HP Inc. stock research
FY2023 Q1
HP (HPQ) Gross Margin — Quarter Ended Jan 31, 2023
Revenue declined while gross profit improved slightly compared to the prior quarter, leading to a higher gross margin. Cost of revenue fell more sharply than revenue, which supported the gross profit increase.
Gross margin takeaway
Quarter ended Jan 31, 2023 · FY2023 Q1
Revenue declined while gross profit improved slightly compared to the prior quarter, leading to a higher gross margin. Cost of revenue fell more sharply than revenue, which supported the gross profit increase.
- The gross margin strengthened compared to both the immediate prior quarter and the same quarter one year earlier. The improvement from the prior quarter was the most notable, as gross profit rose despite lower revenue.
- Revenue and cost of revenue were both lower versus the prior quarter, but cost of revenue decreased at a faster rate, improving gross margin. Compared to the same quarter a year ago, revenue and gross profit were lower, yet gross margin was slightly higher due to a proportionally larger decline in cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
20.2%
Gross profit
$2.8B
Revenue
$13.8B
Cost of revenue
$11.0B
Quarter-over-quarter change
n/a
Year-over-year change
+0.3 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jan 31, 2023 | $13.8B | $2.8B | $11.0B | 20.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Previous quarter unavailable
n/a
Year-over-year change
Jan 31, 2022
+0.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin strengthened compared to both the immediate prior quarter and the same quarter one year earlier. The improvement from the prior quarter was the most notable, as gross profit rose despite lower revenue.
Revenue and cost of revenue were both lower versus the prior quarter, but cost of revenue decreased at a faster rate, improving gross margin. Compared to the same quarter a year ago, revenue and gross profit were lower, yet gross margin was slightly higher due to a proportionally larger decline in cost of revenue.
Monitor the ongoing trend in cost of revenue relative to revenue, as the current quarter's sharper decline in cost of revenue drove margin expansion.