What changed in this filing

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Item 1. Financial Statements

2022-09-02 compared with 2022-06-03 · 186 added, 163 removed, 931 unchanged (27% of the section changed)

Financial Statements and Supplementary Data.

Consolidated Condensed Statements of Earnings for the three and six months ended April 3 0 , 2022 and 2021 (Unaudited)

Consolidated Condensed Statements of Comprehensive Income for the three and six months ended April 3 0 , 2022 and 2021 (Unaudited)

Consolidated Condensed Balance Sheets as of April 3 0 , 2022 and October 31, 2021 (Unaudited)

Consolidated Condensed Statements of Cash Flows for the six months ended April 3 0 , 2022 and 2021 (Unaudited)

Consolidated Condensed Statements of Earnings for the three and nine months ended July 3 1 , 2022 and 2021 (Unaudited)

Consolidated Condensed Statements of Comprehensive Income for the three and nine months ended July 3 1 , 2022 and 2021 (Unaudited)

Consolidated Condensed Balance Sheets as of July 3 1 , 2022 and October 31, 2021 (Unaudited)

Consolidated Condensed Statements of Cash Flows for the nine months ended July 3 1 , 2022 and 2021 (Unaudited)

Consolidated Condensed Statements of Stockholders’ Deficit (Unaudited)

11 unchanged sentences

Guarantees, Indemnifications and Warranties

Subsequent Events

AND SUBSIDIARIES

Consolidated Condensed Statements of Earnings

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

8 unchanged sentences

Amortization of intangible assets 50 42 154 103

Russia exit charges 23 — 23 —

Total costs and expenses 13,392 13,908 44,273 42,748

13 unchanged sentences

Consolidated Condensed Statements of Comprehensive Income

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

Net earnings $ 1,119 $ 1,108 $ 3,205 $ 3,404

Other comprehensive income (loss) before taxes:

Other comprehensive (loss) income before taxes:

Change in unrealized components of available-for-sale debt securities:

Unrealized (loss) gains arising during the period ( 4 ) — ( 6 ) 4

Unrealized (losses) gains arising during the period ( 1 ) 1 ( 7 ) 5

Change in unrealized components of cash flow hedges:

3 unchanged sentences

Change in unrealized components of defined benefit plans:

Gains arising during the period 1 42 22 41

Gains (losses) arising during the period 10 ( 1 ) 32 40

Amortization of actuarial loss and prior service benefit 5 20 16 62

1 unchanged sentence

Change in cumulative translation adjustment ( 14 ) 2 ( 56 ) 35

Other comprehensive income (loss) before taxes 453 194 723 ( 68 )

Other comprehensive (loss) income before taxes ( 48 ) 219 675 151

Provision for taxes ( 62 ) ( 32 ) ( 178 ) ( 41 )

Other comprehensive income (loss), net of taxes 363 153 607 ( 77 )

Other comprehensive (loss) income, net of taxes ( 110 ) 187 497 110

Comprehensive income $ 1,009 $ 1,295 $ 3,702 $ 3,514

2 unchanged sentences

Consolidated Condensed Balance Sheets

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

In millions, except par value

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Common stock, $ 0.01 par value ( 9,600 shares authorized;

1,033 and 1,092 shares issued and outstanding at April 30, 2022 and October 31, 2021, respectively)

1,006 and 1,092 shares issued and outstanding at July 31, 2022 and October 31, 2021, respectively)

Additional paid-in capital 1,130 1,060

6 unchanged sentences

Consolidated Condensed Statements of Cash Flows

Six months ended April 30

Nine months ended July 31

Cash flows from operating activities:

43 unchanged sentences

In millions, except number of shares in thousands

Balance January 31, 2021 1,252,532 $ 13 $ 984 $ ( 2,759 ) $ ( 1,473 ) $ ( 3,235 )

Balance April 30, 2021 1,201,255 $ 12 $ 1,018 $ ( 3,070 ) $ ( 1,320 ) $ ( 3,360 )

Net earnings 1,108 1,108

3 unchanged sentences

Repurchases of common stock (Note 10) ( 49,704 ) — ( 44 ) ( 1,456 ) ( 1,500 )

Cash dividends 7 7

Cash dividends ($$ 0.39 per common share)

( 453 ) ( 453 )

Stock-based compensation expense 69 69

Balance July 31, 2021 1,152,519 $ 12 $ 1,050 $ ( 3,871 ) $ ( 1,133 ) $ ( 3,942 )

Balance April 30, 2022 1,033,392 $ 10 $ 1,081 $ ( 3,336 ) $ 347 $ ( 1,898 )

Balance January 31, 2022 1,059,900 $ 11 $ 1,046 $ ( 3,369 ) $ ( 16 ) $ ( 2,328 )

Net earnings 1,119 1,119

Other comprehensive income, net of taxes 363 363

Other comprehensive loss, net of taxes ( 110 ) ( 110 )

Comprehensive income 1,009

1 unchanged sentence

Repurchases of common stock (Note 10) ( 28,522 ) ( 30 ) ( 971 ) ( 1,001 )

Cash dividends 3 3

Cash dividends ($$ 0.50 per common share)

( 507 ) ( 507 )

Stock-based compensation expense 70 70

Balance April 30, 2022 1,033,392 $ 10 $ 1,081 $ ( 3,336 ) $ 347 $ ( 1,898 )

Balance July 31, 2022 1,005,938 $ 10 $ 1,130 $ ( 3,695 ) $ 237 $ ( 2,318 )

Common Stock Additional

5 unchanged sentences

Net earnings 3,404 3,404

Other comprehensive loss, net of taxes ( 77 ) ( 77 )

