Multinational printing firm HP (HPQ) has reported a 9% rise in revenue within its Q1 2022 financials, thanks in part to a growing demand for its 3D printing offering.
HP’s Q1 2022 results show that in the three months leading up to January 31, 2022, it generated $17 billion, 9% more than the $15.6 billion it brought in during Q1 2021. According to the firm’s CEO Enrique Lores, this incremental revenue rise was down to the strong performance of its gaming, industrial graphics and 3D printing portfolio, the latter of which delivered “significant year-over-year growth.”
“We once again delivered strong top and bottom-line results with record revenue driven by strong demand and our leadership in hybrid,” said Lores on HP’s earnings call. “Our Q1 performance was particularly strong across our key growth areas that collectively grew double digits, including gaming, peripherals, workforce solutions, consumer subscriptions, industrial graphics and 3D.”
HP’s Q1 2022 financial results
Generally speaking, HP reports its financials across two key segments: Personal Systems and Printing, with the former including any revenue generated by its workstations, notebook and desktop systems, and the latter covering income gained from its supplies business, in addition to that brought in by either its consumer or commercial hardware offerings.
As usual, Personal Systems was HP’s highest earning and fastest growing division in Q1 2022, bringing in $12.2 billion, which is 15% more than the $10.6 billion it managed to generate in Q1 2021. On the firm’s earnings call, Lores attributed this success, which saw the segment break its revenue record, to a pricing strategy and disciplined execution that enabled it to manage part and cost headwinds.
By contrast, HP’s Printing arm, which according to its Q1 2022 slide deck also covers its ‘3D Printing and digital manufacturing’ portfolio, actually brought in $200 million less than it did in Q1 2021. For this decline, Lores highlighted “industry-wide supply chain challenges,” though he added that this didn’t stop its 3D printing revenue from growing over the same period, nor did it derail the HP’s “strategy of creating high-value end-to-end applications” for its Multi Jet Fusion (MJF) platform.
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Identifying new MJF applications
HP doesn’t report directly on its 3D printing financials, but it has disclosed that its MJF machines have now produced more than 120 million parts, and there’s evidence to suggest where at least some of these are finding new applications.
At the end of Q1 2022, grocery delivery firm Ocado revealed that it had begun 3D printing pick-and-pack robot parts, for deployment at some of its fulfillment centers. By MJF additive manufacturing half the components of its new 600 Series bots, the company anticipates being able to make them lighter, cheaper to manufacture, and more efficient, in a way that could yield operational savings.
During the quarter, HP also unveiled a partnership with L’Oréal, which has seen the firms collaborate with the aim of exploring entirely new cosmetic-related applications. One way the companies have achieved this is by developing custom adjustable pucks, which since their introduction, have allowed L’Oréal to more flexibly transfer, fill and label products while reaping considerable lead time gains.
Following the success of their initial work together, the companies are said to have continued to seek out further potential MJF applications within L’Oréal’s production workflow and came up with new printing textures as well as lattice packaging, innovations they developed alongside the Alternative and Atomic Energies Commission.
Since then, HP has opted to delve even deeper into the world of product wrapping, by acquiring Choose Packaging, a specialist in paper-based bottles, in February 2022. At the time, HP said that buying and integrating the firm into its Personalization & 3D Printing division, which already houses its Molded Fiber Tooling offering, would allow it to address the wider packaging market, and on its Q1 2022 earnings call, Lores emphasized the deal’s eco-friendly potential moving forwards.
“Choose [Packaging] has invented the world’s only commercially available zero-plastic paper bottle, and they are working with many global brands to commercialize their offerings, including large enterprises like Henkel,” added Lores on the firm’s earnings call. “This acquisition complements our molded fiber solution and positions HP well in the $10 billion fiber-based sustainable packaging industry.”
“There are more than 150 million tons of single-use plastics produced each year, and we intend to disrupt this market with fiber-based 100% plastic-free packaging.”
HP “in compliance” with US sanctions
Lores also took HP’s earnings call as an opportunity to announce that the company would be ‘complying’ with the US administration’s recently-approved sanctions. As a result, the firm has suspended shipments to Russia, and called for “peace and stability to be restored to the region,” citing the current well-being of its people, their families, and its customers and partners as being its “top concern.”
Due to the sanctions that have been imposed on Russia, the highly fluid nature of the way events are unfolding in Ukraine, and wider supply chain issues, Lores added that it’s difficult to provide guidance on the year ahead and it’s “modeling multiple scenarios,” but the former is now likely to impact upon its revenue prospects.
“In Q2, we expect a negative impact to our top line and bottom line as a result of the sanctions that have been imposed,” explained Lores on the call. “In total, net of mitigations, we have factored in a $0.02 to $0.03 EPS headwind into our Q2 guidance. For the second half of 2022, the broad ramifications of the situation in Europe and beyond are uncertain and we are monitoring this closely.”
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Featured image shows a cluster of HP Jet Fusion 5210 3D printers. Image via Weerg.