Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
HP Inc., profitability ratios (quarterly data)
Based on: 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30), 10-Q (reporting date: 2019-01-31), 10-K (reporting date: 2018-10-31), 10-Q (reporting date: 2018-07-31), 10-Q (reporting date: 2018-04-30), 10-Q (reporting date: 2018-01-31), 10-K (reporting date: 2017-10-31), 10-Q (reporting date: 2017-07-31), 10-Q (reporting date: 2017-04-30), 10-Q (reporting date: 2017-01-31), 10-K (reporting date: 2016-10-31), 10-Q (reporting date: 2016-07-31), 10-Q (reporting date: 2016-04-30), 10-Q (reporting date: 2016-01-31), 10-K (reporting date: 2015-10-31), 10-Q (reporting date: 2015-07-31), 10-Q (reporting date: 2015-04-30), 10-Q (reporting date: 2015-01-31), 10-K (reporting date: 2014-10-31), 10-Q (reporting date: 2014-07-31), 10-Q (reporting date: 2014-04-30), 10-Q (reporting date: 2014-01-31).
- Gross Profit Margin
- The gross profit margin demonstrates a declining trend over the periods analyzed. It started at approximately 23.2% in early 2014, maintained a relatively stable level around 23-24% until early 2015, and subsequently declined consistently. By early 2016, the margin had decreased notably to below 19%, where it remained relatively stable with slight fluctuations through to mid-2019, averaging close to 18.5%. This decline suggests increasing cost pressures or pricing challenges affecting the company’s gross profitability.
- Operating Profit Margin
- The operating profit margin showed moderate variability but overall a less pronounced downward trend compared to gross margins. Beginning near 6.6% in early 2014, it decreased somewhat to around 5.3% by late 2015. Thereafter, it experienced a recovery phase during 2016, reaching over 7%, before stabilizing around the mid-6% range through 2019. The improvement and stabilization suggest enhanced operational efficiency or better expense control during the later periods.
- Net Profit Margin
- The net profit margin remained relatively steady around the mid-4% range during 2014 and 2015. Starting in 2016, a noticeable upward trend developed, with margins increasing steadily to peak above 9% in late 2018. This is a significant improvement, reflecting stronger bottom-line results potentially driven by cost management, lower taxes, or other income enhancements. After reaching the peak, net margins slightly contracted but remained above 6.5% through mid-2019, representing improved profitability relative to earlier years.
- Return on Equity (ROE)
- Return on equity was only reported through 2015 and showed a gradual decline from about 19% at the beginning of 2014 to roughly 16.4% by late 2015. This decreasing trend indicates a diminishing efficiency in generating profits from equity capital during this period.
- Return on Assets (ROA)
- The return on assets experienced an initial decline from around 5% in early 2014 to about 4.3% in late 2015, similar to other profitability measures. However, starting in 2016, ROA values surged considerably, reaching double-digit percentages and peaking near 15.4% in late 2018. Such an increase implies improved asset utilization and profitability. Despite some fluctuations, ROA remained strong through mid-2019, suggesting ongoing operational improvements or asset base adjustments that enhanced returns on assets.
