Item 1. Financial Statements and Supplementary Data.

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Item 1. Financial Statements and Supplementary Data.

Index


			Page
Condensed Consolidated Statements of Earnings for the three and nine months ended July 3 1 , 2025 and 2024 (Unaudited)			5
Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended July 3 1 , 2025 and 2024 (Unaudited)			6
Condensed Consolidated Balance Sheets as of July 3 1 , 2025 and October 31, 2024 (Unaudited)			7
Condensed Consolidated Statements of Cash Flows for the nine months ended J uly 3 1 , 2025 and 2024 (Unaudited)			8
Condensed Consolidated Statements of Stockholders’ Deficit (Unaudited)			9
Notes to Condensed Consolidated Financial Statements (Unaudited)			11
Note 1: Basis of Presentation			11
Note 2: Segment Information			12
Note 3: Restructuring and Other Charges			14

Note 4 : Taxes on Earnings			16
Note 5 : Supplementary Financial Information			17
Note 6 : Fair Value			21
Note 7 : Financial Instruments			23
Note 8 : Borrowings			28
Note 9 : Stockholders’ Deficit			30
Note 1 0 : Earnings Per Share			32
Note 1 1 : Litigation and Contingencies			32
Note 1 2 : Guarantees, Indemnifications and Warranties			36

HP INC.

Condensed Consolidated Statements of Earnings

(Unaudited)


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions, except per share amounts
Net revenue:
Products	$	13,114	$	12,750	$	38,232	$	37,212
Services	818		769		2,424		2,292
Total net revenue	13,932		13,519		40,656		39,504
Cost of net revenue:
Products	10,599		10,164		30,800		29,359
Services	482		449		1,426		1,328
Total cost of net revenue	11,081		10,613		32,226		30,687
Gross profit	2,851		2,906		8,430		8,817
Research and development	406		413		1,204		1,248
Selling, general and administrative	1,452		1,404		4,391		4,249
Restructuring and other charges	110		46		302		180
Acquisition and divestiture charges	8		22		31		71
Amortization of intangible assets	159		81		287		242
Total operating expenses	2,135		1,966		6,215		5,990
Earnings from operations	716		940		2,215		2,827
Interest and other, net	(92)		(113)		(381)		(410)
Earnings before taxes	624		827		1,834		2,417
Benefit from (provision for) taxes	139		(187)		(100)		(548)
Net earnings	$	763	$	640	$	1,734	$	1,869

Net earnings per share:
Basic	$	0.81	$	0.65	$	1.83	$	1.90
Diluted	$	0.80	$	0.65	$	1.82	$	1.88

Weighted-average shares used to compute net earnings per share:
Basic	947		979		948		986
Diluted	954		990		955		994

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

HP INC.

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Net earnings	$	763	$	640	$	1,734	$	1,869
Other comprehensive income (loss) before taxes:
Change in unrealized components of available-for-sale debt securities:
Unrealized gains arising during the period	5		3		11		7



Change in unrealized components of cash flow hedges:
Unrealized gains (losses) arising during the period	59		(36)		(301)		(47)
Losses (gains) reclassified into earnings	202		(87)		11		(251)
	261		(123)		(290)		(298)
Change in unrealized components of defined benefit plans:
Unrealized (losses) gains arising during the period	(7)		—		(8)		13
Amortization of actuarial loss and prior service benefit	5		1		15		5
Curtailments, settlements and other	2		1		2		2
	—		2		9		20

Change in cumulative translation adjustment	(1)		11		16		25
Other comprehensive income (loss) before taxes	265		(107)		(254)		(246)
(Provision for) benefit from taxes	(63)		24		47		54
Other comprehensive income (loss), net of taxes	202		(83)		(207)		(192)
Comprehensive income	$	965	$	557	$	1,527	$	1,677

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

HP INC.

Condensed Consolidated Balance Sheets

(Unaudited)


	As of
	July 31, 2025		October 31, 2024
	In millions, except par value
ASSETS
Current assets:
Cash, cash equivalents and restricted cash	$	2,874	$	3,253
Accounts receivable, net of allowance for credit losses of $83 as of July 31, 2025 and October 31, 2024	5,123		5,117
Inventory	8,356		7,720
Other current assets	4,221		4,670
Total current assets	20,574		20,760
Property, plant and equipment, net	2,993		2,914
Goodwill	8,714		8,627
Other non-current assets	7,573		7,608
Total assets	$	39,854	$	39,909
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Notes payable and short-term borrowings	$	820	$	1,406
Accounts payable	16,985		16,903
Other current liabilities	10,059		10,378
Total current liabilities	27,864		28,687
Long-term debt	8,782		8,263
Other non-current liabilities	4,109		4,282
Stockholders’ deficit:
Preferred stock, $0.01 par value (300 shares authorized; none issued)	—		—
Common stock, $0.01 par value (9,600 shares authorized; 939 shares issued and outstanding as of July 31, 2025 and October 31, 2024)	9		9
Additional paid-in capital	2,091		1,778
Accumulated deficit	(2,360)		(2,676)
Accumulated other comprehensive loss	(641)		(434)
Total stockholders’ deficit	(901)		(1,323)
Total liabilities and stockholders’ deficit	$	39,854	$	39,909

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

HP INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)


	Nine months ended July 31
	2025		2024
	In millions
Cash flows from operating activities:
Net earnings	$	1,734	$	1,869
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation, amortization and impairment	708		622
Stock-based compensation expense	432		367
Restructuring and other charges	302		180
Deferred taxes on earnings	(67)		69

Other, net	103		(24)
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	54		(447)
Inventory	(671)		(953)
Accounts payable	94		1,442
Net investment in leases related to integrated financing	(71)		(123)
Taxes on earnings	(360)		(89)
Restructuring and other	(238)		(204)
Other assets and liabilities	53		(583)
Net cash provided by operating activities	2,073		2,126
Cash flows from investing activities:
Investment in property, plant, equipment and purchased intangible	(700)		(439)

Purchases of available-for-sale securities and other investments	(23)		—
Maturities and sales of available-for-sale securities and other investments	69		—
Collateral posted for derivative instruments	(343)		(60)

Payment made in connection with business acquisitions, net of cash acquired	(116)		(15)
Net cash used in investing activities	(1,113)		(514)
Cash flows from financing activities:


Proceeds from debt, net of issuance costs	1,248		266

Payment of debt	(1,312)		(153)
Stock-based award activities and others	(113)		(67)
Repurchase of common stock	(350)		(1,200)
Cash dividends paid	(818)		(812)

Settlement of cash flow hedges	6		—
Net cash used in financing activities	(1,339)		(1,966)
Decrease in cash, cash equivalents and restricted cash	(379)		(354)
Cash, cash equivalents and restricted cash at beginning of period	3,253		3,232
Cash, cash equivalents and restricted cash at end of period	$	2,874	$	2,878

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

HP INC.

Condensed Consolidated Statements of Stockholders’ Deficit

(Unaudited)


	Common Stock			Additional Paid-in Capital					Accumulated Other Comprehensive Loss		Total Stockholders’ Deficit
	Number of Shares	Par Value				Accumulated Deficit
	In millions, except number of shares in thousands
Balance as of October 31, 2024	938,989	$	9	$	1,778		$	(2,676)	$	(434)	$	(1,323)
Net earnings	—	—		—			565		—		565
Other comprehensive income, net of taxes	—	—		—			—		230		230
Comprehensive income	—	—		—			—		—		795
Issuance of common stock in connection with employee stock plans and other	8,405	—		(92)			—		—		(92)
Repurchases of common stock (Note 9)	(2,734)	—		(4)			(93)		—		(97)
Cash dividends ($0.58 per common share)	—	—		—			(547)		—		(547)
Stock-based compensation expense	—	—		192			—		—		192

Balance as of January 31, 2025	944,660	$	9	$	1,874		$	(2,751)	$	(204)	$	(1,072)
Net earnings	—	—		—			406		—		406
Other comprehensive loss, net of taxes	—	—		—			—		(639)		(639)
Comprehensive loss	—	—		—			—		—		(233)
Issuance of common stock in connection with employee stock plans and other	667	—		(9)			—		—		(9)
Repurchases of common stock (Note 9)	(3,118)	—		(6)			(97)		—		(103)
Cash dividends	—	—		—			1		—		1
Stock-based compensation expense	—	—		140			—		—		140

Balance as of April 30, 2025	942,209	$	9	$	1,999		$	(2,441)	$	(843)	$	(1,276)
Net earnings	—	—		—			763		—		763
Other comprehensive income, net of taxes	—	—		—			—		202		202
Comprehensive income	—	—		—			—		—		965
Issuance of common stock in connection with employee stock plans and other	2,057	—		5			—		—		5
Repurchases of common stock (Note 9)	(5,501)	—		(13)			(139)		—		(152)
Cash dividends ($0.58 per common share)	—	—		—			(543)		—		(543)
Stock-based compensation expense	—	—		100			—		—		100


Balance as of July 31, 2025	938,765	$	9	$	2,091		$	(2,360)	$	(641)	$	(901)

HP INC.

