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HP Q1 FY11 Earnings

Announcement

February 22, 2011
http://www.hp.com/investor/home

February 22, 2011 http://www.hp.com/investor/home
FORWARD LOOKING STATEMENTS
This presentation may contain forward-looking statements that involve risks, uncertainties and assumptions. If the risks or
uncertainties ever materialize or the assumptions prove incorrect, the financial results of 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 revenue,
margins, expenses, earnings, earnings per share, tax provisions, cash flows, benefit obligations, share repurchases, currency
exchange rates, the impact of acquisitions or other financial items; any statements of the plans, strategies and objectives of
management for future operations, including execution of cost reduction programs and restructuring plans; any statements
concerning the expected development, performance or market share 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;
and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the impact
of macroeconomic and geopolitical trends and events; the competitive pressures faced by HP’s businesses; 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 and partners; the protection of HP’s intellectual property assets, including intellectual property licensed from third
parties; integration and other risks associated with business combination and investment transactions; the hiring and retention
of key employees; assumptions related to pension and other post-retirement costs; expectations and assumptions relating to
the execution and timing of cost reduction programs and restructuring plans; 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,
2010 and HP’s other filings with the Securities and Exchange Commission. As in prior periods, the financial information set
forth in this presentation, including tax-related items, reflects estimates based on information available at this time. While HP
believes these estimates to be meaningful, these amounts could differ materially from actual reported amounts in HP’s Form
10-Q for the fiscal quarter ended January 31, 2011. In particular, determining HP’s actual tax balances and provisions as of
January 31, 2011 requires extensive internal and external review of tax data (including consolidating and reviewing the tax
provisions of numerous domestic and foreign entities), which is being completed in the ordinary course of preparing HP’s
Form 10-Q. HP assumes no obligation and does not intend to update these forward-looking statements.

2 February 22, 2011 http://www.hp.com/investor/home
USE OF NON-GAAP FINANCIAL
INFORMATION
HP has included non-GAAP financial measures in this presentation to supplement HP’s consolidated condensed 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 non-GAAP operating expense, non-GAAP OI&E, non-GAAP operating profit, non-GAAP net earnings, non-
GAAP diluted earnings per share, and HP’s non-GAAP tax rate 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
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 strategic acquisitions, repurchasing stock and other purposes.

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. Items such as amortization of purchased 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 loss in value is not included in non-GAAP operating profit, non-GAAP net earnings, non-GAAP diluted earnings per share and HP’s
non-GAAP tax rate and therefore does not reflect the full economic effect of the loss in value of those intangible assets. In addition,
items such as restructuring charges that are excluded from non-GAAP operating expense, non-GAAP operating profit, non-GAAP net
earnings, non-GAAP diluted earnings per share and HP’s non-GAAP tax rate can have a material impact on cash flows and earnings
per share. HP may not be able to liquidate the long-term investments included in gross cash immediately, which may limit the
usefulness of gross cash as a liquidity measure. In addition, free cash flow does not represent the total increase or decrease in the cash
balance 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 carefully those
reconciliations.

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 to evaluate the efficacy of the methodology and information used by management to
evaluate and measure such performance.

3 February 22, 2011 http://www.hp.com/investor/home
KEY MESSAGES
 Strong margins, earnings, and cash flow performance with 4% year over year revenue growth
 Expanded non-GAAP operating margins by 40 basis points year over year, excluding net impact from one-time gains primarily
related to real estate, driven by gross margin expansion of 150 basis points
 Continued to invest in growth in higher margin categories, while maintaining operational efficiency
 Non-GAAP diluted earnings per share grew 27% year over year
 Cash flow from operations of $3.1 billion, up 28% year over year

 Continued strength in commercial hardware across HP
 ESSN continued to win in the datacenter with Industry Standard Servers revenue up 17%, Storage up 14%, and Networking’s
switching and routing revenue up over 30% year over year
 IPG delivered another strong quarter with commercial printer units up 33% and commercial revenue up 13% year over year.
Expanded market leadership in both laser and ink, with solid momentum in our new e-Print platform and commercial print solutions
 PSG commercial PC client revenue up 11% year over year