Other comprehensive income, net of taxes 110 110

Comprehensive income 3,514

4 unchanged sentences

Stock-based compensation expense 260 260

Balance April 30, 2021 1,201,255 $ 12 $ 1,018 $ ( 3,070 ) $ ( 1,320 ) $ ( 3,360 )

Balance July 31, 2021 1,152,519 $ 12 $ 1,050 $ ( 3,871 ) $ ( 1,133 ) $ ( 3,942 )

Balance October 31, 2021 1,092,205 $ 11 $ 1,060 $ ( 2,461 ) $ ( 260 ) $ ( 1,650 )

7 unchanged sentences

Stock-based compensation expense 273 273

Balance April 30, 2022 1,033,392 $ 10 $ 1,081 $ ( 3,336 ) $ 347 $ ( 1,898 )

Balance July 31, 2022 1,005,938 $ 10 $ 1,130 $ ( 3,695 ) $ 237 $ ( 2,318 )

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

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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, 2021 in the Annual Report on Form 10-K, filed on December 9, 2021.

This interim information should be read in conjunction with the Consolidated Financial Statements for the fiscal year ended October 31, 2021 in HP’s Annual Report on Form 10-K, filed on December 9, 2021.

The Consolidated Condensed Balance Sheet for October 31, 2021 was derived from audited financial statements.

6 unchanged sentences

Actual results may differ materially from those estimates.

As of April 30, 2022, the extent to which the COVID-19 pandemic will impact our business going forward depends on numerous dynamic factors which we cannot reliably predict.

As of July 31, 2022, the extent to which the COVID-19 pandemic and current macroeconomic factors will impact our business going forward depends on numerous dynamic factors which we cannot reliably predict.

As a result, many of our estimates and assumptions required increased judgment and may carry a higher degree of variability and volatility.

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

• Commercial consists of office printing solutions, graphics solutions and 3D printing & digital manufacturing, excluding supplies;

• Commercial consists of office printing solutions, graphics solutions and 3D printing and digital manufacturing, excluding supplies;

• Consumer consists of home printing solutions, excluding supplies;

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

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

Corporate Investments includes HP Labs and certain business incubation and investment projects.

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HP does not allocate certain operating expenses, which it manages at the corporate level, to its segments.

These unallocated amounts include certain corporate governance costs and infrastructure investments, stock-based compensation expense, restructuring and other charges, acquisition-related charges and amortization of intangible assets.

These unallocated amounts include expenses such as certain corporate governance costs and infrastructure investments, stock-based compensation expense, restructuring and other charges, acquisition-related charges, amortization of intangible assets and Russia exit charges.

AND SUBSIDIARIES

2 unchanged sentences

Segment Operating Results from Operations and the reconciliation to HP consolidated results were as follows:

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

22 unchanged sentences

Amortization of intangible assets ( 50 ) ( 42 ) ( 154 ) ( 103 )

Russia exit charges ( 23 ) — ( 23 ) —

Interest and other, net ( 70 ) ( 55 ) ( 141 ) ( 106 )

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Summary of Restructuring Plans

HP’s restructuring activities for the six months ended April 30, 2022 and 2021 summarized by plan were as follows:

HP’s restructuring activities for the nine months ended July 31, 2022 and 2021 summarized by plan were as follows:

Fiscal 2020 Plan

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Non-cash and other adjustments — ( 36 ) — ( 36 )

Accrued balance as of April 30, 2022 $ 47 $ — $ — $ 47

Total costs incurred to date as of April 30, 2022 $ 694 $ 105 $ 507 $ 1,306

Accrued balance as of July 31, 2022 $ 20 $ — $ — $ 20

Total costs incurred to date as of July 31, 2022 $ 698 $ 110 $ 504 $ 1,312

Reflected in Consolidated Condensed Balance Sheets

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Non-cash and other adjustments ( 1 ) ( 31 ) — ( 32 )

Accrued balance as of April 30, 2021 $ 100 $ — $ 2 $ 102

HP’s restructuring charges for the three months ended April 30, 2022 summarized by the plans outlined below were as follows:

Accrued balance as of July 31, 2021 $ 86 $ — $ — $ 86

HP’s restructuring charges for the three months ended July 31, 2022 summarized by the plans outlined below were as follows:

Fiscal 2020 Plan

Severance and EER Non-labor Total

For the three months ended April 30, 2022 $ 32 $ 46 $ 78

Severance and EER Non-labor Other prior-year plan Total

For the three months ended July 31, 2022 $ 4 $ 5 $ ( 3 ) $ 6

Fiscal 2020 Plan

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These costs primarily relate to third-party professional services and other non-recurring costs.

For the three and six months ended April 30, 2022, HP incurred $ 4 million and $ 5 million of other charges, respectively.

For the three and six months ended April 30, 2021, HP incurred $ 5 million and $ 9 million of other charges, respectively.

For the three and nine months ended July 31, 2022, HP incurred $ 7 million and $ 12 million of other charges, respectively.

For the three and nine months ended July 31, 2021, HP incurred $ 8 million and $ 17 million of other charges, respectively.

AND SUBSIDIARIES

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The components of HP’s pension and post-retirement benefit (credit) cost recognized in the Consolidated Condensed Statements of Earnings were as follows:

Three months ended April 30

Three months ended July 31

Defined Benefit Plans Non-U.S.

