HP : Q2 Earnings Presentation

HP INC. Q2 FY19

May 23, 2019 http://investor.hp.com

1

Forward-looking statements

This presentation contains forward-looking statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of HP Inc. and its consolidated subsidiaries ("HP") may differ materially from those expressed or implied by such forward-looking statements and assumptions.

All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any projections of net revenue, margins, expenses, effective tax rates, net earnings, net earnings per share, cash flows, benefit plan funding, deferred taxes, share repurchases, foreign currency exchange rates or other financial items; any projections of the amount, timing or impact of cost savings or restructuring and other charges; any statements of the plans, strategies and objectives of management for future operations, including, but not limited to, our sustainability goals, the execution of restructuring plans and any resulting cost savings, net revenue or profitability improvements; any statements concerning the expected development, performance, market share or competitive performance relating to products or services; any statements regarding current or future macroeconomic trends or events and the impact of those trends and events on HP and its financial performance; any statements regarding pending investigations, claims or disputes; any statements of expectation or belief, including with respect to the timing and expected benefits of acquisitions and other business combination and investment transactions; and any statements of assumptions underlying any of the foregoing.

Risks, uncertainties and assumptions include the need to address the many challenges facing HP's businesses; the competitive pressures faced by HP's businesses; risks associated with executing HP's strategy; the impact of macroeconomic and geopolitical trends and events; the need to manage third-party suppliers and the distribution of HP's products and the delivery of HP's services effectively; the protection of HP's intellectual property assets, including intellectual property licensed from third parties; risks associated with HP's international operations; the development and transition of new products and services and the enhancement of existing products and services to meet customer needs and respond to emerging technological trends; the execution and performance of contracts by HP and its suppliers, customers, clients and partners; the hiring and retention of key employees; integration and other risks associated with business combination and investment transactions; the results of the restructuring plans, including estimates and assumptions related to the cost (including any possible disruption of HP's business) and the anticipated benefits of the restructuring plans; the impact of changes in tax laws, including uncertainties related to the interpretation and application of the Tax Cuts and Jobs Act of 2017 on HP's tax obligations and effective tax rate; the resolution of pending investigations, claims and disputes; and other risks that are described in HP's Annual Report on Form 10-K for the fiscal year ended October 31, 2018 and HP's other filings with the Securities and Exchange Commission.

As in prior periods, the financial information set forth in this presentation, including any tax-related items, reflects estimates based on information available at this time. While HP believes these estimates to be reasonable, these amounts could differ materially from reported amounts in HP's Quarterly Reports on Form 10-Q for the fiscal quarters ended April 30, 2019 and July 31, 2019, Annual Report on Form 10-K for the fiscal year ended October 31, 2019 and HP's other filings with the Securities and Exchange Commission. HP assumes no obligation and does not intend to update these forward-looking statements. HP's Investor Relations website at http://www.investor.hp.com contains a significant amount of information about HP, including financial and other information for investors. HP encourages investors to visit its website from time to time, as information is updated and new information is posted. The content of HP's website is not incorporated by reference into this news release or in any other report or document we file with the SEC, and any references to HP's website are intended to be inactive textual references only.

2

Use of non-GAAP financial information

HP has included non-GAAP financial measures in this presentation to supplement HP's consolidated financial statements presented on a GAAP basis. Definitions of these non-GAAP financial measures and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included elsewhere in this presentation.

HP's management uses net revenue on a constant currency basis, non-GAAP total operating expense, non-GAAP operating profit, non-GAAP operating margin, non-GAAP tax rate, non-GAAP net earnings, and non-GAAP diluted net earnings per share to evaluate and forecast HP's performance before gains, losses or other charges that are considered by HP's management to be outside of HP's core business segment operating results. Gross cash, net cash (debt), and free cash flow are liquidity measures that provide useful information to management about the amount of cash available for investment in HP's businesses, funding acquisitions, repurchasing stock and other purposes. Net cash (debt) provides useful information to management about the state of HP's consolidated balance sheet.