 Executed well in a challenging consumer PC market with margin expansion and share gains
 Gained worldwide market share sequentially across all PC categories – consumer, commercial, notebook and desktop
 Increased PSG operating profit 27% year over year, delivering a 6.4% operating margin in Q1
 Opportunity in Services to drive growth with more higher value-added solutions
 Solid long term signings and operating margin expansion
 Opportunity to improve short-term signings with more higher value services and add-on projects

 Investing to lead in cloud and connectivity
 Launched several new Cloud solutions, leveraging HP’s converged infrastructure, enterprise-class security, and unique ability to
manage hybrid IT environments
 Generated excitement with WebOS product announcements, including HP’s new Touchpad tablet

4 February 22, 2011 http://www.hp.com/investor/home
Q1 FY11 RESULTS OVERVIEW
Financial – Net revenue of $32.3B, up 4% Y/Y in reported and constant currency
– Non-GAAP(1) diluted EPS of $1.36, up 27% Y/Y
Summary – GAAP diluted EPS of $1.17, up 26% Y/Y
– Cash flow from operations of $3.1B
– $2.3B in share repurchases and $175M in dividends

OP OP $ OP %
$ in millions Q1 Revenue Growth Y/Y% OP $ % of rev Y/Y Y/Y

Services $8,607 (2%) $1,375 16.0% ($4) 0.3 pts
Enterprise Servers, Storage
and Networking $5,634 22% $828 14.7% $221 1.5 pts

HP Software $697 5% $123 17.6% ($49) (8.3) pts

Enterprise Business $14,938 6% $2,326 15.6% $168 0.3 pts

Personal Systems Group $10,449 (1%) $672 6.4% $142 1.4 pts

Imaging and Printing Group $6,630 7% $1,129 17.0% $75 0.0 pts

HP Financial Services $827 15% $79 9.6% $12 0.3 pts
(1) (1) (1)
Total HP (2) $32,302 4% $4,006 12.4% $504 1.2 pts
(1)

1. All non-GAAP numbers have been adjusted to exclude certain items. A reconciliation of specific adjustments to GAAP results for this quarter and prior periods is included on slide
17 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.”
2. Includes Corporate Investments & Eliminations
5 February 22, 2011 http://www.hp.com/investor/home
Q1 FY11 REVENUE
By Segment By Region

U.S.
Imaging & 35%
Printing Group Services
21% 27% EMEA
Americas
38%,
44%, up 6% Y/Y
FLAT Y/Y
Enterprise Canada/
Personal Servers, Latin America
Systems Group Storage & 9%
32% Networking Asia Pacific
17% 18%,
up 7% Y/Y

HP Financial
Services & Other
HP Software 1%
2%
6 February 22, 2011 http://www.hp.com/investor/home
REVENUE & EPS PERFORMANCE

$36 $1.50

$1.40
$34
$1.30
$32
$1.20
$30
$1.10

$28 $1.00

$0.90
$26
$0.80
$24
$0.70
$22
$0.60

$20 $0.50

$0.40
$18
$0.30
$16
$0.20
$14
$0.10

$12 $0.00
1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
Revenue (in billions) $28.5 $28.3 $28.0 $33.6 $28.8 $27.4 $27.6 $30.8 $31.2 $30.8 $30.7 $33.3 $32.3
Non-GAAP EPS $0.86 $0.87 $0.86 $1.03 $0.93 $0.86 $0.92 $1.14 $1.07 $1.09 $1.08 $1.33 $1.36

7 February 22, 2011 http://www.hp.com/investor/home
REGIONAL REVENUE TRENDS
Americas United States
(including U.S.)
$16 20% $12 20%

$14 15% $10 15%

Y/Y revenue growth %
Y/Y revenue growth %
$ in billions

$ in billions
$12 10% $8 10%

$10 5% $6 5%

$8 0% $4 0%

$6 (5%) $2 (5%)
4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

EMEA $8
Asia Pacific 25%
$15 30%

Y/Y revenue growth %
$12 20%
Y/Y revenue growth %
$6 15%

$ in billions
$ in billions

$9 10%
$4 5%
$6 0%

$2 (5%)
$3 (10%)

$0 (20%) $0 (15%)
4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Y/Y revenue growth %
8 February 22, 2011 http://www.hp.com/investor/home Y/Y constant currency revenue growth %
REVENUE GROWTH

25%

(%)% 20%

15%
growth
growth

10%
revenue
revenue

5%
Y/Y

0%
Y/Y

(5%)

