,600 million, with a slight increase to 5,968 million in 2018. This indicates a major goodwill impairment or divestiture event during 2016.

Goodwill and purchased intangible assets

The combined total of goodwill and purchased intangible assets followed a similar trend, slightly decreasing from 34,293 million in 2013 to 34,955 million in 2015, then dropping sharply to around 5,622 million in 2016 and 2017, with a modest increase to 6,421 million in 2018. This reflects the substantial reduction in goodwill and intangible assets noted above.

Overall, the data indicate significant reductions in intangible assets and goodwill starting around 2016, suggesting strategic changes, asset impairments, or divestitures that notably impacted the value of these asset categories. The fluctuations in amortization and net intangible assets correspond with the sharp decreases in gross intangible assets. The stability of the values until 2015 followed by drastic changes from 2016 onward highlight a pivotal event or series of events affecting the company's intangible asset base and goodwill.

The financial data reveals significant shifts in both reported and goodwill adjusted figures over the examined period.

Total Assets

The reported total assets remained relatively stable from 2013 to 2015, fluctuating slightly between approximately 103 billion and 106 billion US dollars. However, a notable decline occurred in 2016, where total assets dropped sharply to around 29 billion US dollars. This lower asset level persisted with a gradual increase through 2017 and 2018, reaching approximately 34.6 billion US dollars by 2018.

The adjusted total assets, which account for goodwill adjustments, exhibited a similar trend. They decreased from about 74.6 billion US dollars in 2013 to roughly 72.1 billion in 2014, then increased modestly to approximately 73.9 billion in 2015. In 2016, adjusted assets fell substantially to nearly 23.4 billion, followed by gradual rises to about 27.3 billion in 2017 and 28.7 billion in 2018.

Stockholders’ Equity (Deficit)

Reported equity was positive and relatively stable from 2013 through 2015, maintaining levels around 27 billion US dollars. In 2016, reported equity shifted drastically to a negative position of approximately -3.9 billion US dollars, reflecting a significant change in financial structure or recognition of liabilities. Although equity values remained negative in 2017 and 2018, there was an improving trend, with the deficit narrowing to around -0.6 billion US dollars by 2018.

Goodwill adjusted equity presented a consistent negative position throughout the entire period. The deficit increased steadily from about -3.9 billion US dollars in 2013 to nearly -5.2 billion in 2015. It then worsened sharply in 2016 to approximately -9.5 billion, remaining negative but showing slight improvement through 2017 and 2018, ending near -6.6 billion US dollars.

Overall, the data indicates a major restructuring or reclassification event around 2016, dramatically reducing both reported and adjusted total assets as well as shifting reported equity from a strong positive to a deficit. Despite this, post-2016 figures suggest gradual financial recovery or stabilization, with assets and equity deficits recovering incrementally through 2018. The persistent negative goodwill adjusted equity highlights ongoing challenges in net asset valuation after accounting for intangible assets such as goodwill.

Over the examined periods, the company displayed noticeable variations in efficiency, leverage, and profitability metrics, with certain trends standing out prominently.

Total Asset Turnover

The reported total asset turnover showed moderate fluctuation, beginning at 1.06 in 2013 and slightly increasing to 1.08 in 2014 before declining to 0.97 in 2015. There was a marked improvement in 2016, rising substantially to 1.66, followed by a slight decrease to 1.58 in 2017 and then an increase to 1.69 in 2018. The adjusted total asset turnover, which accounts for goodwill adjustments, consistently remained higher than the reported figures across all years and demonstrated a similar pattern. Notably, the adjusted ratio peaked at 2.06 in 2016, declined thereafter but maintained levels above 1.9 in 2017 and 2018, indicating improved asset utilization when adjustments are considered.

Financial Leverage

Reported financial leverage held relatively steady from 2013 to 2015, with ratios slightly below 3.9, reflecting consistent use of debt relative to equity. However, no data is available post-2015, leaving trends beyond this point unclear. Adjusted financial leverage data was not provided.

Return on Equity (ROE)

Reported ROE was stable at 18.75% in 2013 and 2014 but declined to 16.4% in 2015 before data became unavailable in subsequent years. The absence of adjusted ROE data limits deeper analysis of profitability from the shareholder perspective after goodwill adjustments.

