If you’ve been following the 3D printing industry at all this year, you likely already known about the grandiose plan that the tech giant HP Inc. has to become a leader in the emerging industry. Excitement was abounding this past week at the Frankfurt-based formnext 2016 exhibition as HP finally showed off several of their 3D printing systems to the public. Additionally, the recent news that the Multi Jet Fusion 3D Printer was on its way to the Belgium-based Materialise factory seemed like a step in the right direction for the tech titan.
In fact, HP has been making some major moves throughout the year, recently acquiring Samsung Electronics’ printing business for $1.05 billion dollars, as well as the German 3D scanning company David Vision Systems GmbH and David 3D Solutions prior to that. Although their well-recognized name has made headlines across tech-based media throughout the year, not all of the news is good news for HP. Back in October, HP began restructuring and cut up to 4,000 jobs as they refocused their attention on the 3D printing market. Now, HP Inc has just released their full year financial results for 2016, and they don’t look very bright.
HP’s 3D printing ecosystem at formnext 2016
The biggest caveat of HP’s financial report was their faltering earnings, which fell 63% to $492 million, a major drop from the $1.3 billion they had during this time last year. In addition, their annual profits were down $2.5 billion from the $4.6 billion they posted in 2015. As for total revenue, HP Inc received $12.5 billion during the past quarter, up 2% from this time last year. For the entire fiscal year, however, the company reported net revenue of $48.2 billion, down slightly at 6%. Things get a bit murkier when you focus in on HP’s printing department, which showed annual revenue down 14% to $18.3 billion, impacted most by the 12% drop in their supplies market.
Although their financial numbers aren’t exactly stellar, they aren’t very unexpected either. In their ambitious attempt to revive their printing sector through entering the 3D printing market, HP has knowingly restructured and reinvested in their printing and PC sectors, which they consider to be their core businesses. With their first line of 3D printing ecosystems set to be delivered by the end of the year, HP feels confident that they are on the right track despite their lackluster fiscal year.
“We delivered on our full year financial commitments and executed well on our strategy to protect our core, drive growth and invest in our future all while taking cost out of the business,” said Dion Weisler, HP Inc.’s president and CEO, in a statement. “As we’ve proved quarter over quarter, we are confident in our abilities to execute and deliver, while making business decisions focused on the long-term success for the company.”
Other promising changes made by HP Inc include their new way of working with resellers. Instead of the previously used “push model’ to get new products out, they’re aiming to cut costs by utilizing the “pull model’, which allows resellers to restock their products as they sell them. All in all, the negative aspects of HP’s fiscal year can likely be attributed to the heavy amount of restructuring that the company has undergone. In order to get a clearer idea of how HP will fare in light of their entrance into the 3D printing industry, it’s probably best to wait on their financial results from 2017. Discuss in the HP Financials forum at 3DPB.com.
