Operating Profit Margin
since 2005
Calculation
HP Inc., operating profit margin, long-term trends, calculation
| Operating profit margin | = | 100 | × | Earnings (loss) from operations1 | ÷ | Net revenue1 | |
|---|---|---|---|---|---|---|---|
| Oct 31, 2018 | 6.95% | = | 100 | × | 4,064) | ÷ | 58,472) |
| Oct 31, 2017 | 6.76% | = | 100 | × | 3,519) | ÷ | 52,056) |
| Oct 31, 2016 | 7.36% | = | 100 | × | 3,549) | ÷ | 48,238) |
| Oct 31, 2015 | 5.29% | = | 100 | × | 5,471) | ÷ | 103,355) |
| Oct 31, 2014 | 6.45% | = | 100 | × | 7,185) | ÷ | 111,454) |
| Oct 31, 2013 | 6.35% | = | 100 | × | 7,131) | ÷ | 112,298) |
| Oct 31, 2012 | -9.19% | = | 100 | × | (11,057) | ÷ | 120,357) |
| Oct 31, 2011 | 7.61% | = | 100 | × | 9,677) | ÷ | 127,245) |
| Oct 31, 2010 | 9.11% | = | 100 | × | 11,479) | ÷ | 126,033) |
| Oct 31, 2009 | 8.85% | = | 100 | × | 10,136) | ÷ | 114,552) |
| Oct 31, 2008 | 8.85% | = | 100 | × | 10,473) | ÷ | 118,364) |
| Oct 31, 2007 | 8.36% | = | 100 | × | 8,719) | ÷ | 104,286) |
| Oct 31, 2006 | 7.16% | = | 100 | × | 6,560) | ÷ | 91,658) |
| Oct 31, 2005 | 4.01% | = | 100 | × | 3,473) | ÷ | 86,696) |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31), 10-K (reporting date: 2012-10-31), 10-K (reporting date: 2011-10-31), 10-K (reporting date: 2010-10-31), 10-K (reporting date: 2009-10-31), 10-K (reporting date: 2008-10-31), 10-K (reporting date: 2007-10-31), 10-K (reporting date: 2006-10-31), 10-K (reporting date: 2005-10-31).
1 US$ in millions
The operating profit margin exhibited significant volatility between 2005 and 2018, characterized by a period of steady expansion, a severe collapse in 2012, and a subsequent phase of stabilization following a substantial reduction in the company's revenue scale.
- Expansion Phase (2005–2010)
- A consistent upward trend in profitability was observed during this period. The operating profit margin grew from 4.01% in 2005 to a peak of 9.11% in 2010. This growth was supported by a simultaneous increase in net revenue, which rose from 86,696 million US$ to 126,033 million US$, and a corresponding increase in earnings from operations from 3,473 million US$ to 11,479 million US$.
- Critical Volatility and Impairment (2011–2012)
- A sharp reversal occurred starting in 2011, culminating in a severe financial anomaly in 2012. In 2012, earnings from operations fell to a loss of 11,057 million US$, resulting in a negative operating profit margin of -9.19%. This represents the most significant contraction in the analyzed period, shifting the company from a position of peak profitability to a substantial operating loss.
- Recovery and Margin Stabilization (2013–2015)
- Profitability returned to positive territory in 2013 with an operating profit margin of 6.35%. Although margins remained positive through 2015, they failed to reach the pre-2011 peaks, dipping to 5.29% by October 31, 2015. During this window, net revenue began a gradual decline from 112,298 million US$ to 103,355 million US$.
- Structural Shift and Normalized Performance (2016–2018)
- A fundamental change in the revenue base occurred in 2016, where net revenue decreased sharply from 103,355 million US$ to 48,238 million US$. Despite this reduction in scale, the operating profit margin improved to 7.36% in 2016 and remained relatively stable through 2018, ending the period at 6.95%. This indicates a transition toward a smaller but more margin-stable operational model.
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Comparison to Competitors
HP Inc., operating profit margin, long-term trends, comparison to competitors
| HP Inc. | Apple Inc. | Arista Networks Inc. | Cisco Systems Inc. | Dell Technologies Inc. | Lumentum Holdings Inc. | Super Micro Computer Inc. | |
|---|---|---|---|---|---|---|---|
| Oct 31, 2018 | 6.95% | 26.69% | 12.71% | 24.95% | — | 11.21% | 2.82% |
| Oct 31, 2017 | 6.76% | 26.76% | 28.57% | 24.94% | — | 4.75% | 3.82% |
| Oct 31, 2016 | 7.36% | 27.84% | 21.56% | 25.71% | — | 1.27% | 4.82% |
| Oct 31, 2015 | 5.29% | 30.48% | 17.83% | 21.91% | — | -2.80% | 7.37% |
| Oct 31, 2014 | 6.45% | 28.72% | 21.49% | 19.82% | — | — | 5.47% |
| Oct 31, 2013 | 6.35% | 28.67% | — | 23.03% | — | — | 2.34% |
| Oct 31, 2012 | -9.19% | 35.30% | — | 21.85% | — | — | 4.54% |
| Oct 31, 2011 | 7.61% | 31.22% | — | 17.76% | — | — | 6.23% |
| Oct 31, 2010 | 9.11% | 28.19% | — | 22.89% | — | — | 5.65% |
| Oct 31, 2009 | 8.85% | 20.96% | — | 20.27% | — | — | 4.60% |
| Oct 31, 2008 | 8.85% | 19.32% | — | 23.88% | — | — | 7.45% |
| Oct 31, 2007 | 8.36% | 18.37% | — | 24.69% | — | — | 7.11% |
| Oct 31, 2006 | 7.16% | 12.70% | — | 24.56% | — | — | — |
| Oct 31, 2005 | 4.01% | 11.84% | — | 29.90% | — | — | — |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31), 10-K (reporting date: 2012-10-31), 10-K (reporting date: 2011-10-31), 10-K (reporting date: 2010-10-31), 10-K (reporting date: 2009-10-31), 10-K (reporting date: 2008-10-31), 10-K (reporting date: 2007-10-31), 10-K (reporting date: 2006-10-31), 10-K (reporting date: 2005-10-31).