Return on Assets (ROA)

The reported ROA exhibited an initial decline from 4.84% in 2013 to 4.26% in 2015, followed by a significant increase reaching 8.6% in 2016. Although there was a slight decrease to 7.67% in 2017, the ratio surged dramatically to 15.39% in 2018. The adjusted ROA consistently exceeded the reported figure each year, starting from 6.86% in 2013, dipping to 6.16% in 2015, then rising notably to 10.67% in 2016, followed by a mild decline in 2017, and peaking at 18.59% in 2018. This suggests a better asset profitability when goodwill is adjusted, with the company enhancing its asset returns substantially in the later years.

The financial data demonstrates distinct trends in both reported and goodwill adjusted figures over the six-year period ending October 31, 2018.

Total Assets

Reported total assets show a slight decline from 2013 to 2014, followed by a modest recovery in 2015. However, there is a significant and sharp decrease in 2016, dropping from around 106,882 million to 29,010 million USD. From 2016 onwards, reported total assets gradually increase but remain well below the earlier levels, reaching 34,622 million USD in 2018.

Adjusted total assets mirror this pattern, starting at 74,552 million USD in 2013, decreasing somewhat in 2014 and 2015, then dropping substantially in 2016 to 23,388 million USD. The adjusted total assets also show gradual recovery in the subsequent years, ending at 28,654 million USD in 2018.

Total Asset Turnover

The reported total asset turnover ratio remains relatively stable around 1.06 to 1.08 during 2013 and 2014 but declines to 0.97 in 2015. In 2016, there is a noticeable increase to 1.66, maintained close to this level with a minor dip to 1.58 in 2017, and a recovery to 1.69 in 2018, indicating improved efficiency in generating revenue from assets after the asset base reduction.

The adjusted total asset turnover ratios are consistently higher than the reported figures across all years, starting at 1.51 in 2013 and rising steadily to 1.55 in 2014 and 1.4 in 2015, followed by a significant jump to 2.06 in 2016. This higher turnover ratio subsequently decreases slightly to 1.91 in 2017 before rebounding to 2.04 in 2018. This trend illustrates that when goodwill is adjusted out, the asset base is smaller and the turnover ratios indicate stronger asset utilization efficiency.

Overall, the data reveals a major restructuring or asset write-down occurring around 2016, causing a sharp reduction in reported and adjusted total assets. Following this, both measures indicate a phase of stabilization and modest growth. Additionally, the improvement in asset turnover ratios post-2015 suggests better operational efficiency or asset management during the later years, notably when goodwill effects are excluded. The consistently higher adjusted turnover ratios highlight the impact of goodwill on asset valuation and underscore a leaner asset base driving revenue more effectively after adjustments.

The financial data reveals several noteworthy trends over the six-year period from 2013 to 2018, with a marked shift occurring between 2015 and 2016. Total assets reported show a relatively stable pattern from 2013 through 2015, fluctuating slightly around 100 billion US dollars. However, a significant drop is observed beginning in 2016, where reported total assets decrease sharply to approximately 29 billion and then progressively increase slightly through 2018 to about 34.6 billion. The adjusted total assets reflect a similar pattern, with a decline occurring in 2016 and only marginal recovery thereafter.

Stockholders’ equity presents a contrasting trend. Reported equity remains solid and stable in the initial three years, ranging from roughly 26.7 to 27.7 billion. This reverses dramatically starting 2016, where reported equity moves into a deficit, initially around -3.9 billion, improving somewhat by 2018 but still negative at about -0.6 billion. The adjusted equity figures provide a consistent indication of a deficit position throughout the entire period, worsening from the negative numbers in 2013 (-3.9 billion) to a deeper deficit in 2016 (-9.5 billion), then gradually improving but remaining negative through 2018.

Financial leverage data is only available in the reported form for the first three years, maintaining a steady ratio close to 3.85. The absence of data beyond 2015 suggests a possible change in reporting or measurement approach coinciding with the significant shifts observed in asset base and equity structure. The missing adjusted leverage ratios limit the ability to evaluate the leverage in the adjusted financial context.

Total Assets

The asset base experienced a substantial decrease beginning in 2016 after years of stability, indicating either significant divestitures, reclassification of assets, or structural changes affecting balance sheet size.

Stockholders’ Equity

The transition from positive to negative equity in the reported data suggests the occurrence of losses, write-downs, or other adjustments that significantly impaired equity value. Adjusted equity figures, consistently negative, highlight potential ongoing valuation challenges or adjustments related to goodwill or other intangible considerations.

Financial Leverage

The stable leverage ratio over the initial years aligns with steady asset and equity levels. The lack of subsequent data restricts comprehensive leverage trend analysis post-2015, but the equity deficits imply possible elevated leverage or financial risk in later years.