Condensed Consolidated Statements of Stockholders’ Deficit

(Unaudited)




	Common Stock			Additional Paid-in Capital					Accumulated Other Comprehensive Loss		Total Stockholders’ Deficit
	Number of Shares	Par Value				Accumulated Deficit
	In millions, except number of shares in thousands
Balance as of October 31, 2023	988,782	$	10	$	1,505		$	(2,361)	$	(223)	$	(1,069)
Net earnings	—	—		—			622		—		622
Other comprehensive loss, net of taxes	—	—		—			—		(235)		(235)
Comprehensive income	—	—		—			—		—		387
Issuance of common stock in connection with employee stock plans and other	8,677	—		(76)			—		—		(76)
Repurchases of common stock (Note 9)	(17,062)	—		(27)			(487)		—		(514)
Cash dividends ($0.55 per common share)	—	—		—			(545)		—		(545)
Stock-based compensation expense	—	—		177			—		—		177

Balance as of January 31, 2024	980,397	$	10	$	1,579		$	(2,771)	$	(458)	$	(1,640)
Net earnings	—	—		—			607		—		607
Other comprehensive income, net of taxes	—	—		—			—		126		126
Comprehensive income	—	—		—			—		—		733
Issuance of common stock in connection with employee stock plans and other	584	—		(4)			—		—		(4)
Repurchases of common stock (Note 9)	(3,474)	—		(6)			(93)		—		(99)

Stock-based compensation expense	—	—		94			—		—		94


Balance as of April 30, 2024	977,507	$	10	$	1,663		$	(2,257)	$	(332)	$	(916)
Net earnings	—	—		—			640		—		640
Other comprehensive loss, net of taxes	—	—		—			—		(83)		(83)
Comprehensive income	—	—		—			—		—		557
Issuance of common stock in connection with employee stock plans and other	2,907	—		13			—		—		13
Repurchases of common stock (Note 9)	(17,006)	—		(30)			(576)		—		(606)
Cash dividends ($0.55 per common share)	—	—		—			(536)		—		(536)
Stock-based compensation expense	—	—		96			—		—		96


Balance as of July 31, 2024	963,408	$	10	$	1,742		$	(2,729)	$	(415)	$	(1,392)

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

HP INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1: Basis of Presentation

Basis of Presentation

The accompanying Condensed Consolidated Financial Statements of HP and its wholly owned subsidiaries are prepared in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”). The interim financial information is unaudited but reflects all normal adjustments that are necessary to provide a fair statement of results for the interim periods presented. This interim information should be read in conjunction with the Consolidated Financial Statements for the fiscal year ended October 31, 2024 in HP’s Annual Report on Form 10-K, filed on December 13, 2024. The Condensed Consolidated Balance Sheet for October 31, 2024 was derived from audited financial statements.

Principles of Consolidation

The Condensed Consolidated Financial Statements include the accounts of HP and its subsidiaries and affiliates in which HP has a controlling financial interest or is the primary beneficiary. All intercompany balances and transactions have been eliminated.

Reclassifications

HP has reclassified certain prior-year amounts to conform to the current-year presentation.

Use of Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in HP’s Condensed Consolidated Financial Statements and accompanying notes. Actual results may differ materially from those estimates.

Recently Adopted Accounting Pronouncements

In September 2022, the Financial Accounting Standards Board (“FASB”) issued guidance that enhances the transparency about the use of supplier finance programs. Under the new guidance, companies that use a supplier finance program in connection with the purchase of goods or services are required to disclose information about those programs to allow users of financial statements to understand the nature, activity during the period, changes from period to period, and potential magnitude. HP adopted this guidance in the first quarter of fiscal year 2024, except for the disclosure on rollforward information which will be adopted in its fiscal year 2025 Form 10-K, in line with the effective adoption dates prescribed by the FASB. See Note 5, “Supplementary Financial Information,” for additional disclosure related to HP’s supplier finance programs.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued guidance that requires disaggregation of specific expense categories in disclosures within the footnotes to the financial statements on an annual and interim basis. HP is required to adopt this guidance for its annual period ending October 31, 2028 and all interim periods thereafter on a prospective basis. Early adoption is permitted. HP is currently evaluating the impact of this guidance on its disclosures.

In December 2023, the FASB issued guidance that enhances the transparency of income tax disclosures by expanding annual disclosure requirements related to the rate reconciliation and income taxes paid. HP is required to adopt this guidance for its annual period ending October 31, 2026. Early adoption is permitted. HP is currently evaluating the impact of this guidance on its disclosures.

In November 2023, the FASB issued guidance that updates reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance on an annual and interim basis. HP is required to adopt this guidance for its annual period ending October 31, 2025 and all interim periods thereafter. Early adoption is permitted. HP is currently evaluating the impact of this guidance on its disclosures.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 2: Segment Information

HP’s operations are organized into three reportable segments: Personal Systems, Printing, and Corporate Investments.

Personal Systems offers desktops, notebooks, and workstations (including HP’s portfolio of AI PCs and workstations), thin clients, retail point-of-sale (“POS”) systems, displays, hybrid systems, software, solutions including endpoint security and services. Personal Systems includes support and deployment, configurations and extended warranty services and maintains multi-operating system and multi-architecture strategies using Microsoft Windows and Google Chrome operating systems, and predominantly using processors from Intel, AMD, and NVIDIA.

Personal Systems groups its global business capabilities into the following business units when reporting business performance:

Commercial PS consists of endpoint computing devices and hybrid systems, for use by enterprise, public sector (which includes education), and small- and medium-sized business (“SMB”) customers. These devices include HP’s Pro and Elite commercial PC portfolio, HP’s Z line of workstations, thin clients, retail POS systems, and HP’s Dragonfly and Chromebook PCs. HP offers a range of secure services and solutions to commercial customers to help them manage the lifecycle of their PCs and mobility installed base.
Consumer PS consists of devices, accessories and services which are optimized for consumer usage, focusing on gaming, learning and working remotely, consuming multi-media for entertainment, managing personal life activities, sharing information and staying connected, informed, and secure. These devices include HP’s new Omni consumer PC portfolio, the Omen and Victus gaming lines, and HP’s Spectre, Envy, Pavilion and Chromebook PCs.

Printing provides consumer and commercial printer hardware, supplies, services and solutions. Printing is also focused on Graphics and 3D Printing and Personalization in the commercial and industrial markets. HP’s global business capabilities within Printing are described below:

Office Printing Solutions delivers HP’s security enhanced office printers, supplies, services, and solutions to SMBs, public sector and large enterprises. It also includes Original Equipment Manufacturer (“OEM”) hardware and solutions.

•**Home Printing Solutions delivers innovative and security enhanced printing products, supplies, services and solutions for the home, home business and micro business customers utilizing both HP’s Ink and Laser technologies.

*•*Graphics Solutions delivers large-format, commercial and industrial solutions and supplies to print service providers and packaging converters through a wide portfolio of printers and presses.

*•*3D Printing & Personalization offers a portfolio of additive manufacturing solutions and supplies to help customers succeed in their additive and digital manufacturing journey. HP offers complete solutions in collaboration with an ecosystem of partners.

Printing groups its global business capabilities into the following business units when reporting business performance:

Commercial Printing consists of office printing solutions, graphics solutions and 3D printing and personalization, excluding supplies;
Consumer Printing consists of home printing solutions, excluding supplies; and

*•*Supplies comprises a set of highly innovative consumable products, ranging from ink and laser cartridges to media, industrial graphics supplies and 3D printing and personalization supplies, for recurring use in consumer and commercial hardware.

Corporate Investments includes certain business incubation and investment projects.

