Third quarter GAAP diluted net EPS was $0.54, up from $0.41 in the prior-year period and above the previously provided outlook of $0.47 to $0.51. Third quarter non-GAAP diluted net EPS was $0.52, up from $0.43 in the prior-year period and within the previously provided outlook of $0.49 to $0.52.
“Q3 was another strong quarter, with consistent and balanced performance across segments and regions”, said Dion Weisler, president and CEO, HP Inc. “We delivered differentiated innovation in our core, advanced our growth initiatives and are investing in our future while delivering profitable growth, with non-GAAP EPS up 21% year over year.”
HP’s net cash provided by operating activities in the third quarter of fiscal 2018 was $1.5 billion. HP generated $1.4 billion of free cash flow in the third quarter.
HP’s dividend payment of $0.1393 per share in the third quarter resulted in cash usage of $0.2 billion. HP also utilized $0.7 billion of cash during the quarter to repurchase approximately 30.4 million shares of common stock in the open market. As a result, HP returned 66% of its free cash flow to shareholders in the third quarter. HP exited the quarter with $7.1 billion in gross cash, which includes cash and cash equivalents and short-term investments of $0.9 billion included in other current assets.
Personal Systems net revenue was up 12% year over year (up 9% in constant currency) with a 3.9% operating margin. Commercial net revenue increased 13% and Consumer net revenue increased 10%. Total units were up 6% with Notebooks units up 6% and Desktops units up 7%.
Printing net revenue was up 11% year over year (up 9% in constant currency) with a 16% operating margin. Total hardware units were up 12% with Commercial hardware units up 91% and Consumer hardware units up 2%. Supplies net revenue was up 8% (up 6% in constant currency).
For fiscal 2018, HP raises estimates for GAAP diluted net EPS to be in the range of $2.82 to $2.85 and non-GAAP diluted net EPS to be in the range of $2.00 to $2.03. In addition, HP continues to anticipate generating free cash flow of at least $3.7 billion for fiscal 2018.