These non-GAAP financial measures may have limitations as analytical tools, and these measures should not be considered in isolation or as a substitute for analysis of HP's results as reported under GAAP. For example, items such as amortization of intangible assets, though not directly affecting HP's cash position, represent the loss in value of intangible assets over time. The expense associated with this change in value is not included in non-GAAP operating profit, non-GAAP tax rate, non-GAAP net earnings, and non-GAAP diluted net earnings per share and therefore does not reflect the full economic effect of the change in value of those intangible assets. In addition, items such as restructuring and other charges, acquisition-related charges, non-operatingretirement-related (credits)/ charges, defined benefit plan settlement charges, debt extinguishment costs, tax adjustments, and the related tax impact on these items that are excluded from non-GAAP total operating expense, non-GAAP operating profit, non-GAAP tax rate, non-GAAP net earnings and non- GAAP diluted net earnings per share can have a material impact on the equivalent GAAP earnings financial measures and cash flow. HP may not be able to immediately liquidate the short-term and long-term investments included in gross cash, which may limit the usefulness of gross cash as a liquidity measure. In addition, free cash flow, which includes net capital expenditures, does not represent the total increase or decrease in cash for the period. The non-GAAP financial information that we provide also may differ from the non- GAAP information provided by other companies.

We compensate for the limitations on our use of these non-GAAP financial measures by relying primarily on our GAAP financial statements and using non-GAAP financial measures only supplementally. We also provide robust and detailed reconciliations of each non-GAAP financial measure to the most directly comparable GAAP measure, and we encourage investors to review those reconciliations carefully.

We believe that providing these non-GAAP financial measures in addition to the related GAAP measures provides investors with greater transparency to the information used by HP's management in its financial and operational decision-making and allows investors to see HP's results "through the eyes" of management. We further believe that providing this information better enables investors to understand HP's operating performance and financial condition and to evaluate the efficacy of the methodology and information used by HP's management to evaluate and measure such performance and financial condition.

HP's Investor Relations website at http://www.investor.hp.com contains a significant amount of information about HP, including financial and other information for investors. HP encourages investors to visit its website from time to time, as information is updated and new information is posted.

3

Q2 FY19 highlights

1. • Net revenue of$14.0 billion,up 0.2% from the prior-year period and up 2.3% in constant currency1
   • Non-GAAP2diluted net earnings per share of $0.53,within the previously provided outlook of $0.50 to $0.53 per share
   • GAAP diluted net earnings per share of$0.51,above the previously provided outlook of $0.45 to $0.48 per share
   • Free cash flow of$747 million2,3
   • Returned$936 millionto shareholders in the form of share repurchases and dividends
2. Adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period
3. A reconciliation of specific adjustments to GAAP results for the current and prior periods is included on slide 13 and in the GAAP tonon-GAAP slides that appear as part of the supplemental slides of this presentation. A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"
4. Free cash flow includes net cash provided by operations of $861 million less net investments in and proceeds from sales of property, plant and equipment of $114 million

4

Q2 FY19 results overview

$ in millions	Net revenue	Growth	Growth	Non-GAAP	Non-GAAP	Non-GAAP	Non-GAAP
OP 3	OP 3	OP
y/y%	CC1y/y%	OP $3	3
					% of rev	$ y/y	% of rev y/y
Printing	$5,116	(2.4)%	(1.7)%	$839	16.4%	$2	0.4 pts
Personal Systems	$8,921	1.8%	4.7%	$385	4.3%	$56	0.5 pts
Corp investments / Other	($1)	nm2	nm2	($187)	nm2	($49)	nm2
Total HP	$14,036	0.2%	2.3%	$1,037	7.4%	$9	0.1 pts