Return on Sales
Return on Investment
Gross Profit Margin
HP Inc., gross profit margin calculation (quarterly data)
| Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | Oct 31, 2018 | Jul 31, 2018 | Apr 30, 2018 | Jan 31, 2018 | Oct 31, 2017 | Jul 31, 2017 | Apr 30, 2017 | Jan 31, 2017 | Oct 31, 2016 | Jul 31, 2016 | Apr 30, 2016 | Jan 31, 2016 | Oct 31, 2015 | Jul 31, 2015 | Apr 30, 2015 | Jan 31, 2015 | Oct 31, 2014 | Jul 31, 2014 | Apr 30, 2014 | Jan 31, 2014 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Gross profit | 2,905) | 2,729) | 2,612) | 2,697) | 2,688) | 2,702) | 2,582) | 2,520) | 2,427) | 2,383) | 2,248) | 2,291) | 2,172) | 2,250) | 2,285) | 6,351) | 6,032) | 6,108) | 6,268) | 6,981) | 6,611) | 6,605) | 6,418) | |||||||
| Net revenue | 14,603) | 14,036) | 14,710) | 15,366) | 14,586) | 14,003) | 14,517) | 13,927) | 13,060) | 12,385) | 12,684) | 12,512) | 11,892) | 11,588) | 12,246) | 25,714) | 25,349) | 25,453) | 26,839) | 28,406) | 27,585) | 27,309) | 28,154) | |||||||
| Profitability Ratio | ||||||||||||||||||||||||||||||
| Gross profit margin1 | 18.64% | 18.27% | 18.24% | 18.25% | 18.40% | 18.43% | 18.39% | 18.40% | 18.46% | 18.38% | 18.41% | 18.65% | 21.25% | 22.59% | 23.41% | 23.96% | 23.94% | 23.98% | 24.03% | 23.88% | 23.47% | 23.33% | 23.20% | |||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Gross Profit Margin, Competitors2 | ||||||||||||||||||||||||||||||
| Apple Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Arista Networks Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Cisco Systems Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Super Micro Computer Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30), 10-Q (reporting date: 2019-01-31), 10-K (reporting date: 2018-10-31), 10-Q (reporting date: 2018-07-31), 10-Q (reporting date: 2018-04-30), 10-Q (reporting date: 2018-01-31), 10-K (reporting date: 2017-10-31), 10-Q (reporting date: 2017-07-31), 10-Q (reporting date: 2017-04-30), 10-Q (reporting date: 2017-01-31), 10-K (reporting date: 2016-10-31), 10-Q (reporting date: 2016-07-31), 10-Q (reporting date: 2016-04-30), 10-Q (reporting date: 2016-01-31), 10-K (reporting date: 2015-10-31), 10-Q (reporting date: 2015-07-31), 10-Q (reporting date: 2015-04-30), 10-Q (reporting date: 2015-01-31), 10-K (reporting date: 2014-10-31), 10-Q (reporting date: 2014-07-31), 10-Q (reporting date: 2014-04-30), 10-Q (reporting date: 2014-01-31).
1 Q3 2019 Calculation
Gross profit margin = 100
× (Gross profitQ3 2019
+ Gross profitQ2 2019
+ Gross profitQ1 2019
+ Gross profitQ4 2018)
÷ (Net revenueQ3 2019
+ Net revenueQ2 2019
+ Net revenueQ1 2019
+ Net revenueQ4 2018)
= 100 × (2,905 + 2,729 + 2,612 + 2,697)
÷ (14,603 + 14,036 + 14,710 + 15,366)
= 18.64%
2 Click competitor name to see calculations.
- Gross Profit
- The gross profit exhibited a fluctuating trend over the analyzed periods. Initially, it increased from 6418 million USD in the first quarter of 2014, reaching a peak around 6981 million USD in the last quarter of 2014. Subsequently, the figure declined through 2015, dropping to approximately 6032 million USD in the third quarter, before slightly recovering by the end of 2015. A notable decline is observed in the early months of 2016, with gross profit falling to levels around 2172–2291 million USD. From 2017 onwards, gross profit showed gradual improvement, steadily increasing quarter over quarter, ultimately reaching approximately 2905 million USD by the third quarter of 2019.
- Net Revenue
- Net revenue demonstrated a similar pattern of volatility. The highest net revenues within the early period were around 28406 million USD in the fourth quarter of 2014. Afterward, a decreasing trend appeared during 2015, with revenues dropping close to 25349 million USD by the third quarter. Beginning in 2016, the revenue figures reflect distinctly lower quarterly values, fluctuating around the range of 11588 to 12512 million USD per quarter. From 2017 forward, net revenue gradually increased, peaking at approximately 15366 million USD in the first quarter of 2019, before slightly decreasing in the subsequent two quarters.
- Gross Profit Margin
- The gross profit margin percentage was relatively consistent around 23%–24% during 2014 and early 2015. However, there was a significant drop starting late 2015 and continuing through 2016, reaching a low near 18.41% to 18.65%. Margins remained near this lower band from 2017 through 2019, fluctuating narrowly around 18.2% to 18.6%, indicating a sustained compression compared to earlier periods. This decline implies that despite increases in gross profit and net revenue after 2016, the margin was significantly reduced relative to total revenues compared to previous years.
- Summary
- The data indicates a downward shift in both gross profit and net revenue around 2015 and the first half of 2016, followed by a recovery phase with gradual growth through 2017 to 2019. Despite this recovery, the gross profit margin experienced a marked reduction from the early 2014 levels to a stable but lower range in later years. This suggests increased costs or pricing pressures impacting profitability despite revenue growth. The financial trends reflect a period of adjustment followed by steady improvement in absolute financial results but accompanied by continued margin compression.