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Prior service cost (credit) — — 1 ( 1 ) ( 2 ) ( 2 )

Net periodic benefit (credit) cost ( 30 ) ( 37 ) 17 20 ( 5 ) ( 9 )

Settlement gain — — ( 1 ) — — —

Total periodic benefit (credit) cost $ ( 30 ) $ ( 37 ) $ 16 $ 20 $ ( 5 ) $ ( 9 )

Six months ended April 30

Nine months ended July 31

Defined Benefit Plans Non-U.S.

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Net periodic benefit (credit) cost ( 96 ) ( 109 ) 53 65 ( 19 ) ( 30 )

Settlement loss — 1 — — — —

Settlement loss (gain) — 1 ( 1 ) — — —

Total periodic benefit (credit) cost $ ( 96 ) $ ( 108 ) $ 52 $ 65 $ ( 19 ) $ ( 30 )

Employer Contributions and Funding Policy

HP’s policy is to fund its pension plans so that it makes the minimum contribution required by local government, funding and taxing authorities.

HP’s policy is to fund its pension plans at least the minimum contribution amount required by local government, funding and taxing authorities.

During fiscal year 2022, HP anticipates making contributions of approximately $ 44 million to its non-U.S.

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non-qualified plan participants and approximately $ 4 million to cover benefit claims under HP’s post-retirement benefit plans.

During the six months ended April 30, 2022, HP contributed $ 19 million to its non-U.S.

During the nine months ended July 31, 2022, HP contributed $ 25 million to its non-U.S.

pension plans, paid $ 23 million to cover benefit payments to U.S.

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Retirement and Post-Retirement Benefit Plans (Continued)

In fiscal 2021, HP entered into an agreement with The Prudential Insurance Company of America (“Prudential”) to purchase an irrevocable group annuity contract and transferred approximately $ 5.2 billion of the Pension Plan obligations resulting in a decrease in interest cost and expected returns on plan assets for the three and six months ended April 30, 2022.

In fiscal 2021, HP entered into an agreement with The Prudential Insurance Company of America (“Prudential”) to purchase an irrevocable group annuity contract and transferred approximately $ 5.2 billion of the Pension Plan obligations, resulting in a decrease in interest cost and expected returns on plan assets for the three and nine months ended July 31, 2022.

AND SUBSIDIARIES

2 unchanged sentences

Provision for Taxes

HP’s effective tax rate was 19.3 % and 8.1 % for the three months ended April 30, 2022 and 2021, respectively, and 18.7 % and 12.7 % for the six months ended April 30, 2022 and 2021, respectively.

The difference between the U.S.

federal statutory tax rate of 21% and HP’s effective tax rate for the three and six months ended April 30, 2022 was primarily due to tax effects of favorable tax rates associated with certain earnings from HP’s operations in lower-tax jurisdictions throughout the world.

HP’s effective tax rate was 7.0 % and 16.5 % for the three months ended July 31, 2022 and 2021, respectively, and 15.0 % and 14.0 % for the nine months ended July 31, 2022 and 2021, respectively.

The difference between the U.S.

federal statutory tax rate of 21% and HP’s effective tax rate for the three and six months ended April 30, 2021 was primarily due to tax effects of internal reorganization and by favorable tax rates associated with certain earnings from HP’s operations in lower-tax jurisdictions throughout the world.

During the three and six months ended April 30, 2022, HP recorded $ 8 million and $ 35 million, respectively, of net income tax charges related to discrete items in the provision for taxes.

These amounts included income tax charges of $ 18 million related to the filing of tax returns in various jurisdictions for the six months ended April 30, 2022 and $ 17 million and $ 56 million related to withholding taxes on undistributed foreign earnings for the three and six months ended April 30, 2022, respectively.

These charges were partially offset by income tax benefits of $ 20 million and $ 31 million related to restructuring charges and $ 7 million and $ 8 million related to other tax benefits for the three and six months ended April 30, 2022, respectively.

In addition to the discrete items mentioned above, HP recorded excess tax benefits of $ 36 million associated with stock options, restricted stock units and performance-adjusted restricted stock units for the six months ended April 30, 2022.

During the three and six months ended April 30, 2021, HP recorded $ 128 million and $ 129 million, respectively, of net income tax benefits related to discrete items in the provision for taxes.

These amounts included tax benefits of $ 89 million related to tax effects of internal reorganization, $ 8 million and $ 36 million related to restructuring charges, $ 23 million and $ 11 million related to audit settlements in various jurisdictions, and $ 12 million and $ 5 million related to other tax benefits for the three and six months ended April 30, 2021, respectively.

These benefits were partially offset by $ 4 million and $ 12 million of uncertain tax position charges for the three and six months ended April 30, 2021, respectively.

For the six months ended April 30, 2021, excess tax benefits associated with stock options, restricted stock units and performance-adjusted restricted stock units were immaterial.

federal statutory tax rate of 21% and HP’s effective tax rate for the three and nine months ended July 31, 2022 and 2021 was primarily due to tax effects of internal reorganization and favorable tax rates associated with certain earnings from HP’s operations in lower-tax jurisdictions throughout the world.

During the three and nine months ended July 31, 2022, HP recorded $ 132 million and $ 97 million, respectively, of net income tax benefits related to discrete items in the provision for taxes.

These amounts included income tax benefits of $ 161 million and $ 144 million related to the filing of tax returns in various jurisdictions for the three and nine months ended July 31, 2022 and $ 3 million and $ 34 million related to restructuring charges for the three and nine months ended July 31, 2022, respectively.

The three and nine months ended July 31, 2022 also included $ 87 million of tax benefits related to internal reorganization.

These benefits were partially offset by income tax charges of $ 109 million and $ 104 million related to uncertain tax positions and $ 10 million and $ 19 million related to audit settlements in various jurisdictions for the three and nine months ended July 31, 2022, respectively.