(10%)
1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Constant currency 8.2% 4.5% 4.7% 15.6% 4.2% 2.9% 4.0% -5.0% 5.4% 8.4% 10.6% 8.8% 4.3%
As reported 13.5% 10.7% 10.5% 18.8% 1.2% -3.1% -1.6% -8.4% 8.2% 12.7% 11.4% 8.1% 3.6%

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SERVICES
In billions Revenue In millions Operating profit

$10.0 $1,600 18%

$1,400 16%
$8.0
$1,200 14%

OP % revenue
$6.0 $1,000 12%

$800 10%
$4.0 $600 8%

$400 6%
$2.0
$200 4%

$0.0 $0 2%

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Q1 FY11 revenue by business
• Services revenue of $8.6B, down 2% Y/Y (down
8%
1% Y/Y excluding ExcellerateHRO divestiture)
ITO
Technology Services • Operating profit of $1.4B, 16.0% of revenue
19% Application Services • ITO revenue down 1% Y/Y
BPO
• Technology Services revenue down 1% Y/Y
• Application Services revenue down 3% Y/Y
43% • BPO revenue down 10% Y/Y (down 2% Y/Y,
30% excluding the ExcellerateHRO divestiture)
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ENTERPRISE SERVERS,STORAGE AND
NETWORKING (ESSN)
In billions Revenue In millions Operating profit

$6.0 $1,000 16%
$900 14%
$5.0 $800
12%
$700
$4.0

OP % revenue
$600
10%

$3.0 $500 8%
$400 6%
$2.0 $300
4%
$200
$1.0 2%
$100
$0 0%
$0.0
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Q1 FY11 revenue by business
• ESSN revenue of $5.6B, up 22% Y/Y
11%
• Operating profit of $828M, 14.7% of revenue
Industry Standard
Servers (ISS) • ISS revenue up 17% Y/Y
18% Business Critical • BCS revenue flat Y/Y
Systems (BCS)
Storage Works • Storage revenue up 14% Y/Y
Division (SWD) • Networking revenue up 183% Y/Y
HP Networking
(HPN) • ESS Blades revenue up 23% Y/Y
10% 61%

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HP SOFTWARE
In millions Revenue In millions Operating profit

$800 $300 35%

$250 30%
$600
$200 25%

OP %revenue
$400 $150 20%

$100 15%
$200
$50 10%

$0 $0 5%

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Q1 FY11 revenue by type
• Software revenue of $697M, up 5% Y/Y
16% 34% • Operating profit of $123M, 17.6% of revenue
Licenses
Support • Licenses revenue up 3% Y/Y
Services • Support revenue up 5% Y/Y
• Services revenue up 9% Y/Y

50%
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PERSONAL SYSTEMS GROUP (PSG)
In billions Revenue In millions Operating profit

$12.0 $700 7%

$10.0 $600 6%

$500 5%
$8.0

OP % revenue
$400 4%
$6.0
$300 3%
$4.0
$200 2%

$2.0 $100 1%

$0.0 $0 0%
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Q1 FY11 revenue by business
• PSG revenue of $10.4B, down 1% Y/Y

2% Notebooks • Operating profit of $672M, 6.4% of revenue
Desktops
• Total units up 5% Y/Y
5% Workstations
Other • Notebook revenue down 5%, units up 4% Y/Y
• Desktop & Workstation combined revenue up 5%,
units up 7% Y/Y
56% • Consumer client revenue down 12% Y/Y,
37%
Commercial client revenue up 11% Y/Y
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IMAGING & PRINTING GROUP (IPG)
In billions Revenue In millions Operating profit

$8.0 $1,300 22%

$6.0 $1,100 18%

OP % of revenue
$4.0 $900 14%

$2.0 $700 10%

$0.0 $500 6%

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Q1 FY11 revenue by business
• IPG revenue of $6.6B, up 7% Y/Y
12% • Operating profit of $1.1B, 17.0% of revenue
Supplies
Commercial • Supplies revenue up 7% Y/Y

Consumer • Total printer hardware units up 13% Y/Y,
22% Consumer printer hardware units up 7% Y/Y,
Commercial printer hardware units up 33% Y/Y
• Color LaserJet units up 20% Y/Y
• Printer-based MFP units up 63% Y/Y
66%
• Indigo digital press page volume up 26% Y/Y