1. CC = constant currency; adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period
2. Not meaningful
3. A reconciliation of specific adjustments to GAAP results for the current period is included on slide 13 and in the GAAP tonon-GAAP slides that appear as part of the supplemental slides of this presentation. A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

5

Q2 FY19 mix by segment and region

Net revenue

By key segment and business unit1

		Workstations and Other	Printing - Supplies
		Personal Systems
		24%
Desktops 7%
21%
		$14.0	Commercial
						Printing -
				billion	Hardware4
						8%
Notebooks
36%				Printing - Consumer
				Hardware44%

Personal Systems = 64%

Printing = 36%

Non-GAAP operating profit2

By key segment3

$1.2 billion

Printing	16.4%
69% of total	OP margin
Personal Systems	4.3%
31% of total	OP margin

Net revenue by region

Americas EMEAAPJ

42% 36% 22%

US: 33%

Canada / LA: 9%

2% y/y	1% y/y	7% y/y
1% CC5	2% CC5	11% CC5

Non-US net revenue = 67% of total net revenue

1. Revenue mix calculated based on total segment revenue, which does not include corporate investments and other

1. A reconciliation of specific adjustments to GAAP results for the current period is included on slide 13 and in the GAAP tonon-GAAP slides that appear as part of the supplemental slides of this presentation. A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"
2. Operating profit mix calculated based on total segment operating profit, which does not include corporate investments and other
3. Commercial hardware includes Office Printing Solutions includingSamsung-branded commercial products and OEM hardware, Graphics Solutions and 3D Printing, excluding supplies. Consumer hardware includes Home Printing Solutions including Samsung- branded consumer products, excluding supplies.
4. CC = constant currency; adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period

6

Revenue and non-GAAP diluted net EPS1performance

Revenue (billions)										Non-GAAP diluted net EPS1
$18							Revenue				$0.60
							Non-GAAP diluted net EPS	$0.52	$0.54	$0.52	$0.53
								1
$16				$0.48		$0.48
								$0.50
		$0.43	$0.44
$14	$0.40
											$0.40
$12
											$0.30
$10
$8	$12.4	$13.1	$13.9	$14.5	$14.0	$14.6	$15.4	$14.7	$14.0
										$0.20
	2Q17	3Q17	4Q17	1Q18		2Q18	3Q18	4Q18	1Q19	2Q19

1. A reconciliation of specific adjustments to GAAP results for the current period is included on slide 13 and in the GAAP to non-GAAP slides that appear as part of the supplemental slides of this presentation. A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

7

Revenue growth

y/y growth (%)
15%					14.5%
					13.1%
		10.9%	11.7%				11.7%
				12.8%				10.3%
10%	7.2%	9.8%	11.3%		9.9%	8.8%	9.4%
5%	6.9%
									2.0%	2.3%
0%										1.3%	0.2%
2Q17	3Q17	4Q17	1Q18	2Q18	3Q18	4Q18	1Q19	2Q19
				Revenue growth in constant currency1		Revenue growth as reported

1. Adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period

8

Regional revenue trends					y/y revenue growth %
								y/y revenue growth in constant currency%1
Americas	$8		15%	$8				15%	United
(including U.S.)		10%			10%	States
	$7			$7
	5%
	5%
	$6		0%	$6		0%
		(5%)			(5%)
	$5			$5
	(10%)
	(10%)
	$4		(15%)	$4		(15%)
	billions	2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 % growth	billions	2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 % growth

EMEA	$7										25%		$4										20%
											20%													15%
	$6										15%
											$3										10%
											10%
	$5																				5%
										5%
																						0%
											0%
												$2
	$4										(5%)											(5%)
																						(10%)
											(10%)
	$3										(15%)		$1										(15%)
	2Q17	3Q17	4Q17	1Q18	2Q18	3Q18	4Q18	1Q19	2Q19	2Q17	3Q17	4Q17	1Q18	2Q18	3Q18	4Q18	1Q19	2Q19
	billions	% growth	billions	% growth