The nine months ended July 31, 2022 also included tax charges of $ 55 million related to withholding taxes on undistributed foreign earnings.

In addition to the discrete items mentioned above, HP recorded excess tax benefits of $ 32 million associated with stock options, restricted stock units and performance-adjusted restricted stock units for the nine months ended July 31, 2022.

During the three and nine months ended July 31, 2021, HP recorded $ 21 million and $ 150 million, respectively, of net income tax benefits related to discrete items in the provision for taxes.

These amounts included income tax benefits of $ 9 million and $ 45 million related to restructuring charges, and $ 23 million and $ 30 million related to the filing of tax returns in various jurisdictions for the three and nine months ended July 31, 2021, respectively.

The nine months ended July 31, 2021 also included a tax benefit of $ 89 million related to tax effects of internal reorganization and a tax benefit of $ 10 million related to audit settlements in various jurisdictions.

These benefits were partially offset by uncertain tax position charges of $ 13 million and $ 25 million for the three and nine months ended July 31, 2021, respectively.

For the three and nine months ended July 31, 2021, excess tax benefits associated with stock options, restricted stock units and performance-adjusted restricted stock units were immaterial.

Uncertain Tax Positions

As of April 30, 2022, the amount of gross unrecognized tax benefits was $ 843 million, of which up to $ 642 million would affect HP’s effective tax rate if realized.

Total gross unrecognized tax benefits increased by $ 23 million for the six months ended April 30, 2022.

As of July 31, 2022, the amount of gross unrecognized tax benefits was $ 961 million, of which up to $ 777 million would affect HP’s effective tax rate if realized.

Total gross unrecognized tax benefits increased by $ 141 million for the nine months ended July 31, 2022.

HP recognizes interest income from favorable settlements and interest expense and penalties accrued on unrecognized tax benefits in the provision for taxes in the Consolidated Condensed Statements of Earnings.

As of April 30, 2022 and 2021, HP had accrued $ 81 million and $ 66 million, respectively, for interest and penalties.

As of July 31, 2022 and 2021, HP had accrued $ 76 million and $ 70 million, respectively, for interest and penalties.

HP engages in continuous discussions and negotiations with taxing authorities regarding tax matters in various jurisdictions.

HP expects to complete resolution of certain tax years with various tax authorities within the next 12 months.

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 $ 79 million within the next 12 months, affecting HP’s effective tax rate if realized.

1 unchanged sentence

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.

The IRS is conducting an audit of HP’s 2018 and 2019 income tax returns.

AND SUBSIDIARIES

3 unchanged sentences

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

Six months ended April 30, 2022

Nine months ended July 31, 2022

Balance at beginning of period $ 111

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Balance at end of period $ 112

HP has third-party arrangements, consisting of revolving short-term financing, which provide liquidity to certain partners to facilitate their working capital requirements.

HP has in place certain third-party arrangements consisting of revolving short-term financing, which 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.

1 unchanged sentence

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 Consolidated Condensed Balance Sheets.

The recourse obligations as of April 30, 2022 and October 31, 2021, and the costs associated with the sale of trade receivables for the three and six months ended April 30, 2022 and 2021 were not material.

The recourse obligations as of July 31, 2022 and October 31, 2021, and the costs associated with the sale of trade receivables for the three and nine months ended July 31, 2022 and 2021 were not material.

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

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

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

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

Finished goods $ 5,334 $ 4,532

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Other Current Assets

April 30, 2022 October 31, 2021

Prepaid and other current assets $ 1,839 $ 1,092

July 31, 2022 October 31, 2021

Supplier and other receivables $ 2,173 $ 2,333

Prepaid and other current assets 1,875 1,092

Value-added taxes receivable 943 1,005

1 unchanged sentence

Property, Plant and Equipment, net

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

Land, buildings and leasehold improvements $ 2,178 $ 2,166

3 unchanged sentences

Other Non-Current Assets

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

Deferred tax assets $ 2,605 $ 2,917

5 unchanged sentences

$ 6,816 $ 7,091

Other Current Liabilities

AND SUBSIDIARIES

1 unchanged sentence

Supplementary Financial Information (Continued)

Other Current Liabilities

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

Sales and marketing programs $ 2,872 $ 3,179

3 unchanged sentences

Warranty 626 731

Tax liability 374 296

Operating lease liabilities 375 350

Tax liability 298 296

Other 2,991 3,228

1 unchanged sentence

Other Non-Current Liabilities

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

Deferred revenue $ 1,111 $ 1,099

5 unchanged sentences

$ 4,462 $ 4,778

Russia exit charges

For the three months ended July 31, 2022, HP recognized charges of $ 23 million towards severance, cancellation of contracts, inventory write-downs and other one-time exit charges related to our decision to wind down our operations in Russia.

Interest and other, net

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

Interest expense on borrowings $ ( 96 ) $ ( 68 ) $ ( 229 ) $ ( 193 )

Loss on extinguishment of debt — ( 16 ) — ( 16 )

Other, net 26 29 88 103

4 unchanged sentences

Net revenue by region

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

4 unchanged sentences

Value of Remaining Performance Obligations

As of April 30, 2022, the estimated value of transaction price allocated to remaining performance obligations was $ 3.6 billion.

As of July 31, 2022, the estimated value of transaction price allocated to remaining performance obligations was $ 3.4 billion.

HP expects to recognize approximately $ 1.6 billion of the unearned amount in next 12 months and $ 1.8 billion thereafter.