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HP FINANCIAL SERVICES (HPFS)
In millions Revenue In millions Operating profit

$1,000 $90 12%

$75 10%
$800

$60 8%

OP %revenue
$600
$45 6%

$400
$30 4%

$200 $15 2%

$0 $0 0%

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Q1 FY11 revenue by region
• HPFS revenue of $827M, up 15% Y/Y
13%
Americas • Operating profit of $79M, 9.6% of revenue
EMEA • Financing volume up 10% Y/Y
Asia Pacific
• Net portfolio assets of $11.4B, up 14% Y/Y
29%

58%

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Non-GAAP FINANCIAL INFORMATION (1)

In millions except
per share amounts Q1 FY11 Q4 FY10 Q1FY10

Revenue $32,302 100% $33,278 100% $31,177 100%

Cost of sales 24,408 75.6% 24,995 75.1% 24,027 77.1%

Total OpEx 3,888(2) 12.0%(2) 4,278 12.9% 3,648 11.7%

Operating profit 4,006(2) 12.4%(2) 4,005 12.0% 3,502 11.2%

Interest & other, net (97)(2) (81) (199)

Pre-tax earnings 3,909(2) 12.1% 3,924 11.8% 3,303 10.6%

Income tax 879(2) 860 709

Net earnings 3,030(2) 9.4% 3,064 9.2% 2,594 8.3%

EPS $1.36(2) $1.33 $1.07

1. All non-GAAP numbers have been adjusted to exclude certain items. A reconciliation of specific adjustments to GAAP results for this quarter and prior periods is included on slide 17 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.”
2 At the time of HP’s Q4 FY10 earnings announcement, HP disclosed that in Q1 FY11 it expected to realize a one-time gain of approximately 4 cents per share primarily related to the
disposition of real estate. Included in HP’s Q1 FY11 results is a net one-time gain of 5 cents per share primarily related to the disposition of real estate, reflected as a one–time credit of
$250 million or 80 basis points to operating expense offset by an $80 million charge to OI&E and a higher effective tax rate.
16 February 22, 2011 http://www.hp.com/investor/home
Q1 FY11 GAAP to non-GAAP BRIDGE
Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $32,302 $32,302

Cost of sales 24,408 24,408

Total OpEx 4,500 (425) (158) (29) 3,888

Operating profit 3,394 425 158 29 4,006

Interest & other, net (97) (97)

Pre-tax earnings 3,297 425 158 29 3,909

Income tax 692 129 48 10 879

Tax rate 21.0% 22.5%

Net earnings 2,605 3,030

EPS $1.17 $1.36

17 February 22, 2011 http://www.hp.com/investor/home
GROSS CASH & NET CASH
In billions
$15.0

$10.0

$5.0

$0.0

($5.0)

($10.0)

($15.0)
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
(1)
Gross cash $11.3 $13.0 $13.7 $13.4 $13.7 $14.3 $14.8 $11.0 $10.0

Net cash (2) ($8.7) ($5.3) ($3.2) ($2.1) ($1.8) ($3.0) ($4.7) ($10.6) ($9.9)
(3)
Net cash excl. HPFS Debt ($1.8) $1.8 $4.3 $6.0 $6.6 $5.6 $4.0 ($1.5) ($0.4)
1. Includes cash and cash equivalents, short-term investments, and certain liquid long-term investments
2. Net cash is defined as gross cash less total company debt including the effect of hedging
3. Net cash excl HPFS debt = HP net cash plus HPFS net debt

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CASH FLOW
In billions
$16.0
$14.6

$14.0 $13.4

$11.9
$12.0
$12.0

$10.2
$9.6
$10.0
$8.4

$8.0 $7.1

$6.0

$4.0
$3.1
$2.7

$2.0

$0.0
FY07 FY08 FY09 FY10 FY11 YTD

(1)
Cash flow from operations Free cash flow
1. Free cash flow = cash flow from operations less net capital expenditures
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STOCK REPURCHASE

Quarterly trends FY07 – FY11
In billions In billions In millions
$4.0 $12 300
$8.6B remaining in stock
repurchase authorization
$3.5
at the end of Q1 FY11 $10 250

$3.0
$8 200

$2.5

$6 150
$2.0

$4 100
$1.5

$1.0 $2 50

$0.5
$0 0
(1) FY11
FY07 FY08 FY09 FY10
YTD
$0.0
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 Stock repurchase $11.5 $9.6 $5.1 $11.0 $2.3