Asia

Pacific

1. Adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period

9

Personal Systems

Q2 FY19

Revenue	Operating profit
$8.9billion	$385million	Key
messages
2% y/y 5% CC1	4.3% of revenue

• Continued execution and profitable revenue growth driven by Commercial
• Growth in strategic priorities including Premium and Attach
• Innovation: Bringing premium features to mainstream customers with the HP ProBook and HP Pavilion x360 portfolio. Improved security with HP Sure Sense: new deep learning AI predictively protects against malware

Revenue breakdown	Revenue and OP % trend	Key metrics

Revenue

	Notebooks	57%
	Desktops	33%
	Workstations	6%
	Other	4%

In billions $12.0

$10.0

$8.0

$6.0

$4.0

$2.0

$0.0

6%

5%

4%

3%

2%

1%

0%

OP % revenue

Total units down 1%y/y

Notebooks revenue down 1%y/y, units down 5%y/y

Desktops revenue up 7%y/y, units up 6%y/y

Commercial revenue up 7%y/y Consumer revenue down 9%y/y

1. CC = constant currency; adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period

10

Printing

Q2 FY19

Revenue	Operating profit
$5.1billion	$839million
2% y/y 2% CC1	16.4% of revenue

Key messages

• Continued revenue growth in contractual business , including Instant Ink
• 3D: in May, launched new Jet Fusion 5200, Digital Manufacturing Network
• Innovation: New OfficeJet Pro series, designed for small businesses and the new HP Stitch series reinvents the textile industry with precision color accuracy and increased efficiency

Revenue breakdown	Revenue and OP % trend	Key metrics

Revenue

	Supplies	65%
	Commercial2Hardware	23%
	Consumer2Hardware	12%

In billions $8.0

$7.0 $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $0.0

22%

20%

18%

16%

14%

12%

10%

8%

6%

4%

OP % revenue

Supplies revenue down 3%(-3% CC1) y/y Total Hardware units down 4%y/y Commercial2Hardware units down 3%y/y Consumer2Hardware units down 4%y/y

1. CC = constant currency; adjusted to exclude the effect of foreign currency exchange fluctuations calculated by translating current period revenues using monthly average exchange rates from the comparative period and excluding any hedging impact recognized in the current period
2. Commercial hardware includes Office Printing Solutions includingSamsung-branded commercial products and OEM hardware, Graphics Solutions and 3D Printing, excluding supplies. Consumer hardware includes Home Printing Solutions including Samsung-branded consumer products, excluding supplies

11

Non-GAAP1financial information

$ in millions, except	Q2 FY19		Q1 FY19		Q2 FY18
per share amounts
Revenue	$14,036		$14,710		$14,003
Cost of revenue	11,307	80.6%	12,098	82.2%	11,301	80.7%
Total OpEx	1,692	12.0%	1,592	10.9%	1,674	12.0%
Operating profit	$1,037	7.4%	$1,020	6.9%	$1,028	7.3%
Interest and other, net	(60)		(57)		(79)
Pre-tax earnings	977	7.0%	963	6.5%	949	6.8%
Income tax	(156)		(154)		(151)
Net earnings	821	5.8%	809	5.5%	798	5.7%
Diluted net earnings per share	$0.53		$0.52		$0.48

1. A reconciliation of specific adjustments to GAAP results for the current period is included on slide 13 and in the GAAP to non-GAAP slides that appear as part of the supplemental slides of this presentation. A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

12

Q2 FY19 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Tax	Non-operating
tax rate and per	GAAP	of	and other	benefit plan	retirement	Non-GAAP
intangible	related charges	settlement	adjustments	related (credits) /
share amounts		charges
	assets		charges		charges
Revenue	$14,036							$14,036
Cost of revenue	11,307							11,307
Total OpEx	1,801	(29)	(69)	(11)				1,692
Operating profit	928	29	69	11				1,037
Interest and other, net	(45)					(5)	(10)	(60)
Pre-tax earnings	883	29	69	11		(5)	(10)	977
Income tax	(101)	(5)	(14)	(2)		(33)	(1)	(156)
Tax rate	11.4%							16.0%
Net earnings	$782	24	55	9		(38)	(11)	$821
Diluted net	$0.51							$0.53
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

