HP Inc (NYSE:HPQ) Q4 2018 Earnings Conference Call - Final Transcript

Nov 29, 2018 • 05:00 pm ET


HP Inc (NYSE:HPQ) Q4 2018 Earnings Conference Call - Final Transcript


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Dion Weisler

delivering differentiated hardware, services, and solutions.

HP continues to be a leader in product design. At our analyst meeting, we introduced you to the stunning world of Spectre Folio. The product is now hitting the market, receiving high praise for design, versatility, and performance, and driving renewed excitement in the PC category. We also recently launched two new Spectre x360s. The Spectre x360 13 delivers the world's longest battery life in a quad core convertible, while the Spectre x360 15 is the most powerful convertible we've ever created.

In commercial, we unveiled the latest EliteBook, the world's smallest and lightest 14-inch business convertible and the first with gigabit-class 4G LTE. In gaming, our OMEN PCs and displays powered the Overwatch World Cup, where 24 countries battled for domination in front of nearly 10 million viewers. We also launched our latest OMEN desktop and a remote service called Game Stream that turns the OMEN PC into a cloud-based gaming server to enable experiences on the go. And at Adobe MAX, we unveiled the new Z by HP workstation portfolio and announced a subscription-based hardware and services bundle specifically designed for elite creative professionals that combines powerful PCs, pro-grade displays, printers, and accessories.

As we innovate across our core, we are also continuing to accelerate our growth pillar with Device as a Service. 60% of IT organizations tell us their resources are increasingly taxed by device management and 80% of their costs are coming after the PC is purchased. HP DaaS uses data and analytics to reduce costs and optimize the experience for IT and for end users. This quarter, the Technology Services Industry Association recognized HP DaaS with its Star Award for Innovation in the standard managed service offering. This is one of the highest honors in the technology services industry.

Like Personal Systems, Printing continues to drive profitable growth. Total print revenue was up 9% in quarter four and 11% for the full year, with growth in all regions and across hardware and supplies. Operating profit grew in both periods, adding $177 million to the bottomline for the full year. This consistent growth is yet another proof point of customer adoption of HP's innovative portfolio. Similar to the PC market, design is increasingly important for printers. Earlier in the quarter, we introduced the world's first smart home printer, HP Tango. Tango combines voice-activated and app-based printing with stunning design and convenience through our Instant Ink subscription program. We believe that Tango reinvents expectations for home printing, setting a new standard for print to fit seamlessly into consumers' lifestyles. We are also strengthening our leadership in the office space to drive new contractual and A3 growth opportunities.

As we mark the anniversary of the S-print acquisition, I am pleased with the progress we have made. We are one team, focused on accelerating our penetration of this large addressable market. Earlier this month, we further accelerated our penetration of the copier market by completing the acquisition of Apogee, providing us with deep