Stock repurchase $1.2 $0.8 $1.0 $2.1 $2.7 $1.8 $2.6 $4.0 $2.3 Shares received 271 216 132 240 54

1. In Q1 FY06, HP entered into a prepaid variable share purchase program. $1.7 billion in cash was used in Q1 FY06 to fully
fund this plan. See our Form 10-Q for the period ended January 31, 2006 for more information. HP completed all
repurchases under this plan in March 2007 and received a total of 53M shares.
20 February 22, 2011 http://www.hp.com/investor/home
FY09 & FY10 reclassification
FY09 FY10
Revised Previously Revised Previously
In millions Amount Reported Variance Amount Reported Variance

Revenue $114,552 $114,552 $- $126,033 $126,033 $-

Cost of Sales 87,489 87,524 (35) 95,956 96,089 (133)

R&D 2,819 2,819 - 2,959 2,959 -

SG&A 11,648 11,613 35 12,718 12,585 133

Amortization of
purchased 1,578 1,578 - 1,484 1,484 -
intangibles

Restructuring
640 640 - 1,144 1,144 -
charges

Acquisition
242 242 - 293 293 -
related charges

Total cost 104,416 104,416 - 114,554 114,554 -

Earnings from
10,136 10,136 - 11,479 11,479 -
operations

Interest and other,
(721) (721) - (505) (505) -
net

Earnings before
9,415 9,415 - 10,974 10,974 -
tax

Provision for taxes 1,755 1,755 - 2,213 2,213 -

Net earnings $7,660 $7,660 $- $8,761 $8,761 $-
In connection with organizational realignments implemented in the first quarter of fiscal 2011, certain costs previously reported as Cost of Sales have been reclassified as
Selling, General and Administrative expenses to better align those costs with the functional areas that benefit from those expenditures.
21 February 22, 2011 http://www.hp.com/investor/home
FY11 Inter-segment reclassification
FY09 FY10
Revised Previously Revised Previously
In millions Segment Amount Reported Variance Segment Amount Reported Variance

Net Revenue Services $35,380 $34,693 $687 Services $35,529 $34,935 $594

ESSN 16,121 15,359 762 ESSN 20,356 18,651 1,705
HP HP
2,655 3,572 (917) 2,729 3,586 (857)
Software Software
Corporate Corporate
191 768 (577) 346 1,863 (1,517)
Investments Investments
Eliminations Eliminations
(1,784) (1,829) 45 (2,479) (2,554) 75
& other & other
Total 52,563 52,563 - Total 56,481 56,481 -
Operating
Services 5,102 5,044 58 Services 5,661 5,609 52
Profit

ESSN 1,657 1,518 139 ESSN 2,825 2,402 423
HP HP
731 684 47 782 759 23
Software Software
Corporate Corporate
(300) (56) (244) (366) 132 (498)
Investments Investments
Total $7,190 $7,190 $- Total $8,902 $8,902 $-
HP has reflected fiscal 2011 organizational realignments on a backward-looking basis to provide improved visibility and comparability.
22 February 22, 2011 http://www.hp.com/investor/home
FY11 Intra-segment reclassification
FY09 FY10
Revised Previously Revised Previously
In millions Segment Amount Reported Variance Segment Amount Reported Variance

Net Revenue ITO $14,563 $15,554 ($991) ITO $14,942 $15,963 ($1,021)

TS 10,665 9,719 946 TS 10,627 9,681 946

Application Application
6,926 6,194 732 6,792 6,123 669
Services Services

HP HP
762 - 762 1,705 - 1,705
Networking Networking

BTO - 2,385 (2,385) BTO - 2,440 (2,440)
Other Other
- 1,187 (1,187) - 1,146 (1,146)
Software Software

HP Software 2,655 - 2,655 HP Software 2,729 - 2,729

Notebooks 20,223 20,210 13 Notebooks 22,602 22,545 57
Desktops 12,892 12,864 28 Desktops 15,519 15,478 41

Handhelds - 172 (172) Handhelds - 87 (87)

Other PSG 929 798 131 Other PSG 834 845 (11)