13

Select cash and debt balances

In billions

$20.0

$15.0

$10.0

$5.0

$0.0 ($5.0)

($10.0)

Net cash (debt)1

		Gross cash 2			Gross debt
2Q18		3Q18	4Q18	1Q19	2Q19

$ in billions	2Q18	3Q18	4Q18	1Q19	2Q19
Gross cash2	5.3	7.1	5.9	3.8	3.6
Gross debt	6.2	7.2	6.0	5.0	5.1
Net cash (debt)1,3	(0.8)	(0.2)	(0.2)	(1.2)	(1.5)

1. Net cash (debt) is defined as gross cash less gross debt after adjusting the effect of unamortized premium / discount on debt issuance, debt issuance costs and unrealized gains / losses on fair value hedges and interest rate swaps
2. Gross cash includes cash and cash equivalents,short-term investments, and certain liquid long-term investments
3. Numbers may not foot due to rounding

14

Cash flow

$ millions

5,000

4,000

3,000

$4,528

$4,154

2,000		$1,723
		$1,420
1,000				$1,050	$937	$861
						$747
0
FY18		FY19 YTD				Q218		Q219
			Net cash provided by operations			Free cash flow 1

1. Free cash flow = Net cash provided by operations less the net of investments in and proceeds from sales of property, plant, and equipment

15

Shareholder return

$ millions

4,000

3,000

$3.5billion

2,000		2,557	$1.9billion
		1,411	$1.0 billion	$0.9million
1,000
	899				801	691
		494
			227	245
0
	FY18			FY19 YTD			Q218	Q219
Shares repurchased	111.5 million			65.9 million			35.4 million	33.6 million
Dividend per share	$0.5572	$0.3204	$0.1393	$0.1602
					Dividend payment			Share repurchase

16

Outlook

Q3 FY19 net EPS guidance

GAAP diluted net EPS	$0.49 - $0.52
Non-GAAP diluted net EPS1	$0.53 - $0.56

Full year FY19 net EPS guidance

GAAP diluted net EPS	$2.04 - $2.11
Non-GAAP diluted net EPS2	$2.14 - $2.21

1. Third quarter fiscal 2019non-GAAP diluted net EPS estimates exclude restructuring and other charges, acquisition-related charges, defined benefit plan settlement charges, amortization of intangible assets, non-operatingretirement-related (credits) / charges, tax adjustments, and the related tax impact on these items
2. Full year fiscal 2019non-GAAP diluted net EPS estimates exclude restructuring and other charges, acquisition-related charges, defined benefit plan settlement charges, amortization of intangible assets, non-operatingretirement-related (credits) / charges, tax adjustments, and the related tax impact on these items

17

SUPPLEMENTAL SLIDES

18

Inventory and accounts receivable

Inventory	Account receivable

In billions
$7.0
	$5.8		$6.1	$6.1
$6.0
	$5.7	$5.6	$5.6	$5.4
$5.2
$5.0
	11.1%	10.5%	10.7%	10.4%
$4.0
10.2%			10.0%	9.6%	9.2%
$3.0
$2.0
$1.0
$0.0
Jul17	Oct17 Jan18	Apr18 Jul18	Oct18 Jan19 Apr19

16.0%

14.0%

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

% of revenue1

In billions
$7.0
$6.0
				$5.1	$5.1	$5.4
$5.0	$4.2	$4.4	$4.4	$4.6	$4.6
$4.0
	8.5%			8.8%	8.7%	9.2%
		8.2%	8.3%
$3.0	8.4%	8.1%
$2.0
$1.0
$0.0
Jul17 Oct17	Jan18	Apr18	Jul18 Oct18	Jan19 Apr19