Operating Profit Margin
HP Inc., operating profit margin calculation (quarterly data)
| Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | Oct 31, 2018 | Jul 31, 2018 | Apr 30, 2018 | Jan 31, 2018 | Oct 31, 2017 | Jul 31, 2017 | Apr 30, 2017 | Jan 31, 2017 | Oct 31, 2016 | Jul 31, 2016 | Apr 30, 2016 | Jan 31, 2016 | Oct 31, 2015 | Jul 31, 2015 | Apr 30, 2015 | Jan 31, 2015 | Oct 31, 2014 | Jul 31, 2014 | Apr 30, 2014 | Jan 31, 2014 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Earnings from operations | 1,079) | 928) | 926) | 1,047) | 1,080) | 964) | 973) | 890) | 955) | 818) | 856) | 663) | 1,117) | 841) | 928) | 908) | 1,212) | 1,431) | 1,920) | 1,908) | 1,458) | 1,822) | 1,997) | |||||||
| Net revenue | 14,603) | 14,036) | 14,710) | 15,366) | 14,586) | 14,003) | 14,517) | 13,927) | 13,060) | 12,385) | 12,684) | 12,512) | 11,892) | 11,588) | 12,246) | 25,714) | 25,349) | 25,453) | 26,839) | 28,406) | 27,585) | 27,309) | 28,154) | |||||||
| Profitability Ratio | ||||||||||||||||||||||||||||||
| Operating profit margin1 | 6.78% | 6.78% | 6.85% | 6.95% | 6.85% | 6.81% | 6.75% | 6.76% | 6.50% | 6.98% | 7.14% | 7.36% | 6.18% | 5.19% | 5.05% | 5.29% | 6.10% | 6.20% | 6.45% | 6.45% | 6.42% | 6.79% | 6.58% | |||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Operating Profit Margin, Competitors2 | ||||||||||||||||||||||||||||||
| Apple Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Arista Networks Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Cisco Systems Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Super Micro Computer Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30), 10-Q (reporting date: 2019-01-31), 10-K (reporting date: 2018-10-31), 10-Q (reporting date: 2018-07-31), 10-Q (reporting date: 2018-04-30), 10-Q (reporting date: 2018-01-31), 10-K (reporting date: 2017-10-31), 10-Q (reporting date: 2017-07-31), 10-Q (reporting date: 2017-04-30), 10-Q (reporting date: 2017-01-31), 10-K (reporting date: 2016-10-31), 10-Q (reporting date: 2016-07-31), 10-Q (reporting date: 2016-04-30), 10-Q (reporting date: 2016-01-31), 10-K (reporting date: 2015-10-31), 10-Q (reporting date: 2015-07-31), 10-Q (reporting date: 2015-04-30), 10-Q (reporting date: 2015-01-31), 10-K (reporting date: 2014-10-31), 10-Q (reporting date: 2014-07-31), 10-Q (reporting date: 2014-04-30), 10-Q (reporting date: 2014-01-31).
1 Q3 2019 Calculation
Operating profit margin = 100
× (Earnings from operationsQ3 2019
+ Earnings from operationsQ2 2019
+ Earnings from operationsQ1 2019
+ Earnings from operationsQ4 2018)
÷ (Net revenueQ3 2019
+ Net revenueQ2 2019
+ Net revenueQ1 2019
+ Net revenueQ4 2018)
= 100 × (1,079 + 928 + 926 + 1,047)
÷ (14,603 + 14,036 + 14,710 + 15,366)
= 6.78%
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several key trends in the company's operational performance, revenue generation, and profitability over the examined periods.
- Earnings from Operations
-
Earnings from operations demonstrate notable fluctuations throughout the quarters. Initially, there is a decline from approximately 1,997 million to 908 million within two years, indicating downward pressure on operational earnings. However, starting in early 2016, earnings show some recovery with intermittent increases and decreases, reaching a peak near 1,080 million in the third quarter of 2018 before declining again towards 1,079 million by mid-2019. This pattern suggests periods of operational challenges interspersed with efforts at stabilization and growth.