Overall, the data depicts a period of stability followed by a marked contraction in asset size and equity valuation starting in 2016, with some recovery toward 2018 yet continuing equity deficits when adjusted for goodwill. This underscores significant financial restructuring or impairment events affecting the company’s capital structure and asset valuation during the latter part of the observed timeframe.

The data presents the reported and goodwill-adjusted financial figures for stockholders' equity and return on equity (ROE) over six fiscal years ending in October from 2013 to 2018.

Reported total HP stockholders’ equity (deficit)

This metric shows a generally stable level around the $27 billion range from 2013 to 2015, fluctuating slightly but maintaining values above $26 billion. However, starting in 2016, there is a notable decline into negative territory, with equity deficits of approximately -$3.9 billion in 2016, -$3.4 billion in 2017, and further reduced to nearly -$0.6 billion in 2018. This shift from a substantial positive equity base to deficits indicates significant changes in the company’s capitalization or accumulation of losses during this period.

Adjusted total HP stockholders’ equity (deficit)

The adjusted figures, accounting for goodwill, consistently show negative equity across all years analyzed. The adjusted deficit deepens from about -$3.9 billion in 2013 to roughly -$5.2 billion in 2015, signaling ongoing goodwill impairments or other adjustments that reduce reported stockholders’ equity. A sharp increase in the deficit occurs in 2016, accelerating to nearly -$9.5 billion, with a slight improvement but still large deficits in 2017 and 2018 around -$9 billion and -$6.6 billion respectively. This indicates long-term challenges related to asset valuation or financial adjustments impacting the true equity base.

Reported Return on Equity (ROE)

The return on equity reported shows a stable percentage of 18.75% in both 2013 and 2014, followed by a moderate decline to 16.4% in 2015. No data is available after 2015, but given the transition to negative equity positions from 2016 onwards, the ROE likely deteriorated or became inapplicable due to the equity deficit.

Adjusted Return on Equity (ROE)

There is no reported data for the adjusted ROE across the period, making it impossible to assess the company’s profitability relative to its adjusted equity base, though the persistent negative adjusted equity suggests challenges to generating positive returns on this adjusted measure.

In summary, the reported stockholders’ equity remained positive and relatively stable until 2015, after which significant declines led to equity deficits. The adjusted equity, considering goodwill, was negative throughout and worsened markedly from 2016 onward. This pattern suggests the company faced considerable financial headwinds affecting its capitalization and asset valuation, which likely impacted profitability and equity returns post-2015.

The financial data reveals several notable trends regarding the assets and return on assets (ROA) of the company over the examined periods. There is a clear distinction between reported and goodwill adjusted figures, which provides insights into the impact of goodwill on asset valuation and profitability metrics.

Total Assets

The reported total assets show a relatively stable trend from 2013 to 2015, fluctuating slightly around the 100,000 to 107,000 million US$ range. However, a sharp decrease is observed in 2016, with total assets dropping drastically to approximately 29,000 million US$, after which a gradual increase occurs in the following years, reaching about 34,600 million US$ in 2018. The adjusted total assets follow a similar pattern but start at a lower base, around 74,500 million US$ in 2013, decreasing moderately up to 2015, then plummeting in 2016 to roughly 23,400 million US$. Subsequently, these adjusted assets rise progressively up to nearly 28,700 million US$ by 2018. This trend suggests a significant adjustment or write-down of goodwill or related intangible assets, heavily influencing the asset base beginning in 2016.

Return on Assets (ROA)

Both reported and adjusted ROA figures present an overall strong performance with notable variations. Initially, reported ROA remains fairly steady around 4.8% from 2013 through 2014, followed by a slight decrease in 2015. From 2016 onwards, there is a pronounced increase in reported ROA, peaking significantly at over 15% in 2018. The adjusted ROA mirrors this pattern but begins at higher values than the reported ROA, starting near 6.9% in 2013 and slightly declining to just above 6.1% in 2015. Subsequently, adjusted ROA experiences a marked rise, surpassing 18% by 2018. The consistently higher adjusted ROA indicates that excluding goodwill results in a more favorable profitability measure relative to the asset base, particularly evident from 2016 onward.

In summary, the data reflects a substantial reduction in total assets around 2016 due to adjustments linked to goodwill, which considerably affects the asset figures. Concurrently, the return on assets improves markedly post-2015, suggesting enhanced operational efficiency or profitability relative to the adjusted asset base. The amplified ROA figures after goodwill adjustment underscore the significance of non-operating intangible assets in the financial structure and performance evaluation of the company.