16.0%

14.0%

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

% of revenue1

1. % of revenue calculations based on trailing 4-quarter net revenue

19

PP&E and accounts payable

PP&E	Accounts payable

In billions
$2.5						$2.2	$2.3	$2.4	6.0%
				$2.1	$2.1
			$2.0
							5.0%
$2.0		$1.9
$1.7
								4.1%	4.0%	1
$1.5									revenue
		3.8%	3.7%	3.7%	3.8%	3.9%
		3.6%
								3.0%
3.4%								of
$1.0										%
								2.0%
$0.5
								1.0%
$0.0									0.0%
Jul17	Oct17 Jan18	Apr18	Jul18	Oct18 Jan19 Apr19

1. % of revenue calculations based on trailing 4-quarter net revenue

In billions
$16.0
				$14.2	$14.8	$14.6
						$13.8
$14.0			$13.3		$13.1
	$12.8	$12.8
$12.0
$10.0
$8.0
$6.0
$4.0
$2.0
$0.0
	Jul17	Oct17	Jan18	Apr18 Jul18 Oct18 Jan19 Apr19

20

Working capital metrics

120

100

80

60

40

20

0

-20

-40

Days receivables

Jul17	Oct17	Jan18	Apr18	Jul18	Oct18	Jan19	Apr19
29	29	27	30	28	30	31	35

		Days inventory	44	46	43	44	46	43	42	43
		Days payable	108	105	97	104	108	105	108	110
		Cash conversion cycle 1	-35	-30	-27	-30	-34	-32	-35	-32

1. Cash conversion cycle = Days receivables + Days inventory - Days payable

21

Q1 FY19 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Tax	Non-operating
tax rate and per	GAAP	of	and other	benefit plan	retirement	Non-GAAP
intangible	related charges	settlement	adjustments	related (credits) /
share amounts		charges
	assets		charges		charges
Revenue	$14,710							$14,710
Cost of revenue	12,098							12,098
Total OpEx	1,686	(29)	(55)	(10)				1,592
Operating profit	926	29	55	10				1,020
Interest and other, net	(26)					(19)	(12)	(57)
Pre-tax earnings	900	29	55	10		(19)	(12)	963
Income tax	(97)	(6)	(12)	(2)		(36)	(1)	(154)
Tax rate	10.8%							16.0%
Net earnings	$803	23	43	8		(55)	(13)	$809
Diluted net	$0.51							$0.52
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

22

FY18 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Debt	Tax	Non-operating
tax rate and per	GAAP	of	and other	related	benefit plan	extinguishment	retirement	Non-GAAP
intangible	settlement	adjustments	related (credits) /
share amounts		assets	charges	charges	charges	costs		charges
Revenue	$58,472								$58,472
Cost of revenue	47,803								47,803
Total OpEx	6,838	(80)	(132)	(123)					6,503
Operating profit	3,831	80	132	123					4,166
Interest and other, net	(818)				7	126	662	(219)	(242)
Pre-tax earnings	3,013	80	132	123	7	126	662	(219)	3,924
Income tax	2,314	(20)	(37)	(20)		(33)	(2,825)	3	(618)
Tax rate	nm1								15.7%
Net earnings	5,327	60	95	103	7	93	(2,163)	(216)	$3,306
Diluted net	$3.26								$2.02
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information" 1. Not meaningful