Corp Corp
191 768 (577) 346 1,863 (1,517)
Investments Investments

Eliminations Eliminations
(1,784) (1,829) 45 (2,479) (2,554) 75
& other & other

Total $68,022 $68,022 $- Total $73,617 $73,617 $-

HP has reflected fiscal 2011 organizational realignments on a backward-looking basis to provide improved visibility and comparability.
23 February 22, 2011 http://www.hp.com/investor/home
OUTLOOK
Q2 FY11 guidance

Revenue $31.4B – $31.6B

GAAP EPS $0.99 - $1.01

Non-GAAP EPS(1) $1.19– $1.21

Full year FY11 guidance

Revenue $130.0B - $131.5B

GAAP EPS $4.46 – $4.54

Non-GAAP EPS(2) $5.20 – $5.28

1. Q2 FY11 non-GAAP diluted earnings per share estimates exclude after-tax costs of approximately $0.20 per share, related primarily to the amortization of purchased
intangible assets, restructuring charges and acquisition-related charges.
2. Full year FY11 non-GAAP diluted earnings per share estimates exclude after-tax costs of approximately $0.74 per share, related primarily to the amortization of
purchased intangible assets, restructuring charges and acquisition-related charges.

24 February 22, 2011 http://www.hp.com/investor/home
SUPPLEMENTAL
SLIDES

February 22, 2011 http://www.hp.com/investor/home
INVENTORY & ACCOUNTS RECEIVABLE

Inventory Accounts receivable
In billions In billions
$9.0 11.0% $20.0 20.0%
$18.5
$18.0 18.0%
$16.5 $16.6
$8.0 $7.6 10.0%
$15.6
$7.2 $16.0 $14.8 16.0%
$14.8 $14.7 $14.7 $14.5
$7.0 $6.6 $6.7 9.0% $14.0 14.0%
$6.4 $6.5
$6.1
$5.9 $12.0 12.0%
$6.0 $5.7 8.0%

$10.0 10.0%

$5.0 7.0%
$8.0 8.0%

$4.0 6.0% $6.0 6.0%

$4.0 4.0%
$3.0 5.0%
$2.0 2.0%

$2.0 4.0% $0.0 0.0%
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Invent ory $7.6 $5.7 $5.9 $6.1 $6.6 $6.4 $7.2 $6.5 $6.7 Receivables $14.8 $14.7 $14.7 $16.5 $14.5 $14.8 $15.6 $18.5 $16.6

% of Rev 6.4% 4.9% 5.0% 5.3% 5.7% 5.4% 5.8% 5.1% 5.3% % of Rev 12.4% 12.4% 12.6% 14.4% 12.4% 12.3% 12.6% 14.7% 13.0%

26 February 22, 2011 http://www.hp.com/investor/home
PP&E & ACCOUNTS PAYABLE

Net PP&E Accounts payable
In billions In billions
$14.8 $14.9
$13.0 12% $15.0
$14.4

$11.8
$13.6 $13.5
$11.6 $13.4
$11.5
$11.2 $11.3 $11.2 $11.2 $12.8
$13.0
$11.0 $10.8 $10.8 10%
$11.8
$11.4

$11.0

$9.0 8%

$9.0

$7.0 6%

$7.0

$5.0 4%
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
$5.0
PP&E $10.8 $10.8 $11.2 $11.3 $11.2 $11.2 $11.5 $11.8 $11.6 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
% of Rev 9.1% 9.2% 9.5% 9.8% 9.5% 9.3% 9.3% 9.3% 9.1% Payables $11.8 $11.4 $12.8 $14.8 $13.6 $13.4 $14.9 $14.4 $13.5

27 February 22, 2011 http://www.hp.com/investor/home
WORKING CAPITAL METRICS

Days

60

50

40

30

20
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11

Days receivables 46 48 48 48 42 43 46 50 46
Days inventory 31 25 25 23 25 25 28 23 25
Days payable 48 49 55 57 51 51 57 52 50

28 February 22, 2011 http://www.hp.com/investor/home
HPFS SUPPLEMENTAL DATA

In millions
Q1 FY11 Q1 FY10 Q4 FY10

Depreciation (1) $404 $330 $376

Net capital expenditures (1) $465 $409 $539

Sequential increase (decrease) in net
financing receivables
$145 $129 $433

1. Depreciation and net capital expenditures are shown net of inter-company eliminations.

29 February 22, 2011 http://www.hp.com/investor/home
FY10 GAAP to non-GAAP BRIDGE

Amort. of Acquisition
In millions except Purchased related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $126,033 $126,033