- Net Revenue
-
Net revenue maintains a relatively steady trajectory with mild volatility. The earlier periods show revenues ranging around 27,000 to 28,000 million, while the mid-2015 to early 2016 timeframe records a lower scale near 12,000 to 13,000 million, likely reflecting a change in reporting or operational scale. From 2016 onwards, revenue trends generally upward, peaking at approximately 15,366 million in early 2019, followed by minor declines but remaining near 14,000 to 15,000 million. This indicates an overall growth trend in sales or service income, with occasional fluctuations.
- Operating Profit Margin
-
The operating profit margin exhibits relative stability, mostly fluctuating between 5.0% and 7.5%. The margin experienced a slight decline from about 6.6% to 5.3% in the early periods, corresponding with the declines in earnings observed earlier. From early 2016 onwards, the margin generally improves, frequently exceeding 6.5% and reaching up to 7.36%, indicating an improvement in operational efficiency or cost management. In recent quarters, the margin maintains a steady range around 6.7% to 6.9%, reflecting consistent profitability relative to revenue.
Overall, the data reflect a company that faced operational earnings pressures in the earlier periods, while revenue remained relatively stable and later exhibited an upward trend. The operating profit margin improvements in recent years highlight better control over expenses or enhanced operational performance, which has contributed to sustaining profitability despite fluctuations in earnings from operations.
Net Profit Margin
HP Inc., net profit margin calculation (quarterly data)
| Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | Oct 31, 2018 | Jul 31, 2018 | Apr 30, 2018 | Jan 31, 2018 | Oct 31, 2017 | Jul 31, 2017 | Apr 30, 2017 | Jan 31, 2017 | Oct 31, 2016 | Jul 31, 2016 | Apr 30, 2016 | Jan 31, 2016 | Oct 31, 2015 | Jul 31, 2015 | Apr 30, 2015 | Jan 31, 2015 | Oct 31, 2014 | Jul 31, 2014 | Apr 30, 2014 | Jan 31, 2014 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Net earnings | 1,179) | 782) | 803) | 1,451) | 880) | 1,058) | 1,938) | 660) | 696) | 559) | 611) | 492) | 783) | 629) | 592) | 1,323) | 854) | 1,011) | 1,366) | 1,330) | 985) | 1,273) | 1,425) | |||||||
| Net revenue | 14,603) | 14,036) | 14,710) | 15,366) | 14,586) | 14,003) | 14,517) | 13,927) | 13,060) | 12,385) | 12,684) | 12,512) | 11,892) | 11,588) | 12,246) | 25,714) | 25,349) | 25,453) | 26,839) | 28,406) | 27,585) | 27,309) | 28,154) | |||||||
| Profitability Ratio | ||||||||||||||||||||||||||||||
| Net profit margin1 | 7.18% | 6.67% | 7.15% | 9.11% | 7.95% | 7.84% | 7.15% | 4.85% | 4.66% | 4.94% | 5.17% | 5.17% | 5.42% | 4.54% | 4.26% | 4.41% | 4.30% | 4.33% | 4.50% | 4.50% | 4.54% | 4.92% | 4.73% | |||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Net Profit Margin, Competitors2 | ||||||||||||||||||||||||||||||
| Apple Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Arista Networks Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Cisco Systems Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Super Micro Computer Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30), 10-Q (reporting date: 2019-01-31), 10-K (reporting date: 2018-10-31), 10-Q (reporting date: 2018-07-31), 10-Q (reporting date: 2018-04-30), 10-Q (reporting date: 2018-01-31), 10-K (reporting date: 2017-10-31), 10-Q (reporting date: 2017-07-31), 10-Q (reporting date: 2017-04-30), 10-Q (reporting date: 2017-01-31), 10-K (reporting date: 2016-10-31), 10-Q (reporting date: 2016-07-31), 10-Q (reporting date: 2016-04-30), 10-Q (reporting date: 2016-01-31), 10-K (reporting date: 2015-10-31), 10-Q (reporting date: 2015-07-31), 10-Q (reporting date: 2015-04-30), 10-Q (reporting date: 2015-01-31), 10-K (reporting date: 2014-10-31), 10-Q (reporting date: 2014-07-31), 10-Q (reporting date: 2014-04-30), 10-Q (reporting date: 2014-01-31).