HP does not allocate certain operating expenses, which it manages at the corporate level, to its segments. These unallocated amounts include expenses such as certain corporate governance costs and infrastructure investments, stock-based compensation expense, restructuring and other charges, acquisition and divestiture charges, amortization of intangible assets, and certain litigation (charges) benefits, net.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Segment operating results and the reconciliation to HP consolidated results were as follows:


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Net revenue:
Commercial PS	$	7,036	$	6,677	$	20,467	$	18,964
Consumer PS	2,895		2,692		7,712		7,640
Personal Systems	9,931		9,369		28,179		26,604
Supplies	2,604		2,703		8,155		8,430
Commercial Printing	1,113		1,147		3,424		3,579
Consumer Printing	269		293		857		877
Printing	3,986		4,143		12,436		12,886
Corporate Investments	16		7		43		14
Total segment net revenue	13,933		13,519		40,658		39,504
Other	(1)		—		(2)		—
Total net revenue	$	13,932	$	13,519	$	40,656	$	39,504

Earnings before taxes:
Personal Systems	$	541	$	617	$	1,457	$	1,662
Printing	689		715		2,313		2,416
Corporate Investments	(32)		(28)		(96)		(95)
Total segment earnings from operations	1,198		1,304		3,674		3,983
Corporate and unallocated costs and other	(103)		(101)		(302)		(278)
Stock-based compensation expense	(100)		(96)		(432)		(367)
Restructuring and other charges	(110)		(46)		(302)		(180)
Acquisition and divestiture charges	(8)		(22)		(31)		(71)
Amortization of intangible assets	(159)		(81)		(287)		(242)
Certain litigation charges	(2)		(18)		(105)		(18)
Interest and other, net(1)	(92)		(113)		(381)		(410)
Total earnings before taxes	$	624	$	827	$	1,834	$	2,417

(1) The three and nine months ended July 31, 2025 includes Certain litigation benefits from a single litigation matter that does not relate to HP's ongoing business operations.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 3: Restructuring and Other Charges

Summary of Restructuring Plans

HP’s restructuring activities summarized by plan were as follows:


	Fiscal 2023 Plan
	Severance and EER		Non-labor		Other prior-year plans(1)		Total
	In millions
Accrued balance as of October 31, 2024	$	120	$	11	$	7	$	138
Charges	218		34		—		252
Cash payments	(175)		(10)		(3)		(188)
Non-cash and other adjustments	4		(25)		—		(21)
Accrued balance as of July 31, 2025	$	167	$	10	$	4	$	181
Total costs incurred to date as of July 31, 2025	$	825	$	91	$	878	$	1,794

Reflected in the Condensed Consolidated Balance Sheets
Other current liabilities	$	167	$	4	$	4	$	175
Other non-current liabilities	$	—	$	6	$	—	$	6


Accrued balance as of October 31, 2023	$	88	$	18	$	2	$	108
Charges	120		8		4		132
Cash payments	(141)		(11)		(4)		(156)
Non-cash and other adjustments	—		(3)		(2)		(5)
Accrued balance as of July 31, 2024	$	67	$	12	$	—	$	79

HP’s restructuring charges for the three months ended July 31, 2025 summarized by the plans outlined below were as follows:


	Fiscal 2023 Plan
	Severance and EER		Non-labor		Other prior-year plans (1)		Total
	In millions

For the three months ended July 31, 2025	$	77	$	14	$	—	$	91

(1) Primarily includes the fiscal 2020 plan along with other legacy plans, all of which are substantially complete. HP does not expect any further material activity associated with these plans.

Fiscal 2023 Plan

On November 18, 2022, HP’s Board of Directors approved the Future Ready Plan (the “Fiscal 2023 Plan”) intended to enable digital transformation, portfolio optimization and operational efficiency which HP expects will be implemented through fiscal 2025. HP estimates that it will incur pre-tax charges of approximately $1.0 billion of which approximately $0.7 billion primarily in labor costs related to workforce reductions and the remaining costs will relate to non-labor actions and other charges.

On February 27, 2025, HP approved an amendment to the Fiscal 2023 Plan increasing its expected gross workforce reductions of 7,000 employees by approximately 1,000 to 2,000 employees. The changes to the workforce will vary by country, based on local legal requirements and consultations with employee works councils and other employee representatives, as appropriate. The Company anticipates incurring an additional $150 million in restructuring and other charges primarily related to labor costs in connection with the plan amendment.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Other Charges

Other charges include non-recurring costs, including those as a result of information technology rationalization efforts and transformation program management costs, and are distinct from ongoing operational costs. These costs primarily relate to third-party professional services and other non-recurring costs. For the three and nine months ended July 31, 2025, HP incurred $19 million and $50 million of other charges, respectively. For the three and nine months ended July 31, 2024, HP incurred $16 million and $48 million of other charges, respectively.

HP INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 4: Taxes on Earnings

Provision for Taxes

HP’s effective tax rate was (22.3)% and 22.6% for the three months ended July 31, 2025 and 2024, respectively, and 5.5% and 22.7% for the nine months ended July 31, 2025 and 2024, respectively. The difference between the U.S. federal statutory tax rate of 21% and HP’s effective tax rate for the three and nine months ended July 31, 2025 was primarily due to decreases in unrecognized tax benefits.

During the three and nine months ended July 31, 2025, HP recorded $281 million and $315 million of net income tax benefits, respectively, related to discrete items in the provision for taxes. These amounts included income tax benefits of $243 million and $228 million related to changes in uncertain tax positions, $20 million and $58 million related to restructuring charges, and $15 million and $18 million related to the filing of tax returns in various jurisdictions for the three and nine months ended July 31, 2025, respectively. The three and nine months ended July 31, 2025 also included benefits of $55 million related to changes in valuation allowances and $22 million related to audit settlements in various jurisdictions. These benefits were partially offset by income tax charges of $80 million related to tax effects of internal reorganization for the three and nine months ended July 31, 2025.

Uncertain Tax Positions

As of July 31, 2025, the amount of gross unrecognized tax benefits was $1.0 billion, of which up to $707 million would affect HP’s effective tax rate if realized. Total gross unrecognized tax benefits decreased by $238 million for the nine months ended July 31, 2025. HP recognizes interest income from favorable settlements and interest expense and penalties accrued on unrecognized tax benefits in the provision for taxes in the Condensed Consolidated Statements of Earnings. As of July 31, 2025 and 2024, HP had accrued $129 million and $130 million, respectively, for interest and penalties.

HP engages in continuous discussions and negotiations with taxing authorities regarding tax matters in various jurisdictions. HP expects complete resolution of certain tax years with various tax authorities within the next 12 months. HP believes it is reasonably possible that its existing gross unrecognized tax benefits may be reduced by $131 million within the next 12 months, affecting HP’s effective tax rate if realized.

HP is subject to income tax in the United States and approximately 61 other countries and is subject to routine corporate income tax audits in many of these jurisdictions. In addition, HP is subject to numerous ongoing audits by federal, state and foreign tax authorities. The Internal Revenue Service (“IRS”) is conducting an audit of HP’s 2018 and 2019 income tax returns.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 5: Supplementary Financial Information

Cash, Cash Equivalents and Restricted Cash


	As of
	July 31, 2025		October 31, 2024
	In millions
Cash and cash equivalents	$	2,871	$	3,238
Restricted cash(1)	3		15
	$	2,874	$	3,253

(1) Restricted cash is related to amounts collected and held on behalf of a third party for trade receivables previously sold.

Accounts Receivable

The allowance for credit losses related to accounts receivable and changes were as follows:


	Nine months ended July 31, 2025
	In millions
Balance at beginning of period	$	83
Current-period allowance for credit losses	6
Deductions, net of recoveries	(6)
Balance at end of period	$	83

HP utilizes certain third-party arrangements in the normal course of business as part of HPs cash and liquidity management and also to provide liquidity to certain partners to facilitate their working capital requirements. These financing arrangements, which in certain circumstances may contain partial recourse, result in a transfer of HP’s receivables and risk to the third-party. As these transfers qualify as true sales under the applicable accounting guidance, the receivables are de-recognized from the Condensed Consolidated Balance Sheets upon transfer, and HP receives a payment for the receivables from the third-party within a mutually agreed upon time period. For arrangements involving an element of recourse, the recourse obligation is measured using market data from similar transactions and reported as a current liability in the Condensed Consolidated Balance Sheets. The recourse obligations as of July 31, 2025 and October 31, 2024 were not material.

The following is a summary of the activity under these arrangements:


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Balance at beginning of period(1)	$	217	$	181	$	284	$	141
Trade receivables sold	3,085		3,111		9,259		9,256
Cash receipts	(3,184)		(2,983)		(9,431)		(9,089)
Foreign currency and other	2		3		8		4
Balance at end of period(1)	$	120	$	312	$	120	$	312

(1) Amounts outstanding from third parties reported in Accounts receivable in the Condensed Consolidated Balance Sheets.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Inventory


	As of
	July 31, 2025		October 31, 2024
	In millions
Finished goods	$	4,800	$	4,338
Purchased parts and fabricated assemblies	3,556		3,382
	$	8,356	$	7,720

Other Current Assets


	As of
	July 31, 2025		October 31, 2024
	In millions
Prepaid and other current assets	$	1,624	$	1,462
Supplier and other receivables	1,619		2,180
Value-added taxes receivable	978		1,028

	$	4,221	$	4,670

Property, Plant and Equipment, Net


	As of
	July 31, 2025		October 31, 2024
	In millions
Land, buildings and leasehold improvements	$	2,612	$	2,527
Machinery and equipment, including equipment held for lease	5,816		5,465
	8,428		7,992
Accumulated depreciation	(5,435)		(5,078)
	$	2,993	$	2,914

Other Non-Current Assets


	As of
	July 31, 2025		October 31, 2024
	In millions
Deferred tax assets	$	3,424	$	3,311
Right-of-use assets	1,092		1,165
Intangible assets(1)	1,071		1,319
Prepaid pension and post-retirement benefit assets	402		362
Deposits and prepaid	317		322
Other	1,267		1,129
	$	7,573	$	7,608