Cost of sales 95,956 95,956

Total OpEx 18,598 (1,484) (1,144) (293) 15,677
Operating profit 11,479 1,484 1,144 293 14,400
Interest & other, net (505) (505)

Pre-tax earnings 10,974 1,484 1,144 293 13,895

Income tax 2,213 391 342 83 3,029

Tax rate 20.2% 21.8%

Net earnings 8,761 10,866

EPS $3.69 $4.58

30 February 22, 2011 http://www.hp.com/investor/home
Q4 FY10 GAAP to non-GAAP BRIDGE
Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $33,278 $33,278

Cost of sales 24,995 24,995

Total OpEx 4,988 (424) (235) (51) 4,278

Operating profit 3,295 424 235 51 4,005

Interest & other, net (81) (81)

Pre-tax earnings 3,214 424 235 51 3,924

Income tax 676 98 68 18 860

Tax rate 21.0% 21.9%

Net earnings 2,538 3,064

EPS $1.10 $1.33

31 February 22, 2011 http://www.hp.com/investor/home
Q3 FY10 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $30,729 $30,729

Cost of sales 23,365 23,365

Total OpEx 5,041 (383) (598) (127) 3,933

Operating profit 2,323 383 598 127 3,431

Interest & other, net (134) (134)

Pre-tax earnings 2,189 383 598 127 3,297

Income tax 416 100 175 31 722

Tax rate 19.0% 21.9%

Net earnings 1,773 2,575

EPS $0.75 $1.08

32 February 22, 2011 http://www.hp.com/investor/home
Q2 FY10 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $30,849 $30,849

Cost of sales 23,569 23,569

Total OpEx 4,422 (347) (180) (77) 3,818

Operating profit 2,858 347 180 77 3,462

Interest & other, net (91) (91)

Pre-tax earnings 2,767 347 180 77 3,371

Income tax 567 92 57 22 738

Tax rate 20.5% 21.9%

Net earnings 2,200 2,633

EPS $0.91 $1.09

33 February 22, 2011 http://www.hp.com/investor/home
Q1 FY10 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $31,177 $31,177

Cost of sales 24,027 24,027

Total OpEx 4,147 (330) (131) (38) 3,648

Operating profit 3,003 330 131 38 3,502
Interest & other, net (199) (199)

Pre-tax earnings 2,804 330 131 38 3,303

Income tax 554 101 42 12 709

Tax rate 19.8% 21.5%

Net earnings 2,250 2,594

EPS $0.93 $1.07

34 February 22, 2011 http://www.hp.com/investor/home
FY09 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $114,552 $114,552

Cost of sales 87,489 87,489

Total OpEx 16,927 (1,578) (640) (242) 14,467
Operating profit 10,136 1,578 640 242 12,596
Interest & other, net (721) (721)

Pre-tax earnings 9,415 1,578 640 242 11,875

Income tax 1,755 451 197 79 2,482

Tax rate 18.6% 20.9%

Net earnings 7,660 9,393

EPS $3.14 $3.85

35 February 22, 2011 http://www.hp.com/investor/home
Q4 FY09 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $30,777 $30,777

Cost of sales 23,466 23,466

Total OpEx 4,178 (401) (38) (60) 3,679

Operating profit 3,133 401 38 60 3,632
Interest & other, net (132) (132)

Pre-tax earnings 3,001 401 38 60 3,500

Income tax 589 117 11 19 736

Tax rate 19.6% 21.0%

Net earnings 2,412 2,764

EPS $0.99 $1.14

36 February 22, 2010 http://www.hp.com/investor/home
Q3 FY09 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $27,585 $27,585

Cost of sales 21,022 21,022

Total OpEx 4,350 (379) (362) (59) 3,550

Operating profit 2,213 379 362 59 3,013
Interest & other, net (177) (177)

Pre-tax earnings 2,036 379 362 59 2,836

Income tax 365 105 108 19 597

Tax rate 17.9% 21.1%

Net earnings 1,671 2,239

EPS $0.69 $0.92

37 February 22, 2011 http://www.hp.com/investor/home
Q2 FY09 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $27,383 $27,383

Cost of sales 20,937 20,937

Total OpEx 4,153 (380) (94) (75) 3,604

Operating profit 2,293 380 94 75 2,842
Interest & other, net (180) (180)

Pre-tax earnings 2,113 380 94 75 2,662

Income tax 392 112 31 24 559

Tax rate 18.6% 21.0%

Net earnings 1,721 2,103

EPS $0.71 $0.86

38 February 22, 2011 http://www.hp.com/investor/home
Q1 FY09 GAAP to non-GAAP BRIDGE

In millions except Amort. of Acquisition related
per share amounts GAAP Purchased Intangibles Restructuring charges Non-GAAP

Revenue $28,807 $28,807

Cost of sales 22,064 22,064

Total OpEx 4,246 (418) (146) (48) 3,634

Operating profit 2,497 418 146 48 3,109
Interest & other, net (232) (232)

Pre-tax earnings 2,265 418 146 48 2,877

Income tax 409 117 47 17 590

Tax rate 18.1% 20.5%

Net earnings 1,856 2,287

EPS $0.75 $0.93

39 February 22, 2011 http://www.hp.com/investor/home
FY08 GAAP to non-GAAP BRIDGE

In millions except Amort. of Acquisition related
per share amounts GAAP Purchased Intangibles Restructuring charges Non-GAAP

Revenue $118,364 $118,364

Cost of sales 89,699 89,699

Total OpEx 18,192 (1,012) (270) (41) 16,869

Operating profit 10,473 1,012 270 41 11,796
Interest & other, net - -

Pre-tax earnings 10,473 1,012 270 41 11,796

Income tax 2,144 262 74 14 2,494

Tax rate 20.5% 21.1%

Net earnings 8,329 9,302

EPS $3.25 $3.62

40 February 22, 2011 http://www.hp.com/investor/home
Q4 FY08 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased Acquisition related
per share amounts GAAP Intangibles Restructuring charges Non-GAAP

Revenue $33,603 $33,603

Cost of sales 25,853 25,853

Total OpEx 5,009 (369) (251) (41) 4,348

Operating profit 2,741 369 251 41 3,402
Interest & other, net (98) (98)

Pre-tax earnings 2,643 369 251 41 3,304

Income tax 531 96 69 14 710

Tax rate 20.1% 21.5%

Net earnings 2,112 2,594

EPS $0.84 $1.03

41 February 22, 2011 http://www.hp.com/investor/home
Q3 FY08 GAAP to non-GAAP BRIDGE

In millions except Amort. of
per share amounts GAAP Purchased Intangibles Restructuring Non-GAAP

Revenue $28,032 $28,032

Cost of sales 21,197 21,197

Total OpEx 4,306 (213) (5) 4,088

Operating profit 2,529 213 5 2,747
Interest & other, net 23 23

Pre-tax earnings 2,552 213 5 2,770

Income tax 525 56 1 582

Tax rate 20.6% 21.0%

Net earnings 2,027 2,188
EPS $0.80 $0.86

42 February 22, 2011 http://www.hp.com/investor/home
Q2 FY08 GAAP to non-GAAP BRIDGE

In millions except Amort. of
per share amounts GAAP Purchased Intangibles Restructuring Non-GAAP

Revenue $28,262 $28,262

Cost of sales 21,205 21,205

Total OpEx 4,467 (224) (4) 4,239

Operating profit 2,590 224 4 2,818
Interest & other, net 3 3

Pre-tax earnings 2,593 224 4 2,821

Income tax 536 55 1 592

Tax rate 20.7% 21.0%

Net earnings 2,057 2,229
EPS $0.80 $0.87

43 February 22, 2011 http://www.hp.com/investor/home
Q1 FY08 GAAP to non-GAAP BRIDGE

Amort. of
In millions except Purchased
per share amounts GAAP Intangibles Restructuring Non-GAAP

Revenue $28,467 $28,467
Cost of sales 21,444 21,444

Total OpEx 4,410 (206) (10) 4,194

Operating profit 2,613 206 10 2,829
Interest & other, net 72 72

Pre-tax earnings 2,685 206 10 2,901
Income tax 552 55 3 610
Tax rate 20.6% 21.0%
Net earnings 2,133 2,291
EPS $0.80 $0.86

44 February 22, 2011 http://www.hp.com/investor/home
February 22, 2011 http://www.hp.com/investor/home