23

Q4 FY18 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Debt	Tax	Non-operating	Non-
tax rate and per	GAAP	of	and other	related	benefit plan	extinguishment	retirement
intangible	settlement	adjustments	related (credits) /	GAAP
share amounts		charges	charges	costs
	assets	charges		charges
Revenue	$15,366								$15,366
Cost of revenue	12,669								12,669
Total OpEx	1,703	(20)	(40)	(26)					1,617
Operating profit	994	20	40	26					1,080
Interest and other, net	13				5		(14)	(54)	(50)
Pre-tax earnings	1,007	20	40	26	5		(14)	(54)	1,030
Income tax	444	(5)	(9)	(6)			(583)	(6)	(165)
Tax rate	nm1								16.0%
Net earnings	1,451	15	31	20	5		(597)	(60)	$865
Diluted net	$0.91								$0.54
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information" 1. Not meaningful

24

Q3 FY18 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Debt	Tax	Non-operating
tax rate and per	GAAP	of	and other	related	benefit plan	extinguishment	retirement	Non-GAAP
intangible	settlement	adjustments	related (credits) /
share amounts		assets	charges	charges	charges	costs		charges
Revenue	$14,586								$14,586
Cost of revenue	11,898								11,898
Total OpEx	1,670	(20)	(4)	(10)					1,636
Operating profit	1,018	20	4	10					1,052
Interest and other, net	0				1		3	(56)	(52)
Pre-tax earnings	1,018	20	4	10	1		3	(56)	1,000
Income tax	(138)	(5)	(7)	(13)				3	(160)
Tax rate	13.6%								16.0%
Net earnings	880	15	(3)	(3)	1		3	(53)	$840
Diluted net	$0.54								$0.52
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

25

Q2 FY18 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Debt	Tax	Non-operating
tax rate and per	GAAP	of	and other	related	benefit plan	extinguishment	retirement	Non-GAAP
intangible	settlement	adjustments	related (credits) /
share amounts		assets	charges	charges	charges	costs		charges
Revenue	$14,003								$14,003
Cost of revenue	11,301								11,301
Total OpEx	1,796	(20)	(57)	(45)					1,674
Operating profit	906	20	57	45					1,028
Interest and other, net	(823)					126	671	(53)	(79)
Pre-tax earnings	83	20	57	45		126	671	(53)	949
Income tax	975	(5)	(13)	17		(33)	(1,095)	3	(151)
Tax rate	nm1								15.9%
Net earnings	1,058	15	44	62		93	(424)	(50)	$798
Diluted net	$0.64								$0.48
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information" 1. Not meaningful

26

Q1 FY18 GAAP to non-GAAP bridge

$ in millions, except		Amortization	Restructuring	Acquisition-	Defined	Tax	US tax	Non-operating
tax rate and per	GAAP	of	and other	related	benefit plan	reform	retirement	Non-GAAP
intangible	settlement	indemnification	related (credits) /
share amounts		assets	charges	charges	charges		adjustment	charges
Revenue	$14,517								$14,517
Cost of revenue	11,935								11,935
Total OpEx	1,669	(20)	(31)	(42)					1,576
Operating profit	913	20	31	42					1,006
Interest and other, net	(8)				1	2		(56)	(61)
Pre-tax earnings	905	20	31	42	1	2		(56)	945
Income tax	1,033	(5)	(8)	(18)		(2)	(1,145)	3	(142)
Tax rate	nm1								15.0%
Net earnings	1,938	15	23	24	1		(1,145)	(53)	$803
Diluted net	$1.16								$0.48
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information" 1. Not meaningful

27

FY17 GAAP to non-GAAP bridge

$ in millions, except		Amortization					Valuation	Non-operating
	Restructuring	Acquisition-	Defined benefit	Tax	allowances, net	Discontinued
tax rate and per	GAAP	of	and other	related	plan settlement	and separation	retirement	Non-GAAP
intangible	indemnification	related (credits) /	operations
share amounts		charges	charges	charges	taxes and
	assets		charges
								adjustments
Revenue	$52,056									$52,056
Cost of revenue	42,478									42,478
Total OpEx	6,210	(1)	(362)	(125)						5,722
Operating profit	3,368	1	362	125						3,856
Interest and other, net	(92)				5	(47)		(135)		(269)
Pre-tax earnings	3,276	1	362	125	5	(47)		(135)		3,587
Income tax	(750)		(82)	(44)		50		54		(772)
Tax rate		22.9%									21.5%
Net earnings from	$2,526	1	280	81	5	3		(81)		$2,815
continuing operations
Net earnings (loss) from	-									-
discontinued operations
Net earnings	$2,526	1	280	81	5	3		(81)		$2,815
Diluted net	$1.48									$1.65
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