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Contract Liabilities

As of April 30, 2022 and October 31, 2021, HP’s contract liabilities balances were $ 2.4 billion and $ 2.3 billion, respectively, included in Other current liabilities and Other non-current liabilities in the Consolidated Condensed Balance Sheets.

The increase in the contract liabilities balance for the six months ended April 30, 2022, was primarily driven by sales of fixed-price support and maintenance services, partially offset by $ 0.7 billion of revenue recognized that was included in the contract liabilities balance as of October 31, 2021.

As of July 31, 2022 and October 31, 2021, HP’s contract liabilities balances were $ 2.4 billion and $ 2.3 billion, respectively, included in Other current liabilities and Other non-current liabilities in the Consolidated Condensed Balance Sheets.

The increase in the contract liabilities balance for the nine months ended July 31, 2022 was primarily driven by sales of fixed-price support and maintenance services, partially offset by $ 1.0 billion of revenue recognized that was included in the contract liabilities balance as of October 31, 2021.

Changes in Variable Consideration

HP reduces the transaction price at the time performance obligations are satisfied for various customer and distributor sales incentive and promotional programs.

During the three months ended July 31, 2021, we recorded an increase to our estimated transaction price for performance obligations satisfied in the prior periods of approximately $ 350 million.

The change in estimate was a result of lower-than-expected marketing incentives due to increasing supply constraints, shifts in customer behavior and the evolving impact of the COVID-19 pandemic.

The changes in estimates recorded during the three and nine months ended July 31, 2022, and nine months ended July 31, 2021 were immaterial.

AND SUBSIDIARIES

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

As of April 30, 2022 As of October 31, 2021

As of July 31, 2022 As of October 31, 2021

Fair Value Measured Using Fair Value Measured Using

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Derivative Instruments:

Interest rate contracts — 3 — 3 — — — —

Foreign currency contracts — 971 — 971 — 277 — 277

4 unchanged sentences

Foreign currency contracts — 272 — 272 — 203 — 203

Other derivatives — 9 — 9 — — — —

Total liabilities $ — $ 322 $ — $ 322 $ — $ 227 $ — $ 227

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The portion of HP’s debt that is hedged is reflected in the Consolidated Condensed 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 $ 8.4 billion as compared to its carrying amount of $ 9.0 billion at April 30, 2022.

The fair value of HP’s short- and long-term debt was $ 10.5 billion as compared to its carrying amount of $ 11.0 billion at July 31, 2022.

The fair value of HP’s short- and long-term debt was $ 8.0 billion as compared to its carrying value of $ 7.5 billion at October 31, 2021.

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Cash Equivalents and Available-for-Sale Investments

As of April 30, 2022 As of October 31, 2021

As of July 31, 2022 As of October 31, 2021

Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value

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All highly liquid investments with original maturities of three months or less at the date of acquisition are considered cash equivalents.

As of April 30, 2022 and October 31, 2021, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity.

As of July 31, 2022 and October 31, 2021, 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 April 30, 2022

As of July 31, 2022

Amortized Cost Fair Value

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Non-marketable equity securities in privately held companies are included in Other non-current assets in the Consolidated Condensed Balance Sheets.

These amounted to $ 65 million and $ 59 million as of April 30, 2022 and October 31, 2021, respectively.

These amounted to $ 109 million and $ 59 million as of July 31, 2022 and October 31, 2021, 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 six months ended April 30, 2022.

No credit-related or noncredit-related impairment losses were recorded for the three and nine months ended July 31, 2022.

Derivative Instruments

4 unchanged sentences

HP recognizes all derivative instruments at fair value in the Consolidated Condensed Balance Sheets.

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

AND SUBSIDIARIES

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Financial Instruments (Continued)

due from HP to counterparty against amounts due to HP from the same counterparty under certain conditions.

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 aggregate derivative fair values exceed contractually established thresholds, which are generally based on the credit ratings of HP and its counterparties.

If HP’s or the counterparty’s credit rating falls below a specified credit rating, either party has the right to request full collateralization of the derivatives’ net liability position.

The fair value of derivatives with credit contingent features in a net liability position was $ 60 million and $ 64 million as of April 30, 2022 and as of October 31, 2021, respectively, all of which were fully collateralized within two business days.

The fair value of derivatives with credit contingent features in a net liability position was $ 79 million and $ 64 million as of July 31, 2022 and as of October 31, 2021, 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 April 30, 2022 and October 31, 2021.

This credit contingent provision did not affect HP’s financial position or cash flows as of July 31, 2022 and October 31, 2021.

Fair Value Hedges

7 unchanged sentences

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.

In March 2022, a series of forward starting swaps totaling $ 1.5 billion notional amount were settled upon the issuance of the senior unsecured notes resulting in a gain of $ 59 million recognized in accumulated other comprehensive income (loss).

In June 2022, a series of forward starting swaps, which were executed in April and May 2022 with a total notional amount of $ 1.5 billion and $ 0.25 billion, respectively, were settled upon the issuance of the senior unsecured notes, resulting in a gain of $ 20 million recognized in Accumulated other comprehensive income (loss).

The gain will be reclassified to Interest and other, net, over a portion of the life of the related debt.

In April 2022, HP entered into a series of forward starting swap instruments with notional amount totaling $ 1.5 billion to hedge the exposure to variability in future cash flows resulting from changes in interest rates related to the anticipated issuance of long-term debt.

In March 2022, a series of forward starting swaps with a total notional amount of $ 1.5 billion were settled upon the issuance of the senior unsecured notes, resulting in a gain of $ 59 million recognized in Accumulated other comprehensive income (loss).