1 Q3 2019 Calculation
Net profit margin = 100
× (Net earningsQ3 2019
+ Net earningsQ2 2019
+ Net earningsQ1 2019
+ Net earningsQ4 2018)
÷ (Net revenueQ3 2019
+ Net revenueQ2 2019
+ Net revenueQ1 2019
+ Net revenueQ4 2018)
= 100 × (1,179 + 782 + 803 + 1,451)
÷ (14,603 + 14,036 + 14,710 + 15,366)
= 7.18%
2 Click competitor name to see calculations.
The financial data reveals several notable trends relating to net earnings, net revenue, and net profit margin over the periods analyzed.
- Net Earnings
- There is evident volatility in net earnings over the quarters. Initially, earnings fluctuated between approximately 854 and 1425 million USD, with some quarters showing growth and others decline. Starting in early 2016, net earnings generally exhibited lower values, often below 800 million USD, before improving gradually towards late 2017. A sharp increase occurred in early 2018, peaking near 1938 million USD, which marks the highest net earnings in the entire timeframe. Following this peak, earnings fluctuated again but generally remained above the earlier 2016 lows.
- Net Revenue
- Net revenue shows a declining trend from early 2014 through early 2016, dropping from over 28 billion USD to a low of approximately 11.5 billion USD per quarter. From 2016 onward, net revenue shows a recovery trend, steadily increasing to reach near or above 15 billion USD in some quarters by early 2019. This recovery after an initial decline suggests a stabilization in sales or service income streams during the latter part of the period analyzed.
- Net Profit Margin
- The net profit margin fluctuates moderately, mostly ranging between 4.3% and 5.5% from 2014 through 2017. A distinct upward trend becomes apparent starting in 2017, with margins rising significantly to peak at over 9% in late 2018. This increase in profitability ratio suggests improvements in operational efficiency, cost control, or pricing strategies. Although margins declined somewhat after peaking, they remained higher than earlier periods, consistently above 6.5% in 2019.
Overall, the data depicts a company experiencing fluctuations in earnings and revenue with a significant rebound in profitability metrics toward the later periods. The substantial peak in net earnings during early 2018 corresponds with the highest recorded net profit margins, indicating a period of strong financial performance. The recovery in net revenue concomitant with improving margins suggests a positive shift in business operations following a mid-period decline.
Return on Equity (ROE)
HP Inc., ROE calculation (quarterly data)
| Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | Oct 31, 2018 | Jul 31, 2018 | Apr 30, 2018 | Jan 31, 2018 | Oct 31, 2017 | Jul 31, 2017 | Apr 30, 2017 | Jan 31, 2017 | Oct 31, 2016 | Jul 31, 2016 | Apr 30, 2016 | Jan 31, 2016 | Oct 31, 2015 | Jul 31, 2015 | Apr 30, 2015 | Jan 31, 2015 | Oct 31, 2014 | Jul 31, 2014 | Apr 30, 2014 | Jan 31, 2014 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Net earnings | 1,179) | 782) | 803) | 1,451) | 880) | 1,058) | 1,938) | 660) | 696) | 559) | 611) | 492) | 783) | 629) | 592) | 1,323) | 854) | 1,011) | 1,366) | 1,330) | 985) | 1,273) | 1,425) | |||||||
| Total HP stockholders’ equity (deficit) | (1,131) | (1,487) | (1,837) | (639) | (1,767) | (1,863) | (2,742) | (3,408) | (4,339) | (3,955) | (4,327) | (3,889) | (3,926) | (4,786) | (4,909) | 27,768) | 27,035) | 26,768) | 26,507) | 26,731) | 28,509) | 28,185) | 27,754) | |||||||
| Profitability Ratio | ||||||||||||||||||||||||||||||
| ROE1 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 16.40% | 16.87% | 17.53% | 18.69% | 18.75% | 17.88% | 19.52% | 19.12% | |||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| ROE, Competitors2 | ||||||||||||||||||||||||||||||
| Apple Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Arista Networks Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Cisco Systems Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Super Micro Computer Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30), 10-Q (reporting date: 2019-01-31), 10-K (reporting date: 2018-10-31), 10-Q (reporting date: 2018-07-31), 10-Q (reporting date: 2018-04-30), 10-Q (reporting date: 2018-01-31), 10-K (reporting date: 2017-10-31), 10-Q (reporting date: 2017-07-31), 10-Q (reporting date: 2017-04-30), 10-Q (reporting date: 2017-01-31), 10-K (reporting date: 2016-10-31), 10-Q (reporting date: 2016-07-31), 10-Q (reporting date: 2016-04-30), 10-Q (reporting date: 2016-01-31), 10-K (reporting date: 2015-10-31), 10-Q (reporting date: 2015-07-31), 10-Q (reporting date: 2015-04-30), 10-Q (reporting date: 2015-01-31), 10-K (reporting date: 2014-10-31), 10-Q (reporting date: 2014-07-31), 10-Q (reporting date: 2014-04-30), 10-Q (reporting date: 2014-01-31).
1 Q3 2019 Calculation
ROE = 100
× (Net earningsQ3 2019
+ Net earningsQ2 2019
+ Net earningsQ1 2019
+ Net earningsQ4 2018)
÷ Total HP stockholders’ equity (deficit)
= 100 × (1,179 + 782 + 803 + 1,451)
÷ -1,131 = —
2 Click competitor name to see calculations.
- Net Earnings
- Over the observed periods, net earnings exhibited notable fluctuations. Initially, quarterly net earnings ranged between approximately 985 million and 1,425 million US dollars, with a general tendency to decline during 2014. In 2015, earnings showed some recovery but remained volatile, with values oscillating between 854 million and 1,366 million US dollars. The period of 2016 demonstrated lower net earnings compared to previous years, with values mostly under 800 million US dollars. In 2017, earnings showed moderate improvement with figures generally above 550 million US dollars. A substantial increase occurred in early 2018, peaking at 1,938 million US dollars, followed by a subsequent decrease but maintaining relatively higher levels than in 2016 and 2017. The trend in 2019 showed moderate stability in net earnings fluctuating between approximately 780 million and 1,179 million US dollars.
- Total HP Stockholders’ Equity (Deficit)
- The stockholders’ equity figures showed an overall declining trend throughout the presented periods. Initially, equity values were robust, fluctuating between approximately 26,500 million and 28,500 million US dollars until late 2015. Beginning in early 2016, a significant shift to negative equity appeared, indicating a deficit situation ranging from -4,909 million to -3,889 million US dollars initially. This negative equity state persisted through subsequent years, with the deficit gradually decreasing in magnitude but remaining negative throughout 2017 to the first half of 2019. The data suggests ongoing financial pressure or restructuring impacting equity values.
- Return on Equity (ROE)
- Return on equity was provided only for a limited timeframe covering 2014 and 2015, with values ranging from 16.4% to 19.52%. The ROE remained relatively stable during this period, reflecting solid profitability relative to shareholders’ equity before the period where equity turned negative. The absence of ROE data beyond 2015 likely corresponds with the transition to negative equity figures, which complicate the meaningful calculation of this ratio. The initial ROE level indicates satisfactory performance prior to the significant equity decline.
- Overall Insights
- The company's financial results demonstrated significant volatility in net earnings across the quarters. The transition from positive to negative stockholders’ equity marked a critical shift, indicating challenges in maintaining financial stability. The deterioration in equity coincided with the absence of ROE data in later periods, highlighting impaired profitability relative to equity. Notable spikes in net earnings in early 2018 suggest episodic improvements, though these were not sufficient to restore equity to positive levels. The patterns imply continued attention to capital structure and profitability is essential for future financial health.
Return on Assets (ROA)
HP Inc., ROA calculation (quarterly data)
| Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | Oct 31, 2018 | Jul 31, 2018 | Apr 30, 2018 | Jan 31, 2018 | Oct 31, 2017 | Jul 31, 2017 | Apr 30, 2017 | Jan 31, 2017 | Oct 31, 2016 | Jul 31, 2016 | Apr 30, 2016 | Jan 31, 2016 | Oct 31, 2015 | Jul 31, 2015 | Apr 30, 2015 | Jan 31, 2015 | Oct 31, 2014 | Jul 31, 2014 | Apr 30, 2014 | Jan 31, 2014 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Net earnings | 1,179) | 782) | 803) | 1,451) | 880) | 1,058) | 1,938) | 660) | 696) | 559) | 611) | 492) | 783) | 629) | 592) | 1,323) | 854) | 1,011) | 1,366) | 1,330) | 985) | 1,273) | 1,425) | |||||||
| Total assets | 32,405) | 31,946) | 32,490) | 34,622) | 34,254) | 32,087) | 35,245) | 32,913) | 31,934) | 28,686) | 28,192) | 29,010) | 27,224) | 25,523) | 25,517) | 106,882) | 107,033) | 101,396) | 100,861) | 103,206) | 103,170) | 103,972) | 105,025) | |||||||
| Profitability Ratio | ||||||||||||||||||||||||||||||
| ROA1 | 13.01% | 12.26% | 12.90% | 15.39% | 13.24% | 13.56% | 10.93% | 7.67% | 7.38% | 8.52% | 8.92% | 8.60% | 12.22% | 13.31% | 14.81% | 4.26% | 4.26% | 4.63% | 4.91% | 4.86% | 4.94% | 5.29% | 5.05% | |||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| ROA, Competitors2 | ||||||||||||||||||||||||||||||
| Apple Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Arista Networks Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Cisco Systems Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Dell Technologies Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Super Micro Computer Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30), 10-Q (reporting date: 2019-01-31), 10-K (reporting date: 2018-10-31), 10-Q (reporting date: 2018-07-31), 10-Q (reporting date: 2018-04-30), 10-Q (reporting date: 2018-01-31), 10-K (reporting date: 2017-10-31), 10-Q (reporting date: 2017-07-31), 10-Q (reporting date: 2017-04-30), 10-Q (reporting date: 2017-01-31), 10-K (reporting date: 2016-10-31), 10-Q (reporting date: 2016-07-31), 10-Q (reporting date: 2016-04-30), 10-Q (reporting date: 2016-01-31), 10-K (reporting date: 2015-10-31), 10-Q (reporting date: 2015-07-31), 10-Q (reporting date: 2015-04-30), 10-Q (reporting date: 2015-01-31), 10-K (reporting date: 2014-10-31), 10-Q (reporting date: 2014-07-31), 10-Q (reporting date: 2014-04-30), 10-Q (reporting date: 2014-01-31).
1 Q3 2019 Calculation
ROA = 100
× (Net earningsQ3 2019
+ Net earningsQ2 2019
+ Net earningsQ1 2019
+ Net earningsQ4 2018)
÷ Total assets
= 100 × (1,179 + 782 + 803 + 1,451)
÷ 32,405 = 13.01%
2 Click competitor name to see calculations.
- Net Earnings
- Net earnings exhibit volatility over the analyzed periods, with fluctuations noticeable both within and across years. Early periods show values generally ranging between approximately 850 and 1,425 million US dollars. A marked decline is observed around the 2016 calendar year, where earnings drop significantly, reaching lows around 492 million. Subsequently, earnings recover variably, peaking at nearly 1,938 million in early 2018, followed again by dips in subsequent quarters. The pattern suggests irregular earnings performance, potentially reflecting cyclical factors, market conditions, or specific operational influences during distinct time frames.
- Total Assets
- Total assets demonstrate a noteworthy structural change during the timeframe. Initially, total assets hover consistently above 100,000 million US dollars until late 2015. Post this period, a substantial reduction occurs, with asset values decreasing to figures in the range from approximately 25,000 to 35,000 million, stabilizing around this lower level in subsequent quarters. This step-change implies a significant corporate event such as a divestiture, restructuring, or reclassification impacting the asset base. Within the lower asset level environment, fluctuations remain moderate but relatively stable, indicating new operational scale or organization size.
- Return on Assets (ROA)
- The ROA percentages reflect corresponding trends in net earnings and total assets. Initially, ROA percentages remain fairly steady around 4.2% to 5.3%, indicating moderate profitability relative to asset base. Following the asset base reduction, ROA values rise substantially, demonstrating improved efficiency in using assets to generate earnings. Peak ROA values approach or exceed 15%, suggesting a period of strong asset productivity and profitability. While some quarter-to-quarter variability exists, the overall post-asset reduction period shows enhanced financial performance and return on resource deployment.
- Summary
- The data reveals a financial narrative featuring a major change in asset size accompanied by variable net earnings and improved asset utilization efficiency as measured by ROA. The reduction in asset scale is closely associated with a notable increase in ROA, implying a more concentrated or efficient asset structure. Despite the improvements in profitability ratios post-change, net earnings continue to demonstrate notable fluctuations, indicating that factors influencing income persist beyond the asset base adjustments. These patterns suggest strategic shifts impacting corporate scale and operational effectiveness, underscoring the importance of asset management and profitability dynamics over the analyzed periods.