(1) During the three and nine months ended July 31, 2025, the Company incurred impairment charges of $65 million related to acquired customer contracts, customer lists and distribution agreements within the Print segment and $27 million of technology and patents within the Corporate Investments segments.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Other Current Liabilities


	As of
	July 31, 2025		October 31, 2024
	In millions
Sales and marketing programs	$	2,856	$	3,060
Deferred revenue	1,548		1,446
Other accrued taxes	1,181		1,233
Employee compensation and benefits	849		970
Warranty	409		486
Operating lease liabilities	409		443
Tax liability	248		291
Other	2,559		2,449
	$	10,059	$	10,378

Other Non-Current Liabilities


	As of
	July 31, 2025		October 31, 2024
	In millions
Deferred revenue	$	1,588	$	1,487
Operating lease liabilities	764		787
Tax liability	620		839
Pension, post-retirement, and post-employment liabilities	598		607
Deferred tax liability	15		31
Other	524		531
	$	4,109	$	4,282

Interest and Other, Net


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Interest expense on borrowings	$	(111)	$	(111)	$	(329)	$	(343)
Factoring costs	(32)		(38)		(101)		(117)
Certain litigation benefits	52		—		52		—
Non-operating retirement-related credits	3		4		13		10
Other, net	(4)		32		(16)		40
	$	(92)	$	(113)	$	(381)	$	(410)

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Net Revenue by Region


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Americas	$	6,107	$	6,086	$	17,419	$	17,085
Europe, Middle East and Africa	4,502		4,420		13,649		13,461
Asia-Pacific and Japan	3,323		3,013		9,588		8,958
Total net revenue	$	13,932	$	13,519	$	40,656	$	39,504

Value of Remaining Performance Obligations

As of July 31, 2025, the estimated value of transaction price allocated to remaining performance obligations was $4.0 billion. HP expects to recognize approximately $1.8 billion of the unearned amount in next 12 months and $2.2 billion thereafter.

HP has elected the practical expedients and accordingly does not disclose the aggregate amount of the transaction price allocated to remaining performance obligations if:

the contract has an original expected duration of one year or less; or
the revenue from the performance obligation is recognized over time on an as-invoiced basis when the amount corresponds directly with the value to the customer; or
the portion of the transaction price that is variable in nature is allocated entirely to a wholly unsatisfied performance obligation.

The remaining performance obligations are subject to change and may be affected by various factors, such as termination of contracts, contract modifications and adjustment for currency.

Contract Liabilities

As of July 31, 2025 and October 31, 2024, HP’s contract liabilities balances were $3.1 billion and $2.9 billion, respectively, included in Other current liabilities and Other non-current liabilities in the Condensed Consolidated Balance Sheets.

The increase in the contract liabilities balance for the nine months ended July 31, 2025, was primarily driven by sales of fixed-price support and maintenance services, partially offset by $1.2 billion of revenue recognized that was included in the contract liabilities balance as of October 31, 2024.

Supplier Finance Programs

HP facilitates voluntary supplier finance programs to provide certain suppliers the opportunity to sell their right to HP’s payment obligations to participating financial institutions. Under these programs, HP agrees to pay the participating financial institutions the stated amount of confirmed invoices from its designated suppliers on the original maturity dates of the invoices. Participation by suppliers in these programs have no impact on the payment terms and amounts due from HP. HP does not have an economic interest in a supplier's participation in the program and is not a party to the agreement between the supplier and the financial institutions. In connection with these programs, HP does not pledge assets or other forms of guarantees as security for the committed payment to the participating financial institutions. For certain programs, HP pays a monthly service fee to a third-party administrator that provides the supplier finance platform and related support. HP and the participating financial institutions may terminate the agreement upon at least 30 days notice. As of July 31, 2025 and October 31, 2024, HP had $8.6 billion and $7.8 billion respectively, in obligations outstanding (i.e., unpaid invoices) that were confirmed as valid under the supplier finance programs, of which $0.5 billion and $0.9 billion were owed to participating financial institutions. These obligations are included within the Accounts payable line item of HP’s Condensed Consolidated Balance Sheets. As of both July 31, 2025 and October 31, 2024, the Company’s outstanding payment obligations that suppliers elected to sell to participating financial institutions were $0.1 billion.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 6: Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.

Fair Value Hierarchy

HP uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement:

Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs.

Level 3—Unobservable inputs for the asset or liability.

The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs.

The following table presents HP’s assets and liabilities that are measured at fair value on a recurring basis:


	As of July 31, 2025								As of October 31, 2024
	Fair Value Measured Using								Fair Value Measured Using
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	In millions
Assets:
Cash Equivalents:
Time deposits	$	—	$	1,773	$	—	$	1,773	$	—	$	1,012	$	—	$	1,012

Government debt(1)	398		—		—		398		1,332		—		—		1,332
Available-for-Sale Investments:

Financial institution instruments	—		3		—		3		—		3		—		3

Marketable securities and mutual funds(2)	8		123		—		131		54		130		—		184

Derivative Instruments:
Interest rate contracts	—		—		—		—		—		4		—		4
Foreign currency contracts	—		133		—		133		—		225		—		225
Other derivatives	—		1		—		1		—		—		—		—
Total assets	$	406	$	2,033	$	—	$	2,439	$	1,386	$	1,374	$	—	$	2,760
Liabilities:
Derivative Instruments:
Interest rate contracts	$	—	$	4	$	—	$	4	$	—	$	22	$	—	$	22
Foreign currency contracts	—		372		—		372		—		158		—		158
Other derivatives	—		1		—		1		—		2		—		2
Total liabilities	$	—	$	377	$	—	$	377	$	—	$	182	$	—	$	182

(1) Government debt includes instruments such as U.S. treasury notes, U.S. agency securities and non-U.S. government bonds. Money market funds invested in government debt and traded in active markets are included in Level 1.

(2) As of July 31, 2025 and October 31, 2024, $67 million and $78 million, respectively, of debt securities were restricted to fund benefits received by qualifying employees under a sponsored defined benefit plan.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Valuation Techniques

Cash Equivalents and Investments: HP holds time deposits, money market funds, mutual funds, other debt securities primarily consisting of corporate and foreign government notes and bonds, and common stock and equivalents. HP values cash equivalents and equity investments using quoted market prices, alternative pricing sources, including net asset value, or models utilizing market observable inputs. The fair value of debt investments is based on quoted market prices or model-driven valuations using inputs primarily derived from or corroborated by observable market data and, in certain instances, valuation models that utilize assumptions which cannot be corroborated with observable market data.

Derivative Instruments: HP uses industry standard valuation models to measure fair value. Where applicable, these models project future cash flows and discount the future amounts to present value using market-based observable inputs, including interest rate curves, HP and counterparty credit risk, foreign exchange rates, and forward and spot prices for currencies and interest rates. See Note 7, “Financial Instruments” for a further discussion of HP’s use of derivative instruments.

Other Fair Value Disclosures

Short- and Long-Term Debt: HP estimates the fair value of its debt primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities and considering its own credit risk. The portion of HP’s debt that is hedged is reflected in the Condensed Consolidated Balance Sheets as an amount equal to the debt’s carrying amount and a fair value adjustment representing changes in the fair value of the hedged debt obligations arising from movements in benchmark interest rates. The fair value of HP’s short- and long-term debt was $9.5 billion as compared to its carrying amount of $9.6 billion as of July 31, 2025. The fair value of HP’s short- and long-term debt was $9.4 billion as compared to its carrying value of $9.7 billion as of October 31, 2024. If measured at fair value in the Condensed Consolidated Balance Sheets, short- and long-term debt would be classified in Level 2 of the fair value hierarchy.

Other Financial Instruments: For the balance of HP’s financial instruments, primarily accounts receivable, accounts payable and financial liabilities included in Other current liabilities on the Condensed Consolidated Balance Sheets, the carrying amounts approximate fair value due to their short maturities. If measured at fair value in the Condensed Consolidated Balance Sheets, these other financial instruments would be classified as Level 2 or Level 3 of the fair value hierarchy.

Non-Marketable Equity Investments and Non-Financial Assets: HP’s non-marketable equity investments are measured at cost less impairment, adjusted for observable price changes. HP’s non-financial assets, such as intangible assets, goodwill and property, plant and equipment, are recorded at fair value in the period an impairment charge is recognized. If measured at fair value in the Condensed Consolidated Balance Sheets these would generally be classified within Level 3 of the fair value hierarchy.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 7: Financial Instruments

Cash Equivalents and Available-for-Sale Investments


	As of July 31, 2025								As of October 31, 2024
	Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value		Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
	In millions
Cash Equivalents:
Time deposits	$	1,773	$	—	$	—	$	1,773	$	1,012	$	—	$	—	$	1,012

Government debt(1)	398		—		—		398		1,332		—		—		1,332
Total cash equivalents	2,171		—		—		2,171		2,344		—		—		2,344
Available-for-Sale Investments:

Financial institution instruments	3		—		—		3		3		—		—		3

Marketable securities and mutual funds(2)	110		21		—		131		115		69		—		184

Total available-for-sale investments	113		21		—		134		118		69		—		187
Total cash equivalents and available-for-sale investments	$	2,284	$	21	$	—	$	2,305	$	2,462	$	69	$	—	$	2,531

All highly liquid investments with original maturities of three months or less at the date of acquisition are considered cash equivalents. As of July 31, 2025 and October 31, 2024, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. The estimated fair value of the available-for-sale investments may not be representative of values that will be realized in the future.

Contractual maturities of investments in available-for-sale debt securities were as follows:


	As of July 31, 2025
	Amortized Cost		Fair Value
	In millions
Due in one year	$	17	$	17
Due in one to five years	53		53
	$	70	$	70

Non-marketable equity securities in privately held companies are included in Other current and non-current assets in the Condensed Consolidated Balance Sheets. These amounted to $119 million and $107 million as of July 31, 2025 and October 31, 2024, respectively.

HP determines credit losses on cash equivalents and available-for-sale debt securities at the individual security level. All instruments are considered investment grade. No credit-related or noncredit-related impairment losses were recorded for the three and nine months ended July 31, 2025.

Derivative Instruments

HP uses derivative instruments, primarily forward contracts, interest rate swaps, total return swaps, treasury rate locks, forward starting swaps and option contracts to offset business exposure to foreign currency and interest rate risk on expected future cash flows and on certain existing assets and liabilities. HP may designate its derivative contracts as fair value hedges or cash flow hedges and classifies the cash flows with the activities that correspond to the underlying hedged items. Additionally, for derivatives not designated as hedging instruments, HP categorizes those economic hedges as other derivatives. HP recognizes all derivative instruments at fair value in the Condensed Consolidated Balance Sheets.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

As a result of its use of derivative instruments, HP is exposed to the risk that its counterparties will fail to meet their contractual obligations. Master netting agreements mitigate credit exposure to counterparties by permitting HP to net amounts due from HP to counterparty against amounts due to HP from the same counterparty under certain conditions. To further limit credit risk, HP has collateral security agreements that allow HP’s custodian to hold collateral from, or require HP to post collateral to, counterparties when the net fair value of financial instruments fluctuates from contractually established thresholds. The Company includes gross collateral posted and received in other current assets and other current liabilities in the Condensed Consolidated Balance Sheets, respectively. The fair value of derivatives with credit contingent features in a net liability position was $242 million and $59 million as of July 31, 2025 and as of October 31, 2024, respectively, all of which were fully collateralized within two business days.

Under HP’s derivative contracts, the counterparty can terminate all outstanding trades following a covered change of control event affecting HP that results in the surviving entity being rated below a specified credit rating. This credit contingent provision did not affect HP’s financial position or cash flows as of July 31, 2025 and October 31, 2024.

Fair Value Hedges

HP enters into fair value hedges, such as interest rate swaps, to reduce the exposure of its debt portfolio to changes in fair value resulting from changes in benchmark interest rates on HP’s future interest payments.

For derivative instruments that are designated and qualify as fair value hedges, HP recognizes the change in fair value of the derivative instrument, as well as the offsetting change in the fair value of the hedged item, in Interest and other, net in the Condensed Consolidated Statements of Earnings in the period of change.

Cash Flow Hedges

HP uses forward contracts, option contracts, treasury rate locks and forward starting swaps designated as cash flow hedges to protect against the foreign currency exchange and interest rate risks inherent in its forecasted products net revenue, cost of products net revenue, operating expenses and debt issuance. HP’s foreign currency cash flow hedges mature predominantly within twelve months; however, hedges related to long-term procurement arrangements, contractual pricing and/or business unit specific exposures may extend several years.

For derivative instruments that are designated and qualify as cash flow hedges, HP initially records changes in fair value of the derivative instrument in Accumulated other comprehensive loss as a separate component of Stockholders’ deficit in the Condensed Consolidated Balance Sheets and subsequently reclassifies these amounts into earnings in the period during which the hedged transaction is recognized in earnings. HP reports the changes in the fair value of the derivative instrument in the same financial statement line item as changes in the fair value of the hedged item.

Other Derivatives

Other derivatives not designated as hedging instruments consist primarily of forward contracts used to hedge foreign currency-denominated balance sheet exposures. HP also uses total return swaps to hedge its executive deferred compensation plan liability.

For derivative instruments not designated as hedging instruments, HP recognizes changes in fair value of the derivative instrument, as well as the offsetting change in the fair value of the hedged item, in Interest and other, net in the Condensed Consolidated Statements of Earnings in the period of change.

Hedge Effectiveness

For interest rate swaps designated as fair value hedges, HP measures hedge effectiveness by offsetting the change in fair value of the hedged item with the change in fair value of the derivative. For foreign currency options, forward contracts and forward starting swaps designated as cash flow hedges, HP measures hedge effectiveness by comparing the cumulative change in fair value of the hedge contract with the cumulative change in fair value of the hedged item, both of which are based on forward rates.

During the three and nine months ended July 31, 2025 and 2024, no portion of the hedging instruments’ gain or loss was excluded from the assessment of effectiveness for fair value and cash flow hedges.

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets

The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows:

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)


	As of July 31, 2025										As of October 31, 2024
	Outstanding Gross Notional		Other Current Assets		Other Non-Current Assets		Other Current Liabilities		Other Non-Current Liabilities		Outstanding Gross Notional		Other Current Assets		Other Non-Current Assets		Other Current Liabilities		Other Non-Current Liabilities
	In millions
Derivatives designated as hedging instruments
Fair value hedges:
Interest rate contracts	$	250	$	—	$	—	$	4	$	—	$	750	$	—	$	—	$	11	$	10
Cash flow hedges:
Foreign currency contracts	13,819		92		14		275		74		14,563		169		36		117		34
Interest rate contracts	—		—		—		—		—		500		—		4		—		1
Total derivatives designated as hedging instruments	14,069		92		14		279		74		15,813		169		40		128		45
Derivatives not designated as hedging instruments
Foreign currency contracts	4,088		27		—		23		—		4,284		20		—		7		—
Other derivatives	156		1		—		1		—		156		—		—		2		—
Total derivatives not designated as hedging instruments	4,244		28		—		24		—		4,440		20		—		9		—
Total derivatives	$	18,313	$	120	$	14	$	303	$	74	$	20,253	$	189	$	40	$	137	$	45

Offsetting of Derivative Instruments

HP recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheets. HP does not offset the fair value of its derivative instruments against the fair value of cash collateral posted under its collateral security agreements. As of July 31, 2025 and October 31, 2024, information related to the potential effect of HP’s master netting agreements and collateral security agreements was as follows:


	In the Condensed Consolidated Balance Sheets
	(i)			(ii)		(iii) = (i)–(ii)		(iv)		(v)			(vi) = (iii)–(iv)–(v)
						Gross Amounts Not Offset
	Gross Amount Recognized		Gross Amount Offset	Net Amount Presented		Derivatives		Financial Collateral				Net Amount
	In millions
As of July 31, 2025
Derivative assets	$	134		$	—	$	134	$	128	$	—	(1)	$	6
Derivative liabilities	$	377		$	—	$	377	$	128	$	343	(2)	$	(94)
As of October 31, 2024
Derivative assets	$	229		$	—	$	229	$	113	$	88	(1)	$	28
Derivative liabilities	$	182		$	—	$	182	$	113	$	61	(2)	$	8

(1)Represents the cash collateral posted by counterparties as of the respective reporting date for HP’s asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date.

(2)Represents the collateral posted by HP including any re-use of counterparty cash collateral as of the respective reporting date for HP’s liability position, net of derivative amounts that could be offset as of, generally, two business days prior to the respective reporting date.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Effect of Derivative Instruments in the Condensed Consolidated Statements of Earnings

The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship were as follows:


Derivative Instrument	Hedged Item	Location	Year	Total amounts of income/(expense) line items in the statement of financial performance in which the effects of fair value hedges are recorded		Gain/(loss) recognized in earnings on derivative instruments		Gain/(loss) recognized in earnings on hedged item
				In millions
Three months ended July 31
Interest rate contract	Fixed-rate debt	Interest and other, net	2025	$	(92)	$	2	$	(2)
			2024	$	(113)	$	13	$	(13)
Nine months ended July 31
Interest rate contract	Fixed-rate debt	Interest and other, net	2025	$	(381)	$	17	$	(17)
			2024	$	(410)	$	28	$	(28)

The pre-tax effect of derivative instruments in cash flow hedging relationships included in Accumulated other comprehensive (loss) income was as follows:


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Gain/(loss) recognized in Accumulated other comprehensive (loss) income on derivatives:
Foreign currency contracts	$	59	$	(33)	$	(304)	$	(44)
Interest rate contracts	—		(3)		3		(3)
Total	$	59	$	(36)	$	(301)	$	(47)

The pre-tax effect of derivative instruments in cash flow hedging relationships included in earnings were as follows:


	Gain/(loss) reclassified from Accumulated other comprehensive (loss) income into earnings
		Three months ended July 31		Nine months ended July 31
				2025		2024		2025		2024
			In millions
Products net revenue				$	(184)	$	117	$	50	$	355
Cost of products net revenue				(21)		(33)		(71)		(109)
Operating expenses				—		—		1		(4)
Interest and other, net				3		3		9		9
Total				$	(202)	$	87	$	(11)	$	251

As of July 31, 2025, HP expects to reclassify an estimated accumulated other comprehensive loss of $162 million, net of taxes, to earnings within the next twelve months associated with cash flow hedges along with the earnings effects of the related forecasted transactions. The amounts ultimately reclassified into earnings could be different from the amounts previously included in Accumulated other comprehensive (loss) income based on the change of market rate, and therefore could have different impacts on earnings.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

The pre-tax effect of derivative instruments not designated as hedging instruments recognized in Interest and other, net in the Condensed Consolidated Statements of Earnings as follows:


	Gain/(loss) recognized in earnings on derivative instrument
		Three months ended July 31				Nine months ended July 31
	Location	2025		2024		2025		2024
		In millions
Foreign currency contracts	Interest and other, net	$	7	$	16	$	(7)	$	23
Other derivatives	Interest and other, net	(3)		7		2		5
Total		$	4	$	23	$	(5)	$	28

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 8: Borrowings

Notes Payable and Short-Term Borrowings


	As of July 31, 2025				As of October 31, 2024
	Amount Outstanding		Weighted-Average Interest Rate		Amount Outstanding		Weighted-Average Interest Rate
	In millions

Current portion of long-term debt	$	772	3.3	%	$	1,358	5.0	%
Notes payable to banks, lines of credit and other	48		—	%	48		—	%
Total notes payable and short-term borrowings	$	820			$	1,406

Long-Term Debt


	As of
	July 31, 2025		October 31, 2024
	In millions
U.S. Dollar Global Notes(1)


$1,150 issued at discount to par at a price of 99.769% at 2.20%, due June 2025	$	—	$	1,150
$1,000 issued at discount to par at a price of 99.808% at 1.45%, due June 2026	522		521
$1,000 issued at discount to par at a price of 99.718% at 3.00%, due June 2027	999		999
$900 issued at discount to par at a price of 99.841% at 4.75%, due January 2028	899		899
$1,000 issued at discount to par at a price of 99.767% at 4.00%, due April 2029	999		999
$500 issued at discount to par at a price of 99.732% at 5.40%, due April 2030	499		—
$850 issued at discount to par at a price of 99.790% at 3.40%, due June 2030	503		503
$1,000 issued at discount to par at a price of 99.573% at 2.65%, due June 2031	997		997
$1,000 issued at discount to par at a price of 99.966% at 4.20%, due April 2032	676		676
$1,100 issued at discount to par at a price of 99.725% at 5.50%, due January 2033	1,098		1,098
$500 issued at discount to par at a price of 99.778% at 6.10%, due April 2035	499		—
$1,200 issued at discount to par at a price of 99.863% at 6.00%, due September 2041	1,199		1,199
$500 issued at par at a price of 100% at 4.75%, due March 2029	3		3
	8,893		9,044
Other borrowings at 1.46%-7.46%, due in fiscal years 2025-2032	711		645
Fair value adjustment related to hedged debt	(3)		(21)
Unamortized debt issuance cost	(47)		(47)
Current portion of long-term debt	(772)		(1,358)
Total long-term debt	$	8,782	$	8,263

(1)HP may redeem some or all of the fixed-rate U.S. Dollar Global Notes at any time in accordance with the terms thereof. The U.S. Dollar Global Notes are senior unsecured debt.

In April 2025, HP completed its offering of $1.0 billion aggregate principal amount of senior unsecured notes, consisting of $500 million of 5.40% notes due April 2030 and $500 million of 6.10% notes due April 2035. HP incurred issuance costs of $9 million. HP will pay interest semi-annually on each series of the notes on April 25 and October 25, beginning October 25, 2025. In April 2025, a series of forward starting swaps and a treasury rate lock totaling $825 million notional amount were settled to mitigate the treasury rates volatility associated with this debt issuance. HP used the net proceeds from the offering of the notes for general corporate purposes, including, together with cash on hand, the repayment of the Global Notes due June 2025 upon maturity.

As disclosed in Note 7, “Financial Instruments,” HP uses interest rate swaps to mitigate some of the exposure of its debt portfolio to changes in fair value resulting from changes in benchmark interest rates. Interest rates shown in the table of long-term debt have not been adjusted to reflect the impact of any interest rate swaps.

Commercial Paper

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

As of July 31, 2025, HP maintained a U.S. commercial paper program for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $6.0 billion. The principal amount outstanding under this program and certain short-term borrowings at any time cannot exceed a $6.0 billion authorization by HP’s Board of Directors.

Credit Facility

As of July 31, 2025, HP maintained a $5.0 billion 5-year sustainability-linked senior unsecured committed revolving credit facility, which HP entered into on August 1, 2024. Commitments under the revolving credit facility will be available until August 1, 2029. Commitment fees, interest rates and other terms of borrowing under the revolving credit facility vary based on HP’s external credit ratings and certain sustainability metrics. Funds borrowed under the revolving credit facility may be used for general corporate purposes.

As of July 31, 2025, HP was in compliance with the covenants in the credit agreement governing the revolving credit facility.

Available Borrowing Resources

As of July 31, 2025, HP had available borrowing resources of $1.1 billion from uncommitted lines of credit in addition to funds available under the revolving credit facility.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 9: Stockholders’ Deficit

Share Repurchase Program

HP’s share repurchase program authorizes both open market and private repurchase transactions. During the three and nine months ended July 31, 2025, HP executed share repurchases of 5.5 million and 11.4 million shares and settled total shares for $0.2 billion and $0.4 billion, respectively. Share repurchases executed during the three and nine months ended July 31, 2025 included 0.3 million shares settled in August 2025. During the three and nine months ended July 31, 2024, HP executed share repurchases of 17.0 million and 37.5 million shares and settled total shares for $0.6 billion and $1.2 billion, respectively. Share repurchases executed during the three and nine months ended July 31, 2024 included 0.2 million shares settled in August 2024.

The shares repurchased during the nine months ended July 31, 2025 and 2024 were all open market repurchase transactions. As of July 31, 2025, HP had approximately $8.9 billion remaining under the share repurchase authorization approved by HP’s Board of Directors.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Changes and reclassifications related to Accumulated Other Comprehensive Loss, net of taxes


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions
Other comprehensive income (loss), net of taxes:
Unrealized components of available-for-sale debt securities
Balance at the beginning of period	$	20	$	11	$	14	$	7
Unrealized gains arising during the period	5		3		11		7

Tax effects on change in unrealized components of available-for-sale securities	(1)		(1)		(1)		(1)
Unrealized components of available-for-sale debt securities, net of taxes	4		2		10		6
Balance at the end of period	$	24	$	13	$	24	$	13

Unrealized components of cash flow hedges
Balance at the beginning of period	$	(393)	$	89	$	47	$	230
Unrealized gains (losses) arising during the period	59		(36)		(301)		(47)
Losses (gains) reclassified into earnings	202		(87)		11		(251)
Tax effects on change in unrealized components of cash flow hedges	(61)		27		50		61
Unrealized components of cash flow hedges, net of taxes	200		(96)		(240)		(237)
Balance at the end of period	$	(193)	$	(7)	$	(193)	$	(7)

Unrealized components of defined benefit plans
Balance at the beginning of period	$	(488)	$	(423)	$	(496)	$	(437)
Unrealized (losses) gains arising during the period	(7)		—		(8)		13
Amortization of actuarial loss and prior service benefit	5		1		15		5
Curtailments, settlements and other	2		1		2		2
Tax effects on change in unrealized components of defined benefit plans	—		(2)		(1)		(6)
Unrealized components of defined benefit plans, net of taxes	—		—		8		14
Balance at the end of period	$	(488)	$	(423)	$	(488)	$	(423)

Cumulative translation adjustment
Balance at the beginning of period	$	18	$	(9)	$	1	$	(23)
Change in cumulative translation adjustment	(1)		11		16		25
Tax effect on change in cumulative translation adjustment	(1)		—		(1)		—
Cumulative translation adjustment, net of taxes	(2)		11		15		25
Balance at the end of period	$	16	$	2	$	16	$	2

Other comprehensive income (loss)	$	202	$	(83)	$	(207)	$	(192)
Accumulated other comprehensive loss	$	(641)	$	(415)	$	(641)	$	(415)

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Note 10: Earnings Per Share

HP calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes any dilutive effect of restricted stock units, stock options, performance-based awards and shares purchased under the 2021 employee stock purchase plan.

A reconciliation of the number of shares used for basic and diluted net EPS calculations is as follows:


	Three months ended July 31				Nine months ended July 31
	2025		2024		2025		2024
	In millions, except per share amounts
Numerator:
Net earnings	$	763	$	640	$	1,734	$	1,869
Denominator:
Weighted-average shares used to compute basic net EPS	947		979		948		986
Dilutive effect of employee stock plans	7		11		7		8
Weighted-average shares used to compute diluted net EPS	954		990		955		994
Net earnings per share:
Basic	$	0.81	$	0.65	$	1.83	$	1.90
Diluted	$	0.80	$	0.65	$	1.82	$	1.88
Anti-dilutive effect of employee stock plans(1)	14		—		8		2

(1)HP excludes from the calculation of diluted net EPS stock options and restricted stock units where the assumed proceeds exceed the average market price, because their effect would be anti-dilutive. The assumed proceeds of a stock option include the sum of its exercise price, and average unrecognized compensation cost. The assumed proceeds of a restricted stock unit represent average unrecognized compensation cost.

Note 11: Litigation and Contingencies

HP is involved in lawsuits, claims, investigations and proceedings, including those identified below, consisting of IP, commercial, securities, employment, employee benefits and environmental matters that arise in the ordinary course of business. HP accrues a liability when management believes that it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. HP believes it has recorded adequate provisions for any such matters and, as of July 31, 2025, it was not reasonably possible that a material loss had been incurred in excess of the amounts recognized in HP’s financial statements. HP reviews these matters at least quarterly and adjusts its accruals to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular case. Pursuant to the separation and distribution agreement entered into with Hewlett Packard Enterprise Company (“Hewlett Packard Enterprise”), HP shares responsibility with Hewlett Packard Enterprise for certain matters, as indicated below, and Hewlett Packard Enterprise has agreed to indemnify HP in whole or in part with respect to certain matters. Based on its experience, HP believes that any damage amounts claimed in the specific matters discussed below are not a meaningful indicator of HP’s potential liability. Litigation is inherently unpredictable. However, HP believes it has valid defenses with respect to legal matters pending against it. Nevertheless, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these contingencies.

Litigation, Proceedings and Investigations

Copyright Levies*.* Proceedings are ongoing or have been concluded involving HP in certain European countries, challenging the imposition or the modification of levies regimes upon IT equipment (such as PCs or printers) or the restrictions to exonerate the application of private copying levies on devices purchased by business users. The levies are generally based upon the number of products sold and the per-product amounts of the levies, which vary. Some European countries are expected to implement legislation to introduce or extend existing levy schemes to digital devices. HP, other companies and various industry associations have opposed the extension of levies to the digital product and certain requirements for business sales exemptions and have advocated alternative models of compensation to rights holders.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Based on the exemption of levies on business sales and industry opposition to increasing levies to digital products, HP’s assessments of the merits of various proceedings and HP’s estimates of the number of units impacted and the amounts of the levies, HP has accrued amounts that it believes are adequate to address the ongoing disputes.

India Directorate of Revenue Intelligence Proceedings*.* On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the “DRI”) issued show cause notices to Hewlett-Packard India Sales Private Limited (“HP India”), a subsidiary of HP, seven HP India employees and one former HP India employee alleging that HP India underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately $370 million, plus penalties and interest. Prior to the issuance of the notices, HP India deposited approximately $16 million with the DRI and agreed to post a provisional bond in exchange for the DRI’s agreement to not seize HP India products and spare parts or interrupt business by HP India.

On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related notice affirming certain duties and penalties against HP India and the named individuals of approximately $386 million, of which HP India had already deposited $9 million. On December 11, 2012, HP India voluntarily deposited an additional $10 million in connection with the products-related notice. The differential duty demand is subject to interest. On April 20, 2012, the Commissioner issued an order on the parts-related notice affirming certain duties and penalties against HP India and certain of the named individuals of approximately $17 million, of which HP India had already deposited $7 million. After the order, HP India deposited an additional $3 million in connection with the parts-related notice so as to avoid certain penalties.

HP India filed appeals of the Commissioner’s orders before the Customs, Excise and Service Tax Appellate Tribunal (the “Customs Tribunal”) along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The Customs Department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HP India to deposit an additional $24 million against the products order, which HP India deposited in March 2013. On February 7, 2014, the Customs Tribunal granted HP India’s application for extension of the stay of deposit until disposal of the appeals. On October 27, 2014, the Customs Tribunal commenced hearings on the cross-appeals of the Commissioner’s orders and rejected HP India’s request to remand the matter to the Commissioner on procedural grounds. The Customs Tribunal cancelled hearings to reconvene in 2015, 2016 and January 2019. On January 20, 2021, the Customs Tribunal held a virtual hearing during which the judge allowed HP’s application for a physical hearing on the merits as soon as practicable, which will be scheduled when physical hearings resume at court. In unrelated, third-party proceedings, the Supreme Court of India has resolved certain jurisdictional questions to the authority of the Directorate of Revenue Intelligence, issues which HP also raised in its appeal to the Customs Tribunal. In late 2024, those jurisdictional questions were resolved. Between late April and June 18, 2025, the Customs Tribunal held three weeks of hearings on the appeals. The matter is presently pending a decision. If the decision is adverse, HP should be entitled to appeal on the merits to the Supreme Court of India, although HP may be required to make additional deposits. Pursuant to the separation and distribution agreement, Hewlett Packard Enterprise has agreed to indemnify HP in part, based on the extent to which any liability arises from the products and spare parts of Hewlett Packard Enterprise’s businesses.

Media Content Protection LLC Patent Litigation (formerly Philips Patent Litigation). In September 2020, Koninklijke Philips N.V. and Philips North America LLC (collectively, “Philips”) filed a complaint against HP for patent infringement in federal court for the District of Delaware and filed a companion complaint with the U.S. International Trade Commission (“ITC”) pursuant to Section 337 of the Tariff Act against HP and 8 other sets of respondents. Both complaints allege that certain digital video-capable devices and components thereof infringe four of Philips’ patents. In October 2020, the ITC instituted an investigation, and Philips later withdrew two of the four patents. On March 23, 2022, the ITC rendered a final determination that no violation of Section 337 has occurred. Philips did not appeal and elected to resume litigation with its case in federal court. Philips seeks unspecified damages and an injunction against HP, and the prior stay has been lifted. On August 10, 2023, HP filed a motion for summary judgment of indefiniteness for all asserted claims. On July 1, 2024, the district court denied the motion without prejudice to renew. Philips conveyed the patents asserted in the district court action to Media Content Protection LLC (“MCP”), and MCP was substituted as plaintiff in place of Philips.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

York County on behalf of the County of York Retirement Fund v. HP Inc., et al., and related proceedings. On November 5, 2020, York County, on behalf of the County of York Retirement Fund, filed a putative class action complaint against HP, Dion Weisler, and Catherine Lesjak in federal court in the Northern District of California. The court appointed Maryland Electrical Industry Pension Fund as Lead Plaintiff. Lead Plaintiff filed a consolidated complaint, which additionally names as defendants Enrique Lores and Richard Bailey. The complaint alleges, among other things, that from November 5, 2015 to June 21, 2016, HP and the named current and former officers violated Sections 10(b) and 20(a) of the Exchange Act by concealing material information and making false statements about HP’s printing supplies business (“Securities Class Action”). Plaintiffs seek compensatory damages and other relief. HP and the named officers filed a motion to dismiss the complaint for failure to state a claim upon which relief can be granted. On March 3, 2022, the court granted the motion to dismiss with prejudice. Plaintiffs appealed the decision. On April 11, 2023, the appellate court reversed the district court’s decision and remanded the case to the district court for further proceedings consistent with the appellate opinion, including consideration of HP’s other arguments for dismissal. On July 21, 2023, HP and the named officers filed a renewed motion to dismiss. On March 27, 2024, the district court issued an order granting in part and denying in part the motion to dismiss. On August 8, 2024, the Court of Appeals for the Ninth Circuit granted HP’s petition for permission to appeal. On October 28, 2024, HP filed its appeal, which is awaiting appellate court oral argument that has not yet been scheduled. On July 28, 2025, the parties executed a binding term sheet containing the material terms of a proposed settlement. On August 19, 2025, the parties filed a stipulation of settlement and motion for preliminary approval of settlement in the district court. On May 17, 2021, stockholder Scott Franklin filed a derivative complaint against certain current and former officers and directors in federal court in the District of Delaware. Plaintiff purports to bring the action on behalf of HP, which he has named as a nominal defendant, and he makes substantially the same factual allegations as in the York County securities complaint, bringing claims for breach of fiduciary duty and violations of securities laws. The derivative plaintiff seeks compensatory damages, governance reforms, and other relief. By court order following stipulations by the parties, the case was transferred to the Northern District of California, and the case was stayed pending a ruling on the motion to dismiss in York County and exhaustion of all related appeals. On January 13, 2022, stockholder Gerald Lovoi filed a derivative complaint in federal court in the Northern District of California against the same current and former officers and directors named in the Franklin action. The complaint alleges the same basic claims based on the same alleged conduct as the Franklin action and seeks similar relief. By stipulation of the parties, the Lovoi action was stayed pending a ruling on the motion to dismiss in York County and exhaustion of all related appeals. On May 31, 2024, the court adopted a stipulation in which the derivative plaintiffs and defendants agreed to consolidate the derivative proceedings, close the Lovoi action, and extend the current stay through summary judgment in the Securities Class Action.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Legal Proceedings re Authentication of Supplies. Since 2016, HP has from time to time been named in civil litigation, or been the subject of government investigations, involving supplies authentication protocols used in certain HP printers in multiple geographies, including but not limited to the United States, Italy, Israel, the Netherlands, Australia and New Zealand. The supplies authentication protocols are often referred to as Dynamic Security. The core allegations in these proceedings claim misleading or inadequate consumer notifications and permissions pertaining to the use of Dynamic Security, the installation of firmware updates, or the potential inability of cartridges with clone chips or circuitry to work in HP printers with Dynamic Security. Plaintiffs base or have based their claims on various legal theories, including but not limited to unfair competition, computer trespass, and similar statutory claims. Among other relief, Plaintiffs have sought or seek money damages and in certain cases have or may seek injunctive relief against the use or operation of Dynamic Security or relief requiring interoperability. If HP is not successful in its defense of these cases or investigations, it could be subject to damages, penalties, significant settlement demands, or injunctive relief that may be costly or may disrupt operations. Certain of these proceedings in the United States, Italy, the Netherlands, Israel, Australia and New Zealand have been resolved, have concluded, or have concluded subject only to HP’s pending appeal. Digital Revolution B.V. (trading as 123Inkt) filed civil litigation, including competition claims, against HP Nederlands B.V., et al. (Netherlands) in March 2020. HP substantially prevailed before the trial court, and both parties appealed. On November 19, 2024, the court of appeal issued a decision rejecting competition claims against HP and providing that use of Dynamic Security by HP is not unlawful. On February 18, 2025, Digital Revolution filed a cassation appeal against the decision before the Dutch Supreme Court. In addition, a putative class action was filed against HP in federal court in Illinois in January 2024, arising out of the use of Dynamic Security firmware updates in HP printers. Plaintiffs seek compensatory damages, restitution, injunctive relief against alleged unfair and anticompetitive business practices, and other relief. The case is in its early stages.

Autonomy-Related Legal Proceedings. In 2015, four former Hewlett Packard Company subsidiaries that became subsidiaries of Hewlett Packard Enterprise at the time of the Separation (Autonomy Corporation Limited, Hewlett Packard Vision BV, Autonomy Systems Limited, and Autonomy, Inc., hereinafter the “Claimants”) initiated civil proceedings in the U.K. High Court of Justice against two members of Autonomy’s former management, Michael Lynch and Sushovan Hussain, for breach of their fiduciary duties in causing Autonomy group companies to engage in improper transactions and accounting practices before and in connection with the 2011 acquisition of Autonomy. Trial concluded in January 2020. In May 2022, the court issued its liability judgment, finding that the Claimants had succeeded on substantially all claims and that Messrs. Lynch and Hussain engaged in fraud, and dismissing a counterclaim filed by Mr. Lynch. The court deferred the issue of damages to further proceedings, but indicated that damages awarded may be substantially less than was claimed. In February 2024, the court held a two-week trial on damages, the Claimants sought recovery for $4 billion in losses, and the court took the issue under advisement. In May 2025, Claimants reached an agreement with Mr. Hussain to resolve claims against him. On July 22, 2025, the court issued its ruling on the quantum of damages, finding that the Lynch estate owed approximately 740 million pounds. The court set a hearing for the week of November 17, 2025, to address additional matters, including attorneys’ fees, pre-judgment interest, and the relevant date to use for the exchange rate to convert the recovery from pounds to dollars. The damages award is also subject to a set-off for prior settlements. Litigation is unpredictable, and there can be no assurance of a recovery. Any amount ultimately recovered would be recorded in the period received. No adjustment has been recorded in the financial statements in relation to this potential recovery. Pursuant to the terms of the separation and distribution agreement, HP and Hewlett Packard Enterprise will share equally in any recovery.

Litigation with Wilus Institute of Standards and Technology, Inc. and Sisvel International S.A. Since September 13, 2024, Wilus Institute of Standards and Technology, Inc. (“Wilus”) has filed three patent infringement lawsuits against HP in the Eastern District of Texas seeking monetary damages, injunctions and other relief. The complaints allege that HP products, that are compliant with the Wi-Fi 6 (801.11.ax) standard, infringe patents owned by Wilus. Wilus is a member of the Wi-Fi 6 patent pool administered by Sisvel International S.A. (“Sisvel”), and the patents at issue in the lawsuits are in the Sisvel Wi-Fi 6 patent pool. In December 2024, HP answered the complaints and filed counterclaims against Wilus and Sisvel, alleging that Wilus and Sisvel violated their obligations to license standard-essential patents on fair, reasonable and non-discrimination (“FRAND”) terms, and seeking a court determination of the proper FRAND rate. As of August 8, 2025, another Sisvel Wi-Fi 6 pool member Koniklijke Philips N.V. and its affiliate Philips GmbH (together, “Philips”) filed three lawsuits against HP Inc., HP Deutschland GmbH and HP International SARL, in the State Court in Munich, Germany asserting pool patents related to Wi-Fi 6 standards. Philips seeks an injunction, reporting, damages and product recall in two of its claims and hearings are scheduled on May 21, 2026 and June 11, 2026. The third claim relates to an expired patent for which Philips seeks damages, and a hearing is scheduled on July 30, 2026. As of August 26, 2025, another pool member, Huawei Technologies Co. Ltd (“Huawei”), filed two lawsuits against HP Inc. and HP Deutschland GmbH in the State Court in Munich, Germany, asserting pool patents related to Wi-Fi 6 standards. Relief sought includes an injunction, reporting, damages, product recall and/or destruction of inventory, and a hearing has been set in one case for March 26, 2026.

HP INC.

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

Environmental

HP is, and may become a party to, proceedings brought by U.S., state, or other governmental entities or private third parties under federal, state, local, or foreign environmental laws, including the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), known as “Superfund,” or state laws similar to CERCLA. HP is also conducting environmental investigations or remediation at several current or former operating sites and former disposal sites pursuant to administrative orders or consent agreements with environmental agencies.

Note 12: Guarantees, Indemnifications and Warranties

Guarantees

In the ordinary course of business, HP may issue performance guarantees to certain of its clients, customers and other parties pursuant to which HP has guaranteed the performance obligations of third parties. Some of those guarantees may be backed by standby letters of credit or surety bonds. In general, HP would be obligated to perform over the term of the guarantee in the event a specified triggering event occurs as defined by the guarantee. HP believes the likelihood of having to perform under a material guarantee is remote.

Cross-Indemnifications with Hewlett Packard Enterprise

On November 1, 2015, Hewlett-Packard Company completed the separation of Hewlett Packard Enterprise, Hewlett-Packard Company’s former enterprise technology infrastructure, software, services and financing businesses. The separation and distribution agreement provides for cross-indemnities between HP and Hewlett Packard Enterprise for liabilities allocated to the respective party pursuant to the terms of such agreement. For information on cross-indemnifications with Hewlett Packard Enterprise for litigation matters, see Note 11, “Litigation and Contingencies”.

Indemnifications

In the ordinary course of business, HP enters into contractual arrangements under which HP may agree to indemnify a third-party to such arrangement from any losses incurred relating to the services they perform on behalf of HP or for losses arising from certain events as defined within the particular contract, which may include, for example, litigation or claims relating to past performance. HP also provides indemnifications to certain vendors and customers against claims of intellectual property infringement made by third parties arising from the vendors’ and customers’ use of HP’s software products and services and certain other matters. Some indemnifications may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial.

HP records tax indemnification receivables from various third parties for certain tax liabilities that HP is jointly and severally liable for, but for which it is indemnified by those same third parties under existing legal agreements. HP records a tax indemnification payable to various third parties under these agreements when management believes that it is both probable that a liability has been incurred and the amount can be reasonably estimated. The actual amount that the third parties pay or may be obligated to pay HP could vary depending on the outcome of certain unresolved tax matters, which may not be resolved for several years.

Warranties

HP accrues the estimated cost of product warranties at the time it recognizes revenue. HP engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers; however, contractual warranty terms, repair costs, product call rates, average cost per call, current period product shipments and ongoing product failure rates, as well as specific product class failures outside of HP’s baseline experience, affect the estimated warranty obligation.

HP INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Continued)

(Unaudited)

HP’s aggregate product warranty liabilities and changes were as follows:


	Nine months ended July 31, 2025
	In millions
Balance at beginning of period	$	550
Accruals for warranties issued	491
Adjustments related to pre-existing warranties (including changes in estimates)	(4)
Settlements made	(575)
Balance at end of period	$	462

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