28

Q4 FY17 GAAP to non-GAAP bridge

$ in millions, except		Amortization					Valuation	Non-operating
	Restructuring	Acquisition-	Defined benefit	Tax	allowances, net	Discontinued
tax rate and per	GAAP	of	and other	related	plan settlement	and separation	retirement	Non-GAAP
intangible	indemnification	related (credits) /	operations
share amounts		charges	charges	charges	taxes and
	assets		charges
								adjustments
Revenue	$13,927									$13,927
Cost of revenue	11,407									11,407
Total OpEx	1,668		(113)	(49)						1,506
Operating profit	852		113	49						1,014
Interest and other, net	(4)				1	(23)		(34)		(60)
Pre-tax earnings	848		113	49	1	(23)		(34)		954
Income tax	(188)		(37)	(16)		23		13		(205)
Tax rate		22.2%									21.5%
Net earnings from	$660		76	33	1			(21)		$749
continuing operations
Net earnings (loss) from	-									-
discontinued operations
Net earnings	$660		76	33	1			(21)		$749
Diluted net	$0.39									$0.44
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

29

Q3 FY17 GAAP to non-GAAP bridge

$ in millions, except		Amortization					Valuation	Non-operating
	Restructuring	Acquisition-	Defined benefit	Tax	allowances, net	Discontinued
tax rate and per	GAAP	of	and other	related	plan settlement	and separation	retirement	Non-GAAP
intangible	indemnification	related (credits) /	operations
share amounts		charges	charges	charges	taxes and
	assets		charges
								adjustments
Revenue	$13,060									$13,060
Cost of revenue	10,633									10,633
Total OpEx	1,510		(46)	(40)						1,424
Operating profit	917		46	40						1,003
Interest and other, net	(18)				1	(10)		(34)		(61)
Pre-tax earnings	899		46	40	1	(10)		(34)		942
Income tax	(203)		(14)	(15)		10		15		(207)
Tax rate		22.6%									22.0%
Net earnings from	$696		32	25	1			(19)		$735
continuing operations
Net earnings (loss) from	-									-
discontinued operations
Net earnings	$696		32	25	1			(19)		$735
Diluted net	$0.41									$0.43
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

30

Q2 FY17 GAAP to non-GAAP bridge

$ in millions, except		Amortization					Valuation	Non-operating
	Restructuring	Acquisition-	Defined benefit	Tax	allowances, net	Discontinued
tax rate and per	GAAP	of	and other	related	plan settlement	and separation	retirement	Non-GAAP
intangible	indemnification	related (credits) /	operations
share amounts		charges	charges	charges	taxes and
	assets		charges
								adjustments
Revenue	$12,385									$12,385
Cost of revenue	10,002									10,002
Total OpEx	1,602	(1)	(140)	(20)						1,441
Operating profit	781	1	140	20						942
Interest and other, net	(27)				3	(5)		(35)		(64)
Pre-tax earnings	754	1	140	20	3	(5)		(35)		878
Income tax	(195)		(13)	(7)		9		13		(193)
Tax rate		25.9%									22.0%
Net earnings from	$559	1	127	13	3	4		(22)		$685
continuing operations
Net earnings (loss) from	-									-
discontinued operations
Net earnings	$559	1	127	13	3	4		(22)		$685
Diluted net	$0.33									$0.40
earnings per share

A description of HP's use of non-GAAP information is provided on slide 3 under "Use of non-GAAP financial information"

31

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