The gain will be reclassified to Interest and other, net, over a portion of the life of the related debt.

Other Derivatives

2 unchanged sentences

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 Consolidated Condensed Statements of Earnings in the period of change.

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Notes to Consolidated Condensed Financial Statements (Continued)

Financial Instruments (Continued)

Hedge Effectiveness

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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 six months ended April 30, 2022 and 2021, no portion of the hedging instruments’ gain or loss was excluded from the assessment of effectiveness for fair value and cash flow hedges.

During the three and nine months ended July 31, 2022 and 2021, 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 Consolidated Condensed Balance Sheets

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

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Notes to Consolidated Condensed Financial Statements (Continued)

Financial Instruments (Continued)

As of April 30, 2022 As of October 31, 2021

As of July 31, 2022 As of October 31, 2021

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

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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 April 30, 2022 and October 31, 2021, information related to the potential effect of HP’s master netting agreements and collateral security agreements was as follows:

As of July 31, 2022 and October 31, 2021, information related to the potential effect of HP’s master netting agreements and collateral security agreements was as follows:

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Notes to Consolidated Condensed Financial Statements (Continued)

Financial Instruments (Continued)

In the Consolidated Condensed Balance Sheets

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Collateral Net Amount

As of April 30, 2022

As of July 31, 2022

Derivative assets $ 978 $ — $ 978 $ 241 $ 675 (1) $ 62

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(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.

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Notes to Consolidated Condensed Financial Statements (Continued)

Financial Instruments (Continued)

(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.

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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

Three months ended April 30

Three months ended July 31

Interest rate contract Fixed-rate debt Interest and other, net 2022 $ ( 70 ) $ 8 $ ( 8 )

2021 $ ( 55 ) $ 5 $ ( 5 )

Six months ended April 30

Nine months ended July 31

Interest rate contract Fixed-rate debt Interest and other, net 2022 $ ( 141 ) $ ( 34 ) $ 34

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

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

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other comprehensive income (loss) into earnings

Three months ended April 30 Six months ended April 30 Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31 Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021 2022 2021 2022 2021

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Total $ 327 $ ( 64 ) $ 491 $ ( 262 )

As of April 30, 2022, HP expects to reclassify an estimated accumulated other comprehensive gain of $ 475 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 income (loss) based on the change of market rate, and therefore could have different impact on earnings.

The pre-tax effect of derivative instruments not designated as hedging instruments recognized in Interest and other, net in the Consolidated Condensed Statements of Earnings for the three and six months ended April 30, 2022 and 2021 was as follows:

As of July 31, 2022, HP expects to reclassify an estimated accumulated other comprehensive gain of $ 355 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 pre-tax effect of derivative instruments not designated as hedging instruments recognized in Interest and other, net, in the Consolidated Condensed Statements of Earnings for the three and nine months ended July 31, 2022 and 2021 was as follows:

Gain/(loss) recognized in earnings on derivative instrument

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

Location 2022 2021 2022 2021

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Notes Payable and Short-Term Borrowings

As of April 30, 2022 As of October 31, 2021

As of July 31, 2022 As of October 31, 2021

Outstanding Weighted-Average

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Long-Term Debt

April 30, 2022 October 31, 2021

July 31, 2022 October 31, 2021

Dollar Global Notes (1)

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$ 1,000 issued at discount to par at a price of 99.966 % at 4.20 %, due April 2032

$ 900 issued at discount to par at a price of 99.841 % in June 2022 at 4.75 %, due January 2028

$ 1,100 issued at discount to par at a price of 99.725 % in June 2022 at 5.50 %, due January 2033

Other borrowings at 0.51 %- 9.00 %, due in calendar years 2022-2029

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and socioeconomic advancement and empowerment.

In March 2022, HP completed its offering of $ 2.0 billion aggregate principal amount of senior unsecured notes, consisting

of $ 1.0 billion of 4.00 % notes due April 2029 and $ 1.0 billion of 4.20 % notes due April 2032.

In June 2022, HP completed its offering of $ 2.0 billion aggregate principal amount of senior unsecured notes, consisting of $ 0.9 billion of 4.75 % notes due January 2028 and $ 1.1 billion of 5.50 % notes due January 2033.

HP incurred issuance costs of $ 17 million.

HP will pay interest semi-annually on each series of the notes on January 15 and July 15, beginning January 15, 2023.

In June 2022, HP terminated a series of forward starting swap agreements with notional amounts totaling $ 1.75 billion that were executed to mitigate the treasury rate volatility associated with this debt issuance.

HP intends to use the net proceeds from the offering, together with other available funds, to fund the purchase price of the acquisition of Plantronics, Inc.

(“Poly”), repay Poly’s existing term loan, and pay any related fees and expenses.

In March 2022, HP completed its offering of $ 2.0 billion aggregate principal amount of senior unsecured notes, consisting of $ 1.0 billion of 4.00 % notes due April 2029 and $ 1.0 billion of 4.20 % notes due April 2032.

HP incurred issuance costs of

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Notes to Consolidated Condensed Financial Statements (Continued)

Borrowings (Continued)

$ 17 million.

HP will pay interest semi-annually on each series of the notes on April 15 and October 15, beginning October 15, 2022.

In March 2022, HP terminated a series of forward starting swap agreements with notional amounts totaling $ 1.5 billion that were executed to mitigate the treasury rate volatility associated with this debt issuance.

HP terminated a series of forward starting swap agreements with notional amounts totaling $ 1.5 billion that were executed to mitigate the treasury rate volatility associated with this debt issuance.

HP intends to use the net proceeds from the offering of the notes for general corporate purposes, which may include, without limitation, repayment and refinancing of debt, funding of acquisition opportunities, working capital, capital expenditures, and share repurchases.

1 unchanged sentence

Interest rates shown in the table of long-term debt have not been adjusted to reflect the impact of any interest rate swaps.

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Notes to Consolidated Condensed Financial Statements (Continued)

Borrowings (Continued)

Commercial Paper

As of April 30, 2022, HP maintained two commercial paper programs.

As of July 31, 2022, HP maintained two commercial paper programs.

program provides for the issuance of U.S.

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Credit Facility

As of April 30, 2022, HP maintained a $ 5.0 billion sustainability-linked senior unsecured committed revolving credit facility, which HP entered into on May 26, 2021.

As of July 31, 2022, HP maintained a $ 5.0 billion sustainability-linked senior unsecured committed revolving credit facility, which HP entered into on May 26, 2021.

Commitments under the revolving credit facility will be available until May 26, 2026.

1 unchanged sentence

Funds borrowed under the revolving credit facility may be used for general corporate purposes.

As of April 30, 2022, HP was in compliance with the covenants in the credit agreement governing the revolving credit facility.

As of July 31, 2022, HP was in compliance with the covenants in the credit agreement governing the revolving credit facility.

On August 23, 2022, HP entered into an amendment to the credit agreement governing the revolving credit facility, pursuant to which the credit agreement has been amended to provide for interest rates at Term SOFR instead of LIBOR.

Available Borrowing Resources

As of April 30, 2022, HP had available borrowing resources of $ 550 million from uncommitted lines of credit in addition to the revolving credit facility.

As of July 31, 2022, HP had available borrowing resources of $ 539 million from uncommitted lines of credit in addition to the revolving credit facility.

Stockholders’ Deficit

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HP’s share repurchase program authorizes both open market and private repurchase transactions.

During the three and six months ended April 30, 2022, HP executed share repurchases of 27 million shares and 69 million shares and settled total shares for $ 1.0 billion and $ 2.5 billion respectively.

During the three and six months ended April 30, 2021, HP executed share repurchases of 52 million shares and 113 million and settled total shares for $ 1.6 billion and $ 3.0 billion respectively.

Share repurchases executed during the three and six months ended April 30, 2022 and 2021 included 1 million and 2 million shares settled in May 2022 and 2021, respectively.

The shares repurchased during the six months ended April 30, 2022 and 2021 were all open market repurchase transactions.

As of April 30, 2022, HP had approximately $ 3.9 billion remaining under the share repurchase authorizations approved by HP’s Board of Directors.

During the three and nine months ended July 31, 2022, HP executed share repurchases of 29 million shares and 98 million shares and settled total shares for $ 1.0 billion and $ 3.5 billion respectively.

During the three and nine months ended July 31, 2021, HP executed share repurchases of 50 million shares and 163 million, respectively, and settled total shares for $ 1.5 billion and $ 4.5 billion respectively.

Share repurchases executed during the three and nine months ended July 31, 2021 included 1.8 million shares settled in August 2021.

The shares repurchased during the nine months ended July 31, 2022 and 2021 were all open market repurchase transactions.

As of July 31, 2022, HP had approximately $ 2.9 billion remaining under the share repurchase authorizations approved by HP’s Board of Directors.

Tax effects related to Other Comprehensive Income (Loss)

2 unchanged sentences

Stockholders' Deficit (Continued)

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

13 unchanged sentences

Changes and reclassifications related to Other Comprehensive Income (Loss), net of taxes

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

Other comprehensive income (loss), net of taxes:

Other comprehensive income, net of taxes:

Change in unrealized components of available-for-sale debt securities:

Unrealized (losses) gains arising during the period $ ( 3 ) $ — $ ( 5 ) $ 3

Unrealized gains (losses) arising during the period $ — $ 1 $ ( 5 ) $ 4

Change in unrealized components of cash flow hedges:

7 unchanged sentences

Change in cumulative translation adjustment ( 14 ) — ( 54 ) 27

Other comprehensive income (loss), net of taxes $ 363 $ 153 $ 607 $ ( 77 )

Other comprehensive (losses) income, net of taxes $ ( 110 ) $ 187 $ 497 $ 110

(1) These components are included in the computation of net pension and post-retirement benefit (credit) charges in Note 4, “Retirement and Post-Retirement Benefit Plans.”

3 unchanged sentences

The components of Accumulated other comprehensive income (loss), net of taxes and changes were as follows:

Six months ended April 30, 2022

Nine months ended July 31, 2022

Net unrealized

18 unchanged sentences

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

Three months ended April 30 Six months ended April 30

Three months ended July 31 Nine months ended July 31

2022 2021 2022 2021

14 unchanged sentences

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 April 30, 2022, it was not reasonably possible that a material loss had been incurred in excess of the amounts recognized in HP’s financial statements.

HP believes it has recorded adequate provisions for any such matters and, as of July 31, 2022, 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.

21 unchanged sentences

In the second phase, the jury returned a verdict in favor of HP, awarding HP approximately $ 3.0 billion in damages, which included approximately $ 1.7 billion for past lost profits and $ 1.3 billion for future lost profits.

The court entered judgment for HP for this amount with interest accruing until the judgment is paid.

The court entered judgment for HP for this amount with interest accruing until the judgment was paid.

Oracle appealed the trial court’s judgment and HP filed a cross appeal challenging the trial court’s denial of prejudgment interest.

45 unchanged sentences

On March 23, 2022, the ITC rendered a final determination that no violation of section 337 has occurred.

Philips may file an appeal or resume litigation with its case in federal court.

In the ITC proceeding, Philips seeks an order enjoining respondents from importing, or selling after importation, the accused products.

In the district court case, Philips seeks unspecified damages and an injunction against HP, and the case has been stayed pending resolution of the ITC proceeding.

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.

Caltech Patent Litigation .

9 unchanged sentences

2020-2222, which was issued on February 4, 2022.

On March 12, 2022, the parties filed a status report regarding whether the stay should be lifted.

On March 12, 2022, the parties filed a status report regarding whether the court should lift the stay, which remains pending.

In re HP Inc.

20 unchanged sentences

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.

Plaintiff seeks compensatory damages and other relief.

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.

2 unchanged sentences

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

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,

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1 unchanged sentence

Litigation and Contingencies (Continued)

as a nominal defendant, and it 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.

bringing claims for breach of fiduciary duty and violations of securities laws.

The derivative plaintiff seeks compensatory damages, governance reforms, and other relief.

15 unchanged sentences

(Netherlands) in March 2020, including its competition claim, remains pending.

On December 15, 2021, the Dutch Supreme Court rejected 123Inkt’s competition law claims, its request to prohibit Dynamic Security, and other claims, but held HP liable to 123Inkt where it can show, in separate proceedings, that it suffered damages resulting from the display of certain old error messages.

Both parties have appealed.

32 unchanged sentences

Trial was completed in January 2020.

On May 17, 2022, the court issued its final judgment, memorializing its findings that HP succeeded in substantially all of its claims

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Notes to Consolidated Condensed Financial Statements (Continued)

Litigation and Contingencies (Continued)

and that Messrs.

On May 17, 2022, the court issued its final judgment, memorializing its findings that HP succeeded in substantially all of its claims and that Messrs.

Lynch and Hussein engaged in fraud, and dismissing Mr.

1 unchanged sentence

The court deferred its assessment of damages to a later, separate judgment to be issued after further submissions, but it has indicated that damages awarded may be substantially less than is claimed.

Litigation is unpredictable, and there can be no assurance that HP will recover damages or as to how any award of damages will compare with the amount claimed.

Litigation is unpredictable, and there can be no assurance that HP will

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Notes to Consolidated Condensed Financial Statements (Continued)

Litigation and Contingencies (Continued)

recover damages or as to how any award of damages will compare with the amount claimed.

The amount ultimately awarded, if any, would be recorded in the period received.

2 unchanged sentences

Environmental

HP is party to, or otherwise involved in, proceedings brought by U.S.

or state environmental agencies under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), known as “Superfund,” or state laws similar to CERCLA, and may become a party to, or otherwise involved in, proceedings brought by private parties for contribution towards clean-up costs.

HP is also conducting environmental investigations or remediations at several current or former operating sites pursuant to administrative orders or consent agreements with state environmental agencies.

HP is, and may become a party to, proceedings brought by U.S.

or state agencies or private third parties under 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.

AND SUBSIDIARIES

21 unchanged sentences

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

Six months ended April 30, 2022

Nine months ended July 31, 2022

Balance at beginning of period $ 959

6 unchanged sentences

Unconditional Purchase Obligations

As of April 30, 2022, HP had unconditional purchase obligations of $ 5.4 billion.

As of July 31, 2022, HP had unconditional purchase obligations of $ 4.3 billion.

These unconditional purchase obligations include agreements to purchase goods or services that are enforceable and legally binding on HP and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum or variable price provisions and the approximate timing of the transaction.

1 unchanged sentence

Unconditional purchase obligations exclude agreements that are cancellable without penalty.

As of April 30, 2022, unconditional purchase obligations were as follows:

As of July 31, 2022, unconditional purchase obligations were as follows:

Fiscal year In millions

1 unchanged sentence

Total $ 4,336

(1) Represents expected unconditional purchase obligations for the remaining six months of the fiscal year 2022.

On March 25, 2022, we entered into a definitive agreement to acquire Plantronics, Inc.

(“Poly”), a leading global provider of workplace collaboration solutions, in an all-cash transaction for $ 40 per share, implying a total enterprise value of $ 3.3 billion, inclusive of Poly’s net debt.

(1) Represents expected unconditional purchase obligations for the remaining three months of the fiscal year 2022.

Subsequent Events

On August 29, 2022, we completed the acquisition of Poly, a leading global provider of workplace collaboration solutions, in an all-cash transaction for $ 40 per share, implying a total enterprise value of $ 3.3 billion, inclusive of Poly’s net debt.

Poly is a leader in video conferencing solutions, cameras, headsets, voice and software.

With the acquisition, we aim to deliver a complete ecosystem of devices, software, and digital services to create premium employee experiences, improve workforce productivity, and provide enterprise customers with better visibility, insights, security, and manageability across their hybrid IT environments.

We expect this acquisition to close by the end of calendar year 2022, subject to approval by Poly’s shareholders, required regulatory clearances, and the satisfaction of other customary closing conditions.

The financial results of Poly will be included in our Consolidated Financial Statements for the year ended October 31, 2022, from the date of the acquisition.

On September 1, 2022, we consummated our offer (the “Exchange Offer”) to exchange approximately $ 0.5 billion of outstanding notes issued by Poly (the “Poly Notes”) for new notes issued by us with the same interest rate, interest payment dates, maturity date and redemption terms as the exchanged Poly Notes.

In conjunction with the Exchange Offer, certain proposed amendments that would eliminate substantially all restrictive covenants and certain events of default and other provisions in the indenture governing Poly Notes were adopted, pursuant to a consent solicitation conducted concurrently with the Exchange Offer.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements