HP posted revenue of $14.4 billion in its fiscal second quarter of 2026 – up 9% year-over-year – delivering non-GAAP EPS of $0.86, well ahead of analyst estimates of $0.71.
The results, driven by surging demand for AI-optimised PCs and a continuing Windows 11 refresh cycle, marked the company's eighth consecutive quarter of top-line growth. Shares jumped as much as 15% in after-hours trading.
The results come against a backdrop of rising commodity costs, a leadership transition, and an accelerating shift toward AI-optimised computing at the edge.
AI PCs Take Centre Stage
The standout number from the call: AI PCs now make up 44 percent of HP's total PC shipments, up from 35 percent last quarter. HP is projecting that figure will reach 60–70 percent in fiscal 2027, climbing above 70 percent by fiscal 2028.
Interim CEO Bruce Broussard was emphatic about what's driving the shift. "Customers are becoming more thoughtful about where AI workloads run," he told analysts, pointing to rising cloud costs, latency concerns, and data privacy pressures as forces pushing enterprises toward edge computing.
"Companies like HP that own the trusted edge, the workflow context, and the orchestration layer between local and cloud intelligence will be positioned to thrive."
HP's pitch is that the PC is becoming a genuine AI execution platform – not just a thin client for cloud services.
Its new Z Workstations and AI Stations are designed to run inference locally, and HP showcased an expanding ecosystem of 150+ software partners building productivity, developer, and creative tools around that capability at its HP Imagine event this quarter.
The Windows 11 refresh cycle is adding further fuel. HP noted that roughly 30% of the installed base is still running Windows 10, with significant upgrade waves still to come in EMEA and APJ – markets that delivered constant currency revenue growth of 6 percent and 18 percent respectively this quarter.
Personal Systems President Ketan Patel noted: "There is intrinsic strength in both commercial and consumer, driven by Windows 11 and AI at the edge – and that remains strong even for Q3 and Q4."
Personal Systems revenue grew 13 percent year-over-year overall, with operating profit up 30 percent – a standout performance that CFO Karen Parkhill attributed to disciplined pricing, a richer product mix, and accelerated mitigation actions on commodity costs.
The Memory Crunch
Not everything was straightforward. HP was candid about a worsening memory and storage cost environment that it expects to intensify through